A Family Business
Coming together is a beginning; keeping together
is progress; working
together is success.
—HENRY FORD
In June of 1988 our store at the Downingtown Farmers’ Market had only been open for a mere four months, but we had already hit our stride. I enjoyed my newfound identity as “businesswoman extraordinaire,” my relationship with my girls seemed headed in the right direction (oh, what an illusion that turned out to be!), and we literally couldn’t make the pretzels fast enough. When it came to the bigger picture, everything seemed wonderful as well: Jonas and I were back in our hometown enjoying our families and old friends, we were better off financially than we had been for a long time, and Jonas’s dream of providing people with counseling had become a reality. What more could we ask for?
But you see, there was one problem. One major problem. Most of my happiness depended on all of this stuff going well, especially the relationship I cultivated with my daughters. I looked back on the years in Texas I spent under that dark cloud, and I felt so guilty about the mother I had been (or hadn’t been) to them. Now that things were smooth, I was happy. I felt that I filled the role of mother again. But happiness isn’t joy, not even close, and I didn’t realize that I walked right beside that old familiar abyss of depression.
How could I see the major arguments and disappointments with my daughters that lay just around the corner? How could I have known how big the business would grow, or how many new stresses that would add to my life? How could I have known that by 1995 I would be back at the bottom again, nearly as desperate as I was during the late seventies? The simple answer is I couldn’t have known, and I walked along in innocent happiness, trusting too much in my own ability to hold it all together.
During these days of fragile happiness, Downingtown continued rolling along. My family, and especially my sisters, Fi and Becky, continued to support me as they always had. We took turns going in early to set up the shop, and we worked so hard together that everything felt like a game again, as if we went back in time twenty-five years to the height of our teenage frolicking. In the evenings, after a hard day’s work, sometimes the three of us would sip coffee and sigh, lean back in our restaurant booth, and talk about how busy we were, amazed that we could sell so many pretzels. The next day we would start up again, enjoying each other’s company and ready to work.
One day a young Amish girl from the barbecue chicken stand came down and started chatting with me. In those days my fame had spread far and wide (to that end of Downingtown Farmers’ Market at least), and I guess she knew I owned the stand. Our new shop name, Auntie Anne’s Soft Pretzels, caught on quickly, and soon everyone who knew I owned the stand started calling me Auntie Anne.
“Auntie Anne, there’s a pretzel stand for sale at a farmers’ market in Harrisburg,” she said at some point in our conversation. “My parents go there. It’s a good market. You should sell your pretzels there. It’s called Broad Street Farmers’ Market.”
I just laughed.
“Oh, I don’t know. I’m having fun here at Downingtown. Why would I want to open another store?”
“Well, you should just sell your pretzels up there,” she kept insisting.
She came back two or three times, persistent in her belief that I should sell Auntie Anne’s Soft Pretzels in Harrisburg, the capital city of Pennsylvania and about an hour’s drive from where I lived. It amazed me then, and it amazes me now, that a little Amish girl would be so insistent that I go sell my pretzels at that market. Now, if a businessman approached me and reasoned with me, explaining that I made a good product and it would be a good business move and so on and so on, then perhaps I could understand. But this was not a businessperson with financial data, a five-year business plan, and numbers to back everything up. This was a teenage Amish girl, just a kid, and her persistence got a little annoying.
Finally I gave in.
“You know what, I guess I could go look,” I said, perhaps more as a way of making her feel better than as an actual commitment to go and visit the market. Curiosity would eventually get the best of me, though, so after calling the market manager, Jonas and I decided to make a trip up there the following week.
We parked on the street in Harrisburg, not a very nice part of town back then. The market master met us and showed us inside. We were not impressed in the least by that inner-city farmers’ market. The floors were dirty, the stands were old and run down, and the whole place smelled like the inside of a Dumpster. Even worse, not a soul seemed to be coming to the market. Market stand owners wandered the aisles alone, trying to find something to do.
On one side of the market sat the government buildings, office upon office upon office. On the other side of the market rose the projects, public housing, and I felt sorry for the people who had to live in those tall, drab buildings. Line after line after line of poor souls trapped in a place from which it must be so difficult to escape. At least that’s how it made me feel when I drove through the neighborhood.
