How to start a bakery or buy an existing bakery
An incredible number of people have given up perfectly lucrative careers to start bakeries. The desire to start and run a bakery stems more from a desire to unleash creativity than from a compelling need for money.
While a bakery business makes substantial profits if run sensibly, even the most prosperous bakery needs time to break even and turn a profit. Also, it is not something that you can leave in the hands of others. You must be a phenomenal baker yourself and be willing to work long hours.
The first decision you need to make is whether you want to acquire a franchise, buy an existing bakery, buy a new one, or start one out of your home. If you’re buying an existing bakery, find out why it’s being sold and check out the equipment. But whatever you plan to do, it’s best to seek professional advice before taking the plunge. Determine the initial investment that will be required and the type of profit that you can expect.
A bakery business takes time to grow and prosper, so make sure you have enough working capital to sustain you until then. Consult your accountant for projections on capital requirements, overhead and potential income.
Next, decide on the location. Your bakery should be located in a place that hosts a large number of customers for your products. A location that faces a busy street and close to schools and entertainment facilities is perfect. Find out how many bakeries are already operating in that area and if they will prove to be a potential threat to your business. Also conduct a market survey to determine what types of baked goods are in demand in that particular locality.
Formulate a business plan that includes the design and layout of the bakery, financial projections, marketing tactics, and procedures for efficient management. Some means of financing your business are savings, credit cards, bank loans, business loans, and investors.
Before you begin your operations, you will need to complete paperwork such as obtaining a license and permit, opening a bank account, purchasing equipment, and hiring employees. Obviously, the main ingredient is flour, so identify the suppliers that will offer you the lowest rates. Save money and eliminate unnecessary expenses as much as possible. The success of a bakery depends on how much you can save on expenses.
Start advertising well in advance of the grand opening. Distribute flyers and brochures and print your business cards. You can also place a banner about the imminent opening of your bakery. Host a small party before the main opening to promote your bakery and pique the interest of potential customers.
If you plan to operate a home bakery, you can approach various retailers to sell your products. Here, having an exclusive product works wonders. Exclusive delicious pastries, cakes, cookies, etc. they are welcomed by retailers as they always want to stay ahead of the competition.
When it comes to pricing, price your products reasonably to cover costs and provide a decent profit margin. Avoid pricing them too high as this will drive you out of the market. Pricing them too low, on the other hand, is also a mistake. After all, you want to make some money from your bakery.
Operating a bakery requires a lot of work, saving and planning. But it can also be very rewarding when you see your dreams come true. With the right amount of effort and skill, you can have your cake and eat it too.
