At Kookie Krazy Inc. in Thousand Oaks, where customers make their own oversized cookies, co-owner Mark Boos Benhard aims to re-create the magic of the original "Willy Wonka & the Chocolate Factory" movie that captivated him as a child.
The colorful store and party spot offers hands-on immersion in all things sweet, with six flavors of cookie dough, dozens of tasty bits to mix in and a post-baking trip to the toppings bar featuring chocolate syrup, sprinkles and other goodies.
"We really wanted to create something that could tap into a child's idea of 'no limit to possibilities' and 'everything is edible,' " said Benhard, 44, who grew up nearby with a garage full of candy boxes, thanks to his stepfather, a sales executive at a major candy company.
Milkshakes and ice-cream sandwiches, cookie cakes, gift baskets and ready-to-go cookies are also on the menu. The cookie dough, made with pasteurized egg whites from nearby Eggology Inc., is safe to eat uncooked; the shop even sells cups of raw dough to snack on.
Co-owner James J. Kelley, 45, who has been an avid cookie baker since grade school, supplied the recipes for the venture the lifelong friends cooked up in 2006.
They opened their doors a year ago in the Janss Marketplace outdoor shopping center with an initial investment of $250,000. It was summertime and business boomed with kids, families and dating couples looking for low-cost fun. "We were screaming busy, meeting or exceeding all expectations," Kelley says.
Kookie Krazy, which charges $4.99 for the custom cookie experience, soon reached the break-even point, in which sales cover costs. The start-up business attracted interest from venture capitalists. And the snappy graphics and sophisticated branding, coupled with a unique concept, lured potential franchisees.
Sales hit $106,000 in the company's first fiscal year, which ended last month. The owners estimate 20,000 customers have visited the shop or celebrated a birthday in the party room.
Still, those numbers would be much higher if the bottom hadn't fallen out of the global economy last fall, the owners say. Their once-bustling mall location turned quiet as tenants closed and kids headed back to school.
"So suddenly we now have a location that is no longer getting foot traffic and is not visible to the street," Kelley says. "Business dropped off dramatically."
That made it hard to meet the benchmarks for sales, profit and advertising spending that the venture capitalists wanted. To start the franchise process, the owners were shocked to learn, they would have to shell out $24,000 to $40,000 to prepare the necessary legal documents.
And $50,000 set aside for marketing was eaten up by last-minute building costs. That was particularly frustrating for Benhard, who runs a marketing and public relations business in addition to his Kookie Krazy duties.
"I just know we could be the next big thing if we had the money to get the word out," he says.
Kelley also owns another business, an insurance agency.
Business consultant Roberto Barragan, president of the nonprofit Valley Economic Development Center, and public relations practitioner Colleen Farrell say low-cost steps could help Kookie Krazy succeed in its current location and position itself for expansion when the economy turns around. Already, "it is organized in a way that can be hugely successful and imminently franchiseable," Barragan says.
Here is a summary of their recommendations:
* Raise additional money. Barragan advises the owners to go back to their original 20 investors to raise enough money to spend $5,000 each month during the crucial summer season for marketing. The message should be that the small sum is needed so the shop achieves the success it needs to move to the next stage.
* Consider a loan. The business would probably qualify for a small loan of $20,000 to $35,000, such as the ones offered by Barragan's organization. The owners say they are hesitant to take on more debt but don't want to lose the $400,000 invested in the store so far for want of a modest sum to pay for marketing.
* Postpone franchising. Barragan recommends they hold off on actively pursuing franchising until the economy improves. He suggests they turn to an angel investor toward the end of the year to fund the franchise paperwork fees.
* Continue landlord negotiations. Barragan echoed the owners' concern about diminished foot traffic. "I am dealing with a lot of businesses going through tough times right now," he says. "And the ones hanging on are the ones who have landlords who are working with them, landlords who are smart enough to understand it's better to have a business there and collect some rent and defer some rent than to have an empty space."
