Just Baked: Cupcake Shop Finds Sweet Success in Detroit

Editor’s Note: This is the first in a series of posts profiling businesses located in depressed or troubled communities. We’ll be spotlighting businesses in other areas in coming weeks. If your business is charging ahead despite being located in a depressed locale and you’d like to be profiled, we’d love to hear from you.

With one of the nation’s highest unemployment rates and widespread poverty, Detroit doesn’t seem like a promising place to start a business. But Pam Turkin’s cupcake shop, Just Baked, is evidence to the contrary: Launched in 2009, the business recently opened its seventh store and is beginning to franchise. Last year, Just Baked recorded $2 million in sales.

Initially, Turkin hadn’t even intended to open a retail shop. She’d simply been doing some catering on the side while working at a marketing job. She’d wanted to jump into catering full-time, so she went looking for a commercial kitchen. “I found an old bakery that had been closed for months,” she says. “There were so many vacant buildings around, so the owner was willing to give it up for a song.”

One day, not long after moving into the commercial kitchen, Turkin baked more than she needed for her clients. She decided to sell her excess inventory in the bakery’s attached storefront. “We put up an open sign, and sold out almost immediately,” she says.

Turkin believes Detroit’s depressed economy is actually a contributor to the business’ success. “A cupcake is a small luxury that someone might buy, instead of going out to dinner or going to a movie if they don’t have the money for that,” she says.

The specialty bakery sells more than 30 varieties of gourmet cupcakes, with flavors such as s’mores, rocky road, and the popular “Fat Elvis.” In contrast to many cupcake shops, which charge as much as $40 or $50 for a dozen cupcakes, Just Baked sells its cupcakes for just $24 a dozen. “We were very conscious of keeping our pricing low enough to be affordable to everyone,” says Turkin.

There are other benefits to operating in Detroit as well: “We’ve been able to secure real estate much more cheaply than we could have before the recession,” says Turkin. “We have a location in an upscale suburban mall that we never could have gotten into five or six years ago.” And, because so many people are unemployed, Turkin has had no trouble finding qualified help.

“The biggest negative is that there’s no financing available,” says Turkin. “There are a lot of great deals available, but you need to have the capital to get them.”

That hasn’t slowed Turkin down. She plans to expand Just Baked to 25 locations by the end of next year and has partnered with an investment firm that will aid their expansion throughout the country in the years to come.

Just Baked proves that, for an entrepreneur with a great concept and the willingness to work, success can be sweet — even in Detroit.

About Kathryn Hawkins

Kathryn Hawkins is a principal at the content marketing agency Eucalypt Media. She's written about business, marketing, and entrepreneurship for publications including BNET, TheAtlantic.com, Inc.com, and owns and operates the positive news site Gimundo. Follow her on Twitter at @kathrynhawkins.
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3 comments
Janine
Janine

Being someone who grew up in Michigan and still has all my family still living there with many living just outside of Detroit, I love finding stories of people who are making it a brighter place!

Doug Cohen
Doug Cohen

We love Just Baked cupcakes. My wife and I are native Metro Detroiters and have been impacted as much as any by the economy here. I was a national account manager with T-Mobile for almost 4 years when the big economic bust happened in 2008 and the automakers (my accounts) started going bankrupt. The T-Mobile upper management figured all of a sudden that I became a bad salesman and couldn't understand why I couldn't sell thousands of new BlackBerrys to companies who were laying off employees by the thousands, so they finally showed me the door the following year. I get it - you can't continue to pay a sales guy when there are no sales to be had - but that's a whole other story. The point is that instead of remaining in corporate America, I joined my wife who had just opened a photography studio here in the Orchard Mall in West Bloomfield, MI. We are now building the business together and having a blast! My wife had been doing it on her own shooting on location for several years but this was a big step opening a studio. It's not easy to do in Detroit as you have detailed in your piece, but through word of mouth and a superior customer experience we are growing. We met Pam Turkin recently and fell in love with Just Baked. We had a party here at the studio for our high school senior spokesmodels and brought in a few dozen cupcakes and they were a huge hit. An image of one of our seniors can now be seen in our window enjoying a Just Baked red velvet cupcake just like the ones Pam is holding on the tray in that photo! I have to say that I was initially a skeptic about the cupcake revolution because I had some at Magnolia Bakery in NYC which people line up around the block for, and I thought they were average. I thought "this is what the hype is all about"? Just Baked however blew me away. So many different kinds to choose from and each one is a unique creation - and they are sooooo delicious. I haven't had one yet that I didn't love, but my three favorites are red velvet, pineapple upside down, and pumpkin pie - YUM. :-)

Jay Badenhope
Jay Badenhope

Glad to hear it, Janine. We thought it would be nice to share some good news from Detroit. Jay B. (Intuit)