The Biz Beat: Peters’ Bakery in San Jose puts the icing on the cake

One San Jose bakery has been making to-die-for burnt almond cake for more than 85 years, bringing customers from hundreds of miles away for this signature dessert and other mouthwatering delights.

Tony Peters founded Peters’ Bakery in 1936. He grew up in a poor Portuguese family in San Jose. During the Depression, he worked for automobile maker Studebaker during the week. On Saturdays, he went to San Francisco, where he learned his baking skills from his uncle.

At age 29, Peters opened his first bakery at the corners of Delmas and San Carlos streets. Two years later, he opened a second bakery on Alum Rock Avenue. Throughout his life, Peters had a close relationship with his employees, retaining them for years. One apprentice, Richard Sota, bought Peters’ downtown store in 1947 and renamed it Dick’s Bakery. Sota kept making those famous, fluffy burnt almond cakes, complete with almond pastry cream and a white frosting covered in candied almond slices.

Even after Dick’s opened, the reputation of Peters’ Bakery never faltered, with more than 100 bakers apprenticing under Peters. Three generations later his two grandchildren, Cap and Cassy Peters, are at the helm. It is the oldest family-owned bakery in Silicon Valley, according to Cap.

For Cap, the sweet aroma of the bakery transports him back to his childhood, remembering how his parents let him pick out his birthday cake. Cassy recalls running around the bakery when she was three or four years old and falling asleep on sacks of flour. Cap and Cassy both love the pumpkin burnt almond cake. Cap said he can gobble up the German pfeffernusse (spice cookies) all day long.

Tabitha Alvarez has been coming to the bakery for more than 15 years, and the importance of this family treasure is not lost on her. She picked up baked goods for her mother’s birthday. 

“When you lose places like this, you lose what makes (a neighborhood) home,” she said, referring to mom and pop small businesses.

During the early days of the pandemic, that almost happened. Cassy wasn’t sure if the bakery would survive. As sales declined, the bakery decreased its hours and days. Then on Mother’s Day 2020, the faithful showed up. 

“I’m not a very emotional person,” Cassy said, “but I walked out front and the line was down the block. I said hello, walked in the door and broke into tears.”

Today, a line on weekends is common. On holidays, lines often wind around the corner. Cap said the support of the tightly knit Alum Rock community is key to the bakery’s survival. Although the bakery did close for one week right before Christmas 2020 when a staff member had COVID, customers have returned and sales are up, Cap said.

Staff is family

The staff is another reason for the bakery’s success. The employees are like family. Cap said bakers who have been there for decades keep the business going, working nonstop from midnight to at times 7 or 8 a.m. on weekends.

“I don’t think people understand the amount of work these guys do,” he said. “It’s not just decorating cakes and cupcakes. It’s laborious work.”

The clerks who box up and take orders are the other half of the synchronized team. The lobby is small and people have to wait outside. Employees will often walk out the door to take orders and deliver baked goods to ease the wait.

“People are upset because there’s a line and we don’t get to them fast enough,” Cap said. “The patience and customer service skills our clerks have are amazing. They’re our front line.”

Jolene Knoth, who came to Peters’ Bakery from Morgan Hill, appreciates the neighborhood eatery.

“You can’t go to a grocery store’s bakery and get this service and quality,” she said.

Cap beams when people tell him they’ve gotten their birthday cakes at Peters’ for decades, or their parents or grandparents visited the store.

“I’m hoping new people who come to this business are starting a new tradition for their family,” he said. “Maybe it’s someone’s first time getting their child a birthday cake and that child is going to come (back) as an adult. That’s what I want to see.”

Contact Lorraine Gabbert at [email protected].

Editor’s Note: The Biz Beat is a series highlighting local small businesses and restaurants in Silicon Valley. Know a business you’d like to see featured? Let us know at [email protected].