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Nov 4, 2011 ... GELATO WAS THE WAY BACK TO HAWAII ... 2 PACIFIC BUSINESS NEWS | pacificbusinessnews.com .... 42-page business plan, $260,000.
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PACIFIC BUSINESS NEWS | pacificbusinessnews.com

NOVEMBER 4, 2011

That’s what he said |



When you run your own business, you’ve just got to be prepared to serve and that’s what we’re doing.

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ASIA-PACIFIC ECONOMIC COOPERATION SECTION HAWAII’S WEEK IN THE GLOBAL SPOTLIGHT is being touted as the beginning of a new chapter for the Islands as an international destination for business meetings. PAGE 18 SOME WAIKIKI MERCHANTS are worried about losing business next week, despite having 20,000 visitors in town for the Asia-Pacific Economic Cooperation meetings. PAGE 20 THE UH INSTITUTE FOR ASTRONOMY will use Leaders’ Week to gain international support for the planned Thirty Meter Telescope on Mauna Kea. PAGE 22 LIST OF APEC ECONOMIES attending meetings in Hawaii next week, along with their head of state and gross domestic

product. PAGE 23 APEC OFFICIAL CALENDAR of events and Hawaii Host Committee events. PAGE 23

STRATEGIES GELATO WAS THE WAY BACK TO HAWAII for a German couple who are finding ways to make their business grow in a high-risk environment. PAGE 12

LISTS OAHU’S LARGEST HOTELS, ranked by number of sleeping rooms and suites. PAGE 15

Adaniya, Hank . . . . . . . . . . . . 5 Allen, Scot . . . . . . . . . . . . . . . 3 Baldridge, Steve. . . . . . . . . . . 1 Beatty, Teva . . . . . . . . . . . . . 5 Benham, Maenette . . . . . . . . 8 Black, Cameron . . . . . . . . . . 4 Bonham, Carl . . . . . . . . . . . . . 7 Brizee, Bill . . . . . . . . . . . . . . . 1 Carr, Stanford . . . . . . . . . . . . 1 Chaffin, Lori . . . . . . . . . . . . . . 5 Ching, Shim . . . . . . . . . . . . . . 5 Chong, Cathy Lee. . . . . . . . . . 3 Combs, Sean Lee. . . . . . . . . . 1 Crouch, Peter. . . . . . . . . . . . 22 Dedrick, Layla . . . . . . . . . . . 5 Egged, Rick . . . . . . . . . . . . . 20 Ferido, Sheryl. . . . . . . . . . . . . 5 Gill, Gary. . . . . . . . . . . . . . . . 4

Hada, Yukiko . . . . . . . . . . . . 20 Hasinger, Guenther . . . . . . . 22 Hedges, Jerris . . . . . . . . . . . 8 Ho, Peter . . . . . . . . . . . . . . . 18 Jones, Jenny . . . . . . . . . . . . . 5 Kobayashi Jr., Bert A. “BJ” . . 1 Kobayashi Sr., Bert A. . . . . . . 1 Koeppenkastrop, Dirk . . . . . 12 Kohler, Cory . . . . . . . . . . . . . . 5 Luke, Warren . . . . . . . . . . . . . 1 Lamoureux, Valerie . . . . . . . 20 Lau, Jeffrey D.. . . . . . . . . . . . 1 Lee, Marian . . . . . . . . . . . . . . 5 Leo, Matt . . . . . . . . . . . . . . . . 5 Li, Bryan. . . . . . . . . . . . . . . . . 1 Lin, Catherine. . . . . . . . . . . . . 1 Lueker, Nicole. . . . . . . . . . . . 12 MacNaughton, Duncan . . . . . 1 MacNaughton, Ian . . . . . . . . . 1 Maddock, Jay. . . . . . . . . . . . . 8

REAL ESTATE PUNAHOU SCHOOL is getting into the faculty housing business by purchasing property from the YWCA of Oahu. PAGE 3

THE ECONOMY HAWAII’S ECONOMIC RECOVERY has hit the pause button, a new University of Hawaii report says. PAGE 7

HIGHER EDUCATION

AIRLINES SERVING HAWAII, ranked by number of passengers flown to Hawaii in 2010. PAGE 16

