Do you spend hours in the kitchen dreaming up sweet confectionery treats and mindblowing savory delicacies? Ever wondered what opening your own bakery would be like, but you lack the startup funds? Don’t even think about taking out a second mortgage – just start a baking business from home!
Before you get started on baking and selling your first batch of goodies, however, there are a few things you need to know first:
Running a bakery from home involves setting goals, complying with regulations, and thorough planning.
Even if you’re not much into the business side of running a bakery, you will have to deal with these inevitable complications before you can get to the fun part: making all those tasty pastries.
I’ve already covered starting your own catering business from home, but now let’s get to baking.
Below, I’ve compiled everything you need to know to get your new home baking business off the ground. Whether you just want to take the occasional order and bake and sell goods on the side or transition into a full-blown baker, these tips will help you realize that dream.
The Reality of Starting a Baking Business From Home
There are a few things that need to be solved before you can start a baking business from home, from both logistical and legal standpoints.
I’ll start with the most important first…
1. Get the legal concerns out of the way first
This is probably the least exciting part of starting a business, but it is still essential that you take these steps before doing anything else.
Comply With Local Business Regulations
Getting to grips with all of the legislation in your country, state and local county can seem overwhelming at first, but it’s not all that hard if you do your research and work through the process methodically.
You could also consider creating a home bakery business plan.
First off, check to make sure whether it’s legal to open your business.
Some states in the US, for instance, don’t allow home bakeries, while others may prohibit certain goods (mainly those that need to be refrigerated).
To get this bakery going, you’ll need a business license that typically needs to be renewed every year. You may also need to have a sales permit (and/or various other licenses or permits) much like a meals-to-go business would.
The type of legal documents you have to acquire will depend on your local laws as well as the type of business you’re aiming to run.
For instance, if you have an area where people can sit and eat then you’ll likely have to obtain different permits than if you were to run a solely delivery-based bakery.
Keep in mind that you might have to pay fees when applying for licenses or permits, so budget ahead for that.
Get up to standard with food safety regulations
You may not be running a restaurant but you’re still working with food and that means food safety laws do apply to you too.
Getting a health and safety certificate will require that an inspector comes to your house to look around so they can make sure your kitchen is up to code. This naturally means that you have to have a sanitary kitchen and the right equipment, but could also involve modifying your kitchen area with commercial-grade upgrades.
Regulations usually aren’t as strict for a home bakery as, say, a restaurant, but there are still a few things that you’ll likely need to take care of. Make sure you prepare your kitchen before the inspector arrives.
Don’t forget about insurance
Like any other business owner, you should apply for liability insurance.
This will cover you in a number of ways, including if any of your clients get sick from eating one of your cakes (which hopefully never happens) or if any property gets damaged during the delivery.
You might also need to take out additional insurance depending on your situation, for instance, stock insurance can come in handy if you buy and store ingredients in bulk, and employers’ liability insurance is necessary if you decide to hire anyone to help you in your bakery.
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Make sure to inform any relevant parties
If you’re renting or living on an estate then you may need to inform others of your decision to start a bakery, which can include a landlord or homeowners association.
Otherwise, you might be facing some hefty fines later on, should they have any rules regarding home businesses on the property.
Oftentimes, just talking to them about your plans should be enough.
2. Market Your Business Online and Locally
Your carefully crafted tarts might be the envy of the neighborhood and local bakers alike, but those goods are staying put without proper marketing.
Marketing might seem like another big, scary hurdle in your path (especially if you hate the idea of selling), yet it’s an extremely important part of your business.
Wow the Locals at events and fairs
A bakery isn’t a bakery until someone buys the first baked good.
Starting out, you’ll want to build recognition around your local community so the word about your business can start to spread.
Think about local events that you can get involved with, like fairs, festivals, bake sales, and parties. Really, any place where you can display and sell your baked goodies will work.
Consider letting people taste some of your creations for free as well to draw them in.
If the idea of putting yourself out there leaves you feeling uncomfortable, remember that the best type of marketing is word of mouth – and letting people see and taste your goods in person is your best shot at winning them over.
It won’t be as bad as you’re probably making it out to be in your head either.
After all, who can resist a sweet treat!
Raise that online reputation
These days, promoting your business online can go a long way towards reaching potential clients and building a solid community of supporters, so it shouldn’t be ignored.
Bakers have more online outlets and platforms are available to them now than ever before and it’s much easier to get started than you’d initially think.
There are multiple platforms that allow you to quickly and easily set up your own website, and creating social media profiles for your bakery is easy as pie. Plus, you can get tons of inspiration from other bakers online too!
Social platforms that work well to promote your bakery on, include:
- Instagram (This is a great place to show off snaps and videos of your delectable treats.)
- Pinterest (Create some appetizing pins and share a few recipes that people can save for later.)
- Facebook (Set up a business page and start promoting!)
- YouTube (You might not have ambitions for your own baking show, but if you’re ever up for recording a few tutorials then this is the place to put them.)
3. Plan orders ahead and organize your kitchen
Running a successful home bakery comes down to meticulous planning and proper organization.
Especially as you get busier and have to juggle multiple orders a day, which makes it just that much easier to get confused and mess up an order or miss a delivery.
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4. Keep close track of the finances
If pricing your cakes wasn’t hard enough, every year the taxman rolls around and there’s no avoiding him either.
It’s crucial that you keep track of all your income and expenses for when you have to file your taxes.
If this is a potential problem area for you then try using business accounting software (there’s plenty available online) that can help you manage your finances.
Remember to keep all your receipts as well in case you need to provide proof for your tax-deductible expenses.
And make sure to file the right tax forms, depending on whether this is your full-time job or a side income.
The Future of Home Bakeries
Setting up your own baking business from home can be challenging but it’s all worth it if you get to do what you love for a living.
As your business grows and your sweet or savory baked goods get more popular, you might even start to consider selling them at local supermarkets – now isn’t that a treat!