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Croissant crowns success of bakery pioneer

Fredy Hiestand realised his childhood dream of becoming a baker (Hiestand)

Sixty-year-old Fredy Hiestand is a dreamer who has become Switzerland's uncrowned king of the croissant.

As a young boy, his ambition was to become a baker and pastry cook. From modest beginnings and savings of SFr5,000, Hiestand built up an empire that is market leader in Switzerland within the frozen and fresh bakery sector.

He owes his success to the humble croissant. Hiestand did nothing to the consistency and taste of the crescent-shaped breakfast pastry, but revolutionised the way it is produced.

Perfecting deep frozen techniques, the Hiestand company has introduced industrial production methods to bake bread to convince even traditional bakers, at the same time as responding to new customer needs.

Convenience drives growth

What has been driving the company, particularly in its home market, is the demand from customers for products at convenience outlets, including petrol service stations and major retail outlets.

The Hiestand sales argument is that deep-frozen is fresher than fresh. Company spokesman Michael Schai told swissinfo that customers define freshness as the time between when the bread comes out of the oven and consumption.

"If you go in a shop and you buy bread that's still warm, that's the freshest you can get. It doesn't matter if the dough or the half-baked bread has been frozen in between," he said.

The company might be considered a threat to the traditional baker in Switzerland but discussion on the issue seems to enter a grey area. The Swiss Bakers' Association confirms that Hiestand is one of its members which produces "complementary products" for bakers.

The Association says that if, for example, a baker has run out of his own bread during the course of the day, he still has a few Hiestand deep-frozen products on hand that can be baked for the customers.

But Hiestand maintains it supplies 50 per cent of Swiss bakeries with its products.

Schai admitted that the company is gaining some market share at the expense of the traditional baker.

"But also at the expense of the two big retailers, Migros and Coop," he said.

Share price below expectations

Company growth was so spectacular in the 1990s that the decision was taken to go public, but the share price since its listing on the Swiss exchange in 1997 has failed to live up to investor expectations.

Issued to the public initially at SFr540, the share price was SFr290 at the end of trading on Wednesday.

Before the announcement of the 2002 figures on Thursday, the company had not been able to convert the impressive rise in sales (on average 20 per cent annually) into earnings power and had lost some investor confidence as a result.

The company appointed former Gate Gourmet head, Wolfgang Werlé, to take over the Hiestand helm in November 2002 to improve the earnings position.

This year, Fredy Hiestand is giving up his position as chairman of the company, although he will remain on the board. He still owns 26 per cent of company stock.

Hiestand has other dreams he wants to turn into reality. The most ambitious is a project near Bern to turn 76 hectares of land into a model organic agriculture centre.

swissinfo, Robert Brookes

Fredy Hiestand

Fredy Hiestand set up a small bakery business in 1967 with savings of SFr5,000.
He lives by the motto: "Don't let anyone steal your dream!"

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