Looking for sweet success

Renee Kim hopes her heart doesn’t get broken on Valentine’s Day.

The Long Beach newlywed isn’t worried about her husband, James Slama. He’ll be at her side all day, helping deliver cookie bouquets and other goodies for her franchise bake shop, Cookies by Design.

She’s concerned about sluggish sales of the $20 to $150 arrangements of heart- or rose-shaped cookies.

“I’m really bracing myself,” says Kim, who bought the shop on Pacific Coast Highway almost three years ago.

Valentine’s Day should be the busiest day of the year for the store, which bakes and sells decorated sugar cookies, including a “Conversation Hearts” arrangement with custom messages. But this year, Valentine’s Day falls on a Saturday -- traditionally not a good day for deliveries -- and in the midst of a recession.

A slow holiday would make it more difficult for the South Korea native to reach her goal to restore sales, which sagged 26% last year to $190,000 after gaining 26% the prior year.

Kim is encouraged by a bump in December and January revenue, as she benefited from the closing of another South Bay franchise and renewed sales efforts.

Still, Kim says she has no money to advertise or to do a remodel she thinks she needs for her shop, where she and three part-time workers mix up batches of sugar cookies -- plain and cinnamon-brown sugar -- and cut them into custom designs or hundreds of off-the-shelf shapes, such as animals, sports equipment and baby bottles. The oven in the back of the 950-square-foot shop also turns out non-decorated cookies such as snickerdoodles, chocolate chip and oatmeal raisin.

To cut costs, Kim says she recently negotiated a 30% rent reduction for the first six months of the year, left unfilled three of her six part-time worker slots, including her delivery person, and covers more hours herself at the store, which is open six days a week.

She also has begun to barter for some products or services. A few weeks ago, she traded store credit to cover a $550 membership fee at the Long Beach Convention and Visitors Bureau, where she hopes to meet potential clients. She also bartered cookie credit for advertising space in a local newspaper.

“I never used to be like that,” says the 32-year-old, who moved to the Los Angeles area when she was 5. “If I needed something, I was just, like, ‘Here’s my charge card.’ ”

Running a cookie shop seems like a dream job to many of the people she meets, Kim says, but she sees the venture as a steppingstone.

“My goal for 2009 is to get really aggressive with my marketing, get really aggressive with sales, just work myself to death, build up my sales and hopefully I can sell at the end of the year,” Kim says.

She’s already been busy: Last week she had her first Facebook-promoted marketing event, offering free cookies on the first day of classes for students at Cal State Long Beach, where her husband teaches. The effort brought in dozens of parents’ e-mail addresses, which Kim can use to pitch care packages for finals or graduation.

She drops off free cookies to local hotels, hospitals and other businesses when she’s out making deliveries but says she doesn’t always follow up. She’s tried various advertising outlets, with no success. She’s not sure where to focus her energy for the best results.

“All of this has been a major test of my tenacity,” Kim says.

Kim is like a lot of small-business owners when it comes to marketing: She has good ideas but hasn’t figured out how to get consistent results.

“There’s no focus and that’s very common among entrepreneurs,” says consultant David Choi, an assistant professor of management and entrepreneurship at Loyola Marymount University.

Choi, who met with Kim last month, came up with several recommendations to help the fellow UC Berkeley grad meet her aggressive goal to boost sales 20% this year despite the flagging economy.

“She has to be extremely productive as a salesperson,” says Choi, who brought some of his former MBA students to the cookie-filled meeting. There are restaurateur Luis Vilaneda, marketer Megan Bristol and entrepreneur James Pyle.

The group found that Kim had tried many of their suggestions, but that she didn’t keep track of results. She works long hours but is challenged by a relatively unknown business, lack of foot traffic in her quiet residential location and the recession, Choi says.

“Diligence is not an issue,” the consultant says. But “she’s a bit disorganized” in her marketing. Choi and his team came up with recommendations that could help Kim and other small-business owners in her situation.

