washingtonpost.com > Business > Local Business

Cupcakeries Emerge as Washington's Sweet Spot in a Downturn

By Thomas Heath
Washington Post Staff Writer
Wednesday, August 26, 2009

The line outside tiny Georgetown Cupcake sometimes stretches 100 people or more, all queuing up for one of the shop's distinctive $2.75 treats. Regulars have been known to pay people to hold their place. Others multitask or use their cellphones to check whether their favorites are still available. Passersby wonder what all the commotion is about.

In a recession that has laid low many businesses in the region, from mighty real estate developers to struggling retailers, the pint-size cupcake sector is a bright spot. On a single weekend day, Georgetown Cupcake will bake 5,000 or so of the confections. Many are headed -- in the company's Range Rover -- for Washington's toniest suburbs, destined to fatten the waistlines at baby showers and birthday parties.

The company suddenly has many competitors, all trying to capitalize on a desire for a simple, inexpensive indulgence at a time when the economic news seems so depressing.

At least half a dozen cupcake bakeries have opened around Washington in the past 20 months, and more are on the way. Penn Quarter's Red Velvet will expand next month to Dupont Circle, where it will compete with year-old Hello Cupcake. A shop called Something Sweet opened in Northwest Washington.

There are online-only local cupcakeries, a vegetarian cupcakery, Blushing Bakeshop in Potomac, a Lavender Moon in Alexandria and Rhonda's Cupcakery in Greenbelt. Established bakers such as CakeLove, Just Cakes, Furin's, Best Buns and Baked & Wired are all in on the act. Early arrivals at the 9:30 Club are treated to Buzz Bakery cupcakes.

"They are everywhere . . . like ants," said Leslie Goldman-Poyourow, a 14-year baker who operates Cakes by Leslie in downtown Bethesda.

As if the competition was not already fierce, Georgetown Cupcake this fall is moving its flagship store to a larger, sit-down location a block away on M Street, and it's opening a branch in downtown Bethesda, which is foodie central in Montgomery County.

Even those in the business see a bubble in the works.

"As more and more places pop up that sell cupcakes and try to take advantage of the wave, the more they lose their uniqueness and the aura that you are getting something special," said Something Sweet co-owner Bo Blair, who also sells full-size cakes, milkshakes, ice cream and other goodies for when the cupcake fad dies.

A Shop to Watch

One development being watched closely is Georgetown Cupcake's foray into Bethesda, where it will pay a hefty rent and compete with the likes of Giffords Ice Cream, Bethesda Bagels, Just Cakes, Haagen-Dazs, a French bakery and Goldman-Poyourow's cake store.

If Georgetown Cupcake's Bethesda store is a hit, generating long lines and lots of buzz, it could be a sign that cupcake stores are here to stay, like Starbucks. If the business doesn't take off, it could mean lights out for the fad.

"We are coming close to a bubble now," Red Velvet owner Aaron Gordon said. "One or two more shops is about as much as the public can support. After that, the folks with the highest-quality cupcakes and best locations will be the ones who survive."

CONTINUED     1        >

© 2009 The Washington Post Company