As part of the British Gas Business Meets series, businesses are interviewed to find out what makes them successful. We talked to Graham Brooks from London Cakes about how he and his wife grew the family business online.
London Cakes is a family run bakery which opened in 1997. They started selling cakes online in 2005, after using a range of rented spaces and even a transit van. In the last 15 years London Cakes have supplied over 50,000 cakes, with one even making its way into Buckingham Palace.
• How did the business start up?
We’re a family business. My wife used to deliver to coffee shops and until she did so well, we moved into a space in a bakery. Eventually we bought out the bakery! We baked bread and cakes but it’s difficult to make much profit when customers only spend a few pounds each. Moving fully into cakes has been a much better business model for us.
95% of our business is B2C but we are increasingly servicing B2B. Last year, a leading UK retailer spent £25,000 on a cake order for every one of their stores in the UK (We’ll deliver a cake anywhere in the UK as long as it’s ordered before 2pm). They added a QR code so that the retailers’ staff could leave comments online. This was really insightful, but also great for feedback!
• What has been the biggest success for your organisation?
Going online. Creating an accessible website has given us access to a huge new market. The old bakery was out of town and the local council added double yellow lines, which significantly reduced footfall. We launched our website in 2005. In the first 6 months we generated £30,000 in sales. Within 5 years it was just under half a million!
• What has been the biggest challenge you’ve faced?
The world we live in today is so digitally focused. Capturing this aspect and totally shifting our business model from servicing coffee shops to being a digital organisation, was a tough but rewarding challenge.
• What advice would you give to other business?
Don’t ignore a changing market place and trends. We were a standard bakery but we’ve worked hard with our website, mobile and social media. By incorporating these into our business, we have grown and continue to expand our customer base.
• What’s your main use of energy in your business?
We spend just under £10,000 a year on energy. Our highest business energy cost is the ovens which bake the cakes. When we bought the bakery it had 60 year old gas ovens. We switched to electric ovens which are cheaper to run and it’s easier to control the heat.
• Where do you see your business in 12 months?
We want to use our website to make us less concentrated on London. There’s less competition in the rest of the UK, so we can utilise our social presence to expand into different regions. There is also a real opportunity in the B2B space, so we are also looking to move more into this market.
• What would you do to help small business if you were Prime Minister for a day?
A lot of the tax laws are very complicated. Small businesses don’t have large accounting teams and VAT, Climate Change Level and Corporation tax needs to be simplified. Employment law is complicated too.
We have an exclusive British Gas Business 5% offer on our cakes! Just enter BGAS12.
www.londoncakes.com (delivery within the M25 only)
www.cakesnextday.com (delivery via Parcelforce anywhere in UK)