How to Start a Bakery

Bakery Business Background:

If you are planning to open your own bakery, there are a few things to consider. First, prepare to start your prep work very early in the morning.

Many recipes require several hours for prep time. You will also need a way of selling your baked goods either through a café setting, with tables and chairs, or through delivered goods to stores and restaurants.

Finally, after the shop is closed to the public, be prepared to spend a few hours cleaning the kitchen and all cookware as well as prep work for the next day.

Considerations Before Starting Your Bakery

Before opening a bakery there are several important decisions to make. First, determine how you want to start (many bakeries often start as a home based bakery and grow from there).

The benefit to this is; of course is low overhead. However, drawbacks include space and capabilities, as well as city or town laws banning the sale of food products out of a residential home.
For example, in the state of Texas it is unlawful to make any foods for distribution unless it is completely closed off from the living and sleeping areas. (http://www.dshs.state.tx.us/foods/faq.shtm)

Also, consider the style of your bakery. Common types of bakeries include pastry bakeries, bread roll and bagel bakeries, large commercial bakeries like Roman Meal®, franchised bakeries like San Francisco Bread Co.® and Panera Bread Co®, gluten free bakeries, and even dog treat bakeries. These bakeries serve different roles and require different amounts of startup money

Tasks And Skills Needed To Run A Bakery:

Business Specific Tasks:

Inventory Management

Bookkeeping/Recordkeeping

People Skills: Employees, Customers, Vendors, etc.

Scheduling

Advertising/Marketing/PR

Sales/Invoicing

Website maintenance and marketing

Money management

Bakery Specific Tasks:

Planning the Menu

Ordering Ingredients (flour, eggs, yeast, etc)

Prep Work (Mixing ingredients, raising bread, oven prep etc.)

Baking and Cooling

Glazing/Decorating

Displaying Baked Goods

Cleanup of Tables, Counters, and Display Cases (if part of business model)

Cleanup of Equipment and Work Areas

Deliveries (if part of business model)

Approximate Hours Needed To Run A Bakery

General hours of Operation: This will vary due to the style of the bakery. Bakeries that serve breakfast style pastries and coffee, may open as early as 6 am and may close as early as noon, while franchise bakeries like Panera Bread® may be open from 6 am to 9 pm.

Hours Needed to Prepare - Recipes that require that the bread rise will need to be started several hours before the first customer enters. After the doors close, the equipment and workstations must be cleaned which may take several more hours. Prep work and closing up could be +/- 6 hours depending on recipes. On the other hand, large-scale bakeries may operate 24 hours a day.

Employees Needed To Run A Bakery:

Initially a bakery can be run by an individual and then grow.
Here's a list of people you may need to hire:

Bakers

Servers

Delivery People

Cleanup Personnel

Shift Supervisor

Bakery Licenses:

You'll have to look into local, state, and federal, permits and licenses. The SBA website has a utility for more information in your area. For a bakery you will also need a food handler's permit for both you and your employees.

Approximate Minimum Start up Cost:

Bare essential: It is recommended that you have three months' worth of operating costs set back before you open your bakery. According to the New Yorker Magazine, a small pastry shop in the Lower East Side of New York City called Baby Cakes has a monthly operating cost of just over $11,600 USD.

However, location and wages, can vary largely. Entrepreneur Magazine estimates that an average bakery startup will cost between $10,000 and $50,000 (depending on the scale of your business.)

Necessary to Operate A Bakery:

Necessary Start-Up Equipment:

Ovens and Mixers

Cooling racks

Tables (for food prep and seating)

Proofing Racks/Storage (for flour to rise)

Cookware (pots, pans, bowls, etc.)

