From Farmer's Market to Macy's

Interview with Kathleen Escamilla-Hernandez

http://www.cocoamains.com/

By Kathryn Gordon and Jeff Yoskowitz of FoodStartUpHelp.com

Kathryn:  Hi Kathleen, you’ve come a long ways since you started at ICE (Institute of Culinary Education) as my student 2 ½ years ago!   We’re very excited. Is it true you just got your first purchase order to sell your Cocoamains macarons at the Macy’s flagship store in Manhattan?

Kathleen:   Yes!  It was interesting to be in the negotiations with such a large customer.  Prior to this, I was selling my macarons and other baked goods at a farmers’ market!   I loved the farm market and meeting my customers directly – but this is a fantastic next step for my business. I do plan though, to continue selling at the farmer’s market in the spring.

Jeff:  You began at a farmer’s market in NJ earlier this year. Can you talk about that process?

Kathleen:  The farmer’s market debut allowed me to pull together my business structure.  When I first started at ICE, I was looking to do something in baking that was creative since I formerly designed children’s wear.   I didn't know precisely what I wanted to do, but I loved pastry and it was a creative outlet from the stress of my former career.  The opportunity to sell on weekends at the farmer’s market came along, and I took the plunge.  I also started to do some dessert catering.   It helps to have a supportive husband, who is also a graphic designer!  At first, I wasn't sure what would sell and I offered pound cakes, madeleines and macarons.  The macarons sold out immediately! 

Process wise, I had to file my LLC, get a trademark, have the website developed, do my Serv Safe certification (which you can do entirely online through www.servsafe.com -- it’s very interesting!), obtain general liability insurance, complete the mandatory paperwork to sell at a farmer’s market, find a commercial kitchen to work in, develop my macaron formula, flavors and prices, buy a tent, and create signage, flyers and business cards!  At that point, I didn’t yet need packaging.  

All summer, I was baking all night, working from 4 am to 2 pm for my regular job, and getting 4 hours sleep.   However, it was a fantastic way to work out the kinks, make money, allow clientele to get to know my product and also allow me to get feedback on my product.

A friend of mine said:  "You don't go to the farmer’s market to make money - you go to promote your product."  But I told him you go to do both or else why bother going if you don't make money?

Jeff:  When do you launch at Macy’s?

Kathleen:  We just opened at Macy’s Cucina and Co. earlier this week.  We gave away free macarons from 11 am until 2 pm!

Currently I am working on my display case – I can create whatever I want in terms of macaron cakes, gift baskets, etc.  It’s a lot of fun.  I like figuring out how to make lacquered display macarons look as realistic and beautiful as the edible ones!

Kathryn:  Originally the Macy’s Department Buyer for Cucina and Co. wanted you to just have fresh, loose “grab and go” macarons available for purchase out of their refrigerated case?  

Kathleen:  Yes, but then a Macy’s Vice President decided that he wanted to offer gift boxes.  There was a bit of going back and forth.  We decided to do both, and now, my custom boxes are being created.  When we open, there will be 2 sizes of macarons available in 8 flavors:  large and Cocoamain’s mini Mac Poppers!  Pre-packaged Cocoamains gift boxes will be available for the holidays which is great, because a lot of people shop at Macy’s and it’s located so conveniently to Penn Station that commuters can pop in and pick up a present!  We’re all hoping that the eye-catching appeal of macarons will do the trick!

Jeff:  What makes your macarons different from other macarons, Kathleen? 

Kathleen:  I respond to my feedback from my customers and offer fresh, accessible flavors.  I have some popular standard flavors (5) and will rotate in (3) others seasonally.   For example, the Macy’s buyer mentioned that she would like to attract customers at breakfast time – and I turned around and gave her my cinnamon raisin twist macaron with cream cheese filling.  It’s absolutely delicious, especially with morning coffee!  So I have flavors that appeal throughout the day to consumers.

Cocoamains offers American theme flavors in appealing colors.   Compared to other macaron start ups, my texture is soft and my flavors are “bumped up.”  The large size fits into someone’s palm in an appealing way like the size of a cupcake.  The mini Mac Poppers are cute, and allows someone to sample all the flavors.

