02 Mar, 2015
For first-time entrepreneurs in the agro-processing industry, opening a bakery is usually a popular choice because of the comparatively low start-up costs. But establishing a bakery requires a careful mix of skills. You need to have some expertise in the area, and be an astute business-person, as success will require not only the skills to create attractive products, but also the ability to run and grow the business with profit in mind. These are some of the characteristics that can be found in Michelle and Herbert Chong, the owners of Honey Bun (1982) Ltd.
The Chongs bought Honey Bun from its then owners in 1982. What started out as a small retail bakery has since grown into a local staple and one of Jamaica’s leading manufacturers employing over 250 persons.
In the local market, Honey Bun is mostly known for its snack and single serving products. These include doughnuts, cupcakes, cinnamon roles and raisin breads. For the export market, the company also produces some small bread such as the spice bun (also known as Easter bun) and the Buccaneer brand rum cake. “We recently started to export our newest product, the Goldie Bun,” Michelle shared. “The name was conceptualised in 2012 after Jamaica won all those gold medals at the London Summer Olympics.”
Michelle believes that due to their success, many other entrepreneurs decided to establish bakeries in the local market. She welcomes the competition, because it pushes her company to constantly strive for excellence. In the export market, however, the competition is a lot less. “There are certain standards needed for export, which rules out some of the smaller bakeries, in addition to the fact that a higher uantity is required and some bakeries may not be able to commit to meeting that volume.”
The mother of four doesn’t think she and her husband had a definite passion for baking when she decided to open a bakery, but she knew there was an opportunity in doing so. “We moved from something we knew, pizza, and went into baking, because it was doing the best at that time. We were led by the experience that we had and moved into the where the opportunities lied.”
However, transitioning from a small retail business to a large wholesale brand proved to be a testing time for the company. “A challenge during start up was the devaluation and instability of the Jamaican dollar. It affects all your costs and makes it difficult for you to plan, because you are not sure what will happen in terms of price. We also had limited spending power from the market.”