London Bakery Cutter & Squidge Eyes £10 Million Milestone as Direct-to-Consumer Model Defies Commodity Surge

London-based bakery Cutter & Squidge is projecting a 12% revenue increase this year as it targets £10 million in annual sales by late 2027, maintaining full bootstrapped ownership while navigating severe cost increases across core baking ingredients.

The company, founded by sisters Annabel and Emily Lui, recorded nearly £8 million in revenue in 2025. Direct-to-consumer online orders now generate approximately 80% of total turnover, marking a structural transformation from the brand’s origins as a physical retail operation. Wholesale and corporate client orders account for 13% of the company’s revenue, while its sole remaining physical outlet on Brewer Street in Soho generates 7%.

According to operational data disclosed by the company, up to 95% of direct-to-consumer purchases are intended as gifts, supported by expanded product lines for celebrations including Chinese New Year, Diwali, Eid, and Ramadan. Hamper sales recorded a 175% year-over-year increase between June 2025 and June 2026.

The business has absorbed a 175% rise in the price of cocoa and chocolate, driven by international supply constraints and harvest disruptions in West Africa. Prices for specialty ingredients, including matcha and pistachios, have risen by roughly 50%. Commercial property rates for the business have climbed 25%, alongside a 15% increase in electricity expenses and a recurring 4% annual rise in labor costs.

Management has ruled out altering recipes or using synthetic substitutes to protect margins, relying instead on data analytics and automated fulfillment workflows to keep operational overhead lean across its 50-person workforce.

The direct-to-consumer shift originated during the 2020 pandemic lockdowns, which forced the closure of the company’s three retail shops. To replace lost foot traffic, the bakery developed nationwide delivery formats, beginning with packaged afternoon-tea kits before scaling brownie shipments to 2 million units annually.

That pivot followed an earlier restructuring in 2014, when the business was left with £15,000 in operational capital after wholesale arrangements with department stores Harrods and Selfridges ended abruptly. The sisters, who previously worked in corporate finance at KPMG and commercial real estate law, used the remaining capital to establish their Soho presence.

Cutter & Squidge recently received the Online Bakery of the Year title at the Baking Industry Awards, reflecting its transition from a local storefront into a nationwide e-commerce operation.