Made in Britain: Cupcake delivery company, Rachael’s Kitchen

Rachael Halstead of cupcake delivery brand, Rachael’s Kitchen, discusses the ups and downs of running a successful bakery business.

What does your business offer?

We are the UKs leading cupcake delivery company, offering a range of almost 40 cupcake flavours including personalised options and delivering next day throughout the UK.

What’s the story behind your company?

I started Rachael’s Kitchen in 2009. It was an exciting time to create an ecommerce business as it was a time that sparked a change in the way we shop and a shift in consumer expectation. I lived in London and in my mid-twenties, I was busy trying to build a career and spent much of my free time in pursuit of great food. I would spend weekends on the Portobello Road, Covent Garden and at Borough Market, seeking out delicious treats and trying new foods. Cupcakes were always a favourite of mine and I love to give gifts and spending time choosing the perfect gift for friends and family – it’s an expression of love when you pick out something thoughtful and personal to the recipient. At the time I thought how great it would be to be able to send beautiful gift boxes of cupcakes to friends I couldn’t easily see or if I was unable to attend a special occasion. That was my lightbulb moment – not because I looked to build a cupcake delivery business but because there must be more people like me who love the ritual of gift-giving and I wanted to do it to the best of my ability.

What is your background?

I originally trained as an accountant and embarked on a role in academia post-grad. I really enjoyed the teaching element but after a couple of years I wanted to experience a little more practice than theory. I worked in London for a few years in a small strategy consultancy which gave me great exposure across the business and I had an incredible female founder as a role model to learn from. Through working for her I gained experience and confidence, I loved the marketing side and nurturing client relationships. It was at this point I had the idea to start the business, having a background in numbers together with experience in the small business sphere were hugely helpful.

What sets you apart from your competition?

We have two revenue streams: firstly, our direct customer ordering a gift box of cupcakes online for delivery and secondly our B2B corporate customer. Our corporate business makes up around 65% of our turnover and we position ourselves as the only cupcake marketing agency. For corporate clients we create cupcakes for events and exhibitions, product launches, engagement campaigns, sales pitches, in-house celebrations and in-store promotions. The cupcakes are a marketing tool and ROI is important. We go to great lengths to ensure the cupcakes we send are on brand, beautifully presented and reflect the brand integrity of the client. We help clients to engage with their audience through social channels and maximise the impact of the campaign.

How do you spread the word about your business?

We are lucky to have a large amount of repeat custom and referral. It’s lovely to see the daisy chain of receiver sending our cakes to another as a gift and so on. As we scale the business, we are very much looking strengthen the brand and build reputation.

How has business been during the Covid-19 pandemic?

We have been incredibly lucky. We have been very busy and have grown significantly. At the beginning of the first lockdown, our entire corporate client base disappeared overnight but our B2C business skyrocketed. It was an emotional time for everyone, and I have never felt so connected and grateful to our customers. Phone conversations felt more personal, so much sentiment went into gift-giving and I think it changed something in society generally. We experienced huge challenges with supplies and the delivery networks. It was a tough and humbling time.

I had my third baby last September and was working 60-hour weeks right up until he arrived – we all worked hard and felt grateful to have a business and jobs. In the last six months, the landscape has changed again, we are still busier than pre-covid and glad to see the return of our B2B clients.

What’s the hardest thing about running a business?

I have had to grow with the business, and I do have to work at my leadership style. Before I had a family my strategy of leading by example, being amongst the team especially when we were stretched and feeling a real bond with my colleagues during difficult times was my flavour of leadership. As we’ve grown it’s not possible to always be first in, last out and volunteering for every task that needed doing. I think it has set the culture and I am blown away by my team’s loyalty, strength and camaraderie but it’s evolved now. I have some team members who have to protect my time a little and keep me away from the day-to-day. I love working ‘on the tools’ as well as sketching out growth strategies and making blue sky plans for the future but it can be all consuming to be in both camps.

Have you received any financial support for your business?

My dad once lent me £300 out of his pension to pay the rent on the commercial unit – that was in the early days and wow money was tight! On a more serious note, we were able to trade throughout the Covid lockdown and were one of the lucky ones.

What have been the biggest challenges you’ve faced?

In the early years it was primarily finding the delivery partners who could successfully deliver a fragile product in perfect condition and quickly. The logistics infrastructure and service agreement has come an incredibly long way since I ventured into ecommerce. Possibly the experience of Covid has changed our buying habits forever and I was lucky enough to be in the right place at the right time.

What’s the best decision you’ve made so far?

Probably to focus on our corporate clientele. It’s great not to have all your eggs in one basket and I’m grateful we are moderately diversified – our B2B business is the natural marriage of my corporate experience coupled with my understanding of effective marketing and all through the medium of cake! I feel proud of the service we offer and that we invested in making each campaign maximum impact and excellent value.

I am very much instinct led. If something feels right or wrong, I will be led primarily by that hunch. I also like to take risks (I love a bet or a game of poker) but I’m also very careful with money. I think it’s a strange mix to be pro-risk but also feel loss aversion keenly. In some ways I think it’s not a bad profile for a small business owner but if I ever regret a decision, it is usually because I’ve been spooked by my cautious side.

If you could go back and change one thing, what would it be?

This is a tricky one to answer, of all the mishaps and hard-learned lessons along the way they have shaped where we are today. I’ve had to take my medicine at points, and it’s made me a better leader for it.