Surviving the Highs and Lows of a Dessert Trend

Gourmet cupcakes now account for two-thirds of sales at Billy Vanilly.
 
It’s been seven years since the height of the cupcake trend, and hundreds, if not thousands, of cupcakeries have fallen by the wayside since the market crumbled. Yet here in Topeka, Kansas, a blue-collar city hit by massive job losses in recent years, a cupcake shop plans to celebrate its 10th anniversary next year and continues to sell plenty of $2 and $3.50 cupcakes to remain profitable while expanding from one to three locations. How did owner Allyson Fiander ever manage?
 
She wonders the same, looking back upon the early thrill of the roller-coaster ride that took her business from 85 percent growth in year three to an unavoidable decline in sales volume that barely kept the shop open. Fiander did not have the luxury of family money or investors. In fact, she worked much of the past decade as the bread winner/single mom of two daughters, Chloe, now a sophomore at the University of Kansas who manages their Lawrence store, and 11-year-old Juliette, an aspiring cake decorator who once explained to her mom that she could work for the bakery under federal labor laws once she turns 12.
 
“This has been a journey of hardship and amazement,” Fiander says today. “Since day one, I have supported my family; I don’t have another job. Owning a cupcake store gave me a stable life with my two girls, and that is what I’m proudest of.”
 
Beyond the emotional side of this story, there is a lesson to be learned for any bakery owner that must navigate the harsh ebbs and flows of running a family business. How does one ride the wave of a huge consumer trend and then stay afloat in the aftermath?
 
For Fiander, she points to several key decisions that proved highly effective in maintaining profitability. First, she decided to build a brand with high internal standards. The French-trained pastry chef had worked 15 years in restaurants and pastries prior to opening her Topeka bakery in 2007. She knows the difference between a good-tasting pastry and a great one. It is essential to create standards for quality of ingredients, production and presentation, and she stuck to them.
 
Once cupcake sales began to dip, Fiander gradually expanded her product line to include cookies, brownies, pies and cakes. Today, cupcakes represent 65 percent of her total sales. She’s also added lunch items such as soups, panini sandwiches and delicious croissants that go perfectly with lattes.
 
“We can sell the cookies, the pies and other items because the customers here really like our brand,” she says of the people of Topeka, which has suffered an estimated loss of 10,000 jobs in three years in a city of 127,000.
 
At Billy Vanilly, customer loyalty won out over price or novelty or any other factor that led to other cupcake shops’ demise.
 
“I want to be the best at what I do, and I figure out how to be more successful every year,” Fiander says. “I wrote a list of what we will never compromise on. Always sell fresh, so baked that day. Always three sizes. Always 15 flavors.”
 

Expanding the Business

 
In 2011, Billy Vanilly opened in Lawrence, a college town 29 miles east of Topeka, and three years later opened in Manhattan, home to Kansas State University and 55 miles west of Topeka. This gave her prime spots in two of the state’s biggest university towns, and Fiander expected sales to blossom. It didn’t. To this day, Topeka remains their highest grossing location.
 
“One of the early decisions we had to make is whether to stay small or grow. I chose to grow,” she says. “When we opened our Lawrence store, this store (in Topeka) started to peak off, and we also started to see cupcake shops pop up everywhere,” the pastry chef/owner recalls. “We did start to see other cupcake stores affect our sales.”

 

 

The Topeka store, she points out, “is our destination location. Our Lawrence store is in a pedestrian district, so a lot comes in as impulse sales. Our Manhattan store is located in much more of a national chain-based center. There is an Olive Garden and Noodles & Co. there.” The 900-square-foot Manhattan store has the smallest footprint but the most efficient kitchen space, and a lot of effort was put into design. There are custom-built displays and special lighting. The details even go down to the angle of the bakery counter, so customers can see the staff opening and closing the oven (promoting the image of freshness), but not the dirty dishes or the garbage can.  
 
One valuable lesson that Fiander leaned is that each store “has to function like I’m not there. Your people have to think like an owner. You can have all the sales you want, but if you don’t have the right ratios, the profits could be all going out the door.”
 
Through it all, Fiander has maintained a steadfast handle over profit and loss by keeping food costs under 25 percent, labor at 30 percent and profit at 15 percent. “We usually exceed that, but if we can hit those numbers, we can survive. We have a sustainable bakery business, regardless of the trends.”
 
“If I could be in the kitchen all the time, I would be in heaven,” she adds. “I’m a number’s person because I have to be.”
 

Wholesale Accounts

 
Expanding her business also required Fiander to become an effective trainer and team builder. She learned to relinquish some control in the kitchen as she trained others in the specific details involved in creating a perfect cupcake, time after time. It takes processes, and you have to write them down.
 
“We believe in cultivating talent and educating people who want to be a baker,” she says. “You get a culinary education here.”
 
Another lesson is that “taste is the best advertising,” and as Fiander learned to get around a new city (she grew up in the restaurant industry in California, studied pastry in France and operated a Kansas City bakery café prior to moving to Topeka), she recognized the enormous value of community involvement.  
 
“If you are selling one cupcake at a time, it’s tough to build sales,” she says. “A lot of what we do now is volume cupcake orders – 200 at a time.” 
 
Whenever Billy Vanilly baked too many cupcakes, they would hit the streets and visit “people who we want to be our customers.” That meant local businesses, government offices, production plants, and anybody who might love a cupcake. The store is involved in an annual fundraiser for the Topeka Zoo. The dedication paid off, and Fiander now requires each store to do a certain amount of outside community involvement.

 

 
Wedding cakes became another growth category, as Fiander built a following around northeast Kansas for her traditional wedding cakes, and nontraditional cupcake weddings and cake pop weddings, grabbing her two daughters to drive miles and miles on weekends to handle nearby wedding events. “My kids have an example of the benefits of hard work and dedication.”
 
Looking back on the past nine years, the bakery owner marvels at “how successful and how hard it’s all been. I think it’s the hard part that makes you better at the good part. You just get better and better. The cupcake trend has survived, and now it’s an established category. The ones who make it are the ones who are committed to having a strong concept and building a brand.”