Wanna know how to start a bakery business from home? Keep reading peeps…
Baked goods have always been a favourite for children and adults alike. From cookies to cakes to brownies, they have always been popular, loved, and eaten by almost everyone around the world, and we owe it to none other than bakers who give the world these sweet treats.
A lot of love and passion goes into the art of baking. While some bake just for the joy of it, some also use their skills to start a business and earn by starting a bakery business.
1. Baking and Home Businesses
Home businesses are a great way for someone to start earning from home. The popularity of small home businesses is increasing daily as more people apply their interests and skill and transform this into a means of earning an income.
Recently, home bakers have become even more popular than commercial cake shops. Baking is one such craft. With the onset of Covid 19, an increasing number of people took to baking to keep themselves occupied in lockdown, and those who already baked could hone their skills and set up a home baking business.
2. Why are Home Bakeries So Popular?
People that have a baking business are those that love to bake. They take their craft seriously and hence focus on the quality of their baked goods. Also, since each good is personally hand-made instead of mass-produced, cleanliness and quality control can be kept in check.
2.2. Creativity and Personalization
Small businesses have fewer customers than bigger businesses. Small business owners thrive on good customer relationships and feedback. Thus, customers get what they want, exactly how they want.
Especially with bakeries, baked goods such as birthday cakes and cupcakes can be personalized. A lot of time thought, and effort is put into these sweet treats. This makes the customers feel appreciated.
Many times, home bakers experiment with new flavours and dishes. These can only be found in their bakery. Hence, the aspect of uniqueness also comes into play, and after all, everybody loves something different once in a while!
2.3. People Supporting Small Businesses
Nowadays, an increasing number of people have begun supporting small businesses. The good quality, focus on personalization, good owner-customer relationship, and so on have led more people to support small businesses, especially bakeries. This has also led to an increase in the number of people that buy from home bakeries.
3. How To Start a Home Bakery Business from Home
Anyone wishing to start a bakery business needs a plan or steps to start a bakery business from home. Starting a new business is never easy, but following through with the right steps can help kickstart and later help consistently and successfully run a business.
3.1. Committing to a New Beginning
Starting a business is a huge commitment. Hence it is necessary to ensure that you not only enjoy baking but also have the time to start and commit to a new business. Understand how many hours you will need to run a bakery business and that running a successful home bakery will take time and effort.
To create your own business, it is important to understand the business world around you. Market research and understanding the target market are important to deciding what to sell and whom to sell it to.
Market research helps in understanding what the current market for bakeries is like. What bakery businesses are out there, what they are selling, and how much do they sell and earn? Answers to all these questions require sufficient research.
Research on other bakery businesses will also lead to understanding what baked goods are not being sold. This knowledge is important because that is where you can step into the picture. Thus, it is not only about finding customers’ needs but creating your place in the market.
Understanding the target market means knowing who your target audience is. These people already buy baked goods, or you know, will buy them. These people will also be your main target in advertising.
Market research will give you the necessary information regarding the producers and consumers in the world of the home baking business and arm you with enough knowledge to start a home bakery business of your own.
3.3. Creating a Plan
After you have gained the information you need through research, it is time to implement it. Implementation requires a plan that you can act on. Working without a plan may cause delays or misdirection, while having a step-by-step plan makes things easier. A good business plan is a holy grail for any business owner.
A business plan is a document that states the goals of your business and how you plan on achieving those goals. The research you have done so far regarding the market, and your competition, along with other plans like marketing strategies, costs of raw materials and other startup costs incurred and so on, are put into the business plan so that you have a roadmap to direct you in starting your home bakery.
3.4. Laws and Licenses
Apart from understanding your competition and customers, research and knowledge are needed of the local laws and rules of your state regarding the selling of food items and any licences and certificates you may require to sell food as a small bakery business.
These may include applying for a sales tax permit, the regulations of cottage food laws, rules and regulations of the state’s health department, how much food tax is imposed on which product, and getting an FSSAI registration.
Depending on the state that you live in, business owners may be required to have business licenses to open their bakery business. If you need a business license, make sure you match the necessary criteria and qualifications and then apply for it according to the rules of the said state.
3.5. Into the Lab
For any home baker, their kitchen is their lab. It is where the magic happens. Before you begin to share your baked goods with the world, you must perfect those recipes yourself and have confidence that your customers will love what you offer.
Like any other art, baking also requires practice. Practising your recipes helps to not only perfect them but also makes you faster. When you have more customers and orders, baking and managing your time becomes especially important.
Whether a dozen cupcakes or a cake, completing your orders and ensuring that your customers get them on time is important. Although timeliness is important for any business, it is even more crucial in businesses like bakeries, where many orders are for celebrations (such as birthdays and anniversaries) and must be delivered at a specific time.
This is also perfect for experimenting with new recipes and innovative ideas. Learning new recipes, perfecting old ones, practising icing and decorating, and all you wish to do before finalizing what to sell can be done during this time.
