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MENTOR HELP!!!!!!

post #1 of 71
Thread Starter 

I AM IN DESPERATE NEED OF A MENTOR !!!!!!!!!

I currently own & operate a store front cake/cupcake business. When I opened 2 1/2 years ago there was ONLY one other cake/cupcake shop in the area. Two months after I opened, THREE other shops opened literally within two miles of each other. Originally, I opened fully aware that my location wasn't the best but because I only had one other competitor I figured it would be a great start, especially since I started without any loans or debt. I was proud of my small but quaint shop. But not so long after opening the 3 other shops that have popped up are in far better locations therefore they are able to charge more money although my work is comparable and in most cases superior to theirs.

I have put in the allotted 16+ hour days here but have watched my competitors gain more customers, notoriety and to my chagrin even cupcake trucks meanwhile, I have been a jack of all trades trying to keep my business a float. ( I have been so busy with my business I haven't posted any new pictures on cake central in years, if you inbox me I can provide my website to verify my skill level ) My question is with my lease about to end should I concede to the not so competition or forge ahead and hope that eventually I will get the traffic necessary to advertise and ultimately grow my business. All advice is welcome, but please private message me if you are a serious prospective mentor

 

Thanks in advance :cry:

she has finally found her calling
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she has finally found her calling
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post #2 of 71
Why are you charging less because of your location? If your product is superior to the higher priced options you should be charging the same or more. People who can afford nice cupcakes don't go to the cheap place.
elsewhere.
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elsewhere.
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post #3 of 71
Thread Starter 

Hi Kikiandkyle,

I calculated my price according to the cost of material, time and overhead. I am located in an older strip mall which is set back from the street, the other shops are located near or in brand new established pockets of the community and therefore have more affluent clientele within walking distance. I absolutely don't undercut in any way and offer a fair price for my product but I don't want to price myself out of my area either.  

she has finally found her calling
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she has finally found her calling
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post #4 of 71
This is exactly why it's so important to do a competitive analysis and take market value into consideration when creating and refining your pricing structure.

How profitable is your business, and what are your competitive advantages? What is your marketing strategy?
post #5 of 71
Thread Starter 

Hi Jason_Kraft,

I honestly haven't adjusted my business plan since I have opened. ( I know that is terrible and believe me I am suffering for it)   My competitive advantages are as follows : I have a great attention to detail on cake design, I am the main cake decorator making sure that my cakes are consistent, everything is made here fresh and no product is store bought or frozen  I also offer exceptional customer service. My marketing strategy has been limited to public data regarding the income levels and clients in my area that may frequent my shop along with my own business data regarding best sellers, worst sellers , highest grossing months and days of the weeks for my business -( March and September) 2nd and third weeks in a month ( densely populated military personnel) , but I don't have a lot of money coming in to do any major advertising, especially with any one of  5 mobile cupcake trucks trolling the area at any given time. I am sure the business structure may be faulty but I am not sure if it is salvageable

she has finally found her calling
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she has finally found her calling
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post #6 of 71
Thread Starter 

I am considering taking a loan mainly to promote the business, add staffing to be able to take on more last minute orders and or possibly move to a different location   but with so much competition already occupying all the high traffic, high income, luxury locations  I don't know if it is a wise decision. It may be smarter to cut my losses  

she has finally found her calling
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she has finally found her calling
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post #7 of 71
I didn't mean that you were undercutting, although I think you're probably undercutting yourself.

Does the majority of your business come from walk ins or custom orders? Do you live in an area where people mainly drive to get to their location?
elsewhere.
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elsewhere.
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post #8 of 71
Why not branch out? Get your own cupcake truck? Approach all the local coffee kiosks around town and ask them to carry some of your stuff? Expose yourself (heh) more! icon_biggrin.gif
Plank.
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Plank.
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post #9 of 71
Quote:
Originally Posted by kikiandkyle View Post

Does the majority of your business come from walk ins or custom orders?

This is a key question. Depending on the demand and your profitability goals It may be wise to cede the walk-in market and focus on custom orders in a lower overhead environment like a rented kitchen or licensed home bakery (if possible).

Plus all your competitive advantages are focused on cakes, and considering the glut of cupcake shops it may make sense to pursue custom cakes as your flagship product. Another option is a niche (ethnic, gluten-free, food allergies, vegan, etc.).
post #10 of 71
Quote:
Originally Posted by BrandisBaked View Post

Why not branch out? Get your own cupcake truck? Approach all the local coffee kiosks around town and ask them to carry some of your stuff? Expose yourself (heh) more! icon_biggrin.gif

I'm not sure adding yet another cupcake truck to the mix is the right way to go, but pursuing wholesale business for your cakes at coffee shops, restaurants, and upscale grocery stores is a great idea.
post #11 of 71

Do you know what % of your business sales are from

walk-in clienteel = cupcakes and cakes not pre-ordered.

custom order clientele - special order cakes and cupcakes

 

Sometimes we keep on going on the treadmill and don't see where our $ comes from.  I think providing more information on your business would help

post #12 of 71
Thread Starter 

I live in an area where everyone drives but there are pockets of the community that are contained so that you can walk, ie. Near large mall complexes with major retail stores like Macy's and Target ect. The other places are in an upscale communities where there are townhomes, doctors offices and one is near large square that host seasonal festivals. I have a half walk ins and half custom orders. All of our cakes require preorder so possibly being able to offer same day cakes may be a solution for some of the income issues, but them my competition becomes the big box stores such as Walmart , Costco and Sams and I cant compete with their prices  

she has finally found her calling
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she has finally found her calling
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post #13 of 71
Thread Starter 

I have actually considered doing away with the cupcakes that I sell for walk up service and concentrate on custom cakes in this location after the lease is up since the rent is manageable, it will benefit me in the sense that I don't have to maintain employees to prep cupcakes every morning  but looking at my numbers the cupcakes account for 40% of my overall sales revenue ( calculated from this time last year until present day  ) and I have no clear data on product loss ( I know that is bad). I am thoroughly confused, should take on a small loan to hire a good marketing and advertising company to help me make the data I have make sense? I am currently doing almost everything no professional help just family and 3 employees ( one concentrating on maintenance/ janitorial, a prep person mainly for cupcake production and a family member that helps with paying bills email and customer service   

she has finally found her calling
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she has finally found her calling
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post #14 of 71
Thread Starter 

40 % of sales are cupcakes 60 % are custom cakes . I only take preorders for cupcakes because I don't have adequate staffing to take on walk in clientele, although this may give me a professional edge and none of my competitors are able to do it, but with the limited amount of money coming in I don't have the funds to hire more staff. Do you recommend taking out a loan to hire more staff  ?  currently, I don't accept walk in cake orders so  I don't have the data to prove if this strategy is wise.

she has finally found her calling
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she has finally found her calling
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post #15 of 71
Why not take on extra staff in the form of interns and see if they extra manpower helps without risking losing any money?
Plank.
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Plank.
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