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Q&A: The changes Sweet Bakes is making to face the challenges of 2022

Cake-baking small business owner Alisha Henderson has adapted to recent changes and challenges with innovative ideas and by listening to her customers.

At a glance

  • Sweet Bakes owner Alisha has built a wildly successful cake baking business online and on Instagram, with more than 220,000 followers.
  • Pandemic pressures and rising business costs have led her to innovate with new products and services, including a monthly cake delivery service called Cake Mail Club.
  • Alisha says a key part of her business’s growth is listening to customers, and remembering that her success is their success.
  • Her advice for other small business owners is to stay agile.

Sweet Bakes founder Alisha Henderson is no stranger to change.

As a young journalism student, she set up an Instagram page to showcase her baking hobby to family and friends. Her creations proved so popular that within six months she made a leap of faith by going full-time. The Melbourne-based Sweet Bakes has now amassed more than 220,000 followers on Instagram, and Alisha shows no signs of hanging up her spatula anytime soon.

When we spoke with Alisha about her top Instagram marketing tips last year, things were looking bright for her bakery. But we know the events of recent years – from lockdowns to cash rate changes, talent gaps to supply chain disruptions – have forced many business owners to make significant changes to their product offerings and operations simply to stay afloat, let alone thrive.

Prospa recently partnered with YouGov* to ask more than 500 Australian business owners and leaders about the actions they are taking to protect and grow their businesses. And confidence was high, with 70% rating their business as healthy. Still, 70% also told us they have made or started to make substantial changes.

These changes include price rises, scaling up marketing activities, contributing extra funds personally to the business or reducing operating hours.

So what’s changed for Sweet Bakes in the past six months – and how is it adapting to fluctuations in the small business climate? We sat down with Alisha to find out.

How has your business changed recently?

“Sweet Bakes is constantly adapting, and I anticipate bumps in the road. I was fortunate enough that during the pandemic, I had a product line called Cake Mail Club that went absolutely bonkers online. I was able to focus purely on that one product, which became my entire stream of revenue.

“As customers hold their precious pennies a little closer, I’ve added extra services, such as a custom cake order service. I’ve released a cake journal, teach cake courses to the community and will release my second children’s book very soon. I’ve added a lot to the Sweet Bakes blueprint this year to keep my audience engaged.”

What challenges is Sweet Bakes currently facing?

“Like all businesses, the cost to simply exist has risen. I’ve watched almost all businesses increase their prices. I’ve not done this yet, as retaining my community of clients is my main focus. Instead, I’ve made changes behind the scenes to ensure I purchase from suppliers at a rate that means it is still profitable for me to sell cakes to clients at the same price point.

“An example of the extra value I’m prepared to give my customers is Cake Mail Club. The theme of the box changes every month – last month’s was ‘Cluedough’. The flavour menu inside the box imagined each cake flavour as a murder suspect, and it was the customer’s job to eat their way through the cake to uncover who had done it!

“The business incurred no additional costs to theme the box, but it provided so much extra value to customers – and the rate of return to opt in for the cake box next month was amazing.”

What changes are you making now?

“I used to use a team of delivery drivers to deliver cakes across Melbourne. Unfortunately, due to rising petrol costs it’s become more economical to have everything express posted in the mail, which takes away the personal element.

“This has reminded me to provide that personal touch to my audience in a different way. Passing on free recipes and dedicating time to interact with and express my gratitude to my community on Instagram has always been important to me, but even more so now.”

How important is planning in your decision making?

“My business can be very ad-hoc. I often make decisions off the cuff rather than as part of a traditional business strategy. However, this is because I feel I’ve got my ear to the ground when it comes to what my clients need. A balance of a strategy and the ability to throw ideas at the wall (or in my case, Instagram) and see what sticks, is really the way to go.

“I place a lot of value in making decisions that don’t just prove successful from a sales or statistics perspective, but also from an emotionally intuitive place. It may sound a little silly, but understanding how people are feeling and what my business can offer them – with the genuine intention to lift their spirits – has been key to Sweet Bakes’ growth.”

What changes do you foresee for Sweet Bakes?

“Customers have become very conscious of where they are purchasing from. I take a personal approach to what I share with my community, so they can see how what they spend at Sweet Bakes allows my business to do what it does.

“If you’re asking people to support your business, they have a right to know what you stand for – and they love to see the bigger picture. I predict we will see a lot more of this from larger companies, where more transparency is needed.”

What advice do you have for other small business owners looking to stay agile?

“I’m approaching 10 years as a small business owner, and something I can guarantee is that there will always be peaks and troughs. If you’re going to run a business, you’ll need to match your flexibility with persistence.

“In times of uncertainty, I’m a big advocate of a pre-sale model approach. Putting an item online to sell before you over-commit to an expensive project is a savvy way to set yourself up for success. You’re not locking into anything that may not sell or investing in stock or supplies that might not be used. This approach works well for products but can be used for services too.

“Everyone should have a goal they work towards. But staying flexible involves remembering the path to that goal might take a few detours.”

*YouGov x Prospa small business research, 2022

With Prospa’s fast application and decision, this time tomorrow you could have the funds you need to set your business up for success. Find out more.

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The information in this post is provided for general information only and does not take into account your personal situation. Nothing contained in this post constitutes advice or an endorsement or recommendation of any kind by Prospa. Any links to third party websites are strictly for informational purposes only. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from financial, legal and taxation advisors. Although every effort has been made to verify the accuracy of the information as at the date of publication, Prospa, its officers, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy, or omission from the information for any reason, including due to the passage of time, or any loss or damage suffered by any person directly or indirectly through relying on this information.

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