Competition...a Little Too Close...
Business By ThatsHowTcakesRolls Updated 17 Feb 2009 , 9:29pm by MrsMissey
Ok...I really try not to be a petty person but something has really gotten me upset...
My shop is located next to a coffee shop. I was here first but they moved in about 3 months after me and I really thought it was going to be a great thing because they are an established business with lots of foot traffic so having them next door to bring over my people to my side of the street should be a good thing.
In the beginning I was selling 7-8 flavors of coffee but scaled it down to either Regular or Decaf once they moved in next door because it didn't seem reasonable to try to compete with a coffee house and really, that wasn't what I was trying to do anyway. I don't even sell coffee every day so obviously I'm not affecting their business!
This coffee shop has a breakfast, lunch & dinner menu - they like to call themselves a cafe more than a coffee shop because they have a pretty big sandwich & soup menu with salads and all that. They've always had a few brownies, bagels & cinnamon rolls for sale - nothing big, and it's from Sysco anyway so not homemade and certainly not my competition. Well....at least I thought not!
I signed up weeks ago to receive their daily specials e-mails and today they sent out an e-mail advertising that they are now selling CAKE! It's not my cake either...I can't believe this. It's insulting, to say the least. They are advertising homemade Carrot Cake & Red Velvet Cupcake specifically which are 2 of my biggest sellers and I believe they know this! Red Velvet is HUGE in this area and people come to me specifically to get these things and for her to now start selling these has really upset me. I realize that this economy is tough and people have to try to make money but this crosses a line to me.
Now, because of this I have decided that I am going to start selling Pizza Slices & Whole Pizzas as well as Soups (which are big for her) for lunch beginning in the Spring. People have often asked me if I was going to go this route and I'd decided that I wouldn't do that since the Coffee Shop was selling food but if I'm not going to be afforded the same consideration then it's time for me to be ruthless too!
Am I wrong for feeling this way now?
Tammi
Meh . . .understandable.
However, I think you're looking at it wrong.
Should you have stopped selling flavors of coffees? Depends on what your customers told you. Depends on your biz plan. Depends ON WHAT YOU NEED TO DO FOR YOUR BIZ. If the coffees weren't selling, then yes, discontinue them. Maybe introduce gourmet teas. Making a decision to limit a product line to be "nice " to another biz is . . .well . . .nuts.
Should you start selling soups? Depends on what your customers tell you. Depends on your biz plan. Depends ON WHAT YOU NEED TO DO FOR YOUR BIZ. If your customers have asked you to offer more lunch options and you want to be a cafe more than a bakery, and it's GOOD FOR YOUR BIZ, then yes by all means do it. If if makes money for you, yes, do it.
There is no reason to base your decisions on your biz on anything but the best interests of your biz. After all that's why you're in biz. To make a profit. And you certainly should not limit your biz to help someone else's biz.
I'm an MBA. Waiting to get flogged.
Do you have the manpower to pick up this new venture?
How about offering a free cup of coffee with purchase of a baked good? Or more specifically with the purchase of a slice of red velvet or carrot cake. 
Shoot. I'm sorry for this! I would suggest looking into a new spot, but that costs far more than you could lose, I am sure.
I have no idea what you should do, but here is a bump, and wishes for luck.
Well that just sucks! All I can say is that in biz the trick is to find what other ppl are NOT doing and do it!
I think there is an obvious solution. Communicate! Go over there and talk to the other owner and ask her what is up? Not rudely, but out of confusion.
I do understand how you feel, I had a similar incident with the local coffee shop that opened up right across the street. The owner is my son's best friend's grandmother. So when she opened I brought her brochures and coupons over to our restaurant/bakery to give to our clients. She solely did coffee, teas, hot chocolate, bagels, muffins, and sold ice cream. Nothing we offered at all.
She complained to me that she hated having to buy her baked goods from sam's so I offered to do cinnamon rolls, muffins and assorted danishes for her and asked her if I could place my cake brochures and our restaurant to go menus in her shop, she said yes. Well things got crazy and a couple of weeks passed before I was able to get the brochures and menus over to her, and I brought her samples of my baked goods for her to try.
I walked in and her bakery case was full of pastries, but I didn't think much of it. Her menu board changed to now offer lunch (sandwiches & soups nothing major but still things we offered across the street) So I give her the samples and the brochures and she gives them back to me saying that a friend of hers who does cakes and baked goods is now working for her and is going to do her cakes out of her coffee shop. I was crushed!
