How to Start a Bakery - Background Info:
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 A bakery gets buzzing before the sun comes up, making breads, cakes and pastries very early every morning. Throughout the day, the bakery will also produce breads, cakes, doughnuts, pastries, pies rolls and anything else that is offered by each particular bakery.
Many bakers not only bake every day, but must also take care of all of the inventory, such as making sure the shelves are stocked and supplies are on order. A baker calculates the amount of flour, yeast, salt, etc. that is needed each day.
There are different types of bakeries: mom-and-pop shops that do their own baking, franchise bakeries and industrial bakeries.
How to Start a Bakery - Tasks And Skills Needed:
Business Specific Tasks:
If you are planning to do all the business tasks or hiring or subcontracting tasks, here's a list of tasks that need to be attended to when it comes to the business side of running a bakery business:
- Bookkeeping
- Website maintenance and responding to email inquiries
- Scheduling
- Advertising/Marketing/PR
- Computer skills
Industry Specific Tasks:
 Same as above if you plan to do everything yourself or get help, here are some of the tasks necessary to operate a bakery business:
- Almond paste making
This task is Performed As Needed
- Artisan breads
This task is Performed Daily at Varying Hours
- Glace work
This task is Performed Daily at Varying Hours
- Specialty cakes and pastries
This task is Performed As Needed
- Chocolate and sugar
This task is Performed Daily at Varying Hours
- Petits fours
This task is Performed As Needed
- Plated desserts
This task is Performed Daily at Varying Hours
- Wedding and other special-occasion cakes
This task is Performed As Needed
- Order food ingredients
This task is Performed Weekly/Monthly
- Order Supplies and Equipment
This task is Performed Weekly/Monthly
- Plan Menus
This task is Performed Weekly/Monthly
- Attend workshops, demonstrations, and courses
This task is Performed at Various Times
How to Start a Bakery - Approximate Daily Hours Needed::
General Hours of Operation: - When your business is open - Typically, bakery companies are open for inquiries from 9 a.m. to 5 p.m. with message service 24/7. A bakery business is always 'open' with doughs rising and other preparatory work such as creating cake decorations.
Hours Needed to Prepare - Before Opening and After Hours Activities - Many recipes require preparation the night before, such as with pre-rising breads. The baking requests and the stock kept up in display counters can be around the clock.
Number of Employees Needed To Run This Business:
Minimum Number of Employees -During the Start Up Phase: Budding talented bakers can run this business single-handedly.
Number of Employees - Once Your Business is Up and Running Successfully:
- Bakers
- Servers
- Transportation
- Ordering of supplies
- Customer service
- Accounting
- Cleanup
Skilled Job Trades:
 Here some of the skills necessary to run this type of business other than the necessary business skills:
- A background in the baking industry
- Passion for baking
- Party-planning
- Dining etiquette
- Decorating
- Coordinating and timing food service with speeches, etc.
- Ability to get along well with people and be flexible
Licenses:
Call your local courthouse to find out which agency in your state is in charge of regulating bakery licenses. In California, for instance, bakery licenses are regulated by the Department of Alcoholic Beverages. Though the regulating office differs from state to state, the application process is largely the same.
You will also want to obtain a business license such as an LLC and tax i. d. number.
In addition, you will 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.
Here is an estimated breakdown of the costs involved:
 Security Deposit & Construction - $30,000 - $32,000
Startup Inventory - $3,000 - $5,500
License & Permits - $300
Total Startup - $33,300 - $37,800
The average cost to operate a bakery is $10,000 to $12,000 per month.
Naturally all this depends on the size of your bakery.
Minimal exposure - Minimal exposure for advertising will run $500 to $1,000 to start.
Necessary Equipment Necessary to Run A Bakery:
Necessary Start-Up Equipment:
- Mixers and ovens of various capacities in order to manage jobs of all different sizes and designs
- Wrapping material, bags, boxes, etc. for customers who want their baked goods on the go
- Cooling racks for the food once it is prepared before it can be packaged or sold
- Display cases so you customers can see all of the goods you have available.
- A number of baking dishes in all different shapes and sizes; made of glass, metal, etc.
- Tables and chairs if you plan to have dine-in customers
- Mixing bowls of all shapes and sizes to accommodate any job
- Chemical detergents and sanitizers to keep you kitchen utensils and equipment safe
- Various cutlery and utensils that you will need to make the baked goods
- Manuals, cookbooks, recipe books, etc. everything you need to keep your menu appetizing to customers
 Supplementary Equipment: - Equipment that you can acquire to once your business is off and running:
- Answering machine/service
- Delivery vehicle with signage
- Rental space for food refrigeration and cooking
- Chairs, tables, tablecloths, etc.
- Ovens, microwaves, warming trays and plates
- Refrigeration unit(s), some portable
Monthly Expenses For A Bakery Business:
- Cell phone service
- Answering service
- Gasoline
- Vehicle and business insurance
- Advertising
- Wages
- Rent
- Electricity
- Water
- Attorney Note: Since you must observe health and safety laws, and other things such as product liability, you may want to consider hiring an attorney to make sure you are in compliance. This can cost up to $3,000, but is well worth it since just one mistake can put you out of business.
Special Requirements For This Business:
- HACCP and excellent Sanitary Practices
- Building permit for any further construction
- Regular checks will be conducted by health officials
- Food temperature monitoring at all times
- Conformance to all applicable food service laws
Pros And Cons:
The Pros of Running a Bakery Business:
- Huge market- depending on your location
- Great potential for expansion. You can start off with a small bakery, just baking breads. You can then expand into a café offering a wide variety of specialty coffees
- You can opt for both, wholesale and retail
- You can develop your own specialty product and be the only place to get it
- No matter what the economic situation may be (booming or a slow economy), this type of business keeps moving – a big bonus.
