Capital At Play: David Holloman’s Appalachia Cookie Co.

Originally from Virginia Beach, Virginia, Holloman had a series of jobs and attended other schools before transferring to Appalachian State. After high school (during which he started a clothing company), he got his real estate license and worked in real estate in Virginia Beach from 2006 to 2008. Then, for the following two years, he worked in management at Vector, the marketing arm of Cutco, a cutlery manufacturer. Throughout this time, he bounced around various educational institutions—from Tidewater Community College, Virginia Beach Campus, to Old Dominion University to George Mason University.

While he had always enjoyed cooking, Holloman says he was “never really a baker by any stretch of the imagination.” As a result, the endeavor started with a lot of trial and error. “We made a lot of really bad cookies,” he admits. In 2011 he transferred to Appalachian State to complete his degree. He was familiar with Boone, because his parents had moved to the town about a decade earlier (his mother had graduated from Appalachian State in 1984), so he had spent summers and holidays there.

As he went through his business classes and tossed around entrepreneurial ideas, he recalled a business he had stumbled upon during his days with Vector. While he was running a branch office in Virginia, he learned of a late-night cookie delivery service. He thought it was an intriguing business model—and he thought he could do it better.

“I wanted to do something that would make people smile,” says Holloman, “something that would make people feel good.” From a business perspective, he also thought a cookie baking and delivery service was doable with the level of business experience he had—“It wasn’t so far-fetched that I couldn’t learn how to do it,” he says—and it wouldn’t take too much capital to get up and running.

So back in Boone, Holloman started learning how to make cookies. While he had always enjoyed cooking, Holloman says he was “never really a baker by any stretch of the imagination.” As a result, the endeavor started with a lot of trial and error. “We made a lot of really bad cookies,” he admits.

At the time, Holloman and his brother, Steve, lived in an apartment above a bar in downtown Boone. Their neighbors became cookie recipe guinea pigs, as the brothers knocked on doors, asking for feedback. But after a while, those neighbors came knocking on their door asking for cookies. It was at that point that they realized they may be onto something.

Holloman wrote up a business plan and started looking for space. He befriended Don Cox, owner of Bald Guy Brew, a local coffee roasting business, who had a space right outside the Boone city limits. Cox offered to split the rent with Holloman while he got his business up and running, a gesture that Holloman says was a “huge help that made it an easy startup transition.”

In August of 2013, Holloman began moving into the space, a 1,000-square-foot storefront in a small retail strip on the NC Highway 105 Bypass. The plan was to open that month, but unforeseen hiccups caused delays. First the hot water heater didn’t work, then new wiring had to be installed for the ovens. After a couple months, Holloman became impatient, concerned that they needed to get the business off the ground before his main target market—students—left for winter break. So in November, he announced to his skeleton crew—comprised of himself, his brother, and a friend, all working without pay—that they would open that month.

“It was a mess,” Holloman says. The business opened two weeks before finals during Holloman’s last semester. His classes at the time included an entrepreneurship class that involved writing a mock business plan (a skill he had already put to use for Appalachia Cookie Company) and an intensive personal selling class that involved working with a sales mentor (causing Holloman to muse whether he could just be his own mentor). When not in class, Holloman was working on the business, working late into the night with cookie deliveries offered between 11pm and 2am. How did he get through it? “A lot of coffee,” he says. “Clearly, I’m a glutton for punishment.”

During the soft opening phase, the business was open from mid-November through mid-December. It closed for winter break, and opened up again—more officially, this time—in January of 2014.

Having worked out the kinks at the end of the year, things went more smoothly after that. In fact, they went much better than Holloman ever expected.

“I went back a few months ago and really looked at the projections in my business plan, and they’re laughable,” he says.

Usually when entrepreneurs say their projections were “laughable,” they mean that their business plan was much more optimistic and ambitious than reality could sustain. But in Holloman’s case, it’s just the opposite. He says that the business has over three times as many employees and triple or quadruple the number of sales that he had expected to see within the first year. “I had no idea that we would take off as quickly as we did,” he says.

Today the business has 24 employees in addition to Holloman—ten drivers, ten kitchen staff, and four managers. On average, the business makes 800 to 1,000 cookies per day, all of which are baked to order and delivered right out of the oven.

