Goldeluck’s Success Story: “How We Took Our Doughnuts Digital”

Goldeluck's Doughnuts

With in-store retail sales under pressure, the fast-growing bakery chain found a new way to surprise customers. Here, founder Phillip Kuoch talks about the next chapter for his business and the Card that’s helped him grow and manage cashflow – all while earning Qantas Points for his dream holiday.

Goldeluck’s Doughnuts has always prided itself on thinking outside the box. “Our biggest point of difference is we like to have a lot of fun with our products,” says owner Phillip Kuoch. “We’re unique and that’s what people love.”

So when it came to facing a rapidly changing 2020 business environment, Kuoch knew he needed to whip up his greatest creation yet. With retail sales in his three Melbourne stores plummeting between 40 and 80 per cent almost overnight in March, “It was so dramatic,” he says. “We had to do something fast.”

But how was he going to connect with customers during a time when in-store dining and retail had almost ground to a halt? Kuoch and his team decided to focus their resources on edible gifts and deliveries, taking the traditionally bricks-and-mortar business and focusing it online. “We started making plans straight away,” he says. “You have to move fast, especially during unprecedented times. You have to adapt really quickly in order to be there with your customers, otherwise you’ll be left behind. We figured a lot of people weren’t going to be able to see each other for birthdays, anniversaries and occasions like that. So we decided to package our products into gift boxes and allow people to personalise them and add messages.”

By 30 April, online sales had skyrocketed 1400 per cent over the previous month and they did $10,000 in online sales in a single day. Kuoch doubled his workforce from 15 to 30, hiring new staff for deliveries, packing and customer support. “It’s been crazy,” says the 26-year-old. “It’s been an interesting time for us. The silver lining is that it’s definitely taught us that we need to invest in digital.”

A new chapter: Goldeluck’s goes national

Apply by 1 July 2020 and spend $3,000 in the first six months. Exclusive to Qantas Business Rewards members only. Terms and conditions apply.

While Goldeluck’s had been accepting online orders for about two years, delivering within 30 kilometres of Melbourne’s CBD, “It wasn’t a really big part of the business. It was just something we did on the side,” Kuoch says. “But during those last couple of years we were able to really work out the processes, so when 2020 hit us we had that digital infrastructure already in place and ready to go.”

Goldeluck's Doughnuts

They just needed to get the word out there – and fast. With an American Express® Qantas Business Rewards Card helping him manage cashflow, this allowed Kuoch to invest not just in more staff, but in digital marketing to promote the new service.

“We quadrupled our ad spend on that same day,” says Kuoch. “It was really scary. I was like, ‘Oh my God, what if this doesn’t work? I’ve got to sell a whole heap of doughnuts now!’ But the good thing about social, like spending on Facebook or Instagram, is that you can turn it off if it doesn’t work after a day or two. But we had a good feeling it would work because we were already seeing customers moving online. After the restrictions were announced our web traffic increased something like 1000 per cent. Our customers are usually in the millennial age group but we’ve seen lots of grandparents ordering from us for the first time. Lots of them are ordering things online for the first time for their grandkids.”

In fact, it’s been such a success, he’s now busy taking Goldeluck’s edible gifts national with the launch in June of Australia-wide deliveries of their signature loaded brownies – delicious chocolate fudge cakes adorned with decadent toppings. “Really crazy brownies,” as Kuoch describes them. “They’ll be baked in our Melbourne bakery and shipped around the country. We’re working with a courier company to do overnight delivery, but there are some areas in Australia that may take one or two days.”

Not bad for a kid who knew very little about business when he started a small bakery with his parents five years ago. “I was 21 when we started and it was never my intention to start a business. It was actually my parents’ lifelong dream to have their own small business. I really had no business skills. I didn’t even know the difference between multigrain bread or wholemeal. So I threw myself in the deep end and it was a massive flop in the first year,” he says, laughing. “We lost heaps of customers, so I had to think of a way to bring back customers and get on people’s radars. That’s when we started doing doughnuts. Instagram-friendly doughnuts.”

The Card that’s helped his business grow

With his business growing rapidly – three stores, plus a pop-up, in the space of four years – Kuoch relied on his American Express® Qantas Business Rewards Card to help manage cash flow. No pre-set spending limit# and favourable payment terms – up to 51 days to pay for purchases^ – made the Card a no-brainer for his business. Plus, a Flexible Payment Option allows the business to pay a portion of its statement balance, up to an FPO limit, over time^^, effectively opening an instant line of credit. “It’s great having a Card that allows you to get points on paying for business essentials but also having that credit line has been really helpful for times when we might need a little bit of help with our cash flow,” he says. “We pay everything we can on it – it’s our first preference.” 

Apply by 1 July 2020 and spend $3,000 in the first six months. Exclusive to Qantas Business Rewards members only. Terms and conditions apply.

Kuoch joined the Qantas Business Rewards program so he could earn Qantas Points on his business expenses – points he can use now or save for a much-needed holiday down the track. As well as earning points when he spends with 50+ Qantas Business Rewards partners, Kuoch scores even more points by paying with his American Express® Qantas Business Rewards Card, earning an additional 1.25 points per $1 spent on everyday business expenses – such as petrol or groceries – and 0.5 points per $1 spent on utilities.

Goldeluck's Doughnuts

“I love how available the program is,” he says. “I’m able to earn points , from my petrol to my grocery shopping. And being able to earn points while I’m paying our electricity bills, gas bills, phone bills is awesome. We’re with Red Energy for gas and electricity. And we earn points when we fill up with petrol.”

As for how he’ll use his supersized Qantas Points balance, Kuoch says he’s looking forward to a resort break in Fiji or the Philippines down the track. “It’s hard to take time off so I’m going to treat myself. Somewhere on an island where I can disconnect from my phone as well. It would be nice to take a break.”

Until then, he needs to continue moving with his customers in a market that changes by the day. While Kuoch suspects the delivery business could slow as restrictions are lifted, he’s hopeful he can keep up. “We’ve always based our business on our customers. We see where they’re moving and we move with them. We don’t wait for them to get there before us. Right now, we’re trying our best to make sure our customer service is on point so people will enjoy their experience and remember it and come back for it again.”

And Kuoch says he’s buoyed by the support of customers. “I think what’s really great about Australians is that we really love to support local businesses. We’re definitely seeing that a lot from our customers. We had a lady call the other day and she was a bit emotional. Her friend had been having a hard time and she couldn’t be there so she sent her a box of doughnuts with a balloon attached to it. She said her friend just broke down because she was so touched. They probably don’t realise it but it makes such a big difference for us to hear that.”

 

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