How To Start A Bakery Business From Home: A Complete Guide

Elena Hudgens
By Elena Hudgens 11 Min Read

Do you like to bake? Are you thinking about how to start a bakery business from home?  Do you find yourself binge-watching baking competitions on TV, thinking you could compete for the ultimate prize of a bakery of your own? Are you the go-to person for a bake-sale fundraiser at a school or a local non-profit organization?

You should think about monetizing your talent to produce delectable delights — after all, you’re already baking.

If you want your baking business to develop and find paying customers, you must treat it like any other full-time business. Unfortunately, the marketing aspect of the home baking business is frequently overlooked, and as a result, most home bakers have difficulty finding paying customers.

Here’s a rundown on how to start a bakery business from home.

1. The Type Of Bakery You Want To Run

The top profitable business ideas for small communities include opening a bakery. Some bakeries are located on the outskirts of cafés that serve coffee and tea all day. Other bakeries specialize in flour-based products such as bread and cakes. Depending on local trends and people’s preferences, you can choose from various retail bakeries.

When it comes to retail bakeries, you’ll discover a vast selection:

Bakery Café: Baked goods, breakfast goodies, and coffee or tea are all available.

Counter Service: Products are almost entirely baked, with no seating or dining areas.

Food Truck: A movement that brings pastries to the streets.

Flour-based Bakeries: Only items made using flour were displayed.

Speciality Bakery by Nationality: There are various places where you can work with speciality bakeries depending on your skills and interest in learning about a specific nationality.

The type of bakery you operate is crucial because it will impact your business plan. 

2. Develop A Business Plan

The business plan lays out what type of eatery you want to operate, how it will be constructed, what items you will sell, marketing methods, and financial estimates, among other things.

Traditional and lean startup company plans are the two most prevalent types of plans. The traditional list is quite complex, takes a long time to produce, and includes a lot of information, whereas the lean startup plan is high-level, concise, and only includes the essential elements.

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Bakery Business Plan Summary: Your bakery business plan summary serves as an outline of your bakery.

Overview: The business overview portion of your bakery business plan must incorporate the point of your bakery business and the types of services you’ll provide.

Industry Analysis: Industry analysis will help you find local competition, analyze your bakery’s target demography, and choose the optimum site for your bakery.

SWOT Analysis: A SWOT Analysis of your bakery business will help you identify the Strengths, Weaknesses, Opportunities, and Threats that your company experiences.

Financial Plans: The cash flow statement, operating costs, fixed and recurrent expenses, and so on should all be included in the financial analysis of your bakery business plan. This will assist you in establishing the economic feasibility of your bakery.

Marketing Plans: In addition, your bakery business plan should incorporate a marketing strategy. The marketing strategy should include how you intend to attract clients and advertise your business.

3. Pick A Spot For Your Business Operation

The type of business space you’ll require will be determined by the kind of bakery you start. For example, if you want to start a food truck bakery, you’ll need to buy the truck and possibly rent space in a commissary kitchen.

Retail bakeries should aim for a facility with a front-of-house area in a central location close to their target audience.

Wholesale bakeries are found further away from the city center or popular regions because they sell their products to businesses rather than consumers. However, regardless of the type of bakery you plan to open, there are a few things to think about when searching for commercial space:

  • Demographics
  • Accessibility
  • Suppliers’ Proximity
  • Competitors
  • Requirements for Size and Space
  • Zoning and Health Codes
  • Crime Rates and Safety

You can engage a lawyer to draw up and negotiate with the landlord once you’ve found a suitable site for your business. 

When negotiating a lease, do include the length of the lease, any rent increases, who will pay for any future improvements, and any utilities that are covered to protect yourself from any potential concerns.

4. Acquire The Necessary Licenses To Open A Bakery Business

The food-service business is regulated extensively on a federal, state, and municipal level, and you’ll need to secure various permissions and licenses before you start your bakery. The types of permissions you’ll need will differ depending on where you live, so check your local legislation and norms to see if any apply to your new business.

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The business license is issued by your government, whereas your city’s health department gives the food-service permit to guarantee that your bakery follows food safety rules.

Apart from a food license, you may also require electricity permission, a plumbing permit, a sign and awning permit, a patio permit, a dumpster placement permit, and a food handler’s permit.

5. Obtain Appropriate Personnel And Equipment

In every business kitchen, reliable equipment is vital. Your bakery’s equipment requirements are determined by the type of baked goods you’ll be producing. To make various baked items in your kitchen, you may require specific pastry supplies. If you’re only making fresh bread, though, you might not need one.

Your bakery equipment list for your commercial kitchen should include ovens, mixers, tables and workstations, refrigerators, storage areas, and POS systems.

Apart from the equipment, you also need to hire some people to help you run the business smoothly. The size and type of bakery will determine the employee size. A retail bakery, for example, must hire and educate front-of-house employees to accept orders and operate the cash register. The majority of your bakery personnel, on the other hand, will prepare and bake the meals in the back of the house.

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Your bakery should have personnel with proper baking training or expertise to supervise the actual baking process. You might also engage inexperienced staff to help with dishwashing, ingredient mixing, product packaging, and other duties that don’t require prior experience or knowledge.

6. Install A POS & Billing Software 

Since POS and inventory management systems became sophisticated and available, the days of handling sales and inventory in bakeries on paper have passed. You’ll find an appropriate bakery POS that will make your life easier whether you’re operating an independent bakery or a chain. You can choose a food truck point of sale and manage your sales quickly even if you decide to make your bakery mobile.

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If you choose a cloud solution, the most straightforward POS equipment and the monthly subscription won’t break the bank. Just make sure it has all of the features you require:

  1. A smooth app for cashiers to speed up purchases during peak hours.
  2. An inventory management tool that lets you see what products you have on hand and how much dough and filler you can make, as well as how much pastry you can bake, all at a glance.
  3. Menu management automatically calculates quantities and costs of components, preparations, and baked goods.
  4. Without any additional software, you can use marketing tools to offer discounts and bonus programs that will boost your bakery’s sales.
  5. Get reports on sales statistics, such as the best-selling pastry, the best-performing employees, peak sales days and hours, and more.

A well-chosen POS system will help you cut starting expenses and assure smooth operation on the first day and for many years to come.

7. Develop Your Brand Image and Market Yourself

Your company’s logo serves as its face. It gives you a distinct identity, and people will recognize you by your company name. Your brand name should be straightforward, easy to remember and reflect your company’s beliefs. Your company’s logo should be memorable and make the ideal impression on people’s minds.

Apart from branding, you must also concentrate on marketing. Many businesses can start marketing their company on social media for as little as a few dollars each month. 

While you wait for permissions and licenses, this is one of the things you may do in your spare time. Consider your social media accounts for your business as your major advertising platform when setting them up.

Wrapping Up

I hope this thorough guide on how to start a bakery business from home has helped you get started on a strategy. If you can already smell the delicious croissants baking in your oven, it’s time to get started on your bakery business plan! You’ll be serving clients and raking in the dough with a bit of forethought and persistence.

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Posted by Elena Hudgens
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Elena Hudgens is an entrepreneur with 10+ years of experience. She started her journey by building her own e-commerce website on Shopify and turned her $1000 savings to millions in just 2 years. Soon she started different ventures in which she failed and succeeded. And now, she's on a mission to help other entrepreneurs with her life and business lessons.
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