Jeff:  Kathleen, where do you do your production?

Kathleen:  I was working in one commercial kitchen in NJ but I am switching to a larger, brand new facility that lets me rent time on a monthly basis.  I just signed that contract.  I had outgrown the freezer space in the first kitchen.

Kathryn:  How will you transport your macarons to Macy’s?

Kathleen:  As an approved vendor, we have a wide range of hours we can unload at the loading dock from even as early as 5 am.  I plan to arrive early to avoid city traffic, and will be able to bring the macarons straight from my commercial kitchen facility up to the refrigerated case at Macy’s Cucina and Co.  

Kathryn:  What’s one of the biggest lessons you learnt between finishing at ICE as a pastry & baking student and becoming an entrepreneur?

Kathleen:   When your instructors tell you to practice piping, they mean it!  On my first day of externship at Bouchon Bakery, I piped their signature Bouchons for 12 hours.  I had recently had a carpal tunnel operation and there was nothing like that much piping to bring back my hand strength.  I will be hand piping my own macarons until I can justify a depositor, since I am now so fast at piping!

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Ready to Jump In

Ready to Jump In

Interview with Cameca Johnson by Kathryn Gordon

www.creationsbycameca.com (website should be live in June)

Kathryn:  Cameca, you graduated from the pastry program at ICE August 2011, and since then you’ve said that you’re baking cakes for friends and family? 

Cameca:  I went to ICE initially with the idea that I would master plated desserts in a restaurant and open a dessert bar.  But after going through the program, a friend asked me to make a cake for her daughter’s birthday, and I continued doing that as more friends and family asked me to do it.  Now I’m really interested in all the different aspects of cakes, decorating and sugarcraft, and driving myself to learn as much as possible.

Kathryn:  How are you doing that?

Cameca:  I currently subscribe to a cake decorating magazine, and I work my way through each of their “projects” systematically.  I’ve also taken a lot of advanced classes, and I go anonymously to various classes offered at bakeries to check out what they’re doing and how they operate.  But that was difficult to do during the day with my 9-5 job.  So I’ve just resigned my day job!  Going forward, I’ll have more time flexibility. 

(Kathryn interviewed Cameca on the annual ICE Cuisine Course in France.  Cameca’s last day at her finance job was just before the trip to the Loire Valley.  www.moulinbregeoncuisinecourses.com)

Kathryn:  Wow, you quit!  Ok, so let’s talk about that decision making process.  How are you planning the steps to take to go from not charging friends and family anything except base ingredient costs – to quitting your day job and jumping into this business?

Cameca:   I took a 16-week workshop in business opportunities designed for business entrepreneurs to learn how to make their businesses sustainable, versus supporting an “expensive hobby.”  I’m just finishing those last classes now:  Workshop in Business Opportunities www.wibo.org.  I have my last session when we return from France.

Kathryn:  So you have a business plan, from having finished that course?

Cameca:  The WIBO program gives you a structure, and then you fill in the aspects of the business plan for your own specific business, customer base, etc.  They provide a wealth of information.  And they bring in actual entrepreneurs to give insight regarding their own experiences.  They provide mentoring resources via direct contact as well as seminars, workshops, etc. to participants who need specific legal or accounting questions addressed, before someone is ready to start paying for those services on their own. 

Kathryn:  So having gone through that program, what about your business incorporation, liability insurance, websites/marketing, your overhead/food/labor cost analysis…  Where are you with all of that part of the process? 

Cameca:  I did cost out each of my cakes, and know what it costs me to make using wholesale ingredient prices and packaging costs.  

Kathryn:  Up till now, you’ve worked in finance – so that must help!  Since you have that skill-set, are you planning to keep up with all of your own accounting, or use a program?

Cameca:  Right now, I am manually maintaining my own general ledger. 

Kathryn:  What about paying yourself? Do you think that your customer base will support it as compared to other market prices for cakes?

Cameca:  I think so.  Honestly, I didn’t think about paying myself at first.  But I think I should “pay myself,” because it is taking me 8-10 hours to make, decorate and deliver each cake.  I’ve also looked at what people are willing to pay for cakes – people in other markets besides people living within Manhattan.