3.6. Creating the Menu
The right menu is what will attract your customers. You need to create a menu for them to know what your business has to offer. Making the right menu depends firstly on your forte. Bakery items include innumerable delicious treats, but the real question is, what are you the best at?
You will know what you want to sell from your initial experimenting and practising. Many times, bakers stick to one bakery item as their main product, such as cakes or cookies. This is either what they are the best at or the most confident in the making.
Feedback is a good way to decide on the menu and what you do and doesn’t want to incorporate. Bake for your friends and family and take their feedback. Remember that while positive feedback is a great motivator and can help you decide what to add to the menu, honest, constructive criticism can also be beneficial by helping you find your setbacks and loopholes.
Thus, it is important to have a group of people that will encourage you but will also provide you with their honest opinions.
3.7. Branding and Labeling
3.7.1. Naming Your Home baking business
Every business needs a name and an identity for people to remember it. The next step in starting a home bakery is giving it a name.
The name of a business should relate to and represent what you sell. What feelings do you want the name to evoke, what should people feel when they think of the name of your business, how does the name relate to your product and similar other questions should be kept in mind when giving a name to your home baking business.
Creating a logo is also included in this step. The logo not only gives an overall feel to your business, but it is also what will be represented on your packaging and advertisements. The logo’s design, font and colours should be well thought through and coordinated with each other, overall representing your baking business.
Designing the perfect logo can be done using various online tools such as Wix Logo, Canva or any other design software. You can also seek professional help from a designer who can help your vision come to life.
3.8. Bakery Equipment and Ingredients
3.8.1. Creating Your Workspace
As the name suggests, a home bakery means you will most likely use your own kitchen. Thus, you must ensure that you create the right space to work on your business. A good way to ensure this is by keeping your assets different from your professional ones. Having different equipment that you use for only your bakery business will help avoid any confusion.
To ensure that your home-based food business runs effectively, you must stock up on baking supplies. Create a list of everything you need, from flour, baking soda, sugar and a dozen eggs to equipment such as cake trays, measuring cups and spoons; every single product to be bought should be listed and kept on record.
Your business plan will mention the overall cost of all the raw materials and baking equipment. Sticking to the planned budget is important since, as a small home business, you may have only a small budget to kickstart your home bakery startup and to go over it may lead to losses.
Hence, spend smartly and skillfully. Compare prices of the ingredients you need from different places, such as your local farmer’s market, grocery stores, and wholesale suppliers and choose to source them from places that provide good quality products within your budget.
“Packaging can be theatre; it can create a story.”- Steve Jobs
Packaging matters! A product goes beyond just the object. Receiving and unboxing it creates a whole experience for the customer. Your customer will see the packaging before they get to what’s inside. Thus, all of this needs to be considered what your packaging is like and how it looks and is made of.
Your packaging may differ in size or shape depending on what bakery item you sell. For example, cake boxes for cakes and pies, bags or smaller boxes for cookies.
The colour and style of the packaging will usually be according to the colour scheme you have used for your logo. Make sure your packaging has your bakery logo (printed or as a sticker) to make it seem more professional and memorable.
3.9. Let the World Know
Once you have all the materials you need, it is time to show the world what your business has to offer. Marketing efforts need to be made to attract customers, especially for home-based food businesses which people might not know about.
One way to market your home bakery business is through traditional advertising such as newspaper ads, flyers, and brochures. People living in the same locality may most likely be interested in your business this way.
3.9.2. Social Media
One of the best mediums to market your baked goods in a fast and free way is through social media marketing. Set up a Facebook page, post on Instagram, make reels about the baking process, get creative and introduce the world to your home bakery.
Social media is especially useful if your target market is teenagers and adults since most people use social media platforms nowadays. Social media helps in saving not only the cost incurred on traditional advertising methods, making it pocket-friendly and allowing you to be more hands-on and creative with the process.
3.9.3. Word of Mouth
It is well known that news spreads like wildfire. Hence, getting people to talk about your baked goods is a great medium of advertisement. Having a good support system with friends and family that will share the news with others can provide the initial thrust needed to help you start selling.
Humans love a good offer, so handing out free samples is another creative way to get people interested in your home bakery business. Samples are like little teasers and give people a glimpse of all the tasty treats your business offers.
Once you gain customers and start receiving orders, it is time to start baking!
3.10. Stay on Top of Your Game
As the sole proprietor of your business entity, you are your boss and employee. Hence, you need to learn and update your business skills constantly.
Good customer service will help you retain customers and gain more loyal customers. Partnering up with local restaurants and food trucks can help you reach more customers, and it will help increase their business as well.
Maintaining a regular bakery business plan, keeping yourself updated on how other home-based bakeries are functioning, keeping your startup costs in check and maintaining a record of all your incomes and spending, understanding what your customers want and finding your place in the market are all necessary to run a successful business.
Love What You Do
Whether you run your home bakery as a part-time hobby or a full-time business, you truly need to enjoy the process. Falling in love with the process, creating each baked good with the utmost care and building long-lasting relationships with valuable customers is what truly lies at the very base of starting and running a successful home bakery business.