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Competition...A little too close...  

post #1 of 121
Thread Starter 
Ok...I really try not to be a petty person but something has really gotten me upset...

My shop is located next to a coffee shop. I was here first but they moved in about 3 months after me and I really thought it was going to be a great thing because they are an established business with lots of foot traffic so having them next door to bring over my people to my side of the street should be a good thing.

In the beginning I was selling 7-8 flavors of coffee but scaled it down to either Regular or Decaf once they moved in next door because it didn't seem reasonable to try to compete with a coffee house and really, that wasn't what I was trying to do anyway. I don't even sell coffee every day so obviously I'm not affecting their business!

This coffee shop has a breakfast, lunch & dinner menu - they like to call themselves a cafe more than a coffee shop because they have a pretty big sandwich & soup menu with salads and all that. They've always had a few brownies, bagels & cinnamon rolls for sale - nothing big, and it's from Sysco anyway so not homemade and certainly not my competition. least I thought not!

I signed up weeks ago to receive their daily specials e-mails and today they sent out an e-mail advertising that they are now selling CAKE! It's not my cake either...I can't believe this. It's insulting, to say the least. They are advertising homemade Carrot Cake & Red Velvet Cupcake specifically which are 2 of my biggest sellers and I believe they know this! Red Velvet is HUGE in this area and people come to me specifically to get these things and for her to now start selling these has really upset me. I realize that this economy is tough and people have to try to make money but this crosses a line to me.

Now, because of this I have decided that I am going to start selling Pizza Slices & Whole Pizzas as well as Soups (which are big for her) for lunch beginning in the Spring. People have often asked me if I was going to go this route and I'd decided that I wouldn't do that since the Coffee Shop was selling food but if I'm not going to be afforded the same consideration then it's time for me to be ruthless too!

Am I wrong for feeling this way now?

post #2 of 121
Meh . . .understandable.

However, I think you're looking at it wrong.

Should you have stopped selling flavors of coffees? Depends on what your customers told you. Depends on your biz plan. Depends ON WHAT YOU NEED TO DO FOR YOUR BIZ. If the coffees weren't selling, then yes, discontinue them. Maybe introduce gourmet teas. Making a decision to limit a product line to be "nice " to another biz is . . .well . . .nuts.

Should you start selling soups? Depends on what your customers tell you. Depends on your biz plan. Depends ON WHAT YOU NEED TO DO FOR YOUR BIZ. If your customers have asked you to offer more lunch options and you want to be a cafe more than a bakery, and it's GOOD FOR YOUR BIZ, then yes by all means do it. If if makes money for you, yes, do it.

There is no reason to base your decisions on your biz on anything but the best interests of your biz. After all that's why you're in biz. To make a profit. And you certainly should not limit your biz to help someone else's biz.

I'm an MBA. Waiting to get flogged.
Answers to the most often asked questions re: SPS. SPS instructions are on Page 15 of the Sticky at the top of the Cake Decorating Forum. Supplies can be ordered from Oasis Supply, Global or BakeryCrafts.
Answers to the most often asked questions re: SPS. SPS instructions are on Page 15 of the Sticky at the top of the Cake Decorating Forum. Supplies can be ordered from Oasis Supply, Global or BakeryCrafts.
post #3 of 121
Do you have the manpower to pick up this new venture?

How about offering a free cup of coffee with purchase of a baked good? Or more specifically with the purchase of a slice of red velvet or carrot cake. icon_evil.gif
post #4 of 121
Shoot. I'm sorry for this! I would suggest looking into a new spot, but that costs far more than you could lose, I am sure.

I have no idea what you should do, but here is a bump, and wishes for luck.
post #5 of 121
Well that just sucks! All I can say is that in biz the trick is to find what other ppl are NOT doing and do it!
I believe that every person is born with talent.
~ Maya Angelou
I believe that every person is born with talent.
~ Maya Angelou
post #6 of 121
I think there is an obvious solution. Communicate! Go over there and talk to the other owner and ask her what is up? Not rudely, but out of confusion.
post #7 of 121
I do understand how you feel, I had a similar incident with the local coffee shop that opened up right across the street. The owner is my son's best friend's grandmother. So when she opened I brought her brochures and coupons over to our restaurant/bakery to give to our clients. She solely did coffee, teas, hot chocolate, bagels, muffins, and sold ice cream. Nothing we offered at all.

She complained to me that she hated having to buy her baked goods from sam's so I offered to do cinnamon rolls, muffins and assorted danishes for her and asked her if I could place my cake brochures and our restaurant to go menus in her shop, she said yes. Well things got crazy and a couple of weeks passed before I was able to get the brochures and menus over to her, and I brought her samples of my baked goods for her to try.

I walked in and her bakery case was full of pastries, but I didn't think much of it. Her menu board changed to now offer lunch (sandwiches & soups nothing major but still things we offered across the street) So I give her the samples and the brochures and she gives them back to me saying that a friend of hers who does cakes and baked goods is now working for her and is going to do her cakes out of her coffee shop. I was crushed!

