The average person would crack open a fortune cookie in hopes of finding good luck. But Karen Belasco Staitman likes to think bigger than that—a lot bigger! Back in 1995, “I was a party planner and I had made some gigantic fortune cookies for party invitations,” she recalls. “One day when walking through a department store I saw some decorated apples and thought to myself, ‘What if I dipped these gigantic fortune cookies in chocolates and caramels and decorated them for every occasion and then place a personalized fortune inside?’ I made some for friends and clients as invitations and party gifts. That’s when I knew I had a great idea.”
So Karen launched Good Fortunes and has been on the lucky side of mompreneurship ever since. The Canoga Park, California-based company has grown to a multi-million dollar establishment producing a range of customized baked goodies. The business has been featured on Food Network and in InStyle, People, US and Better Homes and Gardens magazines. And its corporate clientele includes Ford Motor Corp., AT&T, Microsoft, Mastercard and the Gap. When Karen, who calls herself “Chief Cookie Counselor,” launched her business she had no idea she’d also be baking for such illustrious taste buds as those of Oprah Winfrey, Tom Hanks, Trisha Yearwood, Denzel Washington, Johnny Depp and Julia Roberts, but that’s the way the cookie crumbles. “We are on the forefront of edible personalization,” she says. I asked this mother of three to give us some insight on her entrepreneurial journey.
How do you describe your business when people ask, “What’s Good Fortunes?”
Good Fortunes is a gigantic fortune cookie company.
Each cookie includes your own one-foot long personalized message inside. They’re decorated for every special occasion and holiday and they are like a gift and greeting card all in one. Everything we now make is custom made especially for you, from picture party favors, to dipped and decorated Oreos or graham crackers to gigantic corporate logo cookies. We also hold licenses with a couple of the top stationary artists to create cookies that look like you and we also hold licenses with the United State Post Office and their library of stamps and with PBS.
What made you believe you could make money with the idea?
I had no idea I would make money with it. It was just something that happened. People were asking me for the product, so I knew I was on to something. But turning an idea into a business – that took work. Then when we got picked up by a national magazine, the phones would not stop ringing. That’s when we knew we could make money with this idea.
Everyone says you should have business plan when you start a business. Did you have a business plan and how did you come up with it?
I wish I had had a business plan. It would have helped me immensely.
Instead it took us 13 years to become an overnight success! If I had known now, what I was completely oblivious to then, I would have made a lot of different choices. But as they say, what doesn’t kill you, makes you stronger! Money is always an issue – account payables, account receivables. Be very diligent and learn how accounting really works.
Know your cost of goods or services, overhead and how much profit you will really make and how long it will take you to make it. Forecast and plan and have goals.
If you know how much everything costs with labor, and overhead figured into it, then you can know how much you have to sell to be profitable. Revisit the plan often and adjust it. However, far be it for me to follow my own advice. I built this company flying by the seat of my pants! However, a business plan would have kept me on track and made me see my business clearer, faster. I would have known what was working and what wasn’t working sooner. But a business plan is just that–a plan, and you can’t plan for everything. Sometimes you just have to go with the flow.
What was your initial investment and how did you finance the business?
My initial investment was about 20k, which was all of my savings at that time. Over the first few years I borrowed another 20k from friends and family. And over the years I had to do what I had to do to finance the business, which was use credit cards, lines of credit, etc.
What are your revenues now?
Without being specific, Good Fortunes’s revenues now are several million dollars a year and we’re looking forward to a banner year – even with the recession.
How did you market your product in the beginning?
What were your big breaks?
The most effective marketing/PR for my business was having the good fortune of being featured on the Food Network twice! These segments were and continue to be a tremendous boost to our business. Public relations is the key to getting Good Fortunes out in front of potential customers. We’ve been very lucky over the years and hundreds of magazines have picked up our story or products over the years.
One method that I’ve found that works is to contact the writers in the publications that fit your demographics. Buy the magazine and peruse the stories.
Find the writers and call them.
When you talk to them, you will likely have less than 30 seconds to make your pitch and get them interested. Have your spiel down pat. Also, have a press release ready about your products with pictures and send samples when requested. Your product is your best sales tool.
After years of word-of-mouth marketing, we recently began to place ads in popular magazines. Of course editorial is more cost effective, but we do place strategic ads several times a year. We actually tried commercials in our demographics (Food Network, etc.), but they didn’t do as well as we had hoped.
Is it true that the customer is always right?
The customer isn’t always right, but you’ve got to make them happy anyway – if possible. Over the last 13 years of business, most of the customers we’ve encountered are wonderful. Some 99% of them are fully satisfied and never complain. But, as in all businesses, sometimes things go wrong—wrong address, misspelled word (on personalized fortunes), the cookie isn’t decorated correctly, broken cookies, etc. Some customers have admitted fault while others have blamed us, justly or unjustly. Of course, we try to satisfy our customers because referrals and great word of mouth is the lifeblood of any business.
However, some customers are just downright nasty and cannot be satisfied. In that case, you have my permission to fire that customer or business. I had a wholesaler who gave us orders every month, but nearly every order we made seemed to be wrong or it came in broken. It didn’t take us long to realize that this customer was extremely difficult to satisfy and was definitely taking advantage of us. After all, we make thousands of orders every month for lots of larger retailers who never complain. So we sweetly fired that wholesaler and told them that we could no longer do business with them. It made our lives easier and it was a decision that was in the best interest of the company.
What mistakes did you make starting out that you’ll never make again?
Have all your i’s dotted and your t’s crossed. If you have employees make sure that you have all the appropriate documents signed and completed. If you offer any benefits, make sure you have all those points laid out as well in a clear concise format.