I later found that she really didn't know this woman, that the woman approached her (knowing full well I was across the street) with a barter deal to use her commercial kitchen, "I'll work for free for you if you let me sell my cakes and baked goods from here." deal. The coffee shop owner laughed it off saying "you know when I think of you Angie all I think of is hamburgers" AARRRGGGHHH! Our restaurant was called the Hawk Hamburger Hut & Eatery (Hawks were/are the mascot of the new high school down the road). She knew my cake biz was there too. I had a HUGE sign with picture of a wedding cake and my biz name right across the front of my building!
The Coffee shop still sells lunch and now dinner (since we closed the restaurant) but the cake sales are virtually non-existant. I had a customer who called me last week for a b-day cake tell me they went in there to order a cake and the people working said all they could do was take her number and have the cake lady call her that they didn't personally take the orders and they didn't have anything they could show her of the woman's work. I really thought that was odd, but that is what the lady told me.
I agree whole heartedly with Leahs on this one. It is one thing to pull the coffees if they are not selling. They're probably thinking, "hey, she's selling tons of these cupcakes, lets get our piece of the pie!". Do what's best for your business whether it's a coffee shop or toilet store next to you. I'm sure you'll beat them in taste and it will just boost your sales in the end. 
Thanks for responding everyone...I can see how I made it sound like I only scaled back the coffees out of consideration. The truth is I felt that because they were a coffee shop already established that trying to compete with them wasn't the best business move, especially when I am focused on being a Custom Cake shop - not a cafe. It was a financial move as well since I was losing money on the coffee part....
I'm just so frustrated because we are friendly with each other. Helping each other out if needed in different ways and for this to happen just makes me feel like I was duped...
Sticky Buns are a big item here in PA and she has been trying to make them forever but her sticky bun smear would get rock hard when she made them so she was buying them. Well, she did a little snooping through questions (and no, I didn't pick up on it at first) and has now found a way to sell them and she is underselling me. I think what I might be most upset with is quite possibly my naivete in this situation. I really didn't consider her my competition so she has been the furthest thing from my mind, until now that is.
I am pretty friendly with the owner of the building so I forwarded her this e-mail I received and she responded pretty quickly back that she has been hearing things and that as soon as she gets back into town we should get together and talk. Of course my mind is now racing wondering what she's heard so I'm anxious to have that conversation...Anyway...Thanks again for everyone responding....
Tammi
I would check your lease. When I owned a salon, I was able to get it in the lease that no other business could be in the strip mall doing the same thing. So we only did hair, nails and massage. Which we stated what we were doing on the lease agreement. Someone else was more than welcome to put in a facial place. And my landlord was very good about those things, he was a really great landlord.
So I guess what I'm saying is talk to your management company and check your lease agreement. And if you do have that stipulation(sp) in your agreement let your management company handle it.
I couldn't agree with Leah more! Also, I ABSOLUTELY wouldn't go over and talk to them. Why? Did they talk to you about their business? Their business is theirs and yours is yours. I think the suggesstion to see if you have a non-competition clause in your lease is a good thing to look into as well. However, don't become petty...ie selling things that you aren't interested in and your customers aren't interested in just to anger your coffee neighbor. Good luck in your business!!
cocorum21 has a good idea. I don't have a stipulation like that in my lease, but the leasiing company/landlord made it clear they did NOT want another restaurant in this strip mall. Since I'm not a restaurant, it's ok. The landlord(s) want their tenant to be successful. Successful tenants stay and pay rent. Unsuccessful tenants close up shop and move on ... bad for landlords! Moving in a bunch of tenants who all sell the same thing is bad for everyone .... landlords have a vested interest in keeping a good business mix as tenants.
Don't take it personally. A cupcake bakery just opened 4 blocks away from us. They are underselling us by $.75 a cupcake, and you know what...they are deserted and we are more crowded than ever. They copied my valentine's day specials menu almost word for word. They copied my advertising plan. They even hired one of my former employees, one I fired.
There was a quote in the paper that their owner though there was a real need, since Chapel Hill didn't have a cupcake bakery ( We sold 53,000 cupcakes last year.)
Competetion will come and go. Luckily I have a landlord who loves us and they own the block. They actually contact us when one of their spaces is available and let us know who's looking at it.
I always look at it this way. I don't really have any competition. Nobody can do what we do or has a shop as beautiful as mine within 50 miles. There is room for a Neiman Marcus and a JC Penny's in every town. I just get to be Neiman Marcus.
