How to Start a Bakery Business from Home? – Business Plan
Cupcakes, black forest cake, cheesecakes, croissants, and all such baked items fascinate you baking them at home. Your loved ones are so happy with your baking passion and the baked stuff you make, and they just can’t have enough of it. They often suggest you start a baking business, and you just avoid the topic altogether or simply blush with pink cheeks. But if you are even 1 percent serious about starting a baking business from the comfort of your home without much hassle, then this article is just for you.
Starting from 2021 to the next five years, the Indian baking business industry is expected to increase by 8.5 percent. Hence, we can infer that the baking business will be more lucrative than ever. As a result, you can find several eateries and home chefs starting a baking business around your neighbourhood. So, do not keep your baking recipes a secret and let them spread in your town. You do not need a huge space or a brand name to initiate this venture. You can simply start a baking business from home and call yourself “A home baker boss.”
Here, we have all the steps covered for you to start a hassle-free and profitable baking business from home.
Enhance your baking skills and embrace your passion.
We assume that you love baking, and that’s why you want to venture into business and not because you noticed your best friend posting her baking videos on social media. So, if there is a personal reason for starting this business and that reason is ‘passion,’ you are good to start this venture. However, before you even decide the types of cakes you want to bake and the menu you want to have on your business flyer, it is important to work on your skills. Maybe, you lack in presentation, or you want to learn more about gifting and cakes made at special events.
We do not undermine your baking abilities; we just want you to brush them a little and adopt a stronger professional approach in your business. You can attend a baking class and not restrict yourself to YouTube videos. Remember, a professional can provide you with tips that an average blogger cannot. Hence, consult the baking schools or top cake artists in your area and learn the art very well till you become a pro. You can even find online classes and connect to a renowned culinary school in India. Once you acquire all the expertise and certifications, you will be more confident to start a baking business.
Prepare a baking business plan.
When things start from home, it is okay to take a few things for granted. But when it comes to a business plan, you cannot afford to miss it out or do it orally. Discussions are great, particularly with your family members and friends, but if you don’t write the important points on the paper, you do not take your business seriously. It is not a hobby or a pastime now; it is a business. And every business starts with a solid, full-fledged plan.
In a business plan, you decide the costs of running the business, the formalities of starting out, and the future vision. So, your bakery business plan should consist of the following components:
- The name, location, and the main objectives of the business.
- Business and competitor analysis, you don’t have to beat the best bakeries in your area, but remember other home-based bakeries are also coming up.
- Do a quick SWOT analysis and financial evaluation and a few predictions too. You need to decide the profit to sustain your business in the future.
- Draft a marketing plan. You won’t need any marketing executives, but you should be able to attract customers regularly and retain them as well.
People think that since a home-based bakery business does not require registration, they skip the business planning phase too. We suggest you have a business plan on board, and it is okay to take the registration process lightly.
Complete all the registration formalities of your home-based business.
It is a myth that a home-based business does not have to register. Please stop believing such things. Instead, get all the legal fundamentals right.
- In India, businesses that earn less than 12 lakhs per annum need to register themselves with the Food and Safety Standards Authority of India. Hence, even if you want to bake cakes at home and sell them online, you need to get this registration certificate in particular. Even if you don’t have any workforce and do everything yourself, get this right. You should not face any problems