Bagel Boom

By Adam Djurdjulov
Arizona Daily Wildcat
September 27, 1996

The sun reflects upon the top of a half-eaten shiny bagel. A cup of coffee sits on the table, and Sandy J. Stein, a business consultant, takes a sip.

She sits at one of Tucson's newest bagel shops, Einstein Bros. Bagels, at Swan Road and Sunrise Drive and she's talking bagels. Her daughter gave bagels out at checkpoints to walk-a-thon participants in the '60s, and she remembers how the streets were "li ttered with what they must have thought were rotten doughnuts."

"They got bagels at the checkpoints, threw them down and played 'Kick the Bagel,'" she says. "People's palettes didn't know bagels then."

Today, the bagel has made its way from the street to being revered as one of the fastest growing food fads of the '90s. The bagel, like pizza and the hamburger in the '70s, is fast being baked into American culture, and bagel shops are opening rapidly nat ionwide. Tucson has seen the growth - 13 stores have been built since 1987. The only shops in the city then were non-franchise operations: the Hot Bagel Bakery and The Bagelry.

Locally owned franchises like Bruegger's Bagel Bakery, Chesapeake Bagel Bakery, Goldberg's Bagel and Deli, Einstein Bros. Bagels and New York Bagel and Delicatessen have entered the market, though, and are competing with each other as well as those indepe ndently run shops.

"Pizza and hamburgers are a meal; the bagel is just a piece of bread," says Larry G. Orenstein, owner of Tucson's three The Bagelry shops. "It's a good piece of bread. It's different, but is the market big enough to support the interest?"

Essentially, the bagel is a round piece of bread with a hole in it that's chewy on the inside and crispy on the outside. It's made with high-gluten flour, water and yeast, and is either boiled or steamed before it's baked. Jewish immigrants brought the ba gel to New York and New Jersey in the early 1900's, and they are sometimes referred to as "Brooklyn jawbreakers" or "doughnuts with rigor mortis."

"The bagel is a piece of bread with an attitude," says Orenstein, who opened his first The Bagelry store over 20 years ago.

Orenstein has seen the rapid growth of the bagel in Tucson, and he says the market has evolved. "Franchises are the trend right now," he says.

With the rash of new bagel stores, Orenstein says the personal feel of the traditional bagel business is being lost. While working at a New York bagel shop early in his bagel-baking career, Orenstein broke his leg after slipping on black ice. When his com petition found out, they sent their people to his store to help make bagels. "Those days are gone," he says.

The bagel fad is similar to what happened with pizza and the hamburger, he says. Orenstein wonders, however, whether the bagel trend will continue to expand and whether Tucson will be able to support the growth.

George Goldman, owner of two Chesapeake Bagel Bakeries in Tucson, sees the growth from a different perspective. He says the market will increase to handle the influx of new bagel shops in town.

"It's a good product that continues to have good growth potential," he says. "There are still people who don't know about bagels, and when they find out about them, they'll come back for more."

Goldman owns two shops, one located across from the UA Main Gate. He plans to open seven stores altogether.

"Two months before we opened (the first store), we had people knocking on the door to see if we were open," he says. "It took about 5 minutes for business to get good."

With new businesses including Gentle Ben's, Banana Republic and Coffee Plantation, as well as the new Marriott Hotel scheduled to open, Goldman expects business to get even better.

"The shops will liven up the street in the evening, and the hotel will expand our market in the lean summer months," he says. "Right now, (University Boulevard) is a pretty dead street."

"There will certainly be a Battle of the Titans," he says.

But Orenstein said he has no idea what the outcome will be.

Enter franchise Titan number one, Einstein Bros. Bagels, one of the fastest growing bagel corporations with visions of opening 300 stores across the country by the year's end and 870 stores in the next three years.

Einstein Bros.' first store opened in July, and General Manager Jeff Rolan says it's possible that another store will open near the university by the year's end. Einstein Bros. plans to open four stores altogether in Tucson.

On average, Rolan says his store attracts about 500-700 customers a day and sells from 1,600 to 3,000 bagels. He wouldn't release sales figures.

"Let's just say we're doing well," he says.

He attributes the bagel's popularity to its low cost and value. At 50 cents each, the bagel is not the most expensive of all fast foods. A McDonald's Big Mac sells for $1.99.

"People want their money's worth. With bagels, you get a good value for your dollar," he says. "It's also a portable food, and it goes with a lot of things."

The success of his business also depends a lot on the town's seasonal nature. Because Tucson is a retirement community, people from New York, Illinois, Florida and Michigan come here to settle down, he says.

"They like their traditional foods," he says. "They migrate and the trends in food change."

Dunkin Donuts might even take advantage of the growing bagel trend. In October, managers of local franchises will meet to discuss whether or not there is enough interest in expanding their operation to include making and selling their own bagels, says Jam al N. Awale, store manager at the 5346 E. 22nd St. store. If the decision is made to go ahead with the change, stores in Tucson will be "realigned by the first part of next year," Awale says.

As for the mom-and-pop shops, Rolan thinks the "good ones" will remain.

Fran Milnes is confident her Hot Bagel Bakery stores will survive. She and her husband Cal, the self-proclaimed Head Bagel, jointly own the Tucson's three Hot Bagel Bakery stores. The first was opened in 1976, but the Milnes' took over in 1987.

"(The franchises) have set in here, there and yonder, and I don't know who's going to survive," she says. "I know we will."

Her stores, however, have seen the same decrease in sales that The Bagelry shops have.

"When the first three came in, New York Bagel, Goldberg's, and Chesapeake, they were taking the frosting off the cake," Milnes says. "With all the new ones, they're biting into the cake's top layer. We're surviving on the bottom layer. We'll make it, but just without ostentatious vacations."

MaryLou Hall, supervisor of the A Bagel Express in the Memorial Student Union, says her store currently purchases its bagels from the Hot Bagel Bakery.

A number of local franchises wanted to provide the A Bagel Express with its bagels, she says. The store did do business with a franchise three years ago, but it quickly resumed purchasing from the Hot Bagel Bakery.

"(The local franchise) couldn't provide the quality we were looking for, so we went back," Hall says.

Enter franchise Titan number two, Bruegger's Bagel Bakery. Nationally, Bruegger's has 381 stores opened already, and Time reported that CEO Steve Finn plans to have 1,000 stores by 1999.

With three stores already open in Tucson since December 1995 and another five planned by year's end, Bruegger's has "very aggressive growth plans," says Director of Operations Jennifer N. Keating.

Bruegger's "wants to be the McDonalds of the bagel business," says co-owner Patrick S. Keating.

The franchise's expansion plans do not include overtaking current stores. "We're not looking to take existing stores and switch them over," Jennifer Keating says.

She is concerned that locally owned franchises are misconceived as bad for the community because they stem from a corporate office. While she does pay franchise fees, she says that Bruegger's is "investing a huge amount of money into the community."

"I don't go to bed dreaming about putting others out of business. I'm looking at building a business for myself," she says. "It's not a drive to push others out. As a local business, I'm in the same boat."