Business is business. Like Leah said, you do what you need to do and so will they. It's not a personal attack. Live and learn: next time get an exclusivity clause in the lease. Its pretty common. Sorry this happened tho, it can be tough to work around a situation like that. Just make sure your product is better than theirs. Doesn't have to be cheaper either.
I've calmed down now, thanks everyone. I just thought I would give an update... I've decided it would be ridiculous to start a lunch menu since I barely have time for what I do now! my coffee sales never were that good because of the coffee shop so I had decided to discontinue selling coffee and stick with Teas, as someone mentioned above. Anyway...now, instead of discontinuing it I've decided to offer a free coffee with every purchase...
I was throwing it away anyway so this really was a loss for me so why not just give it away... I believe that this will actually bring in some people who may not have come in otherwise. And since I've been throwing away coffee at the end of every day (some days I wouldn't sell any) what would be the difference? Except that it would generate sells that weren't there before! Am I making sense? I think this is a great way to "play" the business game... 
I've calmed down now, thanks everyone. I just thought I would give an update... I've decided it would be ridiculous to start a lunch menu since I barely have time for what I do now! my coffee sales never were that good because of the coffee shop so I had decided to discontinue selling coffee and stick with Teas, as someone mentioned above. Anyway...now, instead of discontinuing it I've decided to offer a free coffee with every purchase...
I was throwing it away anyway so this really was a loss for me so why not just give it away... I believe that this will actually bring in some people who may not have come in otherwise. And since I've been throwing away coffee at the end of every day (some days I wouldn't sell any) what would be the difference? Except that it would generate sells that weren't there before! Am I making sense? I think this is a great way to "play" the business game...
I always cringe when I see people posting vents about their business or competitors when they have their personal/business info and name in their profile. You are giving other people insight into your thought processes and perhaps an edge when they can google you and find posts like this.
Just a word of caution.
Good luck - I hope it works out and you can both be successful and co-exist peacefully.
I always cringe when I see people posting vents about their business or competitors when they have their personal/business info and name in their profile. You are giving other people insight into your thought processes and perhaps an edge when they can google you and find posts like this.
Just a word of caution.
Good luck - I hope it works out and you can both be successful and co-exist peacefully.
First, I love your screen name ohmyganache, I smile every time I read it I couldn't agree more with your above comment. Since this site is not just for the professional baker or business owner, everyone really should be careful about the information they post.
I've decided to not post any pictures of cakes that I've sold on here. Many times I tell clients to look through the galleries here for ideas and the last thing I want is for one of them to see one of their past cakes and than to read a post where I may have been complaining about a client 
I also do not link my business web site and I don't use the same screen name anywhere else. One thing I really don't like about the internet is the ability to find out just about anything about anyone. My goal is to not make it easy for them to do that.
To the OP..........Since the Coffee Shop started selling carrot and red velvet cake, have you noticed your sales are down at all?
Do you sell cake by the slice as they do or just whole cakes? If you don't sell just slices maybe this is why they feel it's not a conflict with your business. I would approach them in a friendly way since the last thing you want is an all out war with your business neighbors.
Definitely check the fine print in your lease about businesses selling the same products, this may be the weapon you need to get them to stop selling their cakes.
Good luck, let us know what happens.
Deb
I always cringe when I see people posting vents about their business or competitors when they have their personal/business info and name in their profile. You are giving other people insight into your thought processes and perhaps an edge when they can google you and find posts like this.
Just a word of caution.
Good luck - I hope it works out and you can both be successful and co-exist peacefully.
First, I love your screen name ohmyganache, I smile every time I read it
I couldn't agree more with your above comment. Since this site is not just for the professional baker or business owner, everyone really should be careful about the information they post. I've decided to not post any pictures of cakes that I've sold on here. Many times I tell clients to look through the galleries here for ideas and the last thing I want is for one of them to see one of their past cakes and than to read a post where I may have been complaining about a client
I also do not link my business web site and I don't use the same screen name anywhere else. One thing I really don't like about the internet is the ability to find out just about anything about anyone. My goal is to not make it easy for them to do that.To the OP..........Since the Coffee Shop started selling carrot and red velvet cake, have you noticed your sales are down at all?
Do you sell cake by the slice as they do or just whole cakes? If you don't sell just slices maybe this is why they feel it's not a conflict with your business. I would approach them in a friendly way since the last thing you want is an all out war with your business neighbors.
