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Moving my chocolate business to a retail location: Tips from an EC grad
Photo: B Cocoa Artisan Chocolate
For many chocolate business owners, taking the leap to move their business into a retail location is a huge decision. One of our Ecole Chocolat graduates, Brooke Willis from B Cocoa Artisan Chocolate, has just celebrated the first anniversary of her chocolate business out of her home and to a retail location! Brooke has been kind enough to share her experiences with us in the past, and you can read more about her journey in building her brand and business from the ground up: Part 1, Part 2, Part 3.
We asked Brooke to share the story of making the decision to move her business out of her home and into a brick and mortar shop, and what she's learned along the way. Oh, and did we mention Brooke is also a mom of two and that she home schools both of her kids?! Read this amazing woman's story of taking the next leap with her chocolate business. https://www.instagram.com/p/BoAn7R9Dt9J/?hl=en&taken-by=bcocoaartisanchocolate
B Cocoa Artisan Chocolate...first, a little background
I began my chocolate journey after we moved to Texas from England. My original plan was to keep practicing everything I had learned from Ecole Chocolat and gradually get to a point where I could open up a small shop. The demand for chocolate took off much faster than I expected, so I ended up starting my business out of my home kitchen. I was able to manage this madness (I don’t know HOW I managed to make as much chocolate as I did out of my house) for almost three years.
I sold at pop up shops, in small retail spaces, and special events. It was a great way to sell and make money without a lot of overhead and it helped me build B Cocoa from the ground up. If you work with chocolate, and you live in a warm climate, or a melt-your face off hot place like Texas, then you can image how hard it is to lug your delicate treats all over. After I while, I was burned out with constantly hauling half of my kitchen and chocolates back and forth, and needing a babysitter for every daytime event.
B Cocoa was becoming better known at this time and I started getting asked about wholesale orders and selling in our local coffee shop. I knew that I had hit the “cottage law” wall. It was bound to happen because there is only so far you can take your business working from home.
The day it all became clear
I still remember the day, I was sitting at my dining room table, which had become the packaging table, and I lost it. We’re talking ugly-cry face, pity party, LOST. IT! I was at a fork in the road and I knew it and I was scared to death. My two options were 1) quit all together or 2) find a commercial kitchen.
I knew I couldn’t keep up at the level I was and be sane anymore but I was terrified to take the next step because a retail location can be very risky and I don’t like to fail at things.
I have the best, most supportive husband and he’s always there as a level head when I hit my entrepreneurial lows. We both knew I had to make sure that I was 100% in if we were going to invest in a retail location, so I took some time to pray and think about whether this was a journey I wanted to continue.
Photo: B Cocoa Artisan Chocolate
Looking for a retail location
During this time, I started asking local businesses if they had kitchen space to rent and I would drive around looking for an open kitchen or somewhere that might make a good kitchen. I know that every business owner is different and that most of us start out in our homes for various reasons, for me, the main reasons I had run B Cocoa out of my home were:
- I home-school: can’t really find a kitchen that will let you kids hang out
- We are military: I didn’t want to spend thousands on a space when we could move
- I wanted to make sure B Cocoa was going to be a successfully running business
- No debt: I decided that I was going to operate my business without loans.
I was still scared to take the next step and I had decided that all I would worry about was kitchen space, not a retail front. This way I could get out of my kitchen and make all the chocolate I needed to. So, when I was looking for kitchen space all of these reasons helped me narrow down what I needed:
- A space where my kids can hang and do school work while I work.
- Somewhere we can lease that is preferably an already finished kitchen.
- Rent that is affordable and we can cover on our own if the business didn’t succeed.
- Good location and area that fits the image of our product.
As I was jotting these things down and stalking storefronts, I remembered that there was a beef jerky store that I would frequent before my son’s martial arts class. I also remembered that they had posted that it had to suddenly close for personal reasons. I drove over to the location, looked in the window, and saw it was empty. If they made beef jerky in that kitchen, it had to be up to code and MAYBE even have some equipment in it. I called the number immediately and talked to the owner. Yes, it was ready ASAP, yes it had a 3 compartment sink, a hand washing sink, all floors and walls to spec, an office AND a retail space. I hit the jackpot! Even with this, I teetered on a decision.