THE UNIVERSITY OF HAWAII MEDICAL SCHOOL will begin offering a master’s degree in indigenous health. PAGE 8

ENERGY

SMALL BUSINESS

A NEW ONLINE PROGRAM is expected to

PRESIDENT BARACK OBAMA wants federal

Hawaii people and businesses in this issue | PEOPLE

reduce the time needed to process an energy permit in Hawaii. PAGE 4

Matsunaga, Joel . . . . . . . . . . 4 Menka, Tony. . . . . . . . . . . . . 20 Mitchell, Kurt . . . . . . . . . . . . . 1 Mitchell, Vince . . . . . . . . . . . . 5 Moore, W. Bud . . . . . . . . . . . . 1 Ng, Kozue . . . . . . . . . . . . . . . 20 Peel, Jason. . . . . . . . . . . . . . 12 Schatz, Brian . . . . . . . . . . . . 22 Shigekuni, Vincent. . . . . . . . . 1 Sted, Chuck . . . . . . . . . . . . . . 1 Tanaka, Randy . . . . . . . . . . . 18 Tani, Carlyn . . . . . . . . . . . . . . 3 Tollefson, Jim. . . . . . . . . . . . . 1 Topping, Sunshine . . . . . . . . 13 Wakai, Glenn . . . . . . . . . . . . 39 Wolensky, Alan. . . . . . . . . . . . 5

BUSINESSES Academy of the Pacific. . . . . 3 Alan Wong’s Pineapple Room. . . . . . . . . . 12 Aloha Stadium . . . . . . . . . . . 39 APEC 2011 Hawaii Host Committee . . . . . . . . . . . . . 18 Aqua Hotels & Resorts . . . . . 1 Architects Hawaii . . . . . . . . . 1 Asia Pacific Plastic Surgery . 5 Azure . . . . . . . . . . . . . . . . . . 12 Baldridge & Associates Structural Engineering . . . . . 1 Bank of Hawaii. . . . . . . . . . . 18 Bella Pietra . . . . . . . . . . . . . . 5 BlackSand Capital LLC . . . . . 1 Chinese Chamber of Commerce of Hawaii. . . . . . . 1

Choi International . . . . . . . . 1 Fairmont Orchid. . . . . . . . . . . 6 Genius Outfitters . . . . . . . . . 20 Geobunga . . . . . . . . . . . . . . . . 5 Hamilton Boutique. . . . . . . . 20 Hank’s Haute Dogs . . . . . . . . 5 Hank’s Pop Up Lunch . . . . . 5 Hawaii BioEnergy. . . . . . . . . . 4 Hawaii Biotech. . . . . . . . . . . . 6 Hawaii Business Roundtable . .1 Hawaii Convention Center . . 18 Hawaii Department of Business, Economic Development & Tourism . . . . 4 Hawaii Department of Health . . . Hawaii Medical Response Inc. .5 Hawaii National Bank . . . . . . 1 Hawaii Pacific Health . . . . . . 1

Hawaii State Energy Office. . 4 Hawaii Tourism Authority . . . 1 Hawaii Wellness Directory . . 5 Hawaiian Airlines . . . . . . . . . 13 Hawaiinuiakea School of Hawaiian Knowledge. . . . . . 8 Il Gelato Hawaii . . . . . . . . . . 12 International Market Place . . 5 Iolani School. . . . . . . . . . . . . . 3 Kober Hanssen Mitchell Architects. . . . . . . . . . . . . . . . 1 Maile Sky Court Hotel . . . . . . 1 Michel’s at the Colony Surf . .12 Mid-Pacific Institute . . . . . . . 3 Mojo Barbershop . . . . . . . . . . 5 Mynah Bird Marketing. . . . . . 5 Ni Hao Hawaii Magazine . . . . 1 Ni Hao Media . . . . . . . . . . . . . 1

This index highlights businesses, organizations and government agencies featured prominently in this issue. Page numbers listed refer to the pages where the articles begin. The index does not include people listed in Hawaii Pacesetters or companies listed in Business Leads, Top 25 lists or advertisements.