Jonas and I visited the Broad Street Farmers’ Market on a Thursday, since Downingtown wasn’t open on Thursdays, and even though this market was open, the place was dark and empty. We walked slowly behind the market master as he led us to the potential stand, and all the time I thought to myself what a waste of time our visit was turning out to be. Finally we sat down with the market master and he told us we could rent the location for $50 per week. Immediately in my mind something clicked. Fifty dollars a week? We paid $300 a week to rent the space at Downingtown. At that point in my life, as a new business owner in 1988, I could not have told you what the difference was between a profit and loss statement and a balance sheet, but I knew the difference between a rent of $50 and $300 per week: $13,000 per year, to be exact.
I will admit that at the time I felt bad that we took up the market master’s day, and I almost felt obliged to take the location. But could we sell pretzels where there seemed so few people? Then again, there was the cheap rent to consider . . . Before I knew it, we signed the papers, and we owned another store.
I’ll never forget that feeling driving home, the reality of the situation setting in, wondering with complete amazement, What have I done? I sat there quietly, watching the road fly by on a lazy summer afternoon, Jonas driving our little brown Toyota station wagon. The market master wanted us to open our store by July 4, only three weeks away. The stand would probably cost us around $5,000 to build and equip and prepare for our first week, nearly all of the money we’d managed to save at that point. Did we make the right decision?
“What’s wrong?” Jonas asked.
“Honey, what is our problem?” I asked him. “Why are we doing this? Why aren’t we satisfied with Downingtown? For the first time in life we’re making money . . .” My voice trailed off before gathering steam again. “Besides, there’s no one at the market! How do we know what’s going to happen? Now we have to take all of our money out of savings, dump it into this place . . . I just don’t know.”
“We’re not going to lose anything,” Jonas said matter-of-factly. “$50 a week. All we have to do is sell one batch of pretzels each day and we’ll be fine.”
“Yes, I know, but we’ve got to build the store in three weeks! And it’s taking up all our savings! It just seems so risky.”
“You know what, though,” he said calmly, “it’s not a big risk. I’ll build the stand for real cheap. We can use just about everything somewhere else if it doesn’t work out.”
Removed from the situation as I am today, I see many common threads in my life, one of which is Jonas’s never-wavering encouragement. He always showed total confidence in me, whether it be in my skills as a businesswoman or as a mother or as a wife. Even after I disappointed that trust, he continued trusting me. He continued encouraging me. Without his confidence in me, especially during those years when I had such little confidence in myself, I never would have accomplished what I did. Or perhaps I should say we never would have accomplished what we did.
But in those days Jonas’s belief in me wasn’t quite enough. When we got back to the house, I got down on my knees by my bed and started asking God what he thought about it all.
“Lord, I don’t understand this. Did I make a mistake?” I asked, feeling so overwhelmed and worried. I started crying, resting my head on the edge of the bed (I cried a lot in those days).
“Lord, I have to know, did we make a mistake here?”
Out of the blue a feeling washed over me, a feeling as tangible as when I received the flowers from Jonas on my first day alone at Downingtown, as tangible as when my family pitched in to help us get the Downingtown store ready. The feeling was one of peace and security, and I felt God saying one thing to me.
“Fear not, for I am blessing you.”
This intervention completely interrupted my thought process, and suddenly I felt calm.
“Okay,” I said, “I’ll take it. I believe it,” and I stood up and walked out of my room and told Jonas I felt ready to open Broad Street.
We went up there to Harrisburg, and in a few weeks we built that little store. My sister Becky managed Downingtown for me while I ran Broad Street, and suddenly things began to change. Auntie Anne’s Soft Pretzels, after only five months in existence, was forced to grow—because of my natural, human inability to be in two places at the same time, I was forced to trust someone else to run my business at one of the two stores. Things would never be the same again, and the struggle within me to trust others in running my business became a common thread throughout the rest of my days as owner of Auntie Anne’s.
On one hand, I completely trusted Becky. I knew she could manage Downingtown, and not just manage it but manage it well. On the other hand, I knew she did a few things differently than I did, and even though they were little things, it almost drove me crazy to think that I wasn’t in control! Oh, if only I could have seen the future, when we would have hundreds of locations operating under different owners and managers and employees.
