In these times of inflated prices and deflated profits, one company has found a way to cope and even boost its business.
Sales at Emicakes, a local bakery chain known for its durian cakes, have jumped 30 per cent in the past six months, thanks to some 'good moves' made by the company, said director Daniel Ong.
Yes, prices of ingredients such as flour, chocolate, fresh cream and oil have gone up, amounting to a 3 per cent hike in costs.
But instead of raising the prices of its cakes, Mr Ong, 56, has found other ways to cope. Getting cake boxes made in China instead of Singapore has led to a 40 per cent reduction in packaging costs.
Another strategic move was setting up shop in a mall. Emicakes, which has traditionally been located in housing estates, ventured into Compass Point at the start of the year.
'We were quite surprised at the outcome. We found it was very successful,' he said, attributing the success to good human traffic.
The company is now looking at options in other malls.
But to deal with higher transportation costs, Emicakes has started charging customers who want their cakes delivered a fuel surcharge of $2 from this month.
Mr Ong said he has not received negative feedback over this.
He is not ruling out increasing the prices of its cakes although he said it would not be done 'across the board'.
'We will still look at competitiveness and whether the price of ingredients has risen a lot.'
A month ago, it deployed an executive to look at costs.
'Every week, we're reviewing and he's telling us it's bearable. So the increase can be absorbed but we need to find new channels to get sales,' said Mr Ong, adding that a marketing executive has been hired.
This article was first published in The Sunday Times on Jun 15, 2008
