So with me in this reflective mood I thought I would share some business advice I received. In the very very early stages of my business (Kake days) I sought out business advice from Sir Alan Sugar.
At the time Sir Alan had a business column in the Daily Mirror and the paper was looking for readers to Send in business themed questions for Sir Alan.
The apprentice tv show was in to its Second season and I thought to myself wouldn’t it be fab to get some advice from Sir Alan really “how scary can he be” ? so I took an opportunity to contact him via the newspaper column regarding some business advice for getting my rum cake into retail.
On reflection at this current time it’s not something I would even entertain but at the time I was green around the gills so I sent him an email and didn’t think anything more of it, I certainly didnt expect him to reply but he did and they used my question as a feature.
The original email question and reply from Sir Alan is below and I must say he gave some very good advice of which I did Infact follow.
- I did supply a coffee shop, two Infact but now I’m concentrating on selling to the end user.
- I worked on pricing as suggested (which we as cakers struggle with) but I’m glad I took the time to get to grips with it.
- I researched and understood the problem of scaling up so didn’t pursue the retail side of supplying a retail store.
- I didn’t undercut competitors but aimed to be of similar pricing for my market and area and competed on quality and value rather than aiming to being the “cheap cake lady” I wanted customers to come to me out of choice and not cheap prices.
The advice given really set a benchmark with me and was the mainstay of how i pursued my business.
So please have a read and thanks Sir Alan for the business advice. The business is turning a profit and doing just fine.
Ps, my web page mentioned below no longer exists it’s now http://www.kakeandcupkakery.co.uk
Dear Sir Alan,
LAST year I decided to turn my hobby of bespoke cakes for all occasions into a small part-time business, which has proved to be quite successful. I have received orders for cakes from friends and colleagues and have received quite a few recommendations.
I have a web page – http://www.letthemeatkake.co.uk
I’d now like to sell my cakes, in particular a Caribbean-style rum cake, in a department store and I’d like to aim for the Christmas market. Could you give me advice on the best way to approach the stores
Yvonne Donald by email
Sir Alan says,
“I get lots of letters from people who want to turn their hobby into a business. In your case, it’s not an impossible dream.
But realistically I am sure every reader has a friend or someone in their family who is good at baking cakes and does, from time to time, bake you the odd cake for a party or a special occasion.
It is not uncommon and it is also not uncommon for your friends and family to be highly complimentary. As I have said many times in this column, don’t expect a frank and honest opinion from family and friends – they will always tell you what you want to hear.
The only suggestion I have for you is to try to sell your cakes in your local delicatessens or privately-owned cafes, restaurants, coffee shops etc. These people have to buy cakes from wholesalers – they may as well buy them from you.
However, there is a tremendous problem setting up the mass production of cakes and it’s not something you can do from a normal kitchen.
You can appreciate that if you received an order for, say, 100 cakes to be delivered in two or three days, you would not be able to handle it without an industrial kitchen.
Try my first idea, step by step. And make sure you get your calculations right.
First ,work out the cost of the materials to you, the cost of gas or electricity that is being used, your time, effort and labour and any packaging materials.
Once you have calculated that, be sure to add a whopping profit on top.
The margins on food are tremendously high, so don’t be afraid to charge.
Compare the cost of other cakes in the shop and try to undercut them to get yourself started”