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Cost pressures force strategic rethink for independent retailers

Door closes on bricks and mortar to online store sales

Having dished up some of the best curries in Perth, Western Australia, the hugely popular café and kitchen store Latasha’s Kitchen in Leederville, Western Australia, closed its doors to customers last month.
Latasha’s Kitchen joins a slew of recent closures of independent retailers in Leederville and Mt Lawley.
According to business owner Latasha Menon, a massive hike in rent as a result of property development and weekend labour cost pressures forced a strategic rethink of her business model.
For 10 years Ms Menon motivated many through her café food, popular cooking classes and selection of hand-made curry pastes and condiments made from her kitchen. As her lease was drawing to an end, Ms Menon felt it was a time to reassess the future.
“The rise in rent, labour cost pressures and changes in the local demographics influenced my decision to take a change in course,” Ms Menon said.
“We operated a pantry of gift items and the surge and attractiveness of the online industry made us rethink that aspect of the business,” Ms Menon said.
“We were not licensed and thus our income was predominantly on food, cooking classes and our curry pastes and condiments. However, the café/studio kitchen was not the ideal place for us to use as a manufacturing outlet,” she said.
“There was also the added pressure of our drink culture which is somewhat pervasive in Leederville, and other nights spots in Perth, which made it difficult for us to stay open till late as our customers tended to avoid trouble spots, especially those with young families.”
After extensive research and development, Ms Menon was unable to find the perfect commercial kitchen to partner in WA. She now manufactures a range of take-home curry pastes, sauces and chutneys in NSW and travels there to cook her products personally with a team of professionals ready to help her make it to her exacting standards without any compromise to her unique formulations.
These hand-made products are now being sold at local Farmers Markets, selected retailers and through her online store. Thus firmly closing the door on bricks and mortar as a sales model.
With her background in marketing, Latasha came up with a plan to transition her business from bricks and mortar to the manufacture of products for online, wholesale, and at specialist stores.
“I did a lot of research into how I wanted my products to be manufactured. I had to find a company that would adhere to my exacting standards because I wanted only the freshest and most authentic ingredients for my products,” Ms Menon said.
“Importantly, I wanted to be sure that my products were going to be gluten free, 100 per cent pure and natural with no preservatives, fillers or flavour enhancers. I believe in making my products just as if they are made at home. I was not interested in opening my own factory and facing the same issues I faced in having a restaurant such as electricity costs rise, staff shortages, wage hikes, equipment breakdown etc.
With a commercial kitchen in place, Latasha’s Kitchen take-home products are being produced in small batches bimonthly by Ms Menon. Initially, six products were launched but this has already been increased to 15.
According to Ms Menon, the most difficult aspect of changing her business model has been the loss of regular contact with her customers and having to explain why she manufactures in Sydney.
“However, with most customers, they’re happy with a local producer manufacturing in Australia,” she said.
As Ms Menon is now holding in-store cooking demonstrations, she is still in contact with familiar faces, as well as introducing her cuisine to a whole new generation.
“This provides me with an opportunity to explain the reasons behind my decisions. WA doesn’t have the kind of contract manufacturing scene for small manufacturers like me who make high quality spice blends,” she said.
“Most of my blends contain between 20-35 ingredients! Most of which are herbs and spices which are hand roasted, before grinding and blending.”
At these demonstrations Ms Menon takes every opportunity to explain why the manufacturing is not done in WA anymore.
“I am one of the lucky ones who have managed to combine their passion with a business, and I don’t take this lightly. It has been a huge learning curve but already we are finding success. Taking this step has definitely been a positive one – we feel confident we can grow our business in this new direction,” she said.
For more information go to www.latashaskitchen.com.au