The interview was transcribed and adapted into an article by Sujan Lal Manandhar.
Lockdown Economy: Interviews by think tank AlterContacts.org with real entrepreneurs sharing insights, challenges and successes during the COVID19 global pandemic to inspire, motivate and encourage other entrepreneurs around the world.
In this interview, we meet Karen Ertrachter, the founder and owner of Netherlands Bagels in Rotterdam, Netherlands. She launched her business during the Covid-19 in the fall of 2020. Her work in the travel industry had all but dried up and this prompted her to turn her long-enduring passion for making authentic New York bagels into a business. Karen grew up in Queens, New York and her great grandfather was a member of the Bakers and Confectioners Union of New York during the early 1900’s — so the roots go deep for Karen! Karen experienced challenges with the postal delivery system which was experiencing delays due to the pandemic and also additional seasonal volume pressure just as she was ramping up her business during the holidays. She switched to a courier delivery model and was able to smooth out her distribution process. Karen chose to base her business in a shared industrial kitchen with other food entrepreneurs. This strategy helps to lower her operating costs and also provides an in-house network of small business chefs to share best practice ideas and create a community-based approach to their start-ups.
Could you introduce us to the Netherlands Bagels? Tell us when you got started and what you do.
Karen: My business is Netherlands Bagels. It’s an online bagel webshop. We deliver anywhere in the Netherlands. I started this business in October last year in the middle of Corona and we deliver New York-style bagels all over the Netherlands.
How did you start this business?
Karen: I am originally from New York. I actually have been baking bagels since I moved to the Netherlands. I have been living here for 5 years now. This is very much a private passion for me more than anything else. Pre-Corona, I was working in travel and I kept hoping things would improve for quite a while. I realized about halfway through last year that things would not suddenly improve. I have been working for myself for over three years in various freelance capacities, doing writing and also my own business. So for me, it was more of a pivot than a completely new chapter. It was definitely a new thing that I was doing. I had just given my bagels to a good friend of mine and she was blown away by them. I had never even thought of selling them actually. She gave them as samples at her shop and a few people asked her where they could buy them. I thought maybe there was something here. I started thinking through the logistics of setting up a food business here, what it would entail and how to go forward. It took me a few months to think everything through and launch in October.
What types of bagels do you serve?
Karen: We obviously do the traditional varieties. My favourite and best seller is the New York-style. But we do onion, garlic, sesame seed, poppy seed and plain. I have also tried to introduce sweet bagels. We love experimenting so I have introduced the Spicy Rotterdam where I use a local cheese and Turkish Pul Biber peppers for a fusion by taking into account what Rotterdam is. It’s a very diverse place. I like the idea of making bagels inspired by the place. I have been trying to come up with new ideas with a bit of an ode to what the traditional ones are that everyone loves.
Do you work in a shared kitchen with other businesses?
Karen: Yes, and it has been a great dynamic. It is strange to be around people in person during Corona and to be working with all these fantastic food entrepreneurs. It is great to work with new business owners and have the support and advice from them to figure out how we can move forward in the middle of Corona.
How many people are working with you?
Karen: I generally only work with one other person unless it’s really busy. I currently have three employees although they all work part-time. Whenever I am making the bagels, I have one other person helping me with the dough and I am boiling and doing the seeds. There are three of us if it’s busier but usually, it’s just two. I work with one Afghani woman and two American women. It is interesting because we are all constantly switching languages as well.
How does the delivery of the bagels work?
Karen: My biggest challenge was definitely logistics but luckily now I have overcome some of those issues. I started doing mail delivery around November/ December. It was the holiday season. Everyone was buying presents and the mail was swamped. There were unprecedented delays. That really impacted me. If I was going to run a business during Corona I had to make sure I could get my bagels to my clients more reliably. I had to take it into my own hands. We still do one-day delivery by mail but I have switched from PostNL at this point. Things have improved since the holidays. I also know a lot of entrepreneurs who have been impacted negatively by the mail delays during Corona. Some things do work on the mail but you have to think outside the box for others. It is not a solution because you cannot ensure next day delivery at the moment. I had to learn the hard way about how to run a business and how to deal with unhappy clients when things were completely out of my control. You can only plan so many months into the future but there are things that will be thrown at you which you never anticipated. I never anticipated that things would be in a warehouse for days.
Are you connecting with other individuals who are starting their own business? How do you network?
Karen: I feel like I am more dependent on the internet at this point in time because it’s so hard to meet people. Obviously, I do meet clients while wearing masks and practising social distancing outside. But it is strange meeting people in person because I have to be careful due to my own work situation. I am in a WhatsApp group with other food entrepreneurs who are just starting out and that has been a good resource as well. There are some others in the kitchen who are in a similar stage. It has been helpful to come in contact with people doing different kinds of things with food from traditional Indonesian peanuts to vegan meals. It is nice to see the range of things that are possible despite Corona. The courier service that I have been using was a recommendation from others in my kitchen.