Dirk Koeppenkastrop Co-owner, Il Gelato Hawaii See full story Page 12

agencies to increase efforts to commercialize more of the $147 billion annual investment in research and development. PAGE 40

OPINION A PBN EDITORIAL supports state Sen. Glenn Wakai’s efforts to find more productive uses for Aloha Stadium and the area surrounding it. PAGE 39

CLARIFICATION The East-West Center provides scholarships and educational opportunities to both U.S. and foreign students and offers training programs for research and economic development. A Page 4 story in the Oct. 28 issue referred only to the foreign students.

Orthopedic Associates of Hawaii . . . . . . . . . . . . . . . . 5 PBR Hawaii & Associates Inc. 1 Protea Cafe . . . . . . . . . . . . . 20 Punahou School. . . . . . . . . . . 3 Roy’s Waikiki . . . . . . . . . . . . 12 S&P Destination Properties. . . . . . . . . . . . . . . . 1 Stanford Carr Development . . 1 State Health Planning and Development Agency. . . . . . . 5 The Chamber of Commerce of Hawaii. . . . . . . 1 The Royal Hawaiian. . . . . . . 12 University of Hawaii . . . . . . . 7 University of Hawaii Economic Research Organization . . . . . 7 University of Hawaii Institute for Astronomy. . . . 22 University of Hawaii John A. Burns School of Medicine . . . 8 University of Hawaii Manoa

College of Engineering . . . . 22 Vit’s Hawaiian Steak House . 1 Waikiki Aloe . . . . . . . . . . . . . 20 Waikiki Improvement Association. . . . . . . . . . . . . . 20 Your Health Hawaii Magazine . . . . . . . . . . 5 YWCA of Oahu . . . . . . . . . . . . 3

AROUND HAWAII Big Island . . . . . . . . . . . . 5,6,22 Kauai. . . . . . . . . . . . . . . . . . . . 4

Published weekly except one extra issue in December by Pacific Business News, Pacific Business News Building, 1833 Kalakaua Ave., 7th Floor, Honolulu, Hawaii 96815. Copyright ©2011 Pacific Business News ISSN 0030-8552. Pacific Business News, P.O. Box 75130, Honolulu, Hawaii 96836. SUBSCRIPTIONS: Hawaii and 2nd class mainland rates are $88.95 for one year (53 issues), $176.95 for three years (159 issues). Foreign and 1st class Mainland rates on request. Single copy $2 for weekly issues; special annual issue is $49.95. POSTMASTER: Send address changes to Pacific Business News, P.O. Box 75130, Honolulu, Hawaii 96836, or call 808-955-8100. Periodicals postage paid at Honolulu and additional mailing offices. MEMBER: Audit Bureau of Circulations and Hawaii Publishers Association

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PACIFIC BUSINESS NEWS | pacificbusinessnews.com

STRATEGIES

NOVEMBER 4, 2011

Il Gelato owners have a plan, and passion Wholesale business lands contracts with high-end customers BY LINDA CHIEM PACIFIC BUSINESS NEWS hen husband and wife Dirk Koeppenkastrop and Nicole Lueker moved back to Hawaii from their native Germany and bought the assets of the defunct Mondo Gelato in the summer of 2010, they already were armed with a 42-page business plan, $260,000 worth of European, stainlesssteel equipment and more than enough passion to start their new business, Il Gelato Hawaii. Within a year, their quaint Italian gelateria has cultivated a menu of 95 flavors of handcrafted gelato and sorbetto and built up a wholesale client list that includes 40 high-end restaurants and specialty food stores. First-year sales topped $300,000. Next year, they want to expand into retail and are shopping around for potential locations. Italian-style gelaterias aren’t plentiful in Hawaii. Aside from the few successes, such as Maurice Grasso’s La Gelateria, most others failed or never quite got off the ground. Grasso sold his business in 2008 to Kenwei Chong and Erik Ludwick, the former owners of the E&O Trading Co. restaurant, who continue to operate La Gelateria on Cedar Street in Honolulu. Koeppenkastrop, a physical chemist with a Ph.D. from the University of Hawaii, and Lueker, a teacher at the Honolulu Waldorf School in Niu Valley, saw the potential for their gelatos to succeed in Hawaii by promoting high-quality ingredients and practicing good, old-fashioned, genuine customer service. Koeppenkastrop attended Carpigiani’s Gelato University in Bologna, Italy, to learn the trade and technique behind gelato-making and the couple traveled across Tuscany and Florence researching the best in authentic Italian gelato in preparation for launching their Hawaii business. “If everybody’s being cheap on quality ingredients, then the only thing we can do is offer high-quality gelato,” he said. “Hawaii is very small and people appreciate very good quality. The key, with people liking you, is that word travels fast.” They inherited Mondo’s client list, which was really just