Meanwhile, the time came to open Broad Street. It didn’t take long for my concerns regarding the potential for pretzels in that market to melt away—by the end of the very first day, we were competing with Downingtown in sales! We called back and forth, trying to outdo one another, and Broad Street nearly matched Downingtown dollar for dollar even with its shorter days (we were only open there from around 8:00 a.m. to 4:00 p.m.) and one-sixth the rent. Soon my weekend routine became fixed—I would close Broad Street in Harrisburg as quickly as possible, then take the hour-and-a-half drive to Downingtown and be there to finish out the day, see how sales went, and help close the store.
Word of our success spread through the community much like yeast spreads through the dough, reaching every part. Jonas and I found our income more than doubling in no time at all. Both stores became busier and busier. At that time I believed our little business had finally reached its peak, and suddenly my friend’s prophecy all the way back in Texas sprang to the forefront of my mind:
“He will restore every broken relationship, he will give back to you more than you ever had before, he has a plan for you that you don’t know about yet, but he will show it to you.
“I just see so much for you guys. And it’s not just spiritual blessing. It’s, well, you think this house is beautiful? And don’t get me wrong, it is. But I see God giving you things you wouldn’t believe: I see houses, I see land, I see cars, I see, I just see all that stuff.
“God is going to give it all to you. And you’re going to start some sort of a business. I don’t know exactly what kind, but that’s the key. And it’s going to happen within the first year of your arrival in Pennsylvania.”
I couldn’t believe it had actually come to pass. I couldn’t believe things could change so quickly. And most of all, I felt horrible for laughing in my friend’s face, in God’s face, and for not trusting.
But suddenly something started happening that even our friend’s prophecy didn’t prepare me for, something none of us imagined: other people wanted to open their own Auntie Anne’s Soft Pretzels stores.
At first it happened with strangers tasting the pretzels for the first time.
“I’d love to sell these. Could I open a store?” they would ask as they inhaled a pretzel outside one of my two locations.
“Oh no,” I would laugh. “There’s only one Auntie Anne.”
Soon more and more requests came in, serious businesspeople who would return week after week trying to get me to change my mind. While I felt a little jolt of excitement every time someone asked me if they could open a store of their own, my response stayed the same: “No, no, two locations are quite enough.” But I guess two locations were not enough, and I felt myself beginning to give in when my family members started asking if they could open an Auntie Anne’s.
Finally in the spring of 1989, a little more than a year after we sold our first pretzels at Downingtown, Jonas went to Saturday’s Market in Middletown, Pennsylvania, with my brother Jake to talk to the owner of the market about opening an Auntie Anne’s Soft Pretzels store. At that time Jake was a siding estimator for a local builder, but he wanted to own his own business and make some extra money. It wasn’t long before we agreed a deal at Saturday’s Market, and the first licensed Auntie Anne’s was on the schedule to open. We called it licensing back then because we didn’t understand that side of the business very well, but you’ll see what a big part of our development the difference between franchising and licensing played in those early years.
Jake and Jonas built that store from scratch in just a couple of days out of two-by-fours and plywood. The countertops were butcher block Formica, and the front of the store consisted of handmade counters and generic Plexiglas. These days it can cost over $200,000 to start an Auntie Anne’s location, but back then we didn’t have leasing fees, attorney’s fees, architects, brand-new equipment to purchase, or mall regulations to work around—we just built it how we wanted it to look and that was that. The store cost us a couple of thousand dollars to get up and running, and while we paid for the up-front cost, Jake paid us back $100 a week until it was all paid off, plus a 4 percent royalty. We still sold pretzels back then for around 50 cents a piece, but Jake only paid $24 a week in rent, so the costs were just right.
We were busy there right from the first Saturday, and once again the lines seemed to go on and on forever. We also started to notice that people found the whole process of rolling pretzels fascinating—even after they bought their pretzels and started eating them, they would often linger beside the stand for a long time, just watching us make the pretzels. Maybe we didn’t notice this as much at our other locations because pretzels had been at those places before we arrived, but at Saturday’s Market the novelty factor of hand-rolled pretzels became very apparent.
Then there was the lady from the market who came up and told us that she was sure we would do well there.
