Watch Janie's Cakes startup story. (Video credit: Sue Williams)

Running a bakery that makes just one item — a Bundt-shaped pound cake — is not as simple as it might sound.

Janie Clapp, a baker by training, has been operating Janie’s Cakes since 1987 in Tyler, Texas. Daughter Katherine Crow became her official business partner 10 years ago. They make 26,000 poundcakes a year, in a variety of sizes with different fillings, enjoying busy seasons like the holidays and Mother’s Day. Annual revenue is $750,000.

But the tricky part, which might not be obvious to, say, the local Texan who scarfs down a slice of cake, is securing the same premium ingredients on a consistent basis. All the cakes are made with farm-fresh eggs, creamery butter and real cane sugar, and filled with things like rich buttercream icing or topped with toasted pecans.

“We are very particular about our ingredients,” Clapp says. “My product tastes a certain way and bakes a certain way — I’m not willing to fudge.” In recent years, maintaining Janie’s Cakes’ baking essentials has been impacted by everything from severe weather to factory explosions. “Unexpected surprises add another level of challenge in terms of maintaining our own standards,” Crow says.

[Related: Check out these advice and tips for women entrepreneurs]

Stockpiling ‘Liquid Gold’

Case in point: Vanilla. A world away from East Texas, farmers on the island of Madagascar off the coast of Africa produce an estimated 80% of the world’s supply of vanilla. A cyclone tore through the island in 2017, uprooting vines and triggering a sudden increase in the spice’s price. “All of a sudden it goes from a hundred and something dollars to $400 a gallon,” Clapp recalls.

Clapp and Crow say they were almost instantly notified about the cyclone situation from their supplier. After that, it was all-hands-on-deck in Tyler. “Whatever our priorities at the bakeries were,” Crow says, “it immediately went into a halt.” They quickly started researching other companies that sold the same type of all-natural vanilla in volume, hoping to secure gallons of the spice at fair market value, before prices rose. They succeeded.

“When the vanilla bust came, we had purchased enough vanilla to get us through 14 months of production,” Crow says. “We sat on it.” In the months that followed, the two would joke “‘we need a safe — this liquid gold is nerve-wracking!’”

As a baker, Clapp says she was completely unwilling to use much cheaper artificial vanilla. “No, no, no,” she says. (Her preferred brand is Nielsen-Massey, which she says is “fabulous.”) And as a business, Crow adds that Janie’s Kitchen wanted to maintain prices. If the cost of your supplies soars, “you either eat the cost or raise the price — and those are two areas we hope to avoid,” she says.

[Related: Listen to our podcast about starting a snack company]

Weathering the Storms

Throughout the years, Clapp and Crow have weathered other storms, both literally and figuratively. In recent memory, a Louisiana factory exploded while making powdered sugar (it’s highly combustible), triggering a shortage that they’re still dealing with. The price of butter goes up and down, as does cocoa, whose production is impacted by drought and warming climates. Flour, fortunately, remains somewhat consistent.

Crow handles forecasting for Janie’s Kitchen, generally using the slower summer months to analyze reports from the company’s database. She then alerts suppliers as to how much they’ll need of a certain product, per month. She’s currently looking ahead to the Christmas holiday season. “All that information can be transferred to our vendors, so we all have expectations and guidelines,” she says.

Clapp and Crow says aspiring entrepreneurs in the food business should work with experienced suppliers who can help manage sudden shortages or temporary price increases. “Typically, we work with companies that have really great sales reps or companies that really care about customer service,” Crow says. They use bigger suppliers like Ben E. Keith and a number of smaller vendors.  “They immediately inform us and notify us, because they know how important it is to us to maintain the quality.”

While vendors are “helping us look for Plans C, D and E, we do our own experiments,” Crow says. For instance, they recently tried making pound cakes using powdered sugar made from beets, which some bakers have converted to. It didn’t pass muster. “The flavor is different,” Clapp says. “I’ll be so glad when this plant is back up.”