I later found that she really didn't know this woman, that the woman approached her (knowing full well I was across the street) with a barter deal to use her commercial kitchen, "I'll work for free for you if you let me sell my cakes and baked goods from here." deal. The coffee shop owner laughed it off saying "you know when I think of you Angie all I think of is hamburgers" AARRRGGGHHH! Our restaurant was called the Hawk Hamburger Hut & Eatery (Hawks were/are the mascot of the new high school down the road). She knew my cake biz was there too. I had a HUGE sign with picture of a wedding cake and my biz name right across the front of my building!

The Coffee shop still sells lunch and now dinner (since we closed the restaurant) but the cake sales are virtually non-existant. I had a customer who called me last week for a b-day cake tell me they went in there to order a cake and the people working said all they could do was take her number and have the cake lady call her that they didn't personally take the orders and they didn't have anything they could show her of the woman's work. I really thought that was odd, but that is what the lady told me.
post #8 of 121
I agree whole heartedly with Leahs on this one. It is one thing to pull the coffees if they are not selling. They're probably thinking, "hey, she's selling tons of these cupcakes, lets get our piece of the pie!". Do what's best for your business whether it's a coffee shop or toilet store next to you. I'm sure you'll beat them in taste and it will just boost your sales in the end. icon_smile.gif
post #9 of 121
Thread Starter 
Thanks for responding everyone...I can see how I made it sound like I only scaled back the coffees out of consideration. The truth is I felt that because they were a coffee shop already established that trying to compete with them wasn't the best business move, especially when I am focused on being a Custom Cake shop - not a cafe. It was a financial move as well since I was losing money on the coffee part....

I'm just so frustrated because we are friendly with each other. Helping each other out if needed in different ways and for this to happen just makes me feel like I was duped...

Sticky Buns are a big item here in PA and she has been trying to make them forever but her sticky bun smear would get rock hard when she made them so she was buying them. Well, she did a little snooping through questions (and no, I didn't pick up on it at first) and has now found a way to sell them and she is underselling me. I think what I might be most upset with is quite possibly my naivete in this situation. I really didn't consider her my competition so she has been the furthest thing from my mind, until now that is.

I am pretty friendly with the owner of the building so I forwarded her this e-mail I received and she responded pretty quickly back that she has been hearing things and that as soon as she gets back into town we should get together and talk. Of course my mind is now racing wondering what she's heard so I'm anxious to have that conversation...Anyway...Thanks again for everyone responding....

post #10 of 121
I would check your lease. When I owned a salon, I was able to get it in the lease that no other business could be in the strip mall doing the same thing. So we only did hair, nails and massage. Which we stated what we were doing on the lease agreement. Someone else was more than welcome to put in a facial place. And my landlord was very good about those things, he was a really great landlord.

So I guess what I'm saying is talk to your management company and check your lease agreement. And if you do have that stipulation(sp) in your agreement let your management company handle it.
Oh, Bother!
Oh, Bother!
post #11 of 121
I agree with Leahs, just do what you do best and only make changes to your business that benifit the business.
hope every thing works out.
post #12 of 121
I couldn't agree with Leah more! Also, I ABSOLUTELY wouldn't go over and talk to them. Why? Did they talk to you about their business? Their business is theirs and yours is yours. I think the suggesstion to see if you have a non-competition clause in your lease is a good thing to look into as well. However, don't become selling things that you aren't interested in and your customers aren't interested in just to anger your coffee neighbor. Good luck in your business!!
post #13 of 121
cocorum21 has a good idea. I don't have a stipulation like that in my lease, but the leasiing company/landlord made it clear they did NOT want another restaurant in this strip mall. Since I'm not a restaurant, it's ok. The landlord(s) want their tenant to be successful. Successful tenants stay and pay rent. Unsuccessful tenants close up shop and move on ... bad for landlords! Moving in a bunch of tenants who all sell the same thing is bad for everyone .... landlords have a vested interest in keeping a good business mix as tenants.
post #14 of 121
Don't take it personally. A cupcake bakery just opened 4 blocks away from us. They are underselling us by $.75 a cupcake, and you know what...they are deserted and we are more crowded than ever. They copied my valentine's day specials menu almost word for word. They copied my advertising plan. They even hired one of my former employees, one I fired.

There was a quote in the paper that their owner though there was a real need, since Chapel Hill didn't have a cupcake bakery ( We sold 53,000 cupcakes last year.)

Competetion will come and go. Luckily I have a landlord who loves us and they own the block. They actually contact us when one of their spaces is available and let us know who's looking at it.

I always look at it this way. I don't really have any competition. Nobody can do what we do or has a shop as beautiful as mine within 50 miles. There is room for a Neiman Marcus and a JC Penny's in every town. I just get to be Neiman Marcus.
Scratch bakers of the world UNITE !!
Inrideo ergo sum ~ I snark therefore I am.
Cake or Death?......Cake Please!
Scratch bakers of the world UNITE !!
Inrideo ergo sum ~ I snark therefore I am.
Cake or Death?......Cake Please!
post #15 of 121
Business is business. Like Leah said, you do what you need to do and so will they. It's not a personal attack. Live and learn: next time get an exclusivity clause in the lease. Its pretty common. Sorry this happened tho, it can be tough to work around a situation like that. Just make sure your product is better than theirs. Doesn't have to be cheaper either.
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