“These people love to eat,” she said matter-of-factly, her mouth full of pretzel. We laughed and joked about that for weeks.
On the way home that night, Jonas drove Jake’s little white van so that Jake could sit in the back and count the money. Cruising down I-283, Jake went through that day’s sales, a whopping (to us at the time) $440. Everyone got so excited about that opening—here was a way that my brother could make almost $2,000 a month by working only four extra days. It’s hard to believe, but that store is still open today, seventeen years later, selling pretzels every Saturday.
By the time the summer of 1989 rolled around, another one of my siblings was ready to open a store, and this time it was my brother Merrill, with the location being the Morgantown Farmers’ Market in Morgantown, Pennsylvania. He and his wife partnered up with another couple we had known for years and prepared to start their own Auntie Anne’s.
Once again we scouted out the potential locations together and sat down in a local diner to discuss the details. Merrill’s wife, Verna, became one of my closest friends and confidants when we returned from Texas, and I was excited for them. Sitting there in that rinky-dink diner, we signed some handwritten papers that Jonas and I put together. (I can’t remember our paperwork from those days, but the total contract, leasing agreement and licensing agreement was between one and three pages in length!)
During the next week or two, Jonas helped them build their location, find the equipment at used-equipment stores, and prepare for the opening. These days quickly became some of the most exciting of my life—with each store opening came the preparation, the build out, the wondering about how well it would do, and then finally the openings, which in those days all turned out to be great successes. Each store ran so well because the owners worked the store themselves, and the costs always stayed within a manageable level. You would think that with each new successful store, I would have become more and more confident, more and more content. But that’s not how I felt at all.
With each store I actually became more and more stressed out about the fact that I was not in control. I would lie awake at night wondering so many things: Were they making the pretzels properly? Were they giving good customer service? Were they keeping their stores clean? I knew exactly how everyone made their pretzels, which stores made them too fat, which stores made them too skinny, which stores baked them too dark, and which stores took them out of the oven too soon.
I also became increasingly worried about the recipe: in those days, whenever we opened a new location, we gave the recipe to the owners—they would then go out each week and buy the necessary ingredients, mix the batches themselves, and make the pretzels. I felt that the people we gave stores to were very trustworthy, but with each new location we introduced countless people into the circle of those who knew the recipe. On one hand, I wasn’t handling the worry well at all, sometimes nearly collapsing under the stress. On the other hand, an event that happened shortly thereafter taught us all about the importance of protecting the recipe.
A man I will call Frank approached Jonas and me early in 1989, a man with energy and charisma equaled only by the size of his frame, and he wanted to open an Auntie Anne’s Soft Pretzels store. His excitement became contagious, and in good faith we agreed to help him open a location—up until this time we dealt mostly with family, a fact which probably caused us to act a little on the naive side. But he seemed like a nice guy and wanted to open a store in a good farmers’ market, so we threw ourselves into the effort of helping him open.
I traveled with Frank to a Kmart to help him pick out some supplies that he needed.
“Here, take this,” he said, handing me a $100 bill.
“Okay, thanks,” I said, going into the store and picking out the things he would need.
I paid with his money and kept the change and the receipt. He waited for me just on the other side of the checkout, and I handed him the receipt along with the change.
“Oh, just keep the change,” he said calmly.
As soon as those words slipped from his mouth, a red flag went up inside of me. I don’t know if the way he said it caught my attention, or if it just seemed out of character for him. In any case, for some reason I knew I had to give him the change. It felt too much like a trap.
“No, really,” I said. “I insist.”
I gave him the change.
Later that week it came time to open Frank’s location at the farmers’ market. As far as I can remember, he did very well. He hired a group of Amish girls who worked very hard and learned quickly. I also remember that he served customers with some of the best customer service I had seen yet, and I walked away feeling pretty good about how he would run his store.
You can imagine my surprise when, after three or four weeks of his paying his 4 percent royalty religiously, the check didn’t arrive. Hmmm, I thought to myself, I wonder where Frank’s check is? Yet even with the absence of the royalty check, I could never have prepared myself for the phone call that came next.
“Hello?” I said, answering the phone that night in the kitchen of our house.