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TINA YUEN PBN

Il Gelato Hawaii co-owner Dirk Koeppenkastrop, left, scoops mango sorbet into a cone at Whole Foods Kahala, one of his customers, while Darin Manby, a Whole Foods associate team leader, scoops pineapple mint sorbetto. four clients, and made quick work of cold-calling potential customers and dropping off gelato samples. They targeted higher-end restaurants and hotels such as Roy’s, Hoku’s, Michel’s at the Colony Surf, Azure at The Royal Hawaiian and Alan Wong’s Pineapple Room, all of which carry Il Gelato Hawaii’s products almost exclusively. From there, word-of-mouth advertising helped them land accounts with Whole Foods Market and Foodland Farms, which set up gelato bars selling Il Gelato Hawaii’s products. They’re all about going the extra mile for customers, including collaborating with executive chefs at those restaurants to craft signature flavors, Koeppenkastrop said. Their grass-roots marketing also extends to participating in school fundraisers and industry golf tournaments where they give out free gelato. “When you run your own business, you’ve just got to be prepared to serve and that’s what we’re doing,” he said. “You have to be willing to work hard yourself and be right in the middle of everything. Gelato is people’s business and we say in our mission statement that we want to make people happy.” Prepackaged quarts of their

Il Gelato Hawaii Italian-style gelateria Co-owners: Dirk Koeppenkastrop and Nicole Lueker Address: 501 Sumner St., Suite 501, Honolulu, HI 96817 Phone: 542-9276 Website: www.ilgelato-hawaii.com SMALL-BUSINESS ISSUE Operating a business in an uncertain economic climate where competitors have failed. STRATEGIES ■ Craft a solid business plan, chart your growth slowly and pay attention to customers’ tastes and preferences. ■ Promote, promote, promote. Don’t be afraid to cold-call. You have to build your client list from somewhere. ■ Find your marketing niche where others failed — in this case, promoting high-quality ingredients and developing signature flavors with clients.

gelatos or sorbettos sell for $12 plus tax. A five-liter tub sells for between $40 and $50. The most popular flavors are Tahitian vanilla, Kona coffee, chocolate and lychee sorbetto. Il Gelato Hawaii has five employees, who often contribute ideas for seasonal flavors such as pumpkin cream cheese gelato or Oreo mint. Recognizing that people also want to buy direct from them, Il Gelato Hawaii hosts what it calls “factory outlet” hours at its Iwilei facility from 11:30 a.m. to 5 p.m. Mondays, Wednesdays

and Fridays. Walk-in customers can buy $6.50 acai bowls or scoops of the five featured gelato or sorbetto flavors of the day. It’s a prime way to test new flavors to see what sticks with customers. As a result, the menu has grown to 95 flavors. Despite the high costs that come with sticking to highquality ingredients, some of which are shipped in from Italy, they say they have paced their investments and managed their inventory well enough to keep cash flow positive so as

to pour money more recently into establishing a corporate brand. That includes company T-shirts, brochures and a new website, ilgelato-hawaii.com. The couple lived in Hawaii from 1988 to 1997, then moved back to Germany, but were determined to return to Hawaii eventually. The gelateria was their way back. “It takes a lot of passion because it’s high risk where you’re holding a lot of inventory so you’re not getting rich off gelato,” Koeppenkastrop said. “We listen to our customers, we don’t gear toward mass production, so I think that makes us very unique.” Roy’s Waikiki Executive Chef Jason Peel said he is especially happy with their willingness to collaborate with chefs and their uncompromising commitment to high-quality ingredients. “He’s pretty on it and he loves expensive ingredients, but his stuff is amazing,” Peel said of “Dr. Dirk,” as Koeppenkastrop is known to friends and colleagues. “I think everything is great. It’s the best gelato I’ve tried in Hawaii and he’s always willing to change things up, work with the chefs, whether it’s coconut soy gelatos or chocolate sorbettos.” [email protected] | 955-8042