The location was great; it was well-known retail area one block off the main strip, which cut the cost of rent in half. Still, the rent was higher than I wanted to pay and I knew I needed to find a way to supplement the rent. That’s when I met G Pops. They make all natural gourmet popsicles and needed a larger kitchen space to rent. We were a great fit, because they didn’t need a ton of space, and the corner I was looking to rent out was just enough space for them. Our busy times are opposite, theirs is spring and summer, and mine is the fall, winter, and spring. There it was. G Pops was in. We signed the lease and our new journey began.
Getting our kitchen and retail space ready to open
My space is 1500 square feet (and it is starting to feel too small)! We have about 500 square feet for retail, 200 for an office, and about 700 for kitchen plus a dry storage.
We spent about $5,000 to get started. This includes, floors, paint, retail displays, and kitchen supplies. Once you move to a commercial kitchen you need to have all NSF commercial grade appliances and surfaces. We bought 2 stainless steel tables and a new microwave and a used freezer and fridge. We invested a small amount in getting floors and paint for the retail space. I was able to buy the displays and cases from the owner of the building and I found a fantastic couch on Facebook for $150.00. The man who had the space before spent $25,000 to get the kitchen up to code with sinks, walls, floors, etc. so we were able to save a lot!
By September 22, 2017 we were ready to open. We started with light retail hours because I wasn’t sure I wanted full retail, I was more focused on using the kitchen for orders. By the end of October, I had hired my first employee and we were open Wednesday through Saturday. We now have four employees and our retail is far exceeding our expectations.
One year in - advice for chocolate business owners
As we have just celebrated our one year anniversary, the few things that stick out in my mind to tell someone who may be in their chocolate splattered home kitchen, wishing for their own kitchen location are:
- Seeing people support your business is so rewarding. I still get excited when I hear the door chime “Someone actually came for my chocolate?!?!”
- You are in control of your time, your space, your product and that is very freeing.
- In the chocolate industry, you get to celebrate every holiday! It makes all the holidays so special!
- Taking a risk and knowing you have overcome your fears.
- Every day and every new challenge is a learning experience.
The owner of our complex is a very successful businessman. When I signed the lease he told me, “Brooke, remember, feast and famine, feast and famine. Be prepared for the slow months and don’t spend everything in the big months.” He was so right! You can’t track sales until you’ve made it a full year and the summer was HARD. Like, on my knees, praying, “Can I just make rent, payroll, and my bills?” hard.
Sheesh. I learned this early, thank goodness. Handing over your passion to others is hard, and you really need to have trustworthy employees that fit your philosophy and work ethic. If you don’t, this can be a disaster for your business. My first employee was not a good fit and I didn’t realize how negatively it was affecting the business and me until I finally let that person go.
Even when you think you’ve budgeted for every expense you’re going to have…trust me, you haven’t. I would budget 25% for unexpected costs. Labor will kill you when you are slow but you have to have help, so you need to hold over a lot of money during your busy season to help you float through these times. My biggest costs other than labor was plumbing repairs and electrical. We had a sink that would clog when the cocoa butter hardened in the pipes. We spent about 700 after a few clogs and finally a plumber showed us an easy trick to unclog the sink and also told us to run hot, hot water everyday to make sure it clears out. I lost two microwaves because I needed to update electrical. That cost me $500 for two new microwaves and $600 for electrical updates.
We have been BLESSED with the most supportive and complementary customers but remember, once you branch out from your home and your niche market, you will reach a new group of people who have no clue who you are. They will need a lot more convincing to buy your products than those who already follow you and know your story. You have to be ready to prove your worth, and give out a lot of free samples.
Eat it. Be ready to eat it, because going from a home kitchen to a small business is a BIG step. You now have a large overhead and a new audience to reach. It takes a while to build sales and you will feel like a failure at some point every few weeks. This is normal, and part of being a crazy chocolate entrepreneur!
If you are reading this, you may be wishing for your own commercial kitchen or dreaming of how you are going to start your chocolate dream. My best advice to you is do it! Start slow and grow. You have time, chocolate is one of the oldest foods in history, it’s not going anywhere. Take your time, learn your craft, grow your following, don’t be scared to ask other chocolate people for advice. We are all very nice and willing to help!
I just renewed my lease for another year and the owner came in and congratulated me. “Congrats, you’ve made it the first year, 85% of businesses fail in the first three years. You did it, the first year is the hardest and you survived.”
Congratulations Brooke on surviving your first year in business! Thank you so much for sharing all of the lessons you've learned!
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