A Passionate Businesswoman, Having a Blast and Enjoying (Almost) Every Minute
An interview with Shelly Goldenberg
Interview by Jeff Yoskowitz and Kathryn Gordon at Hesperides Incubator Kitchen, Hawthorne NJ
Kathryn: So Shelly, I know from being your Mod 4 instructor at The Institute for Culinary Education (ICE) for chocolate and decorated cakes that you make absolutely stunning cakes, but now you have added chocolate to your repertoire. Can you explain that transition and your vision for your business?
(A note from Kathryn… When Shelly told me “she made cakes,” I postponed looking at her website, because I didn’t know the quality of her cakes. Shelly’s were actually so beautiful, that as soon as her externship chef, Francois Payard, took a look at her portfolio she was asked to create the cake for the opening of his store at The Plaza Hotel).
Shelly: I love learning. I love learning new techniques, challenging myself artistically, and setting challenges for myself. I had a successful cake business before I ever started at ICE, but I was highly motivated to learn more about chocolate during my externship and post-externship training.
Jeff: Okay, so let’s start with talking about your cake business. How did you get started?
Shelly: I used to be a lawyer, and for 10 years I had a high profile, nice job in Israel. Then 6 years ago, we moved to NYC “temporarily” for my husband’s business, which gave me an opening to drop my old job and to start doing the more creative things that I was interested in doing but was too scared to do in Israel because it would have meant leaving the security of my lawyer’s salary.
When we moved here, as a mother, I wanted the best cakes for my 3 kids, so I took some classes with Toba Garrett and Betty Van Nostrand. I volunteered to make cakes for friends, then I sold my first one for $40 and my business began.
Kathryn: Why did you begin the pastry & baking program at ICE?
Shelly: From the beginning, my cakes were gorgeous but I got feedback that they should be moister. My baking initially kind of sucked! Clients weren’t getting the same enjoyment eating the cakes as they were looking at them.
So, instead of creating the whole cake from scratch myself, I hired a professional baker to make my cakes, which I then decorated. It was cheaper for me to do just the fondant work. That didn’t work out though.
Jeff: That sounds like a pretty reasonable set up. How come it didn’t work out?
Shelly: I realized that the baker wasn’t quite following my buttercream recipe. My pistachio buttercream recipe, for example, is delicious. I really worked hard on it and I felt the tastings I did for the clients myself didn’t match the final product.
I wanted complete control of the process and the technical knowledge to get there, so I went to ICE. At the time, I also wanted to learn how to do chocolate, and I thought I would eventually start selling chocolate to my cake customers as party favors.
I wanted people to eat my product and react with “Wow -- that’s what it’s supposed to taste like”!
Jeff: You’re still doing cakes, although now you’re focusing on chocolate?
Shelly: Actually, I believe I can do both. They are both seasonal businesses. I find the highest demand for chocolate in the winter, and now that it’s summer, the wedding season cake orders naturally pick up.
Right now I have two websites, although I am thinking of merging them into one and presenting a cohesive artistic vision for my business. At the moment, I work alone until we’re in the high demand for each season, and then I take on interns and seasonal employees. (I use the free ICE career placement services when I need people).
Jeff: So what’s the vision for your business, since demand is growing in both segments?
Shelly: I am at the point where I can see my success, and what I need to do now is sit down and make some plans. The chocolate and cake businesses do run a bit differently from each other. To continue to do both, I need a business map to visualize for myself what kind of experience I want to give to my clients. I need to be the one to innovate, to bring out a new collection each season (like in the fashion industry). But I think I’m “done” being the only one in the kitchen. To be successful, I need to spend more time marketing. Other people under my supervision can execute my formulas especially in the cake baking, and production line for the chocolates. I will always retain final creative control over the cake decorating, though.
Kathryn: You have pretty chocolates and you’ve modified your packaging for the various chocolate holiday seasons. Did you design it all yourself?
Shelly: Yes and obtaining packaging in runs of less than 5,000 is never easy. But in the end, I found a great small company who will do a small quantity of custom print boxes.
Kathryn: In starting your business, did you take advice from anyone?
Shelly: I actually did everything myself! I did my own market comparison of competitors of artisan chocolates and then priced out my chocolates by lowering my prices by 10% compared to my competitors. I built my own websites and I took my own photos. I drew my own logo of a cocoa bean and gave it to a graphic designer to digitize it. I designed my own packaging to be eye-catching. In short, I took no advice from anyone.
Jeff: How did that work out?
Shelly: I’ll tell you honestly, I started my chocolate business as a way to thoroughly learn the way to produce chocolate, school myself in new techniques, and see if I was able to build a high production line of something I never did before, but always wanted to learn. I started in September, 2011 with no specific plan beyond having as many people as possible love my chocolate! Luckily, because people do like my chocolate, it has grown into a small profitable business.
Now I have some challenges, and an urgent need for a more structured business plan. I sent out my own online newsletters through Constant Contact. Through that, I was able to sell $10K in chocolates in the first 3 months and was able to buy a tempering machine with the profits. I also sell directly at gift fairs, and find that a very good way to move my product so I will continue to do that through the fall.
I was introduced to a broker, who got me into 6-7 retail stores in NYC like Garden of Eden and West Side Market. That gave me volume, but I had to sell at half price for wholesale versus what I can make with direct sales via the internet, or in gift fairs.
Kathryn: Right now you’re producing in an incubator kitchen. Is that working out for you, and how did you get there?
Shelly: When I went looking for a space to produce the chocolates, I started in a “warm kitchen” in the back of a cookware store. It was tiny, but only $20 an hour and the very nice owners didn’t charge me for using the space past 5 pm! I got myself a real bargain, but it was hard to work there for any production efficiency. I Googled incubator kitchens online and found this space.
The best part about this contract is I can rent a small amount of permanent space with no ovens nearby, and rent additional cold storage space for chocolates and/or production space for my cake orders as required. It’s very flexible and cost-effective.
Kathryn: Given the type of production spaces you need, do you think it makes sense to focus on only one of your businesses?
Shelly: I find the high end, custom cake business to be easy for me to manage. You have ample notice for a project, and there’s nothing to stock. Since I’m pretty much the only one working on the cake, I’m under tons of pressure just before the project, but there is no overhead except for rental of the kitchen when needed. For artisan chocolate, it’s more complicated. I need stock, have to care about shelf life, need to have more marketing and sales follow-up, and there are more people involved.
Jeff: A very experienced business person once told me you can’t truly run a business successfully if you have to manage every single detail and aspect of it yourself.
Shelly: I am seeking a partner who will help me with the business part of the business. I have lots of ideas and I know that I can sell the product because people love it, but I need someone to help with the financing and marketing, because I am not good at it.
Jeff: Do you have time for your family?
Shelly: You know, I wrote up a plan of how much time I wanted to spend a day with my kids, my husband, the gym, my businesses etc. It added up to more hours than are in a day so that didn’t work and I threw the paper out!
Recently, I started working with a branding company that gave me a long list of questions to focus on things that are very relevant, and will help me structure my plan to grow my profits and balance my life commitments.
Jeff: OK Shelly, thank you very much for your time today. And thanks for the chocolates! How about we plan on talking to you in a few months, when you’ve finished your branding survey analysis. We’d love it if you can share it with us.
Shelly: Yes, that would be great!