Now that we’ve all wiped away the tears over the loss of the Crumbs Bake Shop, people are wondering what the heck happened.
The biggest problems were financial. The company kept expanding, which is expensive, and they weren’t selling enough cupcakes to cover the cost. The company also went public in 2011, which can lead to a whole separate set of business issues.
Tied closely to that is the belief that the whole premise of the company was a fad, destined to flame out from a drop in sales. Cupcakes shot to prominence with Sex And The City and a guest appearance by Magnolia Bakery, another cupcake bakery, in the early 2000s. The AP makes the case that other companies like Krispy Kreme and TCBY also grew to great heights based on a food trend then eventually came crashing down along with all of our sugar highs. Things like changing health concerns (people are more calorie-conscious these days), shifting taste buds and increased competition from others who are chasing a fad can hurt business.
We’ll propose that it was less the cupcake fad and more the Crumbs brand that played a role in the company’s demise. People still like cupcakes. Maybe not as much as before, but I can count on one hand the number of times I’ve seen someone turn one down. Part of the problem was that Crumbs wasn’t as fun as a cupcake business should be.