Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. So cakes, cupcakes, cookies, bars,
Speaker 1: pots and putting. Susie Cakes is celebrating its sweet sixteen
Speaker 1: and if you're from California, or perhaps you've been to
Speaker 1: Texas or California recently, you might have seen as Susie
Speaker 1: Cakes in the flesh Well. Susie Sarah Susan Sarach is
Speaker 1: the founder and CEO of Susie Cake. She joined us
Speaker 1: on the phone from Los Angeles. Susan, how are you.
Speaker 1: I'm great, Thank you for having me on today. Well,
Speaker 1: it's good to have you with us. Can you take
Speaker 1: us Yeah, that's true, take us into the origin story here,
Speaker 1: because you've got a pretty great beginning, taking the ingredients
Speaker 1: of taking the recipes from your grandmother's and building a
Speaker 1: really what's become an empire. Thank you for mad Yes.
Speaker 1: I grew up in Chicago and both of my grandmother's
Speaker 1: mildren and Madeline lived across the alleys from each other.
Speaker 1: So while I was growing up, we always had some
Speaker 1: great desserts around the house. And fast forward, I went
Speaker 1: to um Hospitality School for college and then worked in
Speaker 1: the hospitality industry about fifteen years. While I was in
Speaker 1: food and beverage and hotels and restaurants, I noticed a
Speaker 1: lot of women leaving the business because it was difficult
Speaker 1: to um have a family or have a life outside
Speaker 1: of work working seven. So I grew up a business
Speaker 1: model predicated on women. Have women having careers in hospitality
Speaker 1: without having to sacrifice other areas of their life. Combine
Speaker 1: with these amazing three by five d and recipe cards
Speaker 1: I had from my grandmother's You know, my my mom
Speaker 1: still has those recipe cards from her mom. We share them.
Speaker 1: We actually we kind of memiograph now and share them
Speaker 1: to the family. They're valuable, so don't lose them. So
Speaker 1: let's talk about your business. So I think about sixteen
Speaker 1: years in you have made it through the financial crisis,
Speaker 1: the pandemic, and then today's supply chain stresses and more,
Speaker 1: and also and in vironment that continues to be disrupted,
Speaker 1: in innovation, whether it's in the food space, how we work,
Speaker 1: who's working. We think about diversity inclusions. So talk to
Speaker 1: us about kind of that progression. That's a long time
Speaker 1: to be running a business. How do you think about it?
Speaker 1: Today and how you run it it is um You know,
Speaker 1: one thing I've always been is very true to what
Speaker 1: our core mission is, which is connecting through celebration and
Speaker 1: not trying to be all things to all people and
Speaker 1: just being very good at what you do. And so
Speaker 1: what I have focused on since to day one was
Speaker 1: creating the highest quality scratch made products combined with the
Speaker 1: highest level of guest service to all of our guests,
Speaker 1: and being very straightforward and open about what we're doing.
Speaker 1: Our kitchens are open, we use high quality ingredients. We
Speaker 1: don't sacrifice on that. And I think as troubling and
Speaker 1: up and down as the economy has been and times are,
Speaker 1: people really want to celebrate now more than ever. But
Speaker 1: you always want to celebrate, right, and so to be
Speaker 1: able to bring that joy to people and bring your
Speaker 1: mindset to a simpler time. A lot of people tell
Speaker 1: me our cakes you're buying them of their childhood or
Speaker 1: you know, when when life was easier. And so I
Speaker 1: think that Susy Cakes has really tribd over the past
Speaker 1: sixteen years because as life gets more complicated and people are,
Speaker 1: you know, on their devices more and more, this premise
Speaker 1: of connecting through celebration with human beings face to face
Speaker 1: and sharing a cake and celebrating somebody has really resonated well, Susan.
Speaker 1: One area of life that has become increasingly complicated in
Speaker 1: recent years has been the labor market. And it's something
Speaker 1: that we talked about with companies big and small. I mean,
Speaker 1: we're in the midst of earning season right now, and
Speaker 1: there's you know, not an earning it is called that
Speaker 1: happens without commentary about attracting and retaining talent right now.
Speaker 1: How's it going for you at your locations throughout California
Speaker 1: and Texas? Are you having a hard time keeping employees?