Have you received any ideas from your clients and other people regarding strategies?
Karen: Yes, especially in a new business, I am very dependent on what I do going well with my customers. So I really have to listen to their feedback to know what I am doing right, what I am doing wrong, how we can improve upon the situation and make the business as good as possible and meet customer needs. We have tried to add a couple of more varieties. We added the sweet bagels upon the request of some clients who are not really savoury bagel people. I am also considering a couple of new bagels but I try to phase out one unpopular bagel and replace it with something new every month so we let people crave what they are looking for. And if we want to bring back a different bagel, we always can.
What plans do you have going forward as the months go on and hopefully when we move to a new normal where things become clearer and maybe closer to what life used to be like?
Karen: I am operating at a time of such uncertainty. You do not even know what will happen two or three months from now. Maybe it’s because I started during Corona but every time we turned our hopes up I kept thinking this would be the moment things go back to normal. However, I don’t imagine anything will change in the next few months if I’m honest. I am going to continue delivery by practising social distancing and letting things continue as they are. When things finally improve, I am hoping we can have a larger kitchen or open a physical shop that is client-friendly. For now, I am biding my time trying not to make any decisions before I know exactly what the path forward is for the Netherlands. I am not going to say ‘Post-Corona’ because I think Corona itself will continue a lot longer than we anticipated. People might not want to stay home once we have a sufficiently high number of vaccinated individuals. I will also need to rethink what is not working in my business model in this new paradigm.
What are the three things with your business that you need help with?
Karen: I wish I had a crystal ball that was perfectly accurate. The problem with being an entrepreneur is that every decision you make has a domino effect. I hope we can figure out how to expand but the question is which path to take. Do you continue what went well during Corona or do you move forward with a different path? I have to second guess everything while moving forward at such an uncertain time- Is this the right decision? Will this be the right decision for the future? That’s something I don’t think anyone can help me with. When you run a business every decision does have an impact. Something I am struggling with and I know will be an issue for a while is financing. Working in food right now, financing is limited for me and my business. My business is considered high risk and no matter what I am doing a lot of investors and banks do not want to touch my business right now. It is going to be harder to move forward and find a new location or finance it. I am very aware of that and I know it is the same for every entrepreneur I have been talking to. They are afraid that the banks will not help them at this time. Lastly, because I started during Corona, we have not had to pivot post-Corona that a lot of businesses have had to do when Corona hit. For me, the question is how we stay relevant post-Corona.
Would like to share anything else in case I left out any questions?
Karen: I would like to say something about stimulating business and attracting customers during Corona. I already knew I had to figure out who my clients are. Who would be willing to order first of all? — And willing to take a risk on a new business. As I have lived here for almost five years, I have had a lot of bagels here and a lot of people (especially if you have lived here for a long time) are very sceptical of new food, especially foreign. There is a higher demand for what you are serving if you claim to be authentic. It sets a higher bar if you say I am trying to do things the proper way. There is no copyright in the Netherlands to open a food business and say I serve New York-style food. It’s not like opening a Thai restaurant and calling it authentic. You have to get a certificate for that. There is no barred entry with American food here. So people tend to be more sceptical when you tell them you are serving that. For me, the biggest hurdle was reaching my core market and convincing them that my product is good. I tried to go on a different route for that with samples. I made sure people can actually try my product which was much harder during Corona. You have to either give the product physically to people or you have to send it to them. I actually ended up working with a few Dutch influencers early on. That was one of the best decisions that I actually made because it allowed me to reach a localized market with people interested in diverse food. It was a good start for my business which helped spread my name in Rotterdam.
How did you find the influencers?
Karen: Maybe because I have been working in travel, I started to see who was actively writing about new restaurants and food. I searched for people who had done a good job talking about the options for food in this region. I decided to start hyper-local because I could at least deliver the bagels myself. That was the worst-case scenario, if I had no career, at least I can make sure that the client would get the bagels. That was my approach and I felt it worked well. Many of the Dutch influencers were blown away by the bagels because they had not really had an actual American-style bagel. I tried to make a couple of deals because I realized the more important aspect of launching during Corona was that people got to try my product. As per the deal, people got to try a free bagel without restrictions. Simply try it for the first time and if you like it, great! Only getting it to them was a hurdle during Corona. Having a storefront would be very nice right now but at the same time, it’s much harder to get one bagel all the way across the Netherlands. It’s been a good way to reach and market to the people who may be curious but not necessarily ready to buy.
About the guest
Karen is a New Yorker who moved to the Netherlands more than five years ago and started baking bagels to alleviate homesickness. She worked as a writer in travel before pivoting to baking in 2020. Netherlands Bagels is a bagel business that bakes New York-style bagels from scratch in Rotterdam, the Netherlands. Although the bagels are made in the Netherlands, the flavors are pure New York with a touch of Manhattan on the Maas (Rotterdam).