Robert Jucker | Crain's Houston

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Robert Jucker

Background:  

Three Brothers Bakery is an award-winning bakery that makes Eastern European-style breads and pastries as well as cookies and specialty cakes. In 2016 Robert Jucker was named as one of the country's 25 best bakers and pastry chefs in Bake Magazine.

The Mistake:

Probably the worst mistake I’ve ever made at the bakery is also the most disturbing one.

We previously handled payroll in-house. There really weren’t any issues. But, under the requirements of the Affordable Care Act our business would have been fined $60,000 if we didn’t provide health insurance to our employees because we employee more than 50 people. So, in January last year we found a pretty large company that said it could do the insurance, administrative work and payroll for about $80,000 plus the cost of insurance for our employees.

When my wife went to sign the contract it was only four pages long. When she asked to see the terms and conditions they said there weren’t really any, so we didn’t think there were going to be any issues.

Probably about three weeks in I realized we had made a mistake. They overcharged us and over the course of the year it ended up costing us well into the hundreds of thousands of dollars range. For a small company that’s trying to be a big company, like us, it hurt us really bad. The financial consequences have been huge.

Every error ... has financial ramifications that are much higher than the initial loss you incur.

The Lesson:

Do your due diligence. Really read your contracts. Know everything about what you’re getting. If you don’t like it and something doesn’t feel right then either write it in the contract or have the other party put it in the contract. If something smells fishy then you need to investigate further and don’t just let folks sell you a bill of goods. Don’t be scared to ask all of your questions.

Every error, no matter what, has financial ramifications that are much higher than the initial loss you incur. For us, that’s exactly what happened.

We asked the right questions, but they didn’t give us the response they should have given us. Had they pulled out the terms and conditions, they would not have had a signed contract. That’s what you have to be very aware of. What are you signing? What are you getting?

This year we’re bringing payroll back in-house. This is also the first time I’ve ever been put on a budget. We’ll get though it, but I’m not used to having to worry.

In the future, we'd love to be able to open another location in the greater Houston area and we are hopeful we can.

Visit Three Brothers Bakery online or check out their Twitter feed @3brothersbakery.

Photo courtesy of Three Brothers Bakery.

Do you have a good story you’d like to share, or know someone we should feature? Email jfisher@crain.com.

And be sure to sign up for your local newsletter from Crain's Houston.