Cake Talk

Business 101: Worthless Checks

I never thought I'd have to do this.

I sent out four statutory notices for worthless checks today.

Over the past six years, we've had only ten checks returned from the bank unpaid; five of them in the past twelve months.

Bad checks are a form of retail theft and can be prosecuted by the local District Attorney, but I've never taken it that far. Until today.

My standard procedure is to call the customer and tell them their check was returned by the bank. When I actually get someone on the phone they are usually mortified and come in right away to "make good" on the check. Lately, however, I've been collecting NSF checks in my drawer. And pondering the Worthless Check Unit brochure from the local District Attorney's office that I've had in my desk for over a year. I don't even remember where I got it.

What did I learn?

1. Anyone who receives a worthless check in Tuscaloosa County while transacting business can file a complaint.
2. There is no charge to the victim to file a complaint.
3. You CANNOT file a complaint if you have accepted a post-dated check or you have accepted partial payment for the check.
4. The complaint must be filed within one year of the date of the check.
5. If the returned check was stamped "Insufficient Funds" or "NSF" you must send a statutory notice to the person who signed the check via certified mail.
6. If the check was returned stamped "Closed Account" you are not required to send a statutory notice.
7. The exact wording for the statutory notice is printed on the brochure.
8. If the check writer does not make restitution within ten days of the date of the statutory notice, you may file a complaint.
9. After that, you wait. The DA's office will issue a warrant and attempt to collect. If an individual ignores attempts by their office to contact him or her and/or fails to make a restitution payment on time, the warrant issued in that individual’s name will be activated, and they may be arrested.

TodayI took out the brochure out and started typing.

No more Mrs. Nice Guy; the checks totaled over $400.

 

Business 101: Tit For Tat

Tit for tat.
Butter for fat.
If you kick my dog,
I'll kick your cat.

Most people only know the first line.

The rest of the phrase I learned from my grandmother.

The original phrase was Tip for Tap, a very old expression that evolved into tit for tat in the mid-16th century. Tip meant a hit or a shove. Tap was a retaliatory hit. The meaning is a punishment meted out to pay back an offense, measured to be equal and proportionate.

A word of advice to would-be bakery owners regarding tit for tat: Resist.

Resist the temptation to answer hurtful comments some people feel compelled to utter. You may feel better for a short bit, but their hunger for the last word will never be satiated. You say something. They reply. You reply to their reply. It never ends when you both have to have the last word.

Resist the urge to correct falsehoods people may tell about you to their friends and family. They don't really care, won't believe you, and will never take your side. So don't bother. Let them have the last word. They'll eventually get bored and move on to a more interesting target. 

Resist the anger and the hurt. But also resist the inclination to buy into the offense or take it personally. The customer is NOT always right, but it doesn't really matter and you have absolutely nothing to gain by pointing that out.

Distract yourself by doing something nice for yourself or the bakery.

Visit your shrink, if you have one. 

Or do what I do.

Write a blog post.

Bootleg Bakers

boot-leg: To make, sell, or transport (alcoholic liquor) for sale illegally. To produce, distribute, or sell illegally or without permission.

Mary's Cakes and Pastries is a licensed food service establishment. In exchange for permission to legally sell our products to the public, we abide by state and local laws, pay a variety of license and permitting fees, collect taxes, and incur a plethora of other costs. If you look on the wall by the front door, you'll see our permits and licenses as well as the latest inspection report from the Alabama Department of Public Health.

To the best of my knowledge there are al least eight other licensed bakeries in Tuscaloosa County (not counting in-store bakeries).

But I'm sure EVERYONE knows SOMEONE who makes and sells cakes or cookies out of their home. Home bakers. I know several.

The Dreaded "P" Word

I read a review recently where someone considered us "overpriced."

Pricing is something many bakers struggle with every day. We love what we do and want our products to be affordable so everyone can enjoy them. But then we also need to cover costs and make a living.

