Foodbeast has long been a supporter of Crumbs Bake Shop, the NYC staple that helped put ridiculously expensive, over-frosted, designer cupcakes on the map back in 2003. And can you blame us? When the cupcake fad surged into popularity a few years back, Crumbs hit the floor running, debuting flavors like PB&J and Oreo. With 67 locations in ten states (nearly double of what it had less than two years ago), Crumbs was basking in the cupcake chaos . . . until this week.
After a 34 percent drop in the Nasdaq last Friday and reporting 22 percent lower than the annual project, things for everyone’s favorite cupcakery are not looking good. The chain is pointing to post-Sandy closures as part of its struggles, but suit-and-tie financial experts are not agreeing.
“The novelty has worn off,” says Kevin Burke of Trinity Capital LLC (a Los Angeles-based investment banking firm that apparently knows some things about food).
Even harsher was Darren Tristano, executive VP at the Chicago consulting firm, Technomic Inc.
“You’re not going to Crumbs every day,” he told WSJ. “Demand is flat. And quite frankly, people can bake cupcakes.”
Well, duh, Darren! But can we bake them with vanilla custard filling, six-inch caps of buttercream frosting, and clever names and/or themes? Probably not. At least not easily.
Crumbs isn’t the only cupcake bake shop to feel the heat. With the trend slowing down at its climax in the early 2000s (following Magnolia Bakery’s appearance on Sex and the City) and competition picking up (there’s a “specialty” cupcakery on every corner now!), the competitive business is struggling to keep up, even with shows like “Cupcake Wars” and “DC Cupcakes” airing every minute of every day.
In other news, did you know Crumbs also serves “colossal” cupcakes, meant for 6-8 people? They’re totally different from cakes. Probably.
H/T WSJ + PicThx JoonBug