Cakes Plus is a family-owned confectionery bakery in Laurel, Maryland, specialized in selling custom baked products. Along with made-to-order goods, Cakes Plus sells pre-baked cakes, cupcakes, and wedding cakes. The bakery also sells products for cake decorating from prominent US suppliers such as Wilton, Bakery Crafts, CK Products, Ateco, and some others. Additional services provided by Cakes Plus include cake decorating courses and candy making workshops that are held weekly.
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- Alexis Hilley − owner, benefits manager, and finance executive.
- Michael Hilley − co-owner, business manager.
There are currently several custom bakeries and other settings offering confectionery in Laurel. Cakes Plus‘s main rivals are Kake Korner, Genet’s Bakery, and I Heart U. The level of competition in the local confectionery market is high, and some of Cakes Plus‘s current and potential competitors may have greater brand recognition and more loyal customers. They may also adopt more aggressive pricing and invest more resources in marketing and infrastructure development. To sustain in the market, Cakes Plus adds such values as quality, selection, price, customer focus, reliable fulfillment to its products and services. The customer value proposition allows the bakery to attract potential consumers more efficiently.
Cakes Plus was started by owners’ funds and supported by loan purchases. The initial funds were needed to establish production, expand the facility, and the number of personnel. Since the opening in 1991, the bakery underwent a significant period of growth due to a steady inflow of storefront customers and the development of long-term partnerships with firms in the catering, food, and wedding industries associated with many business opportunities. To sustain the current level of net profit margins and increase revenues, Cakes Plus plans to invest in marketing, branding, product, and service diversification.
Cakes Plus was established in 1991 as a small family-owned company. During the past decades, the bakery has increased production and expanded business, which allowed it to relocate operations from a 1.200-square foot store to a 4.000-square foot building. Currently, Cakes Plus‘s personnel consists of 30 expert bakers and talented decorators who work six days a week from 10 a.m. to 8 p.m.
Cakes Plus aims to offer unique and high-end confectionery goods and services to the Washington DC and Baltimore residents by retailing delicious cakes and a wide range of decoration supplies, hosting bakery classes, maintaining a creative and professional approach to work.
Cakes Plus has the vision to become the best bakery known for high-quality treats and unique creative designs that make customers’ celebrations and feasts more special and foster bright experiences and excellent mood.
The US confectionery and bakery market is currently on the rise. The enhanced economic conditions and changes in consumer preferences were largely beneficial for such specialty stores as Cakes Plus. However, these factors also triggered the growth in the market competition. Along with valuing individualized and differentiated high-end products and services, customers are now becoming more interested in the quality of products, healthy food options, convenience, and moderate pricing. For this reason, it is expected that in the near future, specialty stores will face greater competitive pressures from traditional grocery stores, supermarkets, as well as natural food shops offering substitutes to goods provided by specialty stores and bakeries, in particular.
- Clear market position,
- Maintenance of good customer relationships,
- Long-term partnerships,
- Proximity to key markets.
Product presentation and brand image may need some improvements.
Nowadays, diet and health-conscious consumers represent the major group of potential customers for Cakes Plus. Consumers’ growing health awareness has triggered the total revenue growth in the specialty food industry by increasing demand for high-quality goods. The shift in consumers’ preferences provides the opportunity for the bakery to target new consumer groups and increase profits by diversifying the current product range and offering some healthy food options.
The industry performance largely depends on such external economic factors as per capita disposable income, consumer spending, and consumer confidence. In order to mitigate these threats, Cakes Plus should adjust its pricing policies to consumer demands.
Professionalism and expertise constitute the core competency of Cakes Plus. The bakery employs talented and highly professional staff members who ensure the delivery of high-quality products to consumers. Fine quality and excellent taste are also among the major competitive advantages of Cakes Plus. And the last but not the least is customer loyalty. The bakery operates with the existing customer portfolio and always strives to expand it by offering top-notch service to each store visitor.
The target market for custom and wedding cakes stretches across all walks of life. Providing the finest custom cakes and readily available goods for any special occasion to include those of any age, gender, social status, and education. Cakes Plus not only services the Laurel area, but is conveniently situated between the major cities of Baltimore, Maryland, and Washington, DC reaching all those desiring high-quality value.
Customer Psychographics and Behaviors
The market segmentation can be conditionally divided into several sections: foodies, celebrators, and newlyweds. To a large extent, different Cakes Plus‘s consumer groups share similar behaviors and motivations − they value delicious and high-quality goods and are interested in the authenticity of their food. For Cakes Plus‘s customers, purchases and food consumption serve as opportunities to obtain meaningful experiences. Thus, they consider the taste and ingredient content of cakes are as important as their style and appearance. All three consumer groups may purchase either pre-made or custom-made treats for different occasions: anniversaries, college graduation, corporate celebrations, baby showers, weddings, family dinners, and so on.
Product and Service Strategy
Since the demand for confectionery and bakery is highly seasonal, Cakes Plus focuses on diversification of products. When selling seasonal cakes and pies baked for specific Holidays and occasions such as Christmas and Halloween, the bakery offers treats for other occasions that happen out of season (e.g., birthdays, etc.) and daily consumption as well.
