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Every week as SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wednesday on Twitter from 8-9 pm ET. This is excerpted from my recent interview withCandace Nelson @SprinklesCandac Candace is the founder of the world’s first cupcake bakery, Sprinkles Cupcakes. She opened her first Sprinkles Cupcakes location in Beverly Hills in 2005, and has since grown her business to 10 bakeries nationwide, a traveling Sprinklesmobile, the world’s first Cupcake ATM and Sprinkles Ice Cream. Candace is also a judge on Food Network’s Cupcake Wars and has appeared on the “Today” show, “The Martha Stewart Show,” “Nightline” and “The Best Thing I Ever Ate.” She is a business expert on the panel for Mission: Small Business, a grant program from Chase and LivingSocial awarding up to 12 individual grants of $250,000 to help small business grow or expand. As part of her role in Mission: Small Business, Candace, along with other panelists, will select small businesses to receive the grants.

SmallBizLady: Sprinkles Cupcakes is known for creating the cupcake craze more than seven years ago, what has been your secret to success?

Candace Nelson: We reinvented a childhood classic and made it into something everyone could love– a sophisticated, quality product (both with respect to ingredients and design).  People were excited to rediscover something they had always loved from childhood but repurposed to suit more grown up tastes.

SmallBizlady: In a crowded marketplace, what is the best way to get a leg up on the competition?

Candace Nelson: Continually innovate! When Sprinkles opened, we were the world’s first cupcake bakery. Since then, hundreds around the world have popped up.  We try to always be ahead of the curve:  we launched the world’s first cupcake truck and world’s first Cupcake ATM and now have expanded into ice cream and cookies!  We also offer free cupcakes daily at all Sprinkles locations via our social media “whisper words” — this gives people the opportunity to try us at no cost to them!

SmallBizLady: You have expanded your empire onto TV and debuted Sprinkles Ice Cream. What tips can you share with other small business owners about expanding into different verticals?

Candace Nelson: Stay relevant to your brand.  We’ve received hundreds of partnership opportunities — from candles to caboodles.  Some may be a fit down the road, but for now we are focused on building Sprinkles into a premier dessert brand. We only take on projects that bring us closer to that goal.

SmallBizLady: What are your best tips for developing a business plan for growth?           

Candace Nelson: Plan your expansion strategy from day one.  Though it may shift, it is important to have a clearly stated goal from the beginning so you can execute against that goal. Before opening Sprinkles, I knew I wanted to expand to every major metropolitan city in the US and abroad. Knowing this, my husband and I built Sprinkles for growth, sometimes incurring a larger overhead than necessary for a company with only a couple stores — but without that extra investment we wouldn’t have been able to get to 10 stores.

SmallBizLady: What are the biggest challenges that hold back small businesses from growth and expansion?

Candace Nelson: Oftentimes, the owners of small businesses find themselves doing everything!  During the first year of Sprinkles, my husband and I spent 16-hour days at the bakery, frosting cupcakes, interacting with customers, and sweeping the floors… all while trying to grow the business.  You can’t do it all!  Hire a good team and train them well so you can set your sights on your business’ future.

SmallBizLady: Expansion for a small business can happen in different ways. How can you best determine, on a limited budget, which direction will prove most successful for your business?

Candace Nelson: You should test out the waters on a small scale first.  For example, I began with a custom cake business out of my house before taking the next step to have a retail location.  Additionally, find like-minded businesses and study what makes them successful or unsuccessful.  Talk to everyone you can in the industry and get your product in peoples’ hands.

SmallBizLady: What is your No. 1 best practice for hiring that has enabled your business to grow?

Candace Nelson: When hiring cupcake associates (counter staff), we look for applicants who have potential to grow with the company.  The majority of our management team started off as part-time employees who discovered their passion for cupcakes and chose to make a career out of it.

SmallBizLady: What resources do you recommend small business owners check out when looking to grow their business? 

Candace Nelson: Employ social media!  Facebook and Twitter are the cheapest form of marketing and a great way to communicate with, and get feedback from, customers. 2- Go local! Get involved with your city’s chamber of commerce or tourism board, which work to drive business to the local community.  Additionally, participating in local charitable events (i.e. check with local schools and organizations) is a great way to generate positive word of mouth while giving back!

SmallBizLady: When you sell a higher-end product, how did you make your small business brand recession proof?

Candace Nelson: At $3.50 each, our cupcakes are accessible to a wide group of consumers. So while consumers may have cut back on larger expenses, a Sprinkles cupcake remains a luxury they can enjoy without breaking the bank.

SmallBizLady: Sprinkles is quickly becoming an international brand. What are some winning strategies for growing your business from a local business to an international business?

Candace Nelson: It is important to partner with someone abroad to help navigate the cultural differences in each country. As a business navigates and prepares for success abroad, the changes and adjustments made must still be relevant to the brand. This is a careful and thoughtful process.

SmallBizLady: One of your biggest recommendations is protecting your intellectual property. What are the most important steps?

Candace Nelson: Act early on.  We began the process of registering our trademarks within the first year of opening, as it can take several months, if not years if you run into challenges.  Additionally, be vigilant.  As a trademark owner, it is your responsibility to protect its integrity.  Simple online searches may bring to light dozens of infringers.  Your lawyers can advise how to handle each on a case by case basis.

SmallBizLady: What other projects are you working on?

Candace Nelson: This spring, we expanded the Sprinkles brand by launching the world’s first Cupcake ATM and Sprinkles Ice Cream in Beverly Hills!  I’m working hard to bring these concepts to our other locations as well as expand Sprinkles internationally.  As you can imagine I have learned a lot along the way and am also excited to be sharing these lessons within the small business community.

Please note:  Voting ends on June 30 for the $250,000 small business grants from @ChaseNews & @LivingSocial.

If you found this interview helpful, join us on Wednesdays 8-9pm ET follow @SmallBizChat on Twitter. Here’s how to participate in #SmallBizChat: http://bit.ly/S797e

For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com