- You are in control of creating your own products which usually results in high profits.
The Cons of Running a Bakery Business:
- Running a bakery means that you have to get up and begin working very early every morning.
- In fact, a number of bakers work 12 – 14 hours every day to make sure they have everything the customers want.
- The average baker is up well before the sun.
- In addition, a successful baker often misses days off for holidays and weekends because there is so much work to be done.
- Bakers work on a tight schedule with a strict quota.
Type of Customers You Need to Attract:
The type
of customers you will be attracting are wedding, convention, and special event planners who are business owners or private individuals.
Bakery Business Statistics:
 As long as people have parties, celebrations, and special events, the bakery industry will flourish. For current statistics, refer to: Valuation Resources | Food Corporate Information
Revenue:
A baker working by the hour can make anywhere from $8 to $14 per hour on average with an annual salary ranging from $15,000 to $20,000 each year. A baker can require higher pay depending on education, experience and geographical location.
Resources:
Industry-Specific Websites:
Baking Business
Modern-Baking
Courses & Books:
How To Start A Bakery Home Study Course
How to Open a Financially Successful Bakery
The Baker’s Trade
Cake Decorating Business
CIA ProChef
AIB
CIA Advanced Baking
How to Open a Financially Successful Bakery (book)
Equipment and Supplies
:
Business.com
Shuma Online
Macrea's Bluebook
Forums:
Bakery-Net
Associations:
American Bakers Cooperative Inc.
Allied Trades of the Baking Industry
American Bakers Association
American Culinary Federation
American Institute of Baking
Independent Bakers Association
Other:
Gaebler (bakery franchises)
Plan Magic (software)
Mother Earth News: Starting a Home Bakery Business (How-to article)
Related Businesses:
- Dog-Bakery business (believe it or not, this is a popular off-shoot)
- Catering
- Party-Planning
- Wedding Cakes and party favors, boxes, etc.
- Artisan Bread
How to Start a Bakery Business - 12 Steps
Before You consider a Bakery Business, see 16 Questions to Consider Before Starting a Business
1. Ensure A Bakery Business is for You!
You have a choice as to what business you're going to start, so start one that's right for you. Getting into the right business can dramatically increase your success. Get into the wrong business and your success rate drops. Read Five Secrets to Getting into the Right Business for more information.
2. Understand How A Bakery Business Operates
How can you run a Bakery Business if you don't know much about the business? What if you run into an issue that you can't or won't deal with? Then what? You're in a business that you hate working in and that's a problem. See Understand How a Business Operates for more information.
3. Make Sure There Is a Profitable Market for Your Business
What's the use of starting a Bakery Business that is not profitable? You'll be putting all your effort in something that can't support itself or you. There are a variety of issues when it comes to setting the stage for profitability. See Tips for Identifying a Profitable Market.
4. Create a Business Plan For Your Bakery Business
A business plan is a must for any size business because it helps you stay focused, see the big picture, and get funding. It's something that you create when you start your business and then update as your Bakery Business evolves. Read our free online guide on How to Write a Business Plan
5. Set up Your Business Team
Setting up your team includes finding the right employees and professionals that will help you run your Bakery Business.
You don't need to employ everyone you work with, but you will need a team of people you can depend on, which could consist of a lawyer, accountant, banker, and consultant, as well as professionals in your industry. See Creating a Business Team for more on this subject.
6. Get a Small Business Loan if You Don't Have the Money to Start
If you don't have the money to get started, then you'll need the necessary financing or you won't have the opportunity to start your Bakery Business. This can be done as a small business loan, a personal loan, or other small business financing options.
For more on financing your Bakery Business see our guide on Financing Your Small Business
7. Legalize Your Bakery Business
In order to run your Bakery Business legally you'll need to abide by government rules and regulations on the state and local level.
You'll need to do your research, determine what type of business (sole proprietorship, corporation LLC, etc.) to register, create and register your business name, and register your Bakery Business with state and local authorities.
To go through the business registration process, see Chapter 6: Making Your Business Legitimate, starting with 6 Easy Steps to a Good Business Name.
8. Get Equipment for Your Bakery Business
In order to run your Bakery Business successfully and efficiently you'll need to acquire the right type of equipment. How can you run an online business without a computer? You can't! This is an important issue. See Acquiring Equipment for more on this topic.
9. Set up Your Accounting System
Running a Bakery Business requires you to collect taxes, and report your earnings. So it's best to set up an accounting system in before you start your Bakery Business. See Setting Up Your Accounting System for more on this topic.
10. Acquire Customers for your Bakery Business
In order to exist, every business needs customers. Getting customers is one thing you'll need to be good at. If you can master the tasks of getting customers, it's just like turning on a cash machine almost any time you want. See Acquiring Customers for more on this topic
11. Prepare To Accept Money
You'll need a way to accept money, you can't depend just on cash or checks. You'll need to accept plastic: Visa, MasterCard, and American Express. To do that you'll need to apply for a merchant account. See Setting Up a Merchant Account for more on this topic.
12. Insure Your Bakery Business
Make sure you have the proper insurance for your Bakery Business. Without the right coverage you could lose everything you've worked for. For tips on insuring your Bakery Business, see our free online guide: Insuring Your Small Business.
Bakery Business Issues's:
Estimating Startup Costs - Find out if you're forgetting something
Business Location - Choosing A suitable one For Your Bakery Business
Build or Buy A Business? - Buying an existing Bakery Business
Business Builders For Your Bakery Business:
Starting A Business - Free Online Guide
Business cards for Your Bakery Business
Business Plan for Your Bakery Business
Business Insurance for Your Bakery Business
Small Business Loans: Finance Your Bakery Business
Small Business Marketing For Your Bakery Business
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