Financial Adviser: 5 Business Lessons Everyone Can Learn the Founders of Conti's Bakeshop and Restaurant

Carole Conti's transition from being an accountant to becoming a business founder is a story of following her passion and never giving up. Despite finding success in her corporate job for many years, Carole always had a strong desire to explore and share her love for cooking with others.

Her entrepreneurial journey began when she moved to the United States and started selling homemade Filipino food to the Filipino community there, but after living there for six years, she decided to return to the Philippines and fulfill her lifelong dream of owning a restaurant and bakery.

In 1997, Carolie invited her sisters, Angie and Cecille, to join her in opening a takeout food outlet in BF Homes and named it "Conti's," after their shared last name.

The small takeout store quickly gained popularity, attracting long lines of customers eager to try their signature dishes. Despite their initial success, Carole and her sisters remained determined and saw even greater opportunities ahead.

Two years later, the Conti sisters transformed their small takeout food outlet into a restaurant and bakery. By 2005, using the profits from their restaurant, they expanded beyond BF Homes and opened their first store in Greenhills. It was at this new location that they introduced their famous Mango Bravo cake, which soon became a favorite dessert among their customers.

The success of Conti’s prompted the sisters to expand its restaurant to 21 outlets within 21 years. In 2018, they made the strategic decision to sell 70 percent of their company to Dennis Uy of Udenna Holdings. Under his leadership, Conti's underwent remarkable growth, expanding to over 80 locations in just five years.

What strategies did Carole and her sisters implement to grow Conti's from a small takeout store to a full-service restaurant and bakery? What lessons can we learn from the Conti’s sisters and their success with Conti’s?

Here are the five business lessons every entrepreneur can learn from the founders of Conti’s:

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1| Know how to turn your passion into profit

When you pursue your passion as a source of income, you're likely to experience a greater sense of fulfillment and satisfaction with your work. This feeling of fulfillment can have a positive impact on your overall well-being. It enables you to explore new ideas, innovate, and find unique solutions to problems, thereby fostering both personal and professional growth.

Even from a young age, Carole always had an inclination towards cooking. However, her mother encouraged her to pursue finance instead. Despite this, Carole still pursued her passion by taking short courses in baking and other home economics subjects.

Eventually, she took the leap and started a small bakery. While living in the United States, she had the opportunity to venture into catering, offering home-cooked Filipino food to the Filipino community. In 1997, upon her return home, she invited her sisters to join her in opening a restaurant, giving birth to Conti’s.

"I finished accountancy and worked with Procter & Gamble for two and a half years," she says. "Then, I transferred to NCR, which is AT&T now. After that, I joined the Aguirre group. Even from the start, I really wanted to have a restaurant and go into business. Even during college, I wanted to take up what was called home economics during our time.

"But, of course, my mom insisted that I pursue something else. I don't recall exactly what she called it, but she suggested I study finance, just like my sister Cecile. So, I did. She also suggested that I take short courses in cooking, dressmaking, and other home management courses.

"Anyway, eventually, while I loved to work in offices, after a while, it got so boring. So, we started a small bakery. It was my first stint into the restaurant and bakery business. Later, I went to the States, started a family, and while in the States, I had a chance to put up a restaurant. I did home cooking. It's like catering or food order just in the house.

"So even when I was in the States, I was telling them, 'Oh, I'd like to put up a restaurant together,' something like that. And then, my sister said, 'Why don't you look for a place?' We all lived in BF during that time. And my sister Cecile was able to find a place and showed me. I said, 'Okay, I think this is a good place in BF Homes.

"And after a year, I went home. When I came back, I asked my sisters to join me in opening a restaurant in the Philippines. That's how Conti’s began in 1997.

"Maybe because I found it easier to put up a business in the Philippines, but I learned a lot in putting up a restaurant in the States. Plus, I had a baby, so it was kind of hard to manage the business alone. I was able to do it on my own at home for maybe two or three years, and it was okay. But then I thought it would be easier to do it in the Philippines because there was more help. Plus, of course, my sisters were there.

"We started catering in the beginning. We were doing it in our house. Maybe for two years. At the beginning, yeah, we were doing it in the small kitchen at home.