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Cake decorating classes and candy making workshops arranged throughout the year allow Cakes Plus to mitigate the risks associated with the extreme seasonality of the pastry business. The company now educates both beginners and more advanced decorators and chocolates. The professionalism of instructors is used as a strategic value.
Custom and wedding bakery requires the best ingredients, individualized service, and significant efforts for the order fulfillment. For this reason, the prices for Cakes Plus‘s cakes are higher than in traditional stores and supermarkets. The prices vary depending on clients’ preferences, size of the cake, the complexity of decoration, and so on. At the same time, pricing for pre-baked items ranges from low to moderate starting out in the upper $3 range. In this way, the overall organizational pricing strategy remains highly competitive.
The bakery’s distribution substantially depends on the advertising and promotion efforts. Currently, Cakes Plus uses the following customer communication channels:
- Official website,
- Information materials distributed in the storefront, e.g., leaflets and posters which illustrate the brand.
- Facebook page.
It is possible to say that Cakes Plus‘s website is designed insufficiently well − it provides minimum necessary information but does not aim to address the psycho-emotional needs of visitors. It means that at the current stage, Cakes Plus‘s marketing activity is not elaborated enough. Thus, the given developmental direction is one of the strategic priorities for the bakery as, in the high level of competition in the confectionery industry, efficient marketing strategies largely contribute to the overall success of enterprises
Promotion and Advertising
Cakes Plus uses the following advertising and promotion methods:
- Advertising on city banners,
- Advertising in print media,
- Social media promotion.
Similarly to Cakes Plus‘s marketing plan, its advertising campaign needs some enhancement. Particular attention should be paid to the visual and informational content of the website − the information should be both comprehensive and well-structured.
|Business and Operation Manager|
|Chief Baking Officer||Store Manager||Education Manager/Administrator|
|Baker||Master Cake Decorator||Customer Service Officer; |
Current Positions: Responsibilities
Operation Manager: product and service development, environmental analysis, resources management, supply chain management, HR management, promotion.
Chief Baking Officer: kitchen management, assortment planning, selection of necessary raw materials and supplies, quality control, the realization of bakery and confectionery products, staff supervision.
Store Manager: optimization of sales and profitability, visual merchandising, staff supervision.
Workshop Administrator: information management, customer communication, consultancy, conflict management, class preparation.
The improvement of advertising and promotion campaigns implies the creation and maintenance of the visual brand representation in various online resources. Thus, the projected positions will include content and customer service manager. His/her major responsibilities will include customer communication, promotion, and popularization of the bakery in the Internet, development, and maintenance of concepts for the website, control over textual and information content, editing and correction of advertising materials, visual decoration of the online space, target market analysis, monitoring of competitors’ work.
One of the potential ways for business expansion is the launching of e-commerce services. The growth of e-commerce is a global trend that increases the risk of a decline in buyer traffic in conventional offline shopping locations. To meet the present-day demands, Cakes Plus should develop a platform that would allow consumers to place orders and make payments at the website and then receive them in a conventional way: delivery or pick up from the counter.
Extra attention should be paid to post-sale service. By establishing mutual communication with customers and considering their feedbacks, Cakes Plus will have a chance to collect information on their preferences. It is easier to stimulate a person’s interest in a product when his or her needs are understood and when an offer is made in a timely manner. The design of appealing and effective online space fostering customer communication is thus important as it will open new business opportunities.
The development and introduction of products aimed to meet the rising demand for healthy products due to the growing number of diet-conscious consumers may become an important step in Cakes Plus‘s product diversification endeavors. The consideration of potential consumers’ needs and preferences can help the bakery develop competitive advantages and enter a new highly profitable market niche.
Evaluation and Control
- Absence of a clear-cut corporate strategy,
- Lack of sufficient competence and knowledge,
- Cost inefficiency.
Effective knowledge management is a premise of high productivity, improved performance, quality of service, and products. It is essential to convey the vision of change to all staff members and, without it, the organizational growth may be impeded. A well-developed strategy and the understanding of organizational goals among employees are essential for effective coordination of internal activities and operations and, thus, it is core to business sustainability.
- Shifts in customer preferences,
- Lack of available resources,
- Shifts in buyer power.
The absence of key inputs in the project realization increases the vulnerability of business. The identified risks may cause a decline in Cakes Plus‘s product demand and affect profitability.
Periphery monitoring (assessment of the area where internal and external factors meet) is one of the essential methods of risk management. When applying this technique, Cakes Plus‘s managers will consider the negative consequences of risks, estimate potential loss, and define where it can lead. Since many risks emerge in a gradual manner, the technique of periphery monitoring may help to avoid critical situations.
When encountering risks, the management will evaluate their severity based on the data accumulated through periphery monitoring, managers will make the decisions about risk refusal or acceptance. For instance, risk limitation may be applied to handle reduced cost efficiency − the company may carry out an audit and develop new partnerships; conduct operation cost analysis against the desired cost limit and industry-accepted expectations and average numbers.