* Work smarter, not harder. It can be tempting for a small-business owner to try to do more, but that isn’t always effective. By stepping back and figuring out what you want to achieve, you can have a clearer idea of what you need to do to get there efficiently.

“When you are an entrepreneur, especially in marketing or sales, the most important thing you have to ask yourself is which project to pursue, which target to pursue and how you can make the most efficient use of your time because that determines your productivity,” Choi says.

* Set up a basic system. Kim takes lots of sales-related notes but acknowledges that she often fails to look at them again. They end up scattered in her car, in her purse or on her desk, where what she calls “organized chaos” reigns.

A better solution is to dump the information into a software program, even a simple Microsoft Excel spreadsheet, to organize the notes that will be vital to Kim’s efforts to work more effectively, Choi says.

She might set up a system that groups target companies by industry type, then set up columns for basics such as contact information and selling opportunities, including product launches, new hires, employee celebrations, corporate gifts, referral thanks and other examples of when a company might want to buy cookie bouquets. Special-event businesses might be targeted for sales of smaller “favor” cookies or centerpieces for weddings, graduations or holiday events.

The spreadsheet should also have space set aside for tracking results and ticklers for when to follow up.

* Break down sales goals. Kim wants to increase her sales this year 20% and her corporate and special-event business 50%. Her first step is to figure out how much more product she would have to sell and how many new orders it would take to reach those numbers, Choi says.

She’ll also need to decide how many contacts she has had to make in the past to get one sale. If it takes 10 calls to get a new customer and she needs 25 new clients, she’ll need to contact 250 people this year. Breaking it down further, Kim would need to contact five new companies each week.

* Prioritize targets. Choi recommends that the business owner tag each target company with a high, medium or low priority, based on how likely it is to order in the quantity she needs to be successful.

“Ignore the low priorities, call the mediums once and spend most of your time on the highs,” Choi says.

* Set aside regular marketing hours. “I don’t want to get dressed up five times a week,” Choi says. “She could plan to go out twice a week, for three hours in the morning.”

* Follow-up. This is the missing piece to Kim’s current marketing efforts but vital to her success, Choi says. Part of her new systematic approach has to include regular follow-up on all potential and existing customers she has contacted.

* Delegate. Once Kim has her system down, she could train a promising part-time worker to handle routine follow-ups for reorders so she can concentrate on landing new business, Choi says.

The advice to manage her time more efficiently and to take some simple steps to organize her marketing efforts “resonated,” Kim says. “I know I can make this successful with the right focus.”

If your company could benefit from a free business makeover, to be published in The Times, send a brief description of your company and its challenges to bizmakeover@latimes.com or to Business Makeover, Business Section, Los Angeles Times, 202 W. 1st St., Los Angeles CA 90012. Put your company name in the subject line, and include a daytime phone number.

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Fixing the recipe

COMPANY SNAPSHOT

Business: Cookies by Design is a national chain of individually owned franchises that design, bake, decorate and sell themed sugar-cookie bouquets, including custom designs, plus cookie favors, cookie cakes and individual gourmet cookie varieties.

Owner: Renee S. Kim owns the Long Beach franchise

Opened: 1998 (Kim bought it in June 2005)

Start-up funds: $125,000 in loans from family and the previous owner

Employees: Three, part-time

Revenue: $190,000 in 2008

CHALLENGE

Come up with creative marketing ideas because the advertising budget for 2009 is zero; cheaply fix up store and attract more foot traffic.

GOAL

Increase annual sales 20%, including a 50% increase in corporate clients, and cut costs 20%.

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Meet the expert

DAVID Y. CHOI

Choi is an assistant professor of management and entrepreneurship at Loyola Marymount University in Los Angeles. Previously, he was a director of strategy at Titan Corp. in San Diego, a senior fellow at Harvard Business School and a consultant at Boston Consulting Group. He still advises various firms.