“…a small business dies a 1,000 deaths. You just need to come to grip with that, get over it and move on.”

This is Taylor Sparks of the Raleigh-Durham MO.com, where we feature small business owners and entrepreneurs to bring you, hints, tips, insights, and perspectives on what it takes to be successful. Joining us today is Chef Chris Duke, who founded Anna’s Gourmet Goodies with his wife Debbie in 2001. Chris, thank you for taking the time to speak with MO.com.

MO:
I’ve read that it was your grandmother, who was a great cook and the inspiration for your gourmet cookies and brownies.  What was it about her love of cooking that made you want to introduce some of her recipes to the world?

Chef Chris:
My memories of cooking and preparing dinner with family were always very happy ones. It was very common in my family for my mother’s brothers and sisters to either come over to our house or we go to Aunt Lois’ or Aunt Lucille’s and we would gather together  and have dinner.   And everybody would bring or cook different things.  So much of what I remember about cooking growing up is that it was very much a family affair.  My mom used to tell me a story about my grandmother. My mom grew up in the later years of the great depression.  She was pretty young but they lived on a farm and basically they didn’t have a lot of money so the depression didn’t mean anything.  But she told me the story that one of the things she remembers about the great depression was that more hobos would show up at the back door where grandmother Birchfield would always have something for them to eat. I took that as ‘wow’, they already didn’t have a lot but whatever they had they would always have something to share.

MO:
You had 17 years of working in the field of technology. Was there one or two things that made you decide to leave it behind and pursue gourmet foods?

Chef Chris:
I always enjoyed sharing food and making people happy.  It’s a part of who I am.  At my last full time venture at Sciquest, one of the things that I used to do when we needed to put out a direct mail campaign and I needed help to do that, I would throw these lunch parties.  I would prepare a meal and get people to help me by bringing them in and feeding them lunch and then I would get all this labor. It worked out great.  I would make soup and desserts.  I enjoyed my time at Sciquest and I’m not sure if there were one or two things. But my final tenure there was during the bust side of the dot com era.  I got to ride the bubble all the way up and rode it pretty far down.  I managed to make all of the cuts as they lay off people. Over time my wife and I started to think about what was really important and what we wanted to do.  I felt like it was time to stop for a while and pursue something that I was passionate about. And it just seemed like food and creating things was just a part of who I was.  I was fortunate enough to be able to step off of the bus.

 

MO:
In the beginning how many roles did you (and Debbie) have to take on to get the business up and running?

Chef Chris:
Well, all of them.  We still wear all kinds of hats around here.  One of the things that I tell people, is that if you  are starting a business from scratch you should really be prepared to do just about anything. Even if you want to delegate responsibility later, which you should do, and every entrepreneur needs to learn how to do, there really isn’t a substitute for knowing the business.  When you do everything you get to learn your business from the ground up.  Some of the most successful people I know started out in the kitchen, on the loading dock, or mail room or some other entry level position in the company.

MO:
You ran the business for part-time for two years.  Was that part of the initial plan so that you could wean yourself out of your job or were you just testing the waters?

Chef Chris:
Initially when we started we were just testing the waters.  It kind of grew organically.  Back to my food experience at Sciquest we had a cheesecake bake off contest.  I wasn’t really planning on entering.  It was the night before and I looked around and thought, well maybe I could bake something. I took my mom’s cheesecake recipe that I had and decided to spice it up a little bit. I sauteed some apples in bourbon and made a date and graham cracker crust and I submitted it to the contest.  Well low and behold I won grand champion.  People loved it and said, “Wow apple bourbon cheesecake, this is fabulous! You should sell this!”  I said no, I didn’t want to and I let it sit for a while.  But eventually I thought maybe I would try.  So I made one and took it to a local restaurant where I knew the chef and said why don’t you put this in and try it and see what people think.  Well he did and they loved it and then he ordered two and then he ordered four.  So initially I would say that organically we were testing the waters. But at some point we decided this might be a business.  We actually planned it very thoroughly. We looked at our expense structure. We cut our overhead wherever we could.  We saved money.  We tried to do everything we could to be very thoughtful about making that exit and to give ourselves the best probability to succeed.

MO:
Were there any times or how many times did you ever  think about quitting?