Frank was on the other end of the line, and he was furious. To this day I can’t even remember what he was so angry about, but he just kept screaming and going off, shouting and hollering and making me very uncomfortable, mostly because he kept putting down Jonas and saying he hadn’t done a very good job with the opening and building of the store. Immediately I felt flashbacks to the days when Pastor had a hold on my life—one of the first ways he tried to get at me was by putting down my husband. I started shaking, unable to control my emotions.
Finally I managed to squeak out a sentence.
“Frank, if you have a problem with Jonas, maybe we should all sit down together and talk about it.”
Eventually we decided to meet at a restaurant and talk about it, but our meeting didn’t do any good. After he left, Jonas and I just sat there in shock, not knowing what to say. It became fairly obvious that he was making a fuss so that he could get out of paying royalties, and we didn’t have a written agreement that would stand up. We never received another royalty payment from Frank, and the confrontation with him was enough to make me want to give it all up, just stop with the stores we had already built. But Jonas wasn’t putting up with that. Sure, we made a mistake when it came to Frank (who continued running his store), but that didn’t mean we should just quit.
“There are two things we have to do,” Jonas said. “First, we have to put an agreement together. And second, we have to ‘secretize’ this recipe of ours.”
During the next few weeks, we met with an attorney and put together an eleven-page licensing agreement. While the recipe still needed to be “secretized” (as Jonas so famously referred to it), we had a new contract in place with which we could continue to expand, and our store total reached nine: the two that we owned in Downingtown and Harrisburg, plus seven licensed stores located in farmers’ markets in Pennsylvania. I felt comfortable operating in farmers’ markets; after all, that was where we got our start. And farmers’ markets tended to be more laid back about the appearance of the store and the way it was run. Yet toward the end of the summer of 1989, a woman from our church started hounding me about trying a completely different location.
A shopping mall.
“You know, Anne, you really should let us open a location in the Park City Shopping Center. It’s such a busy mall. We would sell so many pretzels there.”
Something about her belief in the product resonated with my line of thinking at the time. I began seeing potential Auntie Anne’s locations everywhere—not only markets but downtown locations, shopping centers, anywhere there was a lot of people, maybe even airports and train stations! I thought to myself, What if we became like a McDonald’s? But as soon as the thought entered my mind, the more practical side of me would take over and I would think, Maybe not. Probably not.
But this woman was single-minded. She acted with complete determination, sure that she could open a location at Park City and do well. Finally I told her to go ahead and give it a try—if she could talk the management into letting us open in the mall, then she could have the location. I didn’t think anything would come of it—she was a stay-at-home mom and didn’t have any leasing connections or experience putting together rent-package proposals (neither did we, at that point, and we were far too busy to learn). A few weeks later I talked to her again.
“Well, I met with the mall manager at Park City, and he’s not going to let us come in, but I’m going to meet with him again,” she said. I didn’t have high hopes, to say the least.
She would take him pretzels and try to meet with him again and again. Finally at one point, after hearing of another failed attempt, I casually suggested that maybe she should just back off. It didn’t appear that she was getting anywhere.
“Back off? No way. I am going to sell pretzels in Park City,” she said with determination.
I never would have pushed that hard, and maybe if it was left to me, we never would have gone into shopping malls. One day in August or September, she came up to me at church with different news.
“Well,” she said, “I’ve got a lease with Park City.”
“You do?” I exclaimed.
“Yes, but they want us in before Thanksgiving.”
Jonas already had his hands full building these other market locations, but if we were going to get into Park City, we had to do it before Thanksgiving. Normally two months would have been more than enough time to open a location, but normally we were opening in markets, not shopping malls. That Park City location became our first encounter with the real world of building regulations and fire regulations and architectural drawings. Inspectors and leases and fire marshals.
We finally met with the mall manager at the Park City Shopping Mall. He was a good old Southern boy from Arp, Texas, only ten minutes from the small town in Texas where we had lived. His Southern accent drawled out slowly, and he was firm.
“Ma’am,” he had said, “I tell you what. I don’t see how you can make your rents selling only pretzels. But I will let you in this shopping center—I don’t really know why—and this is the only space I have available for you. You can stay for three months and then we’ll see how it goes.” The location was probably the worst one in the mall, a dark corner unit barely visible at the back of the food court. The mall manager didn’t have very much belief in the product. In fact, he didn’t think we would make it past the holidays.
