A lot of people love to eat pastries and desserts. In fact, why would people not like it? Bakery business is one of the most profitable ventures you can invest in!
Use these tips with your impressive baking talents and you’ll be on your way to success.
1. Select the kind of bakery you’d like to open
One of the first decisions you’ll have to make is the kind of shop you want to open. To do this, you’ll want to assess your talents, budget, and goals. Be sure you’re not making this decision in a bubble you will want to have your ear to the ground on national trends in the industry. It’s equally important to do local market research to figure out how national currents will affect your particular location. Take a look at the list below and decide which one is right for you. 😉
Online -You don’t need a storefront to open a bakery. You can start out online. With a website, pictures of your work, and a way to place an order, you can run it from your home.
Counter service -With a small commercial space, customers can walk in and pick up baked goods from an employee-managed counter.
Specialty service -If you plan to specialize in a certain kind of baked good, a specialty service is your best option. Whether you run the business from your home or rent a space is up to you.
Sit down -More owners are trying to capitalize on the sit-down and dine option. It’s a growing trend in the bakery industry right now. Picture a space that has both an area to order baked goods and spot to sit and enjoy them.
2. Write a business plan
Once you know what kind of bakery you want to open, you need to create a business plan. This will force you to look at the business from every angle. It will help you define your business, set goals, find ways to generate revenue, list expenses, identify your customer base, and examine your competition.
As part of your business plan, you’ll dive into finances. One of the numbers you’ll need to generate is startup cost.You’ll need to compile a list of equipment, from appliances like ovens and refrigerators, to smaller items like utensils and pans. Make sure you create a full list of tools. The equipment will be a one-time hit, but you’ll also need money to live on while the business gets established.
Remember, you won’t make profits overnight, so you need to sit down and figure out when you’ll break even and how much money you’ll need to survive until that time. 😎
3. Shop for space
If you’re running a bakery from your home, you’ve already got your space figured out. If you plan to invite customers into your shop, you’ll need a formal spot with a kitchen and an area for the public. Some bakers decide to rent out commercial kitchen space only. It’s a good option if you don’t want customers to walk through your shop, and just need a bigger, more equipped kitchen.
Whatever your needs, be picky. Shop around, compare prices, talk with neighboring businesses, and research the area to make sure you find the right space. It’s never a bad idea to look into small business incubator programs that might offer space and business training or mentorship at a reduced rate. Do not forget to consider the legal necessaries which will vary state to state such as obtaining a license to bake out of your own kitchen. 🙂
4. Price your baked goods
Bakers base their retail price points on the cost of supplies and the time it takes to make the goods. Your prices should include things like clean up time, packaging, and time spent promoting your business on social media. The biggest hidden cost in a bakery is time. It’s easy to forget the time you spent making flowers because you were watching TV while you did it. There is nothing worse than realizing afterward that you earned 50 cents an hour on a fabulous creation. 😁
5. Have a defined friends and family policy
Before you sell your first product, be aware that friends and family will probably ask for a discount.
When you’re selling cakes and cookies as a side gig, it’s fine to give the neighbor or the PTA president a discount, but when you start your business, it’s different. All those wonderful people who previously bought cakes off of you for the cost of ingredients are going to need to be re-educated about what you’re doing now. Those who really love and support you will also understand your need to feed your family and pay your rent. If you want to offer a 10 percent discount to friends and family, that’s fine, but whatever your policy is, make sure it’s consistent. 😝
6. Find support
Speaking of friends and family, a support system is crucial in the baking business, Batiste says. Opening a business is time-consuming. Time spent baking is only half the commitment. You’ll need to market your business, take orders, help customers, and do an array of administrative tasks.
If you don’t have someone cheering you on, it can be hard. Whether it’s your spouse, a colleague, or business mentor, you need someone in your corner. 😇
