It’s just over a year….time flies!
In 2012, as a bright eyed 23 year old, I had big dreams when starting off Krust Bakery. Over the next six years, until I stepped away from the business at the end of 2018, I had the adventure of a lifetime. What started as a two man band selling pastries to coffee shops and quickly became a wholesale, retail and catering company feeding millions of people each year.
Along the way, we brought the famous Cronuts to Ireland, we were the first bakery in the World to accept bitcoin in 2015, we were the largest supplier of donuts in Ireland in 2018. It was a phenomenal business which allowed me to learn my trade as an entrepreneur and develop the skills to give me an edge as I move forward into the next chapter of my journey with Parkpnp.
Here’s the six of the biggest things I learned:
Our First Cafe! 32 Aungier Street, Dublin 2
Our 2nd Cafe! 6 South Great Georges Street, Dublin 2
The food business is the passion business
Starting a food business is not for the faint of heart. It will bring blood, sweat, and tears (plus a lot of caffeine) so you have to love what you do.
Many who join this industry are following their life passion and mostly not in it for the money, leaving long term careers to live out their dream and set up their own food business. For anyone looking to startup in this industry it is important to do your research first. Meet others who have gone before you, research the market you are getting into, build up the vision of where you want this to go, get a job in the industry first etc. These are all tips I wish someone gave me when I was starting out.
You are about to travel a road well-travelled. Always avail of the daily advice provided by suppliers, other food entrepreneurs, delivery drivers, customers and so on that will become your daily support network.
You can’t do it all
When I started I was very young, an energetic and proud 23 year old. I thought you had to micro manage everything, after 3 years of 20 hour days, 7 days a week I completely burnt out. I believe you have to take care of the fundamentals: health / family/ business and social in that order to operate at 100%. It can’t be all business or you will experience burnout. When burnout happened I needed to take 3–4 weeks off and felt emotionally exhausted. Getting this balance wrong is what causes accelerates tiredness, stress and illness. Be careful.
Famous Customers! can you spot them
It’s all about the people
In the food game, people are your brand, from your barista’s to your delivery drivers, your people represent your brand and it’s vitally important you remember this and you try to make sure they feel respected and happy enough everyday, so they work with a smile. I tried my best to make the company a fun place to work and I thank the 100’s of people who have worked with me over the years. A huge learning curve for me personally and It was because of you we could grow as fast as we did.
Good Times!
Post 2016 it became exceptionally difficult to hire people in Dublin in the food space, due in part to high employment rates but mostly due to the larger tech firms paying above market rate. An example of this; I had a sales guy who was exceptional leave for a 150% increase in salary in a large tech firm!
Government Regulation- The Good & Bad
Former Taoiseach (Prime Minister) Enda Kenny visiting Krüst
Good
Enda Kenny, former Taoiseach (Prime Minister) of Ireland launched a new business initiative from our Krüst cafe on George’s St in 2015 which gave us great profile in some national papers, he was very kind to do so. He wasn’t a coffee man as seen from the above pic!
We ended up winning a government tender to setup and supply an internal Cafe in a government branch in Kildare street in Dublin. We still do to this day and I have never met nicer people.
Bad
It really felt that at every step of the way we were forgotten by the government as a new fast growth employer, after 3 years we were generating revenues of €1m+ and employing 30+. Instead of supporting growth they focused on constantly issuing new regulations that increased our cafe costs, annual street sign tariffs, vat increases, insane overdue VAT collection interest fees, rates increases, minimum wage increases, countless health and safety inspection costs and obligatory imposed levy’s through the business improvement district which completely out of touch.
In a macro sense I believe a Government change of view is needed here to support small Irish traditional businesses or they will be overrun by the larger chains who can benefit from economies of scale.
Every cent counts, track those pennies!
Financial tracking is crucial in this business.
“Marry your Gross Margin”.
If you don’t understand your numbers, find someone to help you immediately. You may survive the good times but you won’t have that buffer during the bad. It’s hugely important to focus on getting the margins right and sticking to them, we aimed for 70-80% Gross Margins, in the beginning we were at <50%. We used the online accounts package Xero to track live financials with our accountant and bank, we used Square for our POS system and we used Shopify for our Krüst website.
When things start moving fast you will appreciate the room margin brings. Those who operate on tight margins leave themselves exposed to external unforeseen pressures. Think of a tight rope versus a bridge — both can get you to the same place, but one will get you there faster and safer.
Future Forecast for price increases and increase your prices as your suppliers will do this too(approx +5%, They will generally do this around a new year and they will all blame it on some market factor, wheat price increases, oil prices etc etc, play the game and increases yourself. For the initial years we consumed these increases out of fear of losing customers and it hurt us.
Focus on the one thing
I fell into the trap many entrepreneurs face. I scattered my focus on every opportunity. In 6 years of business we had built up three very different revenue streams (essentially 3 very different businesses):
Wholesale: this is where we started in 2012, we baked and supplied a specialty bakery range to SuperValu’s, Butlers, Applegreens and Tesco’s and many more.
Retail: We opened 2 cafes in Dublin city centre within a 12 month period in Dublin City Centre.
Catering: We launched a catering division with online ordering for collection and delivery from the cafes to supply the surrounding offices and events.
The entire business grew quickly, however I strongly believe to this day that if I had focused on only one thing the sum result at the end of the day would have been much greater.
Focus on becoming the best in the World at your one thing.
At the end of 2017 I felt I had taken the business as far as I could , in 2018 I took the decision to sell my stake in Krüst Bakery and focus on my new company Parkpnp.
I hope this helps some aspiring foodie entrepreneurs out there, it’s a hard but fun road and I wouldn’t change it for anything. Great people, great memories and I hope Krüst continues to grow under the new team and direction. 📈
Garret