Chemical detergents and sanitizers

Dishwasher

Packaging Materials for delivery or service

Supplementary Equipment: - Equipment that you can acquire once your business is off and running:

Delivery vehicle

Ovens, microwaves, warming trays and plates

Refrigeration unit(s), some portable

Dough 'Sheeter' for rolling out dough

Glazers and 'Icers'

Monthly Expenses For A Bakery:

Ingredients (flour, eggs, sugar, yeast, etc.)
Utilities (electric, gas, water)
Vehicle expenses
Business insurance
Advertising/Marketing
Wages
Rent
Maintenance
Possible regular inspections by a health lab

Special Requirements For Bakeries:

HACCP and excellent Sanitary Practices
Regular checks will be conducted by health officials
Food temperature monitoring at all times
Conformance to all applicable food service laws

Bakery Business Pros And Cons:

The Pros of Owning a Bakery Business:

Huge market - depending on your location

Great potential for expansion

You can opt for both, wholesale and retail

You can develop your own specialty product

Field can be very stable

Total control of manufacturing

The Cons of Owning a Bakery Business:

Prep work requires an early start

Long days or shift work may be required

Work can be 7 days a week and 365 days a year

Bakers work on a tight schedule with a strict quota

Inventory may have to be thrown out or donated if business is slow

Bakery must follow strict government rules

Type of Customers You Need to Attract For Your Bakery:

The types of customers will vary depending on the style of bakery you open. Pastry and cakes bakeries tend to attract special occasion, breakfast, and dessert customers. Small bread bakeries may attract restaurants and small groceries. While larger businesses may only wholesale to large grocery chains like Acme or Wal-Mart.

Bakery Business Statistics:

According to the American Institute of Baking (AIB) the sales of baked goods were over $38 billion USD worldwide in 2008. These sales continue to grow. For example, cookie and wholesale baked goods increased nearly $80 million USD between 2003 and 2004 alone.

Bakery Revenue:

Revenue can depend on several factors including: location, cost of supplies, and style of baking. Baby Cakes bakery, in New York city sells vegan based cupcakes at 50% profit per cupcake. However, due to the high cost of rent and supplies (organic and vegan) they survive with the help of investors right now.

Bakery Guides For Inside Secrets and Tips Related the The Bakery Business

Cake Decorating Business Secrets: A Instantly Downloadable guide where A Professional Cake Decorator Reveals Secrets To Generating A 6-figure Income From A Simple Home-based Cake Decorating Business.

Master The Art of Bread Making - This ebook offers tips on how to make tasty loaves of home-made bread and special treats such as cakes and jams that may help you provide specialty products for your bakery.

Patty Cake, Patty Cake... - A batch of over 100 delicious cupcake recipes and frosting ideas, some recipes are Louise's favorites and some submitted by her readers. included in the book are chapters with vegan and gluten-free recipes.

How To Make Perfect Chocolate Chip Cookies: Insider Secrets - Discover the secrets to amazing chocolate chip cookie baking. make cookies like the pros. insider secrets few home bakers know!

Bakery Business Resources:

Bakery Associations: This page gives information about various membership association websites that promote the interests of professional bakers and their businesses.

Bakery Business Plans: This page is a collection of websites that provide business plans and business plan resources for people starting or running a bakery.

Bakery Equipment: This page is a collection of websites that allow professional bakers to browse online inventories, find, and purchase needed equipment for their kitchen.

Used Bakery Equipment: This page is a collection of various websites where new, used, and refurbished industrial baking equipment can be purchased.

Bakery Supplies: This page is a collection of websites that offer a wide selection of bakery supplies including utensils, specialty bakeware, and ingredients.

Bakery Training, Courses, And Publications: This page is a collection of websites that focus on pastry chef education. Information has been compiled on culinary arts schools that offer baker training.

Bakery Forums Groups and Discussions: This page describes various websites that host forums for those in the food industry to gather and share knowledge. Each site can be viewed for free.

Bakery Franchise Opportunities: This page is a collection of various websites of bakeries that sell franchises. Detailed information specific to individual bakeries is given on each site.

Related Businesses:

Dog-Bakery business (believe it or not, this is a popular off-shoot)
Catering
Wedding Cakes and party favors, boxes, etc.
Artisan Bread