We caught up with some of Shanghai's Leading Female Food Entrepreneurs to find out: in a city as notoriously trend-driven and fickle as Shanghai, why start here?
The recession's silver lining
This isn’t an argument you hear everyday, but if the recession did one thing for the under 35’s, it boosted the appeal of going it alone and creating a startup. Most of us have at some point dreamed of quitting the day job, but research of Generation Y workers finds that in 2015, up to 70 percent would rather start their own businesses than continue working for ‘The Man,’ despite ongoing economic uncertainty.
With diminished security of a regular day job no longer a reason to work for somebody else, the risk of becoming your own boss seems a less daunting prospect for some.
But with venture capital funding unpredictable, grassroots businesses built on shoestring budgets must harness individual resources, social media and word-of-mouth marketing campaigns from the local community. Even in in urban communities with diverse demographics like Shanghai, food and drink hold universal appeal. Almost no sector has seen as many grassroots entrepreneurs as the F&B industry.
It's (still) a man's world
The bad news for half the population is that if you’re one of those under-35 entrepreneurs, then you’re most likely male as well. 2014 information from data research firms Duedil and Enterprise Now published in the UK’s Telegraph found that women ran just 26 percent of such businesses. In Shanghai, however, some of the most successful individually-owned F&B enterprises were created and run by women.
So just what does it mean to be female and starting your own culinary outfit here? Do grueling hours, setbacks and financial uncertainty outweigh the benefits of being your own boss? Are there limits to ambition or is it ‘succeed by any means necessary?’ We caught up with some of the city’s most prominent female F&B entrepreneurs to find out: in a city as notoriously trend-driven and fickle as Shanghai, why start here?
Business: Zhao Xiaojie Bu Deng Wei, High Heels 73 Hours
For local TV personality and serial restauranteur Zhao Ruohong, known also as ‘Zhao Xiaojie,’ an F&B business means using any and all resources at your disposal. A former TV host for the Shanghai Media Corporation, Yale-educated Ruohong uses her witty humor, bold personality and socialite status to be her own ‘brand ambassador’ and increase the appeal of her restaurants to consumers.
The success of this is demonstrated by her wildly popular debut restaurant Zhao Xiaojie Bu Deng Wei (‘Miss Zhao doesn’t wait for a table’) on Changle Lu. Initially an extravagant gift from husband Na Duo, himself a renowned novelist, the irony now is that customers – and apparently even Zhao Xiaojie herself - wait up to four hours for a table.
Having expanded her husband’s ‘gift’ into a business of six citywide locations, Ruohong has now presided over the opening of two dessert stores, the newest ’High Heels 73 Hours’ on Julu Lu, a girly apartment-themed lane house cafe and shoe boutique. Possessed of a darkly self-deprecating sense of humor, Zhao makes a concerted effort to avoid coming across snobbish or stuck up. “I wouldn’t call myself a successful businesswoman,” she emphasizes, “I’m a terrible budget controller and still owe money to the bank!”
From an outsider’s perspective however, Zhao’s effervescent charm serves her and her business well – during our chat at her new cafe, several friends, who also seem to double as patrons, can’t help but stop to congratulate her. “Definitely the biggest challenge is money, I can’t pretend it was easy,” she confesses, after offering to add a dram of whisky to our coffees (we both oblige). “I focus on simple concepts that aim to make people happy. To me, 73 Hours is just a fun place for girls to hang out and bond over tea, cake and shoes.”
Zhao doesn’t stock other people’s shoes, however, choosing instead to create her own line. “I literally lived in Guangzhou for months to monitor the process,” she explains. Her efforts are already coming to fruition, it seems – the initial batch of shoes, which cost up to RMB1000 per pair, sold out within days to legions of fans and customers.
Business: Lollipop Bakery, The Pantry
Cooperative starting point
Labor costs and other aspects of F&B operation might be cheaper in Shanghai, but with commercial spaces, rent can almost match that in London or New York. For 29-year-old Lexie Morris, one way of negating this was by incubating her cupcake business Lollipop Bakery at a cooperative shared kitchen called The Pantry, along with other likeminded cottage industries Strictly Cookies, Spread the Bagel, Amelia’s Jams and Trencher’s Sandwiches.
“I started Lollipop bakery in Beijing five and a half years ago, but always wanted to expand down into Shanghai,” says Lexie, a Cambridge graduate and former strategic consultant.
“Opportunity struck when I took over from Oh My Goodness Cupcakes, who were part of The Pantry at the time. Basically it was five girls who came together to start a foodie co-op and support one another. If one of us came in and went ‘Our oven blew up this morning!’ then there’d be somebody there to say ‘Oh we had that too, this is how you fix it.’ That definitely made my expansion into Shanghai a lot easier.”
License to bake
A shared space also helped with the issue of licensing, a major hurdle for any would-be business in China. “Licensing issues can be tricky to negotiate, so having the other girls involved really helped split the costs and ultimately got things done faster.” explains Lexie, who also owns boutique ice cream shop Magic Labs in Nanjing.
These days, many of the original brands at The Pantry have gone on to their own outright spaces, Lollipop Bakery included. “Our first shop is opening on Wulumuqi Lu this month,” Lexie tells us with a grin, “I’m so excited, but also absolutely terrified!”
Businesses: Spread the Bagel, The Pantry
Practice makes perfect
For fellow Pantry cooperative member Christine Asuncion, finding success for her business Spread the Bagel meant years of perseverance and product testing. Not without results, however – Spread the Bagel’s offerings are regarded as the most authentic Shanghai has to offer, with New Yorkers themselves declaring them a winner by their own exacting standards.