Holloman estimates that about three-quarters of those cookies are going to students, the business’ original fans. Holloman and his friends worked hard to market to this community via social media (the business’ Facebook page currently has over 5,400 “likes”). And its easy to see why the affordable and convenient service appeals to college students, who stay up late studying or partying. 

But through word of mouth and by becoming more involved in the community, the business is being discovered by others as well. Elementary and high schools order hundreds of cookies at a time for events and spirit rallies. Businesses order them for meetings and office parties. Nonprofits, schools, fraternities, and sororities purchase bulk orders at a steep discount and sell the cookies at fundraisers.

However, with an $8 minimum order, anyone with a hankering for sweets can get cookies delivered right to their door. Customers can also stop by the bakery location for a carry-out order. The current business hours of 11am to 2am (with deliveries starting at 2pm) mean that non-night-owls can also get their cookie fix. 

Just what kind of cookies are we talking about here? Holloman says they now have 17 to 18 cookies available at any one time, with rotating seasonal flavors. They vary from the classics (chocolate chip, snickerdoodles, and oatmeal raisin) to the innovative (cheesecake, s’mores) to the elaborate (blueberry white chocolate oatmeal). There are even vegan and gluten-free options.

A stand-out hit is a special cookie Holloman developed called the “Ron Swanson,” affectionately named after the popular character on the Parks and Recreation sitcom and containing a heart-stopping (and appropriately “manly”) combination of bacon and whiskey.

“The sense of guilt from eating a cookie will be a bit diminished when you know that you’re helping feed someone who can’t afford to eat,” jokes Holloman. For some, it might be difficult to get excited about a cookie. But to experience these confections in person is a different matter. They are huge, gooey affairs (a box of a dozen has a heft that will make your arm tired) that don’t skimp on sugar, butter, or other flavorful ingredients. One taste confirms the superlatives expressed on Facebook, TripAdvisor, and Yelp, where reviewers repeatedly proclaim that these are the best cookies they’ve ever had—“literally.”

If Holloman has his way, soon people outside of Boone will be able to experience Appalachia Cookie Company as well. While a second location is on the horizon (he has got his eye on Asheville), a major way of scaling the business will involve shipping cookies nationwide, a functionality Holloman and his website consultant are putting the final touches on now.

In addition, in December the business is launching an initiative it calls the 30/30 Project. Using a subscription model, customers will pay $30 per month to receive a dozen cookies in the mail; and for every $30 it receives, Appalachia Cookie Company will donate enough money to Boone’s Hunger and Health Coalition to supply 30 pounds of food to a needy family in Watauga County. “The sense of guilt from eating a cookie will be a bit diminished when you know that you’re helping feed someone who can’t afford to eat,” jokes Holloman.

But in all seriousness, Holloman is very excited about this program. For him, it completes the picture of a business that makes a good product, delivers a good service, and also does good for the community. Once the 30/30 Project is underway, he hopes to be able to expand it to partnerships with other nonprofits in the area. He’s especially interested in working with small, local nonprofits. “I feel like the grassroots movements need funding more than the larger, national ones,” he explains.

Listening to Holloman talk about the business’ success and its plans for growth, it’s easy to forget that the Appalachia Cookie Company has only been around for less than a year. While there have been plenty of learning experiences and a number of mishaps—for example, the store was robbed this summer before Holloman installed a security system—overall, the results have been better than anyone predicted. While some people were initially less than supportive—Holloman says, “a lot of folks that weren’t familiar with the concept thought it was a joke and that I was a crazy person”—Holloman, his family, and his friends were optimistic. “I had great aspirations for it,” he says, “but I didn’t expect it to do as well as we have so far.

To what does Holloman attribute this success?

While his previous business experience and education are certainly factors, Holloman says the support from both the university faculty and the community have been overwhelming. “In all the other kinds of businesses I’ve done and the other places I’ve lived,” he says, “you don’t get the kind of support you get here.” He also says working alongside his brother, Steve, who helped him get the business off the ground and now acts as the store manager, was an essential ingredient.

But on a personal level, Holloman says that his ability to handle adversity has served him well as an entrepreneur. “When something goes wrong, I tend to have a pretty positive attitude and bounce back from things.” Combined with an entrepreneur’s unflappable optimism and a streak of stubborn independence (he says he loves making decisions that don’t have to be run up through a chain of command), Holloman seems well on his way to a long and successful business career—one delicious cookie at a time. 

 

Original Article from Capital at Play: https://www.capitalatplay.com/