How not to start a gourmet cupcake shop

24Feb10

Chicago seems to have a lot of gourmet cupcake shops. At some point last year, one of them opened up near the Randolph and Wabash CTA station, which is a location I pass fairly often. However, I don’t think this particular purveyor of pricey cupcakes will be around for long. Here are some of the things they did wrong:

– The cupcakes are expensive — in the range of $3-6 each, if I remember correctly — but they don’t take American Express. If you’re selling a premium product, accepting AmEx is a must.

– They’re located next door to a McDonald’s — which doesn’t exactly attract the type of clientele who are likely to plop down big bucks for a single cupcake.

– The sidewalk outside the shop is constantly plagued by fairly aggressive beggars, suggesting nobody from the cupcake place actually spent much time scouting the area beforehand.

– The decor inside the cupcake shop is cold and uninspiring, with barely any seating.

Obviously, there’s no way to account for every variable ahead of time when you start a new business or open a new location for an existing one. But a little bit of common sense is all it takes to prevent most of the mistakes I described. In the case of the cupcake shop, I wish I could say that the cupcakes are so amazingly awesome that people will show up from far and wide to buy them, and overlook the flaws. However, the only time I actually went into the store, I didn’t have any cash on me. Since they don’t take AmEx, I never even got the opportunity to try the product. And with so many other strikes against them, I doubt I’ll be back.



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