“Bagels are surprisingly complicated to make; to perfect, at least,” explains San Diego native Christine, “I learned this the hard way starting from scratch. Getting the recipe right took months, even years of practicing, first using a toaster oven in my apartment – while teaching during the day – and then finally in my own industry-standard kitchen.”
Know your strengths
Why base your business around a product so notoriously tricky, especially considering that by their heavy, bready nature bagels don’t mesh with local Chinese tastes? Seems that when it comes to the F&B industry, being a custodian of excellence and focusing on food you know well pays off eventually.
“Living in New York for several years, I grew up eating the best bagels,” says Christine, “they were something I ate after school everyday, so I know exactly how they should taste.”
Businesses: Grosfairy Cupcakes
Perseverance might hold the key for some, but for others things happen a little more quickly. Shaanxi native Selina Cao founded her cupcake business Grosfairy in New York at the end of 2013 but quickly realized the vast potential it had back in Shanghai.
Riding the consumer trend for all things sweet and indulgent, Grosfairy’s expansion from zero to eight stores in under a year has been aggressive, to say the least. “I knew the brand had potential with the local market,” explains Selina, “but I think the trick was my insistence on keeping the quality as I had in New York, even if it meant using expensive imported ingredients.”
Stick to your principles
In the recent wake of unappetizing food safety scandals, consumers have shown their willingness to fork out premium prices for glamorous products with imported ingredients, and it seems Grosfairy’s formula nails it. “Our staff has expanded to over 60 people now,” Selina says proudly, “and we’re opening more stores in Beijing and Chengdu soon. Ultimately I want to make Grosfairy the Starbucks of the cupcake world.”
Businesses: Sproutworks, Cantina Agave, Boxing Cat Brewery, Liquid Laundry
Pick your partners
No list of female F&B entrepreneurs would be complete without a mention of Kelley Lee. Visited a Sproutworks, Boxing Cat Brewery, Cantina Agave or Liquid Laundry lately? Then you’ve eaten at one of the 11 restaurants in Kelley’s rapidly growing empire.
Classically trained at the Cordon Bleu cookery school in Paris, Los Angeles-born Kelley is a formidable figure on Shanghai’s F&B scene, but as we discover, her belief in people is one of the most important attributes to success.
Google her name and articles from Forbes to Condé Nast Traveller spring up on her Shanghai F&B empire, but, says Kelley, strategic working relationships with partners Lee Tseng, Raffe Ibrahamian and Malcolm Shu are critical to the business.
Play to your strengths
“We all have strengths and weaknesses, so having great partners helps share the burden of running multiple restaurants,” says Kelley, who estimates 350 people under her employ. “They help me with things I’m not so good at.” Such as what, we ask? “Anything technical or involving chitchat,” she laughs, “specifically being front of house or the audio visual aspects. I’m also not immune to using gender stereotypes and saying, ‘I’m a girl, you take care of this!’ to my male business partners.”
Jokes aside, teaming up with people whose strengths are her weaknesses ultimately allows Kelley to retain control where it matters to her most: “Their help leaves me with more time in the kitchen – I wouldn’t have it any other way.”
As a graduate from the prestigious Cordon Bleu school, Kelley could have worked any where in the world, so what made Shanghai a good place to grow her empire? “For starters, it’s a really interesting mix of people here with a big culture of eating out. The young local population is increasingly international, cosmopolitan and open to trying new things,” says Kelley. “Elsewhere in China, you don’t really get that.”
Fair enough, but why not her native USA? “I didn’t have the kind of money it would take to open a restaurant there, and quite frankly still don’t,” she reveals. “The starting capital is still at least twice as low here. For example, our first restaurant ten years ago opened with RMB200,000 and within six months we were turning a profit. That’s the kind of opportunity Shanghai offers.”
Businesses: Shanghai Supperclub, Egg (Opening soon).
Taking the reigns
For American expat Camden Hauge, founder of Shanghai Supperclub and soon-to-be-opened breakfast-themed restaurant Egg, realizing the dream meant biting the bullet and going it alone. “I’ve had just about every challenge you can think of,” says 27-year-old Camden. “Finding the right people to work with was especially hard, and I had some awful experiences.”
It’s been a long road for the former Saatchi & Saatchi advertising exec, who finally plans to open Egg this month, a year after its inception. “Eventually I decided to do everything myself; I got the licensing, supervised the construction and designed the space.” Quite the achievement considering Camden doesn’t speak fluent Chinese. “You have to take control sometimes, and for me that ended up being the right decision.”
But taking control doesn’t mean going it alone in terms of support. “It’s amazing how encouraging the Shanghai food community can be of new enterprises – girls in particular. People have been wonderful in how willing they are to share advice.” For Camden, this mutually supportive network of likeminded F&B entrepreneurs is one reason that makes Shanghai a surprisingly good place to set up shop.
“In any other big city, F&B communities are more protective over their suppliers, for example. New York and London are cluttered with competition, so it’s hard to achieve anything without years of formal training or a huge investment. My friend Lexie Comstock, who started Strictly Cookies once told me: "Nothing is impossible in Shanghai, but everything is difficult." That’s certainly something I’ve found to be true.”
It seems there might not be a set formula for owning a successful F&B business in Shanghai – no doubt some of it is down to timing and the occasional spot of good luck. One thing we’ve learned for sure, though, is that even now Shanghai remains a relatively fresh canvas on which to start; not yet saturated with competition like Hong Kong, New York or London.
The road to owning your own business here is rocky, but it seems for some post-Recession millennials, the only way to fail is not to try.
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