Ricardo “Richie” Cuna is an advocate of a well-crafted business plan. His company, Milkin Corporation—a toll producer of tailor-formulated ice cream products—and his flagship brand, Fiorgelato, are testaments to the success of his methodical approach.
It was not an easy journey for him, but focus and determination got him to where he is right now—a dominant player in the high-end ice cream market, with 65 outlets nationwide.
Cuna was still working with a bank as a business developer when he started Milkin. He did not take out any loans since, at that time, the interest rates were too high and he relied on his salary and savings as capital for his first venture. “It was a slow process for me because I didn’t borrow money from anybody. It was really just determination and discipline,” he said.
Cuna knows that keeping to his fiscal principles can be a great challenge, and he meets it with the help of a 25-year business plan, crediting it for helping him steer the company to growth since they started.
In the beginning, Cuna had Italian partners. But he had the vision to grow the brand further, so he decided to buy out his Italian partners. At the time, the gelato brand only had two outlets. Because he did not want to borrow money, he decided to franchise the business in order to expand.
But there were barriers to Cuna’s vision: “When we launched the brand, it was unknown and difficult to pronounce. We were ahead of the rest. The ingredients and machines were not available locally so I had to go out of the country to purchase what I needed. But the number of years we were ahead, that was an advantage for us.”
The banker also decided to retire and focus on his growing venture, which added to the stress. “When I left my [regular job], I had sleepless nights. But I always say, sometimes you have to fail to succeed—[you need] to feel the pain.”
Though Cuna champions the business plan, he also said that one must be flexible and allow for adjustments along the way. A case in point was Fiorgelato’s initial target niche. The brand was then catering to the top-end of the market when Cuna realized that it was a small slice of the pie. “The board decided to review the scenario, and we suggested making it mass-based. That’s one key to the brand’s success—we were able to spread nationwide,” he shared.
Setting the bar high
There were many things that contributed to Fiorgelato’s growth. Cuna had to monitor the different aspects of the business himself since his entrepreneurial structure did not allow for high-salaried managers and consultants at the beginning.
As far as the product was concerned, Fiorgelato set the bar high. “There are a lot of players in the market but they’re using foreign formulations or flavors and ingredients. Despite the Italian technology, it’s still has the Filipino heart—we put a lot of Filipino flavors,” Cuna said.
Transporting perishables, especially to provincial outlets, is tricky business, but Cuna takes pride in their system, saying “in our 23-year history, our ice cream melted only twice. We have very good logistics for bringing our products to the market.”
Cuna is proud his franchising division is one of the most successful in the country: “There’s so much discipline in the business, it’s a systemized set-up.”
He also cautions against the temptation of rapid expansion. “There has to be a balance [between company-owned and franchised outlets]. You can’t have one company-owned outlet and 150 franchised outlets—that’s suicide. If you’re too greedy on your expansion mode, that will spell your downfall,” he said.
From start to finish, Cuna always referred to his so-called bible, their 25-year business plan. “Fiorgelato’s strength has been precisely because the people behind it have a definite mission and vision,” he said. “We were determined and focused to pursue the dream.”
Devi is a freelance writer and the former Homes and Market Editor of ELLE Decoration Philippines. Follow Devi on Twitter, @burunggay.
This article was originally published in the November 2015 issue of Entrepreneur Philippines magazine.