News From Terre Haute, Indiana

Business

December 21, 2013

ISU students taste success in ‘sweet’ project

Sweet and Petite startup business sells cupcakes in Federal Hall

TERRE HAUTE — While Dana Miller savored the samples of pastry to determine which would be served as her wedding cake, she didn’t think it would serve up another inspiration: a startup business venture.

Miller was part of a group of four Indiana State University business students who created Sweet and Petite, a small venture that was part of a semesterlong class project to create a business. Sweet and Petite sold cupcakes at Federal Hall, which houses the Scott College of Business, and at several businesses in downtown Terre Haute. The cupcakes were created by Marshall, Ill.-based LMC Creations, which is also creating Miller’s wedding cake.

“A lot of the teachers have been very willing to support us,” said Miller, a senior business management major from Marshall. She would buy the cupcakes at the start of each week before the group would set up in the basement of Federal Hall, near a study area and several classrooms. “The students are passing by, seeing these delicious cupcakes and then purchasing them.”

The group, which included Indiana State students Kathleen Anslinger, Sumika Mogi and Allison Vaught, initially ordered 24 cupcakes for their first two days. LMC Creations gave the students some extras, which left them with an initial order of 33. They quickly realized what was to come, though, when they pre-sold five of the sweets before they even had set up their selling area.

“We thought that would be a safe number, but not too much of an underestimation,” said Anslinger, a senior business management major from Haubstadt, of their initial two-dozen estimate. “We were very wrong. Learning from experience, I guess, is the best way to do things sometimes.”

The project was part of International Global Business Advisors, which was started by Aruna Chandra, professor of management in the Scott College, to engage her students in experiential learning opportunities that also include organizations and businesses around the world.

After the students decided they wanted to sell cupcakes, they had approached Lisa Claypool, owner of LMC Creations, who supported their idea.

“It’s the first time I’ve had a chance to do something like that,” Claypool said of the students’ proposal for Sweet and Petite. “I do have some commercial clients … but never had anyone approach me with the idea of a project like this. It was kind of neat to have the opportunity to do that.”

Miller’s parents had first tasted some of LMC Creations’ cupcakes during a high school reunion over the summer, and Miller then approached her to make her wedding cake and with the startup venture idea.

“You never know when you do something like that because there are (also) some bakeries in Terre Haute…,” Claypool said. “When you have college kids, they’re willing to try anything, and when college students eat something and they like it, then they can get the word of mouth out really fast.”

The Sweet and Petite members received their initial funding from Chandra, who taught the business course. The students then bought the cupcakes and containers to put them in, and printed out labels. They sold the cupcakes for $2 each, which led to more than 80 cents of profit per cupcake sold.  

“I’m thinking about having my own small business,” said Mogi, a senior exchange student from Japan, “so it was good to get some insights about starting a business from a small size with few resources.”

The students repaid Chandra, their “angel investor,” before splitting up their profits, spending them on a trip to New York City. Chandra led the four students on the trip to the Big Apple to meet with entrepreneurs so that the students could learn how people had successfully started up their small businesses.

“The way I see entrepreneurship, it’s like a magic trick. You have to know how the trick works before you can go perform it,” Chandra said. “Entrepreneurship is similar to that. You need to know the nuts and bolts of the process in a very generic form before you can actually put that into practice.”

The group divided up each of the functions necessary to run the business, from marketing to logistics. They also listened to their cupcake customers. They switched several flavors each week, taking advantage of LMC Creations’ palette of more than 280 cupcake flavors. Yet they also paid attention to customers’ preferences, bringing back the pumpkin-flavored cupcakes that were the quickest to sell out, and which had received rave reviews.

“They came up with the name themselves and they did everything on their own,” Chandra said. “I thought it was a very good name, and the flavors are really interesting.”

They quickly expanded their business, delivering cupcake orders across campus. They also received several weekly orders from Old National Bank in downtown Terre Haute.

“Just starting this business on such a small scale, we thought of stuff we had to do that I didn’t imagine,” Anslinger said. “It is an eye-opener in a way. Even though it is so small scale, it is similar to running a business.”

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