Definitely check the fine print in your lease about businesses selling the same products, this may be the weapon you need to get them to stop selling their cakes.
Good luck, let us know what happens.
Deb
Oh no...I want my copetition to know I think of them as JC Pennys and us as Neiman Marcus. 
tbroskosky:
I really do not have any advice for you, but I was so excited to see you were in Carlisle! My DH and I lived ther before we moved to OH. Our families still live in PA (Mechanicsburg and Hershey) and we get home in the summer and at Christmas. I would love to come visit your shop this summer when we are home!!!
Oh no...I want my copetition to know I think of them as JC Pennys and us as Neiman Marcus.
As much as I respect what you do and your success thus far, I would have to say that this comes off as very snobby. I would never want to appear that I thought I was better than anyone else - I would let my baked goods speak for themselves. Even your competition can sometimes be your allies. I try to foster good relationships with those in the same business - you never know when it may come in handy.
I think it's okay to be "snobby" sometimes. I'm in the cake snob club, I know there are others here who are also members. The competition can sometimes be allies, but there are different kinds of "competition," if that makes sense. Some shops here are my competition, and some are cake shops that sell to a different customer base, and they are the Walmart to my Neiman's. If you know who's who it makes it easier overall, and I do refer out to shops who are my "equal" in terms of product. I don't want to refer someone to a crappy shop, that would reflect badly on my judgment. So if that makes me sound snobby, okay.
And I know very well that I'm better than some of them, and some of them might be better than me, oh well.
But I don't post my business info here either, for the same reasons dkelly doesn't.
Oh believe me, I know who I'm better than - and who I am not. However, I would never have that attitude that I couldn't mingle with the hoi polloi. If someone wishes to have that attitude in private - that's one thing. But to post it in a public forum is doing yourself a disservice in my opinion. Because while you may be "the sh*t" at the moment - what about 5 years from now? Alienate people now, and it could come back to bite you in the butt (because they will try harder to bring you down and celebrate when you fall) - that's all I'm sayin'.
Also, it seems very mean to try to rub other peoples' noses in your success. Just my opinion.
I'm in the cake snob club, I know there are others here who are also members.
Some people can't afford me .... and that's ok!
I guess that qualifies me for membership, too!
But I dont' just post that in a public forum. I freely say it in front of people all the time. 
Oh believe me, I know who I'm better than - and who I am not. However, I would never have that attitude that I couldn't mingle with the hoi polloi. If someone wishes to have that attitude in private - that's one thing. But to post it in a public forum is doing yourself a disservice in my opinion. Because while you may be "the sh*t" at the moment - what about 5 years from now? Alienate people now, and it could come back to bite you in the butt (because they will try harder to bring you down and celebrate when you fall) - that's all I'm sayin'.
Also, it seems very mean to try to rub other peoples' noses in your success. Just my opinion.
Nobody likes Martha Stewart either, and she's a billionaire. There's a difference between those who are in this as a real business, and those who dabble. I have my life savings plus a hefty mortgage in my business, and I'm not really in it to make friends.
I work upwards of 70 hours every week, so I don't think that kind of work schedule is much to "rub people's noses in". I am however proud to say that nobody is willing to work as hard as we do to make sure our desserts are perfect, fresh, and made from scratch.
Every successful business has a marketing plan and a target audience. Mine is the customer who would want Martha Stewart to make their cake. Those who want Paula Dean can go someplace else.
Have I mentioned lately how much I want to be like txkat when I grow up?
I heart you too, Debi!!
I think Rachel Ray's empire is gaining on Martha's - and she got there by being nice and working hard. You can be good, and not be a b*tch about it is all I'm sayin'. (NOT calling you a b*tch txkat) And insulting your competition in a public forum is a good way to develop serious hard feelings.
For instance - I worked for a start-up bakery/cafe. It didn't work out (she thought she was Gordon Ramsey) and I would have been fine with that. However, since they spoke down to me like I was garbage and it was THEIR name on the door so they should be worshiped - well, I am going to be working THAT much harder to put them out of business and humiliate them just a little (or hopefully - a lot). Yes, I can be spiteful. Had they had not been so disrespectful and tried to humiliate me, I wouldn't have given them a second thought, and wouldn't have minded being friendly. But now? Well, let's just say - "IT'S ON!"
In essence, if you want people to respect you - don't you also need to show them respect?
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