After so many years in the food business, Clapp is pragmatic about dealing with shortages. “So much of life is problem solving,” she says. When something like a vanilla bust happens, “you get busy and solve the problem.”

[Related: Read a full profile of Janie’s Cakes here.]

Read Full Transcript

Katherine: A lot of new customers come in and they ask, “Are you Janie?” And I'll go, “No, I'm not Janie.” And then the next question is, “So, is there a Janie?” “Yes, of course there's a Janie! Would you like to meet her?”

Janie: Usually I have my hairnet on or something, and they're like, “And you're baking?” I'm like, “Yes, I'm back here baking!”

TEXT: Janie Clapp – Founder, Janie’s Cakes – Tyler, Texas

Katherine: At Janie's Cakes we make an old-fashioned pound cake. And the tagline that we use on a regular basis is that we want you to spread a little kindness one cake at a time.

SOT: We went to high school together, that’s how much we love each other.

TEXT: Janie and her daughter Katherine have lived all their lives in Tyler, surrounded by a large extended family.

Janie: My great-grandmother, she would get me in the kitchen and she'd go, “Jane. Let's learn how to bake. I want you to learn all the chemistry, what works, what doesn't.” And then she'd go, “Well, do you know why this didn't work? Do you know why it fell or why it tastes awful?” And so, she taught me all the chemistry behind the baking.

TEXT: Throughout school, Janie baked for family and friends. At Texas Christian University, she studied art, focusing on ceramics and sculpture.

TEXT: In 1973 she married Matt Clapp, a local rancher.

Janie: After we married, my nieces and nephew came into the picture. And I was like, “You don't want a sheet cake for your birthday? You want a tennis shoe or something sculpted?” So before I knew it, my husband had engaged me with other people. “Sure, Jane would love to make your son a birthday cake.” And before I knew it, it evolved into this business.

TEXT: Janie set up her company in 1987. She soon outgrew her home kitchen.

Janie: I started looking around for buildings that I could rent or buy. So, I went to the bank. Because I had always banked with a certain bank and my family had, my husband's family had, they knew me. And so they were like, “Okay.”

TEXT: Janie borrowed $80,000 to buy a building and equipment.

Janie: I started making wedding cakes for all these people that I had grown up with and knew in Tyler.

TEXT: Katherine was born in 1983. She spent much of her childhood in the bakery.

Katherine: Much like Janie, I really did love cooking. And part of that was learning skills as it went along. Like, she might be making a flower or something and I would make a flower and put it on my creation.

TEXT: Katherine worked full time at the bakery through college. They were making wedding cakes that fed up to 1,000 people--at $15 a slice.

Janie: The sculpt-a-cake business and the wedding cake business, it was loads of fun. But it's also very intense, because I used fresh ingredients, did everything at the very last minute, everything we made from scratch. And it was just so time consuming. And of course, nobody really wants to get married on a weekday! It’s always on the weekend! We ended up traveling all over Texas delivering cakes. And so we would get home late Saturday and just kind of crash. And I’m like, “Okay, I want my weekends back.”

TEXT: Janie and Katherine stopped making wedding cakes and began making simpler pound cakes.

TEXT: Katherine took the company online. She became a partner in the business in 2009.

Katherine: You're looking for a birthday cake that you can mail, or you need a thank you gift. We're at that click of a button.

Janie: She's very tech savvy, yes.

Katherine: I don't know that I would give myself that much credit.

Janie: Yes, yes, I would.

TEXT: Janie’s Cakes has 7 employees and sells about 26,000 cakes a year.

Janie: Weather is a huge factor. Just when you're just rocking along and then all of a sudden, oh, no kidding. A hurricane, that affects production for the company that we buy our vanilla from. And so, all of a sudden it goes from $100-something to $400 a gallon. So that's a challenge.

TEXT: Annual revenues are close to $750,000 a year.

Janie: It sounds pretty nutty and I guess nerdy, but still, when I take the pans off the cakes, I'm hoping that each one is going to be perfect. There's still something about that. There's just something about it. The smell. The steam. The cake. It's a pound cake, but it's a pretty darn perfect cake.