Superstorm Sandy was devastating for many businesses, but for Lisa Gundersen-Umansky of Polka Dot Pound Cake in Rockville Centre, it marked a key turning point.
Even before Sandy, she'd grown concerned that selling her cakes at farmers' markets, craft fairs and festivals across Long Island was limiting her selling season and leaving her vulnerable to bad weather.
That worry multiplied tenfold when Sandy hit two years ago and many of the municipal lots that hosted the farmers' markets were suddenly occupied by utility vehicles.
"Some markets opened, and some didn't," says Gundersen-Umansky, 51, who lost about three weeks of the key fall selling season that year. "I remember thinking, 'What other options do I have?' "
One that came to mind was opening a brick-and-mortar store, but the decision to take on a physical location didn't come easy. There are, she says, no guarantees: "If you build it, they may not come."
Internet has advantages
"Brick-and-mortar stores aren't for everyone," explains Thomas W. Shinick, an adjunct professor of entrepreneurship and small business at Adelphi University in Garden City and president of Corporate Development Partners, a Merrick-based business advisory firm. "They require a lot of thought and planning."
They also require a solid customer base and a good reserve of capital, notes Shinick, adding that firms may consider other alternatives first, including selling online. On the Internet you're not limited by geography, he says; stores generally only draw customers in a 3- to 5-mile radius.
"Online is a very inexpensive way to expand and reach a huge market," says Erica Chase-Gregory, acting director of the Small Business Development Center at Farmingdale State College. "You have no boundaries."
Gundersen-Umansky had sold her cakes online initially but felt a storefront could help her grow even more and expand her offerings. She took the plunge and opened her store two months after Sandy.
She couldn't afford her own commercial kitchen, so she produced her cakes the same way she had for selling at farmers' markets: in rented space at a commercial kitchen in Baldwin. But she was limited by the number of days that facility was available, and by the logistics of transporting her goods to her Rockville Centre location.
It took almost two years of bootstrapping — paying for the construction and equipment piece by piece, without any loans or outside capital — but she finally completed a $30,000-plus commercial kitchen at the store in December. "It really was sell some cake, buy a piece of equipment," Gundersen-Umansky said.
With her own kitchen, she's been able to increase volume and expand her product line beyond pound cakes. New additions include fruit tarts, cookies, crumb cakes and cakes by the slice. She also serves hot and cold beverages and has a sit-down area in the 950- square-foot store.
The on-site kitchen has enabled her to increase production by 50 percent, allowing her to bake about 1,200 pound cakes, cookies and tarts weekly. Gundersen-Umansky does this almost single-handedly: She has an intern assisting her and is in the process of hiring a part-time employee.
She now hosts children's birthday parties and has begun offering breakfast items on weekends such as waffles, which she added to the menu this month.
"I love that she's diversifying," says Chase-Gregory. "That's really important."
It also helps that she already had a customer base from which to draw before opening the storefront, she adds.
It's wise, though, to not totally give up her farmers' markets, because some customers may not want to travel to Rockville Centre, notes Shinick.
Gundersen-Umansky says she hasn't abandoned the farmers' markets and still sells at four — Rockville Centre, Malverne, New Hyde Park and Westhampton Beach.
"We've been cultivating such a nice relationship with many of these customers over the years," she notes, adding she's been promoting the storefront at her farmers' markets.
That's wise, says Shinick, noting she'll "have to market it quite a bit."
To focus on the store she stopped selling online, but may revisit that in the future. She's also hoping to add restaurant and other wholesale accounts. "This was definitely what I needed to take the business to the next level," says Gundersen-Umansky.
AT A GLANCE
Name: Polka Dot Pound Cake, Rockville Centre
Owner: Lisa Gundersen-Umansky
Product: Assorted bake goods
Annual revenue: $100,000-plus