Marketing Strategy Success Stories

Owners of CAO Bakery & Café cook up a sweet success

Caution: this story may make you crave a pastelito, or three.

Step into a CAO Bakery & Café and you’ll find a menu of original Cuban and Cuban-American favorites. The small business takes the beloved Cuban bakery tradition into the next generation, offering cafecitos, pastelitos and croquetas, along with a hearty steak and egg breakfast and a variety of creative sandwiches and salads for lunch or dinner.

There are now 12 CAO Bakery & Café locations, from Pinecrest to Fort Lauderdale. The café group was founded by Tony Cao, a third-generation Cuban baker, and Carlos De Varona, a friend of Tony’s since childhood – “Cuban cousins” as they say. The CAO Bakery & Café name has been around only since 2018 but the roots of the chain go back to 1972. That’s because 7 of the 12 locations were part of the Vicky Bakery chain, founded by Tony’s grandfather Antonio who started baking in Cuba before immigrating to Miami.

Before some locations were rebranded as CAOs, some of the original Vicky locations – including the original one in Hialeah where Tony learned the trade working with his father and grandfather — served traditional bakery items and some served the larger menu, which confused customers. Now there is no confusion: If you want a fuller café and catering menu, CAO is ready to serve you. Both businesses continue serving the bakery staples they are most known for, but CAO goes further, fusing Cuban cuisine and American traditions. For example, in addition to the popular Original Cuban and Media Noche sandwiches, CAO also offers the “Medio Dia” – smoked ham and cheese on a guava & cream cheese pastry. Or maybe you fancy snacking on Arroz con Pollo bites?

The CAO founders wanted next-generation bakery cafés with wifi and a younger fast-casual design and ambiance – think a Cuban Starbucks or a Cuban Panera — not your old school bakery on the corner, as we’re opening our 12th store” said De Varona. ” We started selling sandwiches and other products that weren’t just pastries, bread, and cakes in order to drive more traffic during the morning, the afternoon and the evening.”

That business model quickly became a success. Cao and Da Varona started in 2018 by converting 7 former Vicky locations into CAO Bakery & Cafes and have since added five more locations.

Fortunately, CAO Bakery & Café was already preparing to ramp up its online ordering capacity when the pandemic hit, and that accelerated the process. The cafes were not sit-down restaurants so they were already more set up for grab and go – some of the stores even have windows where customers can order and pick up without ever going in the store. All the cafes were already set up with UberEats and GrubHub services for deliveries, and curbside pickup was quickly added for takeouts, De Varona said.

“We were affected like all other restaurants, but we were an essential business and we managed to stay afloat and get through the tough times.”

Building up a strong foundation helped the small business weather the tough year too, and the co-founders turned to Florida SBDC at FIU for help with that. FSBDC at FIU, the small business development center within the university’s College of Business, provides no-cost business consulting and training to small businesses throughout Miami-Dade and Monroe Counties.

FSBDC at FIU’s team of consultants helped De Varona and Cao with their business planning process and then the team put the owners in contact with Pilot Bank, which helped CAO Bakery & Cafe obtain SBA loans so that the business could continue to grow.

Those relationships were a key to success. For example, FSBDC consultants not only helped them develop the business plan but also access to growth funding. “We had all our materials, and we needed to be connected to the right people, the right bank,” De Varona said.

During the COVID crisis, CAO already had a relationship with Pilot Bank thanks to FSBDC at FIU, and so was able to receive a forgivable PPP loan.

“FIU has been a great help on the small business side, and the resources they’ve offered really helped us during our growth,” De Varona said.

Today CAO Bakery & Café has over 200 employees. “We want to continue to grow, we want to grow smarter, we want to expand,” said De Varona, who is eyeing other parts of the state, too. The owners see an opportunity to convert some smaller restaurants that unfortunately didn’t survive the crisis into bakery cafes, and also to expand through franchising.

“So that’s really what our goal is — to grow smarter and try to capitalize on those opportunities,” he said. “We’d like to conquer the world, but realistically we’re going to focus on Florida.”


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