Tag Archives: Bakery

How To Start A Bread Bakery Business

  1. Prepare a Business Plan

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    A business plan is not as scary as it sounds. Even if you don’t intend to source any capital from banks or investors, it is important that you organize your thoughts on paper. It doesn’t have to be complex or too elaborate, just something to keep your eyes on the big picture. The business plan will allow you to easily identify the obstacles and anything you may not have considered.
    Your business plan should consider the prevailing market price for the type of bread you want to produce and how much competition there is. You also need to estimate the profit you’re likely to make in the first, second and third years. Is it sustainable? Is it worth the time, effort and capital? It’s usually wise to keep 8-12 months working capital to adequately support a bread bakery business.

  1. You Should Know Enough About Bread

    Nobody says you must be a master baker to succeed in this business; you really don’t need to. However,  you need to know the basics and tricks of the trade if you want to survive in this business. Sign up for a bread baking course and learn the basics about measurements, recipes, flavours, packaging, branding and marketing. You should not give in to the temptation of thinking it’s enough to just hire a manager and have the bakery make you money. Your ignorance is likely to open you up to financial losses and eventual failure.

  1. Choose A Location That’s Close To Your Target Market

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    The types of bread in the African market appeal to different segments of consumers. You must ensure that the type of bread you intend to produce will find a sizeable market in your area. What kind of people live around you? Are they high, middle or low-income earners? Are they students, single people or households with families? Are they predominantly young or old people?
    If you live in a closely knit community like a residential estate or a university campus, it may be a great opportunity to run this business from your home kitchen.
    Look for newly established or developing suburbs and high traffic locations that have little competition. It’s also important to focus on areas that may not be well serviced, like industrial estates or high density office blocks where you can draw eager customers.

  1. Would You Need a Permit or License to Operate?

    Depending on your country and location, you may require a permit or license from a government establishment or Consumer Health office to operate a bakery. What are the requirements and standards for approval? Would you need to have specific equipment like fire safety tools? Is there a standard qualification you must obtain to be eligible for a permit? You must know these requirements in advance and take the necessary steps to ensure you get the approval you need to open your doors to the public.

  1. You Need to Use The Right Equipment

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    The size and quality of your equipment will depend on how much bread you intend to produce for the market and the amount of startup capital you have. It’s very important that you don’t spend too much on equipment at the beginning of this business. Look out for any good quality, pre-owned (second hand) bakery equipment you can find at a bargain price. The basic equipment you need  to start a bakery business include: an oven, mixer, dough moulds, dough divider, fermentation chamber (proofer) and maybe a bread slicer.

    Putting it all together…

    Because most people WILL eat bread most of the time, the bread business can be a very rewarding venture if entrepreneurs can find a large market with few competitors. With some creativity and higher quality, a new bakery can easily win consumers over from an established bakery. When properly planned and operated, bakeries can become a rich source of lasting income.

    If you believe this type of business will work for you, start working on a business plan and take action as soon as possible.

How to Open a Bakery

According to a private research firm, baked goods and bakeries were in the top 10 of fastest-growing industries for small businesses in 2010. So, if you’re a skilled baker with entrepreneurial skills, opening a bakery may be a lucrative step. You’ll also need to understand how to plan a startup and effectively run a company in order to generate enough revenue to stay in business and make a living. Read the following steps to learn how to open a bakery.

Steps

  1. Decide what type of bakery you want to open.
    • There are bakeries that only sell baked goods, those that sell sandwiches and coffee to go or some that have a seating area where customers can eat breakfast or lunch.
    • Choose whether you want to sell conventional baked goods, organic baked goods, gluten-free baked goods, or vegan (e.g. egg and dairy-free) products.
  2. Research the competition in the area to find out if there’s a demand for the type of baked goods you want to sell. For example, if the local supermarket sells conventional, organic and vegan baked goods at reasonable prices, you might not be able to compete. But, you could open up a new market if you open a bakery with a pleasant seating area and offer specialty baked goods and fresh sandwiches.
  3. Draw up a business plan. Make sure you carefully calculate the costs of your location, equipment, supplies, staff, taxes and marketing. Balance them against your projected income to determine how much profit you’ll make over the first few years.
  4. Review your business plan with an accountant, who will probably find additional expenses you overlooked. An accountant will also tell you how the costs of a startup can affect your tax returns.
  5. Raise the necessary capital for opening a bakery. Ask your bank for a business loan or talk to private investors to raise the money.
  6. Register your business with your city and apply for a sales permit to sell baked goods.
  7. Choose the location for your bakery. Make sure it’s easily accessible, has plenty of traffic and meets all safety requirements.
  8. Buy your equipment and have it professionally installed to make sure everything is safe and up to code. You’ll need scales, bowls, pan racks, ovens, mixers, butcher block tables, display cases, and refrigerators.
  9. Decide which baked goods to sell at your bakery and determine which ingredients you need.
  10. Interview and hire employees. Make sure they are friendly, efficient and trustworthy.
  11. Call the local Consumer Health Services agency and have your bakery inspected for health safety.
  12. Buy all necessary ingredients for your baked goods, such as flour, yeast, eggs, sugar, raisins and butter.
  13. Prepare your baked goods. Make sure they look and taste as good as possible to draw in customers.
  14. Advertise your bakery in the local newspaper, on flyers and online.
  15. Open your bakery.

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What Is a Bakery Concept Statement?

A business concept statement summarizes the focus of your new business, particularly how it differs from competitors. A bakery concept statement presents the focus of that bakery, such as wedding cakes, artisan breads, pastries or a particular target audience, as well as the overall business concept that sets that bakery apart from other bakeries in the area.

Purpose

Your bakery’s concept statement lets potential lenders or investors know more about your business. It should provide a clear view of why your bakery will be successful, even if local competitors are larger or cheaper, to convince these sources to lend or invest money for your start-up or operating costs. The business concept can also help set you apart from competitors in your customers’ eyes, so it should provide a compelling reason for them to buy your products over others.

What to Include

A bakery concept statement should include the basic information about what your bakery is and does, how it is unique, and who it serves. The latter should include the location as well as your target customer demographic. You should also include when the bakery will open for business, its operating hours, and the basics of your marketing plan. You don’t need to include specific financial numbers in the concept statement, but note where and how you intend to market your bakery, such as at wedding expos for a wedding-cake-focused bakery or through local coupon books for a neighborhood full-service bakery.

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