Alright – so today we’ve got the honor of introducing you to Henry Adeleye. We think you’ll enjoy our conversation, we’ve shared it below.
Hi Henry, thanks for joining us today. Let’s jump right into the heart of things. Outsiders often think businesses or industries have much larger profit margins than they actually do – the reason is that outsiders are often unaware of the biggest challenges to profitability in various industries – what’s the biggest challenge to profitability in your industry?
The biggest challenge to profitability in our industry right now is inflation, both in ingredients and labor. The costs of goods have increased substantially in the past year. And the cost of labor has gone up in concert both to adjust for inflation and as the job market opened up post-Covid. The easy answer to this is to just raise prices, but keeping in mind that there is only so much customers are willing to pay for non-essential goods also plays a role and limits how much prices can be raised to achieve that profitability.
Henry, before we move on to more of these sorts of questions, can you take some time to bring our readers up to speed on you and what you do?
We are Henry and Kascha Adeleye. Our journey began when Kascha was experimenting with cupcakes many years back. Henry originally wanted to use his business background as a DJ to help her market her business but the original plan never materialized. Fast forward a few years, after reading the Steve Jobs biography, Henry had a desire to jump into the business world but didn’t really know what to do. He and Kascha revisited the cupcake idea, with a plan to add a coffee shop element as a place for our community to gather. We originally started baking out of our apartment at the time in September of 2014 because we were too broke to afford a storefront. We delivered around the Atlanta area until we were able to piece enough pennies together to open our store in East Point in May of 2016. We quickly found a family of customers and supporters, offering fresh baked goods, coffee and pastries, and an event space to host community, social, and creative events and are hoping to open our second location in Grant Park in Fall of 2022. We are most proud of the opportunities we’ve been able to create for our staff and for helping to spark a sense of community in East Point in a place you wouldn’t expect to find a bakery or coffee shop. Our second location is opening under a program to help aspiring bakers open their own Kupcakerie and we hope to continue to forge paths for people in our community to build something they can call their own.
Can you talk to us about how your funded your business?
So, of course, we started baking out of our apartment so we didn’t really need a whole lot of capital to start. But once it was time to open a storefront that all changed. All together we needed about $26,000 to open up. To help with costs we sought out a place that didn’t need to be completely built out. That’s where a good chunk of your opening budget can get lost. We saved two years in a row of tax returns, put them directly into another account, kept everything we made selling online, and both took out small personal loans to make it happen. We also financed our oven so we didn’t have to come directly out of pocket for it. We actually opened with $0 in our account, and we still owed our contractor $1,200, so -$1,200 in our account. But we were able to pay him back after our grand opening. Moral of the story though is that you never know what your tax return can turn into.
Can you tell us about a time you’ve had to pivot?
As with most businesses, and people for that matter, we had to pivot our business during Covid. We were very unsure of how the world around us was going to change. Literally no one was coming into our store, where most of our revenue comes from. We also weren’t able to host any events in our event space and all of our catering orders had to be cancelled and refunded. However, our online ordering and delivery system was still up and running, both our in-house website and 3rd party UberEats partnership. Our Sysco rep told us about another bakery that was selling cake decorating kits and said we should try to see if it could drum up some business for us. So we came up with a cupcake decorating kit that we still offer today, posted a tutorial video and started taking orders online for people to have it delivered to them. It created enough buzz to reignite the rest of our products online and our delivery service ended up increasing enough to cover our costs through Covid, and we were fortunate enough to not have to close or do any layoffs.
Contact Info:
- Website: kupcakerie.com
- Instagram: instagram.com/kupcakerie
- Facebook: facebook.com/kupcakerie
- Linkedin: https://www.linkedin.com/company/kupcakerie/
- Twitter: twitter.com/kupcakerie