"Angie was more involved in PR and marketing. Since she held the marketing position, she handled the PR tasks and reached out to friends and relatives, you know, to invite food orders, while I worked in finance and focused on collections and also payroll.

2| Know how to achieve growth without borrowing

Expanding the business through internally generated cash flows promotes long-term sustainability by ensuring that growth aligns with the company's financial capacity and operational performance.

By avoiding external financing, the business maintains financial stability, reducing reliance on sources like loans and minimizing the risks associated with debt repayments.

The Conti sisters grew the business by leveraging the proceeds from their catering business, which started small and gradually accumulated funds. As the business gained traction, fueled by customer demand, they expanded strategically, opening new branches to meet the needs of their growing customer base.

Throughout this expansion, the sisters maintained financial discipline, prioritizing timely payments to stakeholders, including employees, suppliers, and landlords. This approach allowed them to grow sustainably, responding to market demand while remaining debt-free and financially responsible.

"It was my husband who proposed the name Conti’s," Carole says. "Even while we were still in the States, it was just the two of us talking. I asked him what would be a nice name, and it was hard to think of one. Then he suggested, 'Why don't you use the name Conti?' I was surprised and said, 'Huh? Yeah, because that's the thing common to the three of you, Conti.' I mentioned that it sounds like 'konti,' you know? Then he said Conti’s would be good. So that's how it started.

"Actually, I was the one who came up with the name and the logo of Conti’s. That's my handwriting. It's how I write it, and green was my favorite color back then. It was very simple at first, just on a white background with the name Conti’s.

"We started, I think, in September of 1997. The first Christmas we had at home, we had a long line of customers picking up their orders. We created traffic inside BF Homes. We were surprised that we created traffic inside the village, not in the commercial area. They were waiting to pick up their orders past midnight because our cooking was slow

"Actually, from the very beginning, we were already thinking of putting up a restaurant, but it took us a while to finish it. We had to come up with the funds first to develop and put up the restaurant. And it all came from the proceeds of our catering business, the one in the house, little by little. So we started from zero.

"After two years, we put up our restaurant. We created a lot of traffic again. We opened in '99 in BF, and the first branch was in Greenhills in 2005. In the beginning, we kept the interior of the restaurant very simple, just a white background with the oval thing and green. Later, we hired an interior designer to improve it. The concept was more of an Italian and Mediterranean style. I think that was the thing before during that time, but the food was Filipino and International.

"At the time, we had a challenge with the supply—meaning the production area on the second floor of BF was too small already. So we had to put a commissary in FTI. We got the place in FTI because of the cakes and everything being done in the commissary.

"After 2005, we opened the commissary. In 2006, we branched out to Greenhills, and in 2007, March, we opened in Serendra, and then in November, we opened in Trinoma. We expanded because we had to support the commissary. It was kind of big at that time, so we had to branch out.

"We never had any borrowings from the beginning. We just used our credit cards. In the beginning, we were not really into expanding. It was the clamor of our customers that pressured us to branch out because they were saying, you know, how come we are not expanding.

"But we didn't want to go beyond. We were happy with what we had in BF. But, of course, it's the customers' demand that pushed us to branch out. And we didn't want to branch out by borrowing money, so we just made do with what we had.

"I think one thing leads to another. It's not because we wanted to make it big, it's because of the customers' demand. Plus, when we opened in Greenhills, they were complaining. We branched out, but the branch that we opened was too small. I mean, you know. All this came from the customers, we were just obliged to do that. We were just responding. It was not really our plan to grow big because initially our thought was just a home-based business.

"When you're there and people are asking you, it's like they were saying you're so selfish that you don't want to share what you know, but it's not that. It's not that easy to expand in terms of not just in capital, but in terms of management and all other things that come with it.

"With finances, I think it was not really a problem because we were able to sell products without an issue. You know, and maybe we were not really aspiring for such a big business. We were not even looking at profit.

"As long as we had our priorities to be able to pay all our stakeholders, the people working with us, our suppliers to be paid on time, and our landlords to be paid on time or ahead of time, I think that was our priority instead of looking at what's the bottom line. I think for you to build up a business, the priority should be to create an honorable kind of restaurant where you're able to pay all your stakeholders."

