AIRPLANE MODEL TO KIDS BUSINESS MODEL
This week we announced the launch of Kids Loves Baking. Our new purpose driven baking business dedicated to educating them about where their food comes from and giving them the skills to bake via a network of charity partners, schools community projects and not-for-profits who will benefit from 5% of all revenue.
It will also help disadvantaged young people turn their big food ideas into reality through our Freshly Baked equity of up to £10,000, access to our hyper local supply chain, our digital estate, production knowhow and founders will be supported with mentorship & an entrepreneurship programme similar to the one taught to my students at UNC as well as space within our production facility for up to 1 year for 5% equity.
PUTTING PEOPLE FIRST TO MAKE BAKING AFFORDABLE TO ALL
With today's rising cost of living and the average price of a kids baking subscription costing £132* pounds per year, making it unattainable for some 24 million families in the UK. We put people needs and purpose first over profits and shareholders to make baking affordable with prices average 70% cheaper than online retailers and subscription services.
To achieve that price point we have kept it simple and removed all the faff and expensive packaging that, doesn't really add very much to the baking experience itself. We focus on the quality of the ingredients and teaching kids more about where food comes from, learning new baking skills and helping them to build confidence in themselves and in the kitchen.
REMOVE THE RISK & THE FAILED DELIVERY
One of the biggest risks and costs to eCommerce start-ups are courier companies failed deliveries, theft, loss and damage and for the consumer it’s the delivery charge, To mitigate the risk and costs our new business model only uses couriers for shipping bulk orders to our network of community-based collection points, who will share in the revenue. And by couriers we mean the Royal Mail, as none of the others are regulated and do meet our new supplier standards. We are currently discussing partnerships with charity shops, food banks, churches school, community centres, mums, and dads who will earn up to 15% of the sale in revenue when they join our community collection points network. This model will help provide income and much needed support to those organisations and people who need it most and lessen the impact a failed first deliveries damaged and stolen goods by unregulated Courier companies which costs small businesses £770m a year.
PUT EVERYTHING IN THE BOX EXCEPT EGGS
Over the past six months we have been testing new ideas and products to develop a range of kids baking kits that come with everything weighed out and measured, so there is no stress and no waste. There are no hidden costs or extra items needed, which can add up to 30% of the cost of a subscription box, the only ingredients needed are just a few eggs. The new range will include a fun bread making kit, chocolate and almond shortbread kit and cookie cutter, fruit, nut & oat cookies, orange chocolate cookies a victoria sponge and a bread making course made with natural, quality ingredients and no added salt, fat of sugar.
FROM AIRPLANE MODEL TO BUSINESS MODEL
The “Tastes Good, Does Good” business model came about after I started working with ReLondon - a partnership of the Mayor of London and London’s boroughs – on how to reduce waste and create a more sustainable business model. Kids Love Baking has always been bubbling away in the back of my mind. I knew I wanted to make baking more affordable to everyone and I wanted to recreate the same excitement I got as a kid with those magazines you bought and over 2 months you made something. The joy of getting your pocket money, rushing to the shop, picking up a copy, running home and starting to make the wing of plane or door of car. I wanted to do the same but for baking, but without the cost of the magazine, and I wanted a way for kids to make the buying decision, the right food choice and bake what they want. That is simple when you are dealing with a plastic car or plane, not so easy when you’re dealing with food.
At that point I started looking at the role technology had to play in all of this, outside of just building an ecommerce site, it needed to house our baking content, location services to search for a pickup point or the location of a local baking club or register to become a collection point. Tracking the inbound delivery to the collection point, but also alerting the customers to tell them it is arrived and ready for collection. If we were going to enable kids to shop it had to allow parents to set up a kids’ user account. But only surface products based on product type, ingredient and allergen choice, nutritional value, cost. From there and how many little Tommy could buy a week/ month? or could he be rewarded for going tasks around the house. For our food bank partners who could give boxes to those families who needed cant afford to buy a box and ensure no kid is excluded and every kid was given the opportunity to learn how to bake and gain a lifelong skill as I did building those bloody airplane wings, which kept falling off!. But I did learn all about aerodynamics and lift, which I put to beneficial use when I trained as a pilot many years later.
It was the output from the time spent and the audit that ReLondon provided that helped me to refine the ideas and produce the delivery model, our overall technology roadmap and freshly baked grants, so I could create a truly sustainable business and revenue share model that will help build a future where nobody goes hungry.
COULD WE ALL HAVE OUR CAKE & EAT?
Of all the businesses I have worked on this one has proved to be the most challenging, after all it's not everyday you sit there and think how "I can develop a business that’s address several huge social issues and be catalyst for change". At the same time develop a fun way that enables kids to start making better food choices and gain new skills. Whist ensuring the business never deviates from its purpose and always puts people first, before profits and shareholders. Let’s be honest notions of “changing the world” and might sound great but a seasoned VC is going to look right past “does good and want to know when and how much profit will you make? Hence, they are more concerned with whether the idea high revenue potential over redressing the issue of food inequality
CAKE SMOTHERED IN GOOD WITH A SPRINKLING OF PROFIT
The “doing good” bit needed to be visionary and have the commerciality needed make enough profit that would enable the business to raise funds grow and scale globally, well if you look below that chart shows you how much 5 nations gave their kids £24.04BN a year ( we decreased it by 10% & took off highest earning households) and on average kids spend 21% on hobbies, education activity & games £5.04BN, but our margin is lower about 11% net add that the 5% equity in our incubated starts-up, more importantly all the good it would do around the world to ensure no one goes hungry including the VC's
Greg Wixted is the founder of Kids Love Baking and adjunct Professor of Entrepreneurship at the University of North Carolina