Have Your Cake And Sell It Too
Proof that you can have your cake and sell it too, is the Crabapple Cupcake Bakery.
The Melbourne based business sells about 10,000 cupcakes per week, with 40% sold through the Crabapple’s three Melbourne stores.Â
Founder Jennifer Graham didn’t have plans to be so large when she started the business in 2001, she was simply looking to sell some cake-stands at a local market and made some cupcakes to place on them.
Needless to say, the cupcakes sold well, although no mention of how the cake-stands went.
Graham was astute enough to realise that there was a market for high quality cupcakes, with customers happy to pay a premium price to get the hand decorated cakes.
Attention was placed on high quality ingredients, but the biggest attraction is the frosting and the signature Crabapple swirl.
She points to the use of top-notch ingredients as crucial, but also to the attention paid to the look and design of the product, especially the precise application of the frosting.
An appearance on a television show helped demand grow to the point that the business moved out of the home-based category and into its own factory. Cookbooks have followed, along with expansion into weddings and corporate functions.
Crabapple has also entered into partnerships with some coffee shop chains, but wisely stipulated that their brand remain on all the products.
With a high quality product such as this, comes a high end price, with Crabapple cupcakes selling for $3.50 - $4.50 each. At this price, margins are still tight, which would be a factor of the ingredients and the hand frosting.
With the products niche being freshness and quality, growth is stifled due to the cupcakes not traveling well. Graham admits the only real way to expand into other states is to build more factories to serve interstate markets, something they are not in a position to do at this stage.
In the meantime, they will continue to do the local markets and stay in touch with their customers.
Â
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
Comments
Sadly, tis true… the Crabapple Cupcake Bakery went into liquidation the day you wrote/published this article. The business has been sold through liquidators Pitcher Partners, but no word yet on who the purchasers are.
I met with Jennifer in March this year and booked Crabapple to supply my wedding cake. Purely by accident I found out 2 weeks ago that they have gone into receivership. Taking my $100 deposit and leaving me without a cake (my wedding is in 2 weeks time). I am disappointed that I did not receive a courtesy letter pointing out that I needed to find a new wedding cake supplier. As for the deposit, I imagine I will never see that again! Fortunately I have found a lovely lady in Croydon - Juli from Just Cupcakes and she has gone out of her way to help me out. And her cupcakes are even better!!
Thanks for the info, looks like my timing may have been a little off.
In researching the company, I did find some of their practices strange, such as the fact that they continued to sell at markets.
The business model did not lend itself to expansion and would appear far too labour intensive for the volume of market they were trying to capture and service. Maybe the new owner will be able to invest in some processes to increase production and shelf life without greatly diminishing quality.
Jo-Anne, good to hear you have a replacement cake for your wedding.
I am upset and angry to find out that Crabapple (mum call’s them Crapapple) have gone into receivership.
I also booked them for my Wedding cake. I am upset that we received no letter advising what is happening…and am now angry to find out that they are now reopening under the name of Crabapple cupcakes and supplies and have still not received any communication telling us that we are not getting our deposit back….or at least they could offer to make our cakes under then “new” company name. Jennifer spare 50c and send you customers a letter advising us whats happening…dont leave us in the lurch….
Shes a selfish cow & couldn’t care less about any one shes ripped off on the way down.She swore to her staff that all brides & upcoming orders had been notified re. their orders & only as things have unfolded have they found out otherewise.She paid no taxes & owed $200,000 to the tax office not to mention all her Staff in excess of $100,000 plus creditors its just a joke & not a good one!!Yes its been bought by her “close” friend & shes running it again with not so much of a minutes thought for anyone shes ripped off.She doesn’t deserve a business(although technically on paper its not now hers!!)& i would hope anyone reading this can support all those shes ripped off & not buy from her again.
We too have been let down by this woman & her company. My sister & I booked us & our mother in for the $90 per person cupcake course for my Mum’s birthday & surprised her the day before with what we had planned. Three hours prior to us leaving to travel to the course, this woman phoned stating that the floors were being sanded & therefore the course was cancelled for the day! Hardly an apology was given & she even tried to book us in for another course further down the track. Despite attempts to contact her & get our money back, it has all gone nowhere. Attempts will continue…
Nice writing style. Looking forward to reading more from you.
Chris Moran