3| Know how to innovate by responding to customer needs

Customer feedback provides valuable insights into the strengths and weaknesses of products. By incorporating suggestions and addressing issues, entrepreneurs can continually improve their offerings, making them more competitive in the market.

Moreover, adapting products according to customer needs is essential for businesses to remain relevant in an ever-evolving market landscape. Through attentive listening to customer suggestions, businesses can identify emerging trends and opportunities for innovation.

The Conti sisters innovated by listening to customer feedback in several key ways, particularly with the creation of the Mango Bravo dessert. Initially inspired by their travels and dining experiences abroad, they sought to craft something unique rather than replicate existing recipes.

Despite initial production challenges due to limited space and high demand of Mango Bravo, they responded by establishing a commissary to scale up production. This proactive response to customer demand and feedback not only ensured the availability of the Mango Bravo but also highlighted other popular items in their menu.

"First of all, we love to eat a lot," Carole says. "I mean, travel and eat. So, we try different restaurants abroad. By trying something different, you put it together and then come up with your own because I don't like a copycat, you know, like exactly the same, so you come up with your own using the different ideas that you pick up around the world.

"One of these is the Mango Bravo. The base of that is like Pavlova. You know, Pavlova, a single layer of meringue with fruits and cream. But because during that time, it was too small and too flat, so we layered it. That’s the origin of it.

"Initially, it was the feedback of the customers that made it that way. In the beginning, it was not that big, but our employees, you know, sometimes you teach them this and all of a sudden it becomes different, you know, higher things like that." Carole says

"And I said, 'Ohh, it's better' and that one. A customer commented that it's so grand, it's very attractive. And when they eat it, they really love it because of the parts, the cream, and the different texture that comes with it without knowing that it will be liked by so many people and that it will be popular. So that's how it just started. It's just by listening to the customers. By observing what's being done outside plus by listening to our customers. So whatever they say. We experiment on it and if it will be appreciated by the customers there, we multiply it.

"When we opened in Greenhills in '99, we were able to offer Mango Bravo because we had freezers already, it should be frozen there. The first Christmas that it was offered, we were not able to make a lot because our commissary was small, so if I remember right, we can only make 35 whole Mango Bravos in a day. You know you make it the day and the following day you can sell it, but you can only make 35 whole a day.

"That was the biggest challenge. When Christmas came, we were telling our customers that we would not accept reservation because we had limited storage and the first Christmas I think Angie was telling our customers, ‘You just come early so that you can get your Cake.’ No reservations were allowed because if we accepted them, our freezers would be filled and we would not be able to make more. Even before lunchtime, we ran out of stock.

"That's why we had to establish a commissary right away. When we had the commissary, we could only produce about 35 cakes, maybe 100 at most, but that was too little to meet the demand. We continued producing to meet the demands for that month.

"When it comes to cakes, our number one seller is, of course, Mango Bravo, followed by Choco Overload. And for our food, the Baked Salmon and Lengua Estopado are popular choices, along with roast beef, beef salpicao, and chicken relyeno. These items were saleable at that time. Our garlic sotanghon has been very saleable up to now. It's actually our mom's recipe."

4| Know how to balance quality and affordability

In today's competitive market, offering quality products at competitive prices sets a business apart from its competitors. When customers receive value for their money, they are more likely to be satisfied with their purchase and become repeat buyers.

Customers are more likely to remain loyal to a brand that consistently offers quality products at reasonable prices. This not only helps in retaining customers but also facilitates market expansion, enabling the business to reach new demographics.

The Conti sisters implemented strict standards and measurements for all aspects of food preparation, ensuring consistency and quality across their offerings. They also adhered to standard brands and maintained high-quality ingredients to ensure that any modifications did not compromise the quality of their products.

The sisters focused on setting reasonable prices to satisfy customers across different income brackets while still maintaining profitability. Their goal was to offer high-end products at affordable prices accessible to customers from all income brackets.

"We do standardization," Carole says. "We don't hire chefs. It's like an exact science. We have set standards and everything is measured. So we just train the people to follow these standards, which we audit regularly. We check if they're following them through food tasting because just by tasting it, you can tell if they did not follow the standard.