Speaker 1: Are you having to raise wages and are you seeing
Speaker 1: differences in different areas of the country. Yes, it's been
Speaker 1: very challenging actually in both areas of the country. And UM,
Speaker 1: you know, in order to meet the decreased labor market
Speaker 1: early in we had to quickly alter our business model
Speaker 1: to a fewer days, fewer operating hours per day, and
Speaker 1: fewer product offerings, so we really had to lean heavily
Speaker 1: on technology and UM have a focus on driving more
Speaker 1: sales online. So as a result, we've increased our online
Speaker 1: sales from six per to thirty one percent, which is huge,
Speaker 1: but that allowed us to have um less team members
Speaker 1: in the store taking orders and having an easier production model,
Speaker 1: creating less waste that we actually ended up with a
Speaker 1: more profitable business model really, because I do think about
Speaker 1: like the higher price cost. I mean, are you feeling
Speaker 1: though a little squeeze sometimes right now just because huge
Speaker 1: see huge squeeze, huge squeeze. Um. You know, both our
Speaker 1: cost of goods and cost of labor are up well
Speaker 1: over ten percent, and you know, like most retailers, we've
Speaker 1: had to pass some of that on to guess um.
Speaker 1: But since we've built our reputation as you know, best
Speaker 1: in class and highest quality, we've been able to maintain
Speaker 1: our guest base. One thing I wanted to ask you
Speaker 1: from what I understand in reading in for this UM
Speaker 1: is that you pitched your business for like two years?
Speaker 1: Is that fair? That? Yeah? It was? I yes, I
Speaker 1: would say the better part of eighteen twenty. Was it
Speaker 1: just that? Because we talked about this a lot at
Speaker 1: Bloomberg UM about the ability or inability of women and
Speaker 1: certainly minorities to attract investment dollars? What was it was? It?
Speaker 1: Was it just because did you bootstrap or did you
Speaker 1: get money or like, tell me about it? Very bootstrapped?
Speaker 1: UM three UM. Really, literally everyone who I spoke to
Speaker 1: and showed my business model to said Susie cakes was
Speaker 1: a bad idea. And um even the f b A
Speaker 1: said Susie um baking is a hobby out of business
Speaker 1: and UM it was incredibly frustrating and difficult at times
Speaker 1: to you know, keep going knowing that so many people
Speaker 1: were saying people I respected, we're saying that, UM, it
Speaker 1: was a bad idea and so are really only options
Speaker 1: that we had were bootstrapping and you know, gathering UH
Speaker 1: money from friends and family. Who would you know, at least,
Speaker 1: you know, have a little bit of faith in me,
Speaker 1: UM to get the first door open. What would you
Speaker 1: say to the world at large having seen the business
Speaker 1: that you're building and it sounds like you continue to
Speaker 1: grow um because it does sound like investors, whether it's
Speaker 1: angel investors or an s p A, that there missing
Speaker 1: a huge part of our population. So much of my
Speaker 1: time outside of work is spent on supporting the next
Speaker 1: generation of female entrepreneurs because they are still struggling with
Speaker 1: getting UH funding and UM, you know it needs it
Speaker 1: needs to shift and I don't know what will create
Speaker 1: that shift, but I'm still seeing it sixteen years later. Okay,
Speaker 1: you guys have locations, Susan in Texas and in California,
Speaker 1: but you can actually order online and you do ship nationally,
Speaker 1: so people who don't live in those areas can get
Speaker 1: Susie Cakes. What about expansion in terms of bricks and mortar,
Speaker 1: because on our planning call this morning, we were thinking,
Speaker 1: wait a second, this would work in New York pretty
Speaker 1: well and just have about twenty seconds. Yes, Um, we
Speaker 1: are looking for brick and mortar expansion as well as
Speaker 1: a nation wide shipping. So we're looking to have a
Speaker 1: flagship location in major metropolitan areas and then build out
Speaker 1: the brand name from that and enhance our nation wide shipping.
Speaker 1: Wait you do ship? We start. We just started shipping
Speaker 1: as a new initiative for us. Checking out a carrot
Speaker 1: cake and a flowerless chocolate cake. I am hungry all right, um, Susan,
Speaker 1: good luck, stay in touch, let us know how the
Speaker 1: expansion plans are growing and just running the business. Um.
Speaker 1: So great to catch up with you, um, Susan. Sarah.
Speaker 1: She's the founder and chief executive officer of Susie Cakes,
Speaker 1: joining us on the phone from Alice. I love me
Speaker 1: some flowerless chocolate cake actually for your birthday. Maybe promise
Speaker 1: I'm gonna hold you to it. Okay, mark the date.
Speaker 1: It's July two, all right,