Not a smart move for us to make with just a three-month lease in a horrible location, but we went ahead anyway, unable to imagine a situation in which we would not succeed. For one of the first times, I was in awe of what we were doing: the store looked great, very professional, and had a neon sign above the shiny, new equipment. It was the Cadillac of all our locations, and I thought we had arrived.
On grand opening day they sold pretzels faster than they could make them. Once again the product proved itself. They literally could not keep up, even with me and other family members there to help. And what of the doubting mall manager? Well, he went on to become one of our most beloved franchisees, opening four stores in Atlanta, our first stores in Georgia.
So there we were, Christmas of 1989. Park City sold an incredible number of pretzels during the holidays, and all of the market stands stayed busy. Our store total reached ten, and even without spending a cent on franchise marketing, more and more people would call each week asking if they could open an Auntie Anne’s. By January 1990 we hired managers for our two stores, Downingtown and Broad Street, but I still tried to be at the stores on the weekends, and with our increasingly busy schedule, Jonas and I realized we simply could not keep up.
The main area in which we needed help was in the actual building of stores. As we began to look at locations that required a more professional appearance, we realized we could not open stores in the one-week time frame that we could open farmers’ market locations. We built everything in the store, including the shelves, the walls, and the cabinets, all from scratch, and Jonas needed help. We decided to ask my brother-in-law Aaron, Becky’s husband, if he would come on full-time and help Jonas with the build-out side of things.
Aaron worked for Stoltzfus Structures, a local shed-building company. We asked him if he wanted to be our first full-time “corporate” employee—I was nervous, though, because I didn’t even know for sure if we could actually pay him every week. In spite of the uncertainty, there was an excitement in the air when it came to Auntie Anne’s Soft Pretzels, and Aaron decided to take us up on our offer.
Meanwhile, Becky continued managing Downingtown for me and tagging along with Aaron during the weeks. The four of us would hang out all the time, trying to figure out how to do things better and talking about our existing licensees and who was doing a good job, who was struggling, who made the best pretzels, all of that kind of stuff. There was a little diner we met regularly, and my brother Merrill would often join us as we talked about the direction the company seemed to be headed.
We still struggled with the idea of “secretizing” the recipe. Eventually we decided to bag the mix ourselves and eliminate the need for the licensees to know the ingredients. We tried so many different strategies—from brown bags stapled shut to plastic bags fastened with a metal tie, then went through various boxes and containers to ship the mix to the store owners.
The whole process started around March, and I discovered my sister Becky was taking over more and more of the responsibility when it came to the packaging of the mix. She would work for hours at a stretch, making one bag of mix at a time, taking orders from the store owners who called, and even arranging for some of the younger nephews and nieces to come and help bag mix—I think we paid them 10 cents for each bag they put together. For those four months at the beginning of 1990, Becky worked as hard as the rest of us, never asking for an extra cent above what she got paid for managing Downingtown. Finally one day in April while we were bagging mix in my garage with one of my nephews, I turned to her and laughed.
“Becky, if you keep coming to work, I’m going to have to start paying you!”
She just laughed.
“You don’t have to pay me. I’m just hanging around here with Aaron. I don’t have anywhere else to be.”
But we finally got to the place where I could pay her, and she became our second full-time employee. Once again my family was there for me, just jumping in as the need arose. I couldn’t have done it without them. Their presence served as a continual reminder to me: even though I wanted to control the process and have everything done my way, I couldn’t do it all on my own. I had to depend on them, and they were all very dependable.
During 1989 and the first few months of 1990, the business became an all-consuming whirlwind that just picked me up and never put me back down. By the end of 1989, we had already opened ten locations and sold over 200,000 soft pretzels. Jonas and my two girls were caught up in it as well, and we all had our own individual responses. Jonas continued counseling, growing that side of things exponentially, as well as building store after store for me. The girls, on the other hand, weren’t doing well at all: LaWonna was never home, and LaVale became more and more withdrawn. There were still so many skeletons in my closet, too many past hurts and disappointments that I hadn’t dealt with properly. The business served as a suitable Band-Aid for the time being, but at some point that Band-Aid would have to come off.