"We follow standard brands and quality for ingredients. So whenever a supplier makes improvements to their product, our R&D team has to talk to them. We tell our suppliers that they have to inform if there are changes. There was an instance when a big company made a change and they were saying there was no change.

"But I said ‘Look at this. I showed them, etcetera, etcetera. I had to visit their production just to compare and tell them how it differs, because we had the stocks of the old one and after a long discussion, they complied without question. They appreciated how we were able to detect the difference and corrected their formula.

"We thought about franchising the business; in fact, we attended franchising seminars. But considering the kind of product we had and the quality we were very particular about, it's something we couldn’t compromise. We thought we needed more time for that, and we were not really in a hurry to franchise. Our priority was to maintain quality and meet customer demand because the bigger you are, you know you will face a lot of challenges, and it might compromise the quality of the products that we were making. So while we were not discounting the idea of franchising, we were thinking that it would take some time, or maybe it's not our priority to do that.

"I'm not really a marketing person, but I handled pricing. I was not involved in marketing strategies; my main focus was to satisfy our customers. Our main objective, even with my sisters Angie and Cecile, was to satisfy our customers, and the price should be reasonable so that we can reach out to more people.

"It's more for the satisfaction of the customer. In the real pricing strategy, you have to have a certain percentage. I took that well, of course, as an accountant we knew how the percentage works, but I didn't follow that."

"Just to add to what Carol mentioned, but we had this goal," Angie says. "Our goal was to have high-end products, not necessarily for the higher bracket, that should be affordable for all brackets. So yun yung parang pinaka ano namin earlier on when we were starting. Di kami makalagay ng mataas na price, although the kind of quality that we were serving, was for high end market, but we wanted it affordable by almost all.

"It's so nice nga eh for those who belong to the lower class. They really stay just to be able to eat or to buy mango bravo. We were so amazed at how they really crave our food, even people within the low income bracket. They say that's their aspiration."

5| Know how to build values and principles in business

When a business operates according to clear values and financial principles, it builds trust with stakeholders, including customers, employees, investors, and partners. Trust is essential for long-term relationships and success.

By adhering to established values and financial principles, businesses foster a culture of accountability. Employees understand the expectations and consequences of their actions, leading to more responsible behavior and better outcomes.

The Conti sisters focused on imparting values rather than implementing systems in the beginning. They emphasized on setting an example for others to follow. They stressed the importance of minimizing wastage and maximizing resources, considering it as their primary value. This principle guided their approach more than strict adherence to accounting principles.

Moreover, the sisters exercised careful spending practices, ensuring they operated within their means. They believed in sharing products that pleased their customers, valuing customer satisfaction as their greatest profit.

After years of operation, the sisters understood that growth required a different kind of management. Their decision to seek new leadership was not only for business advancement but also to prioritize the well-being of their employees and families.

"In the beginning, it was more about training the people, instilling our values in them," Carole says. "I think it's more about that. The system came much later because we didn't have it in the beginning, so it's more about instilling our values in the people and setting an example.

"I think it’s the value of maximization. Especially for my sister Cecile, there's no wastage. It's more about the principle of maximizing what you have and minimizing wastage; I think that's the number one value. It's more about that than being an accountant, I think.

"We're also very careful in spending, based on what we have. We don't go beyond what we have; that's why we didn't expand as fast. We were also not into borrowing.

"It's not that borrowing is bad, but maybe it's just our value, our principle, I think. Why do we have to borrow? We're happy doing it and sharing the products that we do with our customers, and when they're happy, that's already our biggest profit.

"After many years, it was time for us to hand it to someone who can bring the company to the next stage. You know, it's a different level of management already. It calls for different expertise. Creating is different from, you know, the growth and at a certain level, it calls for different management.

"We knew that at a certain point, we will have to look for somebody to take care of the business and make it even better. It was also more for the people working with us because growth was needed. We knew when it's time to relax and have time with our families."

Henry Ong, RFP, is an entrepreneur, financial planning advocate and business advisor. Email Henry for business advice [email protected] or follow him on Twitter @henryong888