Cupcakes: No longer the darling of retail?

A source of delight for some, bewilderment for others: the cupcake boom.

A source of delight for some, bewilderment for others: the cupcake boom.

Covered in brightly-colored icing and intricately designed, cupcakes suddenly cluttered the tops of bakeries around the world. Entrepreneurs caught on to the latest food trends, opening dedicated stores to indulge our sweet tooth. One such example is Crumbs Bake Shop which has 67 locations and trades on the NASDAQ.

Cupcake specialist stores did not exist a decade ago -- and now it seems, the sugary bubble has burst. Analysis from the Wall Street Journal highlighted that stock prices are plummeting; Crumbs was at its $13 peak in 2011, and now has fallen to only $1.27 a share.

Why has the cupcake boom evaporated in such a fashion? Restaurant analyst at Wedbush Securities Nick Setyan commented:

"I never understood the cupcake thing to begin with. With Crumbs, their expansion strategy was too quick, disorganized and franchise-heavy. The big issue: people can bake cupcakes at home."

Perhaps the rapid build of such stores that have flooded the market is to blame -- or simply the fact that for stores to remain competitive, they have to have a wide product range. In addition, as obesity rises and people become more health-conscious, a 500-calorie cupcake suddenly doesn't look so appetizing.

Leading from this, it is worth noting how the cold-pressed juice industry is now rising in the same manner as cupcake stores did. At least juice may be a little more forgiving on our waistlines -- although not our wallets.

Read More: Forbes

Image credit: Eva Blue

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