Kathryn:  How are you charging for the cakes? By the serving?

Cameca:  Yes, but I do charge differently for simple buttercream versus the more expensive fondant, and I charge additional fees for sugarpaste flower decorations (which require more labor skill and time).

Kathryn:  How do you get your cakes to your customers? 

Cameca:  I am actually about to buy a second hand car. Friends and family can continue to pick up their cakes from me, or I will charge a delivery fee from my production place in Queens with gas and tolls.

Kathryn:  Where will you be doing your production?

Cameca:  I will be using an incubator kitchen in my area on a shift-by-shift basis (The Entrepreneur Space).  Not too many of their customers are cake bakers – so the incubator has cake pans I can use, as well as additional equipment.  I pretty much just have to schedule time to bake and bring in my ingredients.  My friend’s husband goes to Restaurant Depot, so that is one way I can get wholesale ingredients.  So I have no overhead cost unless I have a customer order.

Kathryn:  What if this takes off, what would be your next step for production?

Cameca:  Next, I would sign a lease for monthly space at an incubator kitchen that would be open 24 hours a day.  After that, I would try to rent and renovate a studio space for a commercial kitchen. I think that jumping to a retail storefront as a next step is too expensive.

Kathryn:  What does the incubator require besides the fee for the 8-hour production shift?      

Cameca:  In addition to the application, the incubator requires:  1) a security deposit; 2) proof of insurance (including worker’s compensation if applicable; 3) Food Handler’s certificate; 4) business registration and tax ID number; and 5) emergency contact information.

After I start using the kitchen I will apply for the 20C Food Processing Establishment License.

Kathryn:  How are you marketing your new business?

Cameca:  After France, I am meeting a high school friend of mine shortly to work on the website and Facebook page.  I am trying to obtain some free PR through doing competitions and charity events.   I will make samples for a charity event for 500 people in June, so I am hoping to have brochures ready by then with the website up live.  Another strategy I plan to try is advertising in small local papers.  Friends are also already helping me with referrals.  And I’ve been trying to take my own photos of all my cakes, to help get the website and Facebook pages up and my brochures ready.

Kathryn:  How many flavors of cakes are you offering, and are you doing tastings?

Cameca:  I have about 7 standard flavors, but I will customize.  I do tasting consultations and that cost is included in the final proposal to the client.  So far, most of my current customers want round, tiered cakes with fondant and “wow” colors.  Maybe from watching TV!

Kathryn:  What kind of deposit do you require?

Cameca:  Currently I collect 25%, but I am considering going to 50% upfront. 

Kathryn:  Cameca, I hate to ask, but how are you financing this?   You rent your apartment now, right?  How are you going to be able to pay for all of this?

Cameca:  I have some savings from my prior job in the finance industry that will cover me a few months, and some employee stock that will be automatically liquidated shortly since I am leaving.  This, together with the rehire policy from my employer (since I left on good terms), is my safety net.  The stock sale may actually generate some tax losses, so I am hoping that I will not have to pay any taxable income penalty.

I also still have a part-time (evening and weekend) job that I got after my externship that will be continuing, for now.  And I’m lucky it allows flexibility in scheduling, because it’s in catering and I can tell them when I’m available, and when I’m not.  If I had to start working there full-time, the catering job would pay for my rent. 

Kathryn:  So what words of advice would you give to some other person, like a recent graduate, who thinks they might also be ready to make this kind of a move?

Cameca:  Think everything out.  You need a plan prior to doing anything.  Don’t just quit your day job without a plan – if you work for someone, find out what that company’s termination procedure is.   In some positions, you might be vested.  Determine if this the right time strategically to leave, or if you wait a bit longer is it more beneficial to you in terms of future retirement pay?  Do you have any unpaid vacation days that they will owe you based on how many years you’ve worked there?  And finally, how many months will all of that accumulate to help pay your production and living space rent(s)? 

Kathryn:  OK Cameca, those are very useful questions that anyone else in your shoes who is considering jumping into this industry on your own should be ask themselves.

Thanks for sharing those thoughts, and we’d like to follow-up with you in a few months of baking cakes in the incubator kitchen!

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