Cookie delivery biz jumpstarts $10 million a year venture.
By Chuck Green
Leon Chen felt he needed a part-time job during college to pay the bills. After all, they don’t just give away textbooks. A fact, perhaps, that calls for some comfort food. How about a nice warm chocolate cookie? Chen’s got you covered.
“My wife-to-be, Tiffany, was baking cookies and it was a good recipe and I just thought we could sell them. It wasn’t meant to be a business or a career; it was just a way of making money in college,” said Chen, owner of Tiff’s Treats, which specializes in warm cookie delivery.
The more involved in the enterprise they became, they realized they might have an actual business on their hands, “beyond a way to just make side money,” said Chen.
Tiff’s Treats At-A-Glance
The cookie business is located at 8900 Shoal Creek, Suite 135, Austin, TX 78757 with additional locations in Houston and Dallas. The biz is booming.
Business description: First in the nation to do warm cookie and brownie delivery. Works just like pizza; order ahead for pick-up or for delivery in about an hour. It's a million-dollar idea.
Web site: www.cookiedelivery.com
Year founded: 1999, while Sophomores at The University of Texas.
Sales from last year/anticipated this year over $10 million this year.
Early on, they considered five orders a night quite the bounty. Soon, sales blossomed to 10 orders an evening, said Chen, who noted that if he hadn’t used his college apartment to conduct the initiative, “the overhead cost would have been too great to even attempt the business.”
Of course, it was illegal to operate their type of home-based business, which the couple learned only after they’d been running it there for a while. “We had no idea—we were just ignorant college students,” he said. “When we found out, we were like, ‘I suppose we need to be legit and get a space in a real commercial kitchen.’”
At the time they didn’t know about things like licensing and packaging requirements. “The volume of our business was so small,” said Chen. “Not only didn’t we pay attention, but no one took notice. We started out
selling to friends of friends and a couple of random people on campus. I’m not saying that the day we found out it was illegal that we found a kitchen space, but the day we found out, we started thinking we had to figure a way to make this more legit.”
Renting out commercial kitchen space proved rather difficult. “We weren’t picky; we just needed a place that was legitimate and that had an oven or allowed us to bring in our own. We went up and down the main strip there and asked every business owner that looked like it might have a kitchen if we could rent from them. But we got a lot of weird looks. People were really confused or said no,” said the biz owner.
Finally, when Chen had all but given up hope, he found one business owner willing to listen. “It was at the end of the baked-potato craze and there was a little baked-potato shop that wasn’t doing so well, so they let us rent their kitchen for $500 a month.”
Chen was able to satisfy the requirements of the health department. “Luckily, we were doing cookies, not chicken or fish or anything that had a danger of food-borne illnesses. So, even from the start, as far as meeting regulations, it was fairly simple. It wasn’t as bad as a full-blown restaurant would have been.”
Eventually, the potato store went out of business and Chen and his wife took over the entire space. Consequently, Chen said his business became more of a storefront. “People could see us and pick up their cookies from us, and that kind of expanded our reach.” Using the same grassroots methods, such as handing off samples, they also targeted customers beyond those who attended the university. “It’s easy to hand out warm chocolate chip cookies.”
Beyond that, Chen said getting off the ground was “more evolutionary than revolutionary. It was slow process, but it was just a matter of improving, one step at a time.”
Adding to the challenge, Chen said there wasn’t any blueprint in place for what they were doing. “It wasn’t like we were opening a pizza joint, where there’s a blueprint on how successful pizza places are run. No one else knew how to do what we were doing. We just made things up as we went along. Eighty to 90 percent was trial and error.”
Furthermore, they had no business plan in the beginning. “We were still finishing school. By my senior year, I talked the university into letting me use my business as an internship, so shortly thereafter, we put together a very rudimentary business plan.
Leon Chen and his wife, Tiffany, started their own cookie delivery business to earn extra money to pay the bills. The enterprise took off and now the busy couple owns several locations and makes millions of dollars a year.
Chuck Green is a business writer in the Atlanta area.