So here's where the money goes. For every dollar that comes into the bakery...

9% is actually state, county and city sales tax. I collect it from the customer, pay any and all fees associated with collecting that money (such as credit card processing) then remit the entire amount to the proper agency.

25% covers food and packaging. Things you'd expect like flour and sugar and butter and eggs. Plus bakery boxes and cellophane bags. And bakery string and labels. All of the items needed to transform raw ingredients into baked products and get them to your home safely. This includes some things you might overlook like gloves and plastic wrap, tape, cups and lids, parchment paper and garbage bags. Plus all of the cool decorating items that make our products special such as sprinkles and gel colors and edible glitter and chocolate and gum paste and fondant.

36% -- and my biggest single expense -- is labor (not mine). Payroll plus the employer contributions to social security. Plus worker's compensation insurance. These are the people who help bake and decorate your cakes and cookies, help me open and close the shop, without whom I could not attempt to run my business -- clearly money well spent.

9% goes to rent, utilities and phone.

2% goes to advertising. Very thankful here that Facebook is free and the cost of maintaining the website is minimal.

7% goes to miscellaneous overhead. Things like banking fees, permits and business licenses, equipment repair, our monthly pest control service, supplies and smallwares.

Which leaves 12% for me as the business owner. I made more money when I had a "real" job in industry, and benefits too, but running the bakery is much more satisfying in ways that money can't buy.

We make almost everything in the bakery from scratch, so my food costs are higher than a grocery store bakery's might be, and so are my labor costs. Also included are the food and labor costs associated with making food we give away, to children who come into the shop, and as donations through gift cards for charitable events. Plus the cost of making items we don't sell and have to throw away, breakage, waste, you-name-it.

I never expected to make a fortune running a small bakery, but you could not pay me enough money do do anything else.

And if you'd rather buy your baked goods from a grocery store or home-based baker because they are cheaper, I understand.

Days Like This...

I should have known when the phone rang at 7am.

"It's 79 degrees in the shop" Sarah reported. A quick thinker, she turned off the A/C (that was blowing hot air) and turned on the (back-up) wall A/C. I told her to open the door and quickly looked through my contacts for the phone number of our repairman.

Then I logged on to the bank account and saw that a check deposited the week before had been returned, and our account had been charged a fee.

I need coffee.

We just about made it to lunch without further incident.

Then the cash register computer failed. ON A FRIDAY AFTERNOON! I called the computer guy who was too busy to come himself, but sent someone out to fetch it. Aparently it had a major virus. We'd be lucky to have it back by the end of the day.

Pulled out the calculator, paper credit card slips, and "knuckle buster" (manual imprinter). 37 transactions were processed by hand. Thanks Maury!! Her basic math skills got a workout.

Then the battery on the scale stopped working and had to be replaced. Somehow I managed to break a wire while doing that. Thanks Brandon for re-wiring the scale.

Then the power in the building went out for a few minutes. We were grateful the computer was out of the shop, so the sudden surge when the electric went back on had no effect on it.

But the internet connection had to be reset.

And we didn't notice until the end of the day why the phones were quiet all afternoon. Aparently the phones also needed resetting.

Thankfully all ended well.

The A/C got fixed for less than $200. We got the computer back for Saturday for under $100 and I was able to process the credit card transactions before going home. The phones and internet are also working.

So if you tried to call us yesterday afternoon, you know why we didn't answer the phone.

Oh, the joys of owning a business.

 

Breaking (In) Dawn

We have a new supplier at the bakery.

Dawn Food Products.

They're bakery specialists and I am thrilled!

At last. Folks who understand the subtle differences in flours and sugars. They have margarine in five-pound blocks. More shortenings than I even knew existed. Powdered egg whites, meringue AND royal icing. Glazes, flavorings and emulsions. Small fancy pecans. Raw unsalted macadamia nuts. Raw pistachios. Gel colors for decorating. Rolls of plastic wrap 24-inches wide.

