Baker grabs a slice of the action

Tea for two? Chris Arnot finds a burgeoning cake maker who has attracted Fortnum & Mason

Sporting a broad-brimmed hat and weighed down by several bags, the elderly lady bore a fleeting resemblance to the late Margaret Rutherford, of Ealing comedy fame. She squinted at the chocolate cake, the date and nut loaves and the rich fruit cake. On being told the prices she didn't flinch. "I just need to know," she said, "because when my family arrives, I need cake and plenty of it." With that, she swept out of the Meg Rivers Traditional English Tea Room into the narrow high street of Shipston on Stour in Warwickshire.

Here, you felt, was a woman who at one time might have baked herself. Perhaps she no longer has the time, the energy or the inclination. Why bother if you can afford to buy something that tastes home-made?

Meg Rivers' cakes have been consumed by a schoolteacher and his pupils in Kathmandu and a wedding party back home in Melbourne. She is an Australian who has cut herself a generous slice of business in Middle England. Or Middle Tysoe, to be precise - the Warwickshire village where she has a small bakery supplying cakes for mail-order worldwide as well as what she hopes will be a franchised chain of tea-shops closer to home.

The one at Shipston is a blueprint. Everything is just so, from the starched white tablecloths topped by blue and white china and fresh flowers, to the display of Meg Rivers cakes, Meg Rivers lemon curd, Meg Rivers honey and Meg Rivers meringue cases near the cash desk. It is difficult to imagine a better example of one business being used to display the wares of another.

"The two do seem to dovetail quite nicely," says their creator, who is already negotiating for other sites in Warwickshire and further afield. Eventually, she hopes to have about 20, similarly furnished and all selling cakes baked in Middle Tysoe.

Not surprisingly, she looks very favourably on the somewhat neglected tradition of afternoon tea. "A period of calm reflection in the afternoon can be a great pleasure if done properly. It's a very English kind of thing, but my dream would be eventually to open one in Australia."

By then her life would have turned full circle. She first learned to bake at her mother's Elm Tree Tea Rooms in the Southern Tablelands, south of Sydney. In 1973, she set off to see the world - and never came back.

With her English husband she "wanted to move out of the London rat race" and set up a new life in the soft countryside she loves so much. The kitchen of an old parsonage is not the likeliest place to start a business. But it was here, with a cool larder at one end and a lovingly restored Victorian range and bread oven at the other, that she took up serious baking.

Her new friends had already commented on the quality of her cakes. "Somebody asked me to send one to a relative in Zimbabwe. Then someone else wanted me to send one to Belgium. The mail-order idea just developed from that."

With one or more of three young children cluttering her kitchen at any time, she needed organisation and stamina. Sometimes she was still writing labels at one in the morning.

But the mail-order service began to pay off. By 1986 she had a turnover of pounds 34,000. Then her marriage broke up. She had to find a new home as well as business premises.

"But I had a mailing list. I knew I had a good product and there were customers out there prepared to pay for it. I also knew I had the energy to make a go of it."

She bought a derelict butcher's shop and managed to negotiate a rent- free period while it was being restored. A three-deck baker's oven was installed with the insulation necessary to keep the constant heat she had had from her Aga at home.

Today, the mail-order cakes business has a turnover of more than a quarter of a million and her headquarter's small reception area bears evidence of her success in various Businesswoman of the Year competitions. Mrs Rivers employs six full-time staff and 12 at Christmas.

A key factor in the growth, she feels, was a decision to apply for a DTI Business Award. "You pay half and they pay half for a 10-day consultancy. They made three major recommendations: installing a computer system, redesigning the catalogue to make it look more professional, and increasing the product range.

"It's no good making an investment like that if you don't act upon the advice. The computer has paid for itself a hundred times over." As for the catalogue and product range, the turnover expansion speaks for itself. Customers around the globe seem happy to pay pounds 17.50 for a 1.5kg rich fruit cake or pounds 28.50 for a 2.3kg "Celebration Cake" topped by a posy of silk flowers. Fortnum & Mason and Selfridge's have also approached her to supply them.

"That's very flattering," she says, and a profound change from the early days when she went knocking on the doors of the big stores to find them closed.

Sadly, her mother is no longer alive. "I would love her to know what I'm doing now," says the former waitress of the Elm Tree Tea Rooms, 80 miles south of Sydney.