Chef Chris:
I can’t count that high! The truth is that in small business or in starting any business whether starting small and it becomes big.  There are tough times and there are fabulous times.  I think anybody that says that the thought of, “maybe I should pack it all in”, never enters their mind, I’m not sure that that is really true.  My friend August Turak, who is also a mentor of mine said, ‘Chris, a small business dies a 1,000 deaths. You just need to come to grip with that, get over it and move on.’

MO:
Is that how you were able to overcome your moments of having ‘1,000 deaths’?

Chef Chris:
I think the one thing that helps when you run into difficult situations, is to step back for just a second and look at what is really happening and try to remove the emotional part of it.  That’s where the, ‘I want to quit’ comes in, when you get emotional about something.  This isn’t a personal thing. This is just something that occurs along your journey.  If you step back and look at it unemotionally and then see what you can do to take one more step, something positive.  Say to yourself, I may not be able to fix all of this but maybe I can take one more step.  Then you step back and look at it again and look at it from a different perspective and then you take one more step.  I think the secret to moving on is that you just have to get up again and again and again.  One of my favorite moves is Cool Hand Luke with Paul Newman.  George Kennedy plays opposite Paul and in it they are in prison. In the movie disagreements are settled by going out into the yard with boxing gloves and having a knock down fight.  It’s a pretty brutal scene but George keeps knocking Paul down again and again and again. But no matter how hard Paul gets knocked down, he keeps getting back up and getting back up until finally George walks away.  So sometimes when I get knocked down a little bit, I think back on that movie and think back on Paul Newman and I get back up.

MO:
There are a lot of gourmet food companies on the market. Why did you decide to focus on cookies, as opposed to, say… gourmet pasta?

Chef Chris:
The cookie business was really an evolution from my dessert business. The story about Sciquest and the apple bourbon cheesecake is where the business was founded.  We started it doing wholesale dessert for restaurants.  We did some retail because we would ship our cheesecakes on ice packs overnight as we had a web store pretty early on. Much of the early business was in the wholesale desserts. We had a number of restaurant clients after we had the one and it sort of grew and we added more and more folks.  We grew that business until we ran up against our capacity wall. We were able to fill up our freezers as much as we possibly could.  We were making as many cheesecakes and pies as we possibly could. We realized that if we were going to make enough money, if we were going to take this to the next level, we were going to have to get bigger.  Or we are going to have to figure something else out. That’s when we stepped back a little bit from that wall. We had a website, what if we were able to do other types of gifts, like cookies.  It requires the same equipment, a little bit different ingredients. We could manage a little bit better. We would make better margins because we were selling a retail gift that we were shipping.  That’s an example of when we ran into something, took a step back and looked at it from a different perspective.  That’s how we ended up going down the road to cookies.

 

 

MO:
How long was it before you were profitable?

Chef Chris:
I’d like to think that we were technically profitable from the beginning.  We managed our business very well. If there is one lesson that I learned, as this is my third business, is that you really, really have to watch what you take in and what goes out and what things really cost you.  One thing I would pass on to people starting a business that is very, very important is to understand what your exact expenses are.  And to try and to control those and to make sure that you are taking in more money than you are paying out.  The days of the dot com bubble were great where you could go out and you lost money and tried to make it up on volume.   Well now days you can’t do that because it doesn’t work. It was probably about three years before we had a cushion of our savings to fall back on and to where we built that up so that it started to take on a life of its own.  But we did manage it very thoughtfully, very frugally and very carefully from the very beginning.  This is one thing that has helped us survive.

MO:
How many employees do you currently have?

Chef Chris:
The business is primarily Debbie, Anna and I.  During the holiday times when things are incredibly busy, we bring in some extra folks.  We have one family that has been working with us for years and they know our customers about as well as we know our customers.  We have hired others and outsourced some tasks where that is possible.  We try to be very efficient in terms of where we put our labor.

MO:
Your company is a long-time supporter of the NC Special Olympics.  What made you decide to get involved in that particular charity?

