A Piece Of Cake: Starting Your Independent Bakery

For everyone who has a sweet tooth, there can be no better business idea than opening your own bakery. As bakery shops are becoming more and more varied, you can even choose to focus your skills on the creating of sweet cupcakes or the kneading on international bread varieties. There is a bakery business for everyone and a desire for the authentic taste in every bakery owner. But the financial and logistical components of your business might still be a little fuzzy at first. Here is a short guide to help you through the first business steps of your bakery shop.


#1. Utilize equipment financing

According to financial sources, bakery startups costs range from $10,000 to $50,000, which means that you need to keep a close eye on the budget to make sure that you don’t run into the red. A good tip is to utilize equipment financing for your professional kitchen equipment, as it will guarantee that your personal capital, credit card and bank account are still available everything that will cost money over time. You can then choose to lease the equipment or use government loans or a sale-leaseback to buy it.


#2. Proactively build your customer base

While you shouldn’t be spending too much on branding at first, you need to be creating a buzz to attract your customer base. In other words, your marketing strategy is key to make yourself known. You can choose a freebies approach and let know that you’ll be distributing free cupcakes or free loaves at a specific time in your shop. Customers will flood the place! The advantage of a freebie approach is that your customers get a real taste of your products. But you can also work with a street artist to build up some local brand awareness. Street art works wonders for that!

Free cupcake


#3. Know your break-even point

As a small bakery shop, you need to know how much you can afford to spend to get your sales to a break-even point. Erin, in her BabyCakes bakery shop in NYC, is $500 shy of breaking even every month despite working up to 12 hours a day and paying her staff in cash. In her vegan bakery, baking one cupcake costs her $2 each time as she’s using high-cost vegan ingredients. Without a high-profit margin, Erin is forced to recruit more investors so that she can afford more staff and quicker equipment to break even.


#4. Make it easy to pay

If you want your customers to be happy to buy from your bakery shop, you need to make it easy for them to pay. This means accepting credit cards for payment so that customers can use them to maximize their purchases. While there is a merchant fee associated with a credit card transaction, you will be losing customers if you only take cash. Additionally, there are now other ways to pay. Paypal is letting merchant accept Paypal payments in their shops, and you can let smartphone users pay via their favorite wallet apps. The easiest you make it for customers to pay, the more likely they are to buy.  

Pixabay image


Launching your own bakery requires a lot of business know-how on top of your love for sweet recipes. From understanding how to finance the specialist equipment to making it easy for customers to know about your shop and pay, it can seem that the road to sweet success is long. But keep working at it, and you might soon be rolling in dough!


Featured image source: Four River Shop


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