Make sure that your documents are legal and binding and have a lawyer look over all your documents.
Of course I learned the hard way — I had one employee who was helping me with my children during the afternoons. Because she worked for me personally, I never had her sign any documents. Soon after she graduated college, she asked to help in the factory as a Cookie Counselor and PR person. She was great and learned quickly — maybe too quickly, because she ended up leaving and took everything – databases, procedures, company secrets, and opened up her own cookie factory right down the street. Legally, I didn’t have a leg to stand on! As I found out, this happens all the time so make sure you do your due diligence as well.
Where is your product available?
What are your plans for the future for Good Fortunes?
The sky’s the limit. We have a bunch of plans, from franchising to making Good Fortunes into a household name.
How has your life changed since becoming a Mompreneur? How has it affected your relationship with your children?
We all started together. I was pregnant with my first child when I began Good Fortunes. From the first day I could work after giving birth, my children came with me to work. They stayed with me in a crib in my office for the first few months where I would field phone calls and breastfeed. Then as they got bigger and more active, I made a bigger area and playroom for them. They’ve learned that there is a balance in
everything: work and play, reading and running around.
I have to say, that all of my children are entrepreneurial and are always coming up with new and innovative ideas — not all great or even good, but I love that they come up with them. They are all verbal children who love to interact with friends and adults alike. Last week after just having reconstructive foot surgery, my son mentioned to his doctor an idea he had for a new invention that would have helped him heal better. The doctor liked the suggestion and he’s taking the idea to a friend. Who knows if it will ever go anywhere, but I love that he came up with it.
How do you balance your family time with time in your growing business?
The best part of my day is going home to my family.
I start my day early, then wake the kids, get them fed and ready for school, drop them off and then go to work. I now end my days so that I can pick up my kids from school and they never knew I was gone. My kids all grew up in the factory. I love all the time we spend together. They’ve all grown up so fast. I didn’t know or realize how fast time flies. You blink and a year has passed.
Do you ever take time out for yourself and if so, what do you do?
About a year ago, I took up singing. I’ve always had severe stage fright when it came to singing or acting. Of course, that doesn’t bode well when my secret ambition is to be on a Broadway stage! I’m so scared to get up on stage and belt one out – which doesn’t make any sense if you knew me. I’m very gregarious and outgoing. No problem to get in front of television cameras with an audience of a couple million people when talking about my business, but to sing and act in front of a couple of hundred people, I’m a basket case! I also write – mostly musicals and am almost finished with one now.
Would you ever go back to your old life?
What old life? When I started Good Fortunes I was newly married and just pregnant with my first child.
But I have to say, that I do dream of being a full-time mom – after all, that’s my most important job. Then of course, PTA meetings, helping out in the classrooms, working out after 9 am (not 4:30 am) …..I know, I know, I’d be back into something really quickly. But I am a writer as well, and would love to finish my musicals. I have a million things I’d like to do and a million plans I’ve made.
How old are your children now and what are their names?
There’s Jake, 12, Sarah, 10, and Sami, 8.
What does your husband do? Does he participate in your business?
My husband, Steve, is a very successful entrepreneur in his own right. A couple of years ago he sold his company of 10 years and was looking forward to partial retirement. However, I roped him in to Good Fortunes and asked him to work his magic on this company. Before he came to Good Fortunes the company was fat with inventory and waste. Today, he’s got his eye on the bottom line and he’s made Good Fortunes a lean, mean profitable machine. He’s also landed us some pretty big national accounts as well:
Whole Foods, Costco and more.
What is the biggest obstacle to moms becoming successful entrepreneurs?
The work load never gives you time to work on the business. As your business grows the demand on your time grows as well. But to stay ahead of the competition or to keep your current customers happy, you have to find the time to create new products. If that means that I get up at 4 am and have a couple of hours everyday before I have to get the kids ready for school, and before I go into the office, then that’s what I do. Time is a very precious commodity and I wish there was more of it, but the reality is that you do with your day as much as you can and still honor your commitments and still make time to spend with your family and friends. But being an entrepreneur is knowing the price of success and what you need to do to achieve it! It’s not easy and it is a fulltime commitment, but it can be extremely rewarding.
What was the hardest part of starting Good Fortunes?
Time and money—always money. Manufacturing is tricky. There are permits and laws to follow, and of course employees and cash flow to worry about.
Constantly coming up with new products. Just all the things about owning a business.
What is the best part of owning Good Fortunes?
I’m very proud of all we’ve accomplished over the years and our continued success
What advice would you give to budding Modern Mompreneurs?
- Be passionate about what you do: Dream big and enjoy!
- Educate yourself and ask advice from those who are may be more knowledgeable than you.
- Weigh your priorities and create your own balance.
There comes a time when
those extra hours won’t make a difference in the scheme of things. Family comes first!
- Have a plan and specific goals. Know your financial situation inside and out. Costs of goods or services, operating costs, profits etc… Revisit the plan often.
- Build your brand and market yourself and your company. Aim to be #1 in your market.
- Treat others as you would want to be treated. It’s a golden rule and a good one at that! From the UPS delivery driver to garbage collection man to the CEO of the company you want to sell to – treat everyone with the same respect and courtesy that you would expect anywhere on any given day.
Here’s a funny
story: I’ve had the same package delivery driver for years. I know all about his family etc. One day when we had one of our one-minute conversations he mentioned quite by accident that his dad was president of a multi-billion dollar company that I was trying to get an appointment with for years. He had never mentioned that before. I asked him a few weeks later if he could arrange for me to meet his dad, and he did! But if I had never established a friendly relationship with my driver over the years, then I would have never have happened on this opportunity.
- Use spell check and know your product or service.
People form their opinions of you and your product instantaneously.