Chef Chris:
We support a number of different charities and we give back as much as we can.  This particular charity is one that Debbie used to volunteer for back when she lived in Kentucky.  Our friends Bill and Darlene McKenney were involved in a local club that provided meals for the athletes.  They volunteer to serve meals to the athletes and when they asked us to get involved it just seemed like a really good thing to do. I love supporting the charity where we are able to take product and do something where the benefit goes directly to the people.  It feels right to give the cookies to the athletes that are out there giving their best. This is especially true at a time where some of the funding in North Carolina is being cut for the Special Olympics.

MO:
Have you given thought to expanding into other gourmet food areas?

Chef Chris:
We haven’t at this time.  We have tried other products along this journey, similar baked goods.  We have ventured off a little bit, but I believe in the power of focus. I think you can try and do too many things.  We are a member of the North Carolina Specialty Foods Association and Good Grows in North Carolina. It’s a great organization as I get to meet and network with a lot of people who are doing different things like sauces or nuts in the gourmet specialty area. I get to meet some of these people and occasionally if I can help them out I’m always volunteering my knowledge or sharing or meeting with somebody to see if I can help them along the way, which I love doing. But right now I think we will continue on our current path.  We are getting ready to launch a new cookie.  It’s called an Artisan Cookie.  We are spending some time visiting with some of the local farmers that produce the ingredients that go into this cookie. I think it’s going to be pretty exciting so my energy is focused on getting that cookie off the ground.

MO:
Your daughter Anna, who’s named after your mother, has also been a great inspiration. Has she helped develop some of the flavors?

Chef Chris:
Anna likes to taste whatever we make!  We had a round of tasting on the Artisan cookie this morning! Sometimes she agrees and sometimes she doesn’t agree.

MO:
Do you hope that she will one day pass on the tradition of great gourmet baked goods?

Chef Chris:
I don’t know if she will take the baton or not.  We’ll have to wait and see. I know that it worked pretty well for Dave Thomas and Wendys.  I think Paul Newman did a pretty good job with Newman’s Own.

The Final Five!  Five semi-random questions.

MO:
Proudest personal achievement?

Chef Chris:
I would place that on the schools and education.  I went to Kentucky Wesleyan College for my undergrad and Duke University’s Business School for my Graduate degree.  I went to both of those schools on scholarship. I went to Kentucky on a full ride and for Duke I got a pretty significant scholarship from Junior Achievement.  My parents helped a little bit but most of my education is self-funded.  I paid off everything myself and it was a lot of work.

MO:
Title of last book read?

Chef Chris:
Heart of a Leader by Ken Blanchard. It’s a series of small parables on traits of a leader.

MO:
Three non-family members you admire?

Chef Chris:
Harlan Sanders, the Colonel from Kentucky Fried Chicken. I think he was a very early influence on me.  I got to meet the Colonel a couple times and he has just an unbelievable story.  On the more modern and younger side, it would be Ryan Allis from IContact.  He’s a local entrepreneur that started and built up the email marketing company IContact . He wrote the book Zero to One Million. Just a good young man with a good heart and we use their product. He understands the importance in giving back.  And August Turak, he’s a local entrepreneur (www.augustturak.com) that started a company and built it and sold it up for a pretty good chunk of money and I have gotten to know him and I consider him a friend.

MO:
Favorite hobby or diversion for fun?

Chef Chris:
It used to be golf but don’t have the time requirement for that.  It pretty much evaporated with running businesses.  I really enjoy tinkering with cars and fixing things. For me there is really nothing better than a little garage therapy sometimes. I go out and tinker around and fix things.

MO:
If you weren’t in the gourmet foods business, what career would you have?

Chef Chris:
That’s a little tough.  I’m one of those people who have been very fortunate that I have gotten to do a lot of different things.  Three things that I was thinking of that I think would fit me well. The things that I would enjoy would a teacher/author/speaker.  I don’t know if that is a right career but those are three things that I seem to enjoy.  I met someone recently who was starting a business and they were looking for a little bit of help.  I was able to give them some guidance so I spent some time with them and pass that information on.  I would like to be able to take some of the things that I have learned and put that down in a book.  I’ve actually registered a domain for that called Inside the Oven.  My blog is www.outsidetheoven.com.  I want to be able to share what I’ve learned.  I think that there is value in that. I think that’s what it means to give something back.  I have been very fortunate and very blessed.