I placed my first order yesterday, to be delivered tomorrow.

And they sent me a confirmation! An emailed list of the items I ordered, with extended prices and a total.

This may seem like a normal thing to some of you. But over the past six years, I have NEVER, EVER gotten a confirmation of my order prior to delivery. Written or otherwise.

Such a simple thing. It reduces the chances of getting things I don't want or didn't order. The three M's:

• Misunderstandings (can liners instead of pan liners).
• Miscommunications (one box instead of one case of twelve boxes).
• Mistakes (wrong brand).

Assuming no Mispicks (ordered flour, but sugar was put on the truck), I actually know how many bags and boxes I need to make room for.

I think I'm gonna like this.

 

 

Don't Call Me Darling

Maybe it's a northern thing.

Maybe it's a city girl thing.

Maybe it's a child of the 60's thing.

But I absolutely HATE it when someone I don't know calls me darling. Especially when that person is a salesman.

It's very patronizing. And to me, it means you don't care enough about me or my business to use my name.

But that's just my opinion, so I looked it up.

According to the urban dictionary, a darling is a term of endearment for a great friend, or soon-to-be romantic partner.

Sorry, but I am none of these. I am your CUSTOMER. We have a BUSINESS relationship.

I'm much more tolerant in my personal relationships. After all, this is the South. I get called "honey," "sweetie" and "darling" all the time and just let it slide.

But professional relationships are different. I expect respect and have a low tolerance for ignorance. Surely you wouldn't walk into a classroom as a student and call the teacher or professor "darling."

And while we are on the subject of professional relationships, I have other expectations.

If you are a salesperson, I expect you to know your products. If I ask for a grease resistant package, I expect one. If I ask for Swiss cheese, I expect the cheese with holes, not individually wrapped "Process Swiss-American Cheese."

I also expect a basic understanding of my business. Walk into my shop and look around. Do you see ready made pastries? Frozen cinnamon rolls? Twinkies?

Notice the "Back To Scratch" signage? OK, so don't offer me ready-made pastries or frozen bagels and cinnamon rolls.

 In other words, THINK. Make me believe you have paid some attention to my business.

And, if you want me to buy stuff from you, you'll call me Mary or Miss Mary.

 

 

 

 

Business 101: Rule #1

You open a bakery because you love to bake, right?

Wrong. You open a bakery because you want to make a living baking. Which means you have to actually sell the things you bake.

If you just want to bake, bake at home for your friends and family. You won't need a business license, permits, insurance, a telephone, internet or sales and marketing plan. You know, all that stuff that costs money and takes up time that you would rather spend baking.

Case in point:

One of our customers has a daughter in college in another state. She was participating in (Sorority) Rush last month. I'm pretty sure the official name is "Formal Recruitment."

She wanted to send a big box of cookies to the Sorority her daughter hoped to pledge. She would have called us and mailed the cookies, but we were closed for winter break.

So instead she went searching the Internet for a bakery in the college town.

She found one whose website reminded her of us, so she called to see if they could make some custom cookies to be delivered the next day. The bakery told her they were small and needed more time for a custom order.

We would have said the same thing, so I just listened and nodded.

So she continued searching for other bakeries but found none that could help her. She called the first bakery back. Did they have any cookies on hand that they could just box up and deliver with a card? The bakery asked how many cookies she wanted to buy, and she said five dozen.

"Oh my gosh, that would clean us out" was the reply.

To which our customer responded "and your point is?"

I had to laugh as I assured her that I would have GLADLY sold her our last five dozen cookies.

Rule #1:

You bake cookies to sell, to make money, to pay your bills and yourself, so you can bake more cookies. Or, you bake cookies once. Keep them in the case forever. Until they go bad and you go out of business. Which should take about a month.

Doing the Math.

I received an email from a national chain of bridal shops. They want me to pay them to *feature* our bakery in their Birmingham store. We'd be the preferred baker for that location, which would entitle us to:

1. In person, in-store promotion to their brides. We could come (to Birmingham) as frequently as we like and set up a table. We can even bring samples (because you KNOW the newly engaged want to eat cake while trying on dresses). 


2. A bi-weekly lead sheet containing key contact information for their bridal customers to include their name, address, telephone, email, wedding date, etc.


3. Have our marketing materials made available to their Bridal customers. Our information would be on the vendor display, in the registration bags that are given out to the brides as well as on a professional menu sign at the checkout.  They will even create a professional shutterfly album of pictures of our cakes to have on display at all times.

There you go. Only $150 per month and we'd be their exclusive local baker in Birmingham.

But wait, before we even do the math... We're not in BIRMINGHAM. We're 50 miles away in Northport (and they HAVE a local store in Tuscaloosa, but they are not offering that location).

That little issue aside, let me walk you through my thinking.

1. My advertising budget is 2-5% of sales, which means the $150 investment would have to yield AT LEAST $3,000 in additional monthly wedding cake revenue.
2. That could be one or two large cakes, or several smaller ones. While the average wedding gown costs $1,075, according to Condé Nast Bridal Media, the average dress at this chain retails at $550. Some sell for just $99. So I'm thinking we won't be booking many $2000 cakes.
3. We'd likely need to book 4-8 weddings EACH MONTH.
4. That's 1-2 MORE weddings EVERY week.
5. Or DOUBLING the number of weddings we currently do.
6. We already have a big mixer, but we'd need another oven, two or three more FULL TIME cake decorators, another delivery vehicle, a walk-in fridge or freezer, and more space.

And we'd be like Publix or Wal-Mart, with very little personalization. Which is exactly what we are NOT. I love meeting with brides; sitting down and talking about what they want for their big day.

So do my decorators.

I'm the Mary behind Mary's Cakes and I oversee each and every wedding cake as it is baked, decorated and delivered. Afterall, it's MY name on the door.

So I'm thinking no.

5 Facebook Tips for Bakeries

I spend a fair amount of time looking at photos of baked goods on Facebook, baking blogs, and websites. Hey, I bake for a living, and am always interested in what others are doing.

Do you own a bakery or bake for others? Want (or have) a Facebook presence? There are some really good pages, blogs and websites out there. But... there are also many that make me cringe. Here are five simple Facebook tips to help you market AND SELL your products. Assuming, of course, that your goal is to sell what you make...

1. Be a page and not a person. Please don't make me have to "friend" you. I may like your products but I don't know you well enough to share my personal posts with you.
2. Put your city and state (or country) in the "Info" section of your page. And if you have a physical address, by all means post it. And your shop hours. And your phone number. There is nothing more annoying or frustrating that finding you, liking you, liking your product, and then not being able to contact you to place an order. Or, sending an email only to find you're hundreds (or more...) miles away.
3. Respond to comments in a timely manner. Like by the next day, especially if there is no other way to contact you. Either you're gonna take this seriously or not. Please don't lure me in with a Facebook Page and then ignore me. I'll wonder if you're for real or went out of business. And I'll certainly wonder if you'll really make what I order.
4. Post decent photos. And post only one of each item. You don't need an expensive camera, or professional skills. But import that photo into Photoshop or iPhoto, or some other editing program, crop the photo and fix the color and exposure. That yellow tint is not very appetizing. I also don't need to see three photos of the same cake, cupcake or cookie, just because you could not decide which one you liked best. Then show the photo to someone other than your mother, husband, wife, boyfriend or girllfriend. Ask them for an HONEST opinion of whether it's worth bragging about and take their advice. And PLEASE, post your own photos, not photos of someone else's products.
5. Engage your fans. Show us nice pictures or have a contest. Post a link. Something... a couple of times a week so we remember why we liked you in the first place.

One more thing... ASK before you tag someone in a photo and don't tag yourself in a photo that does not feature you. There is a SHARE button below the photo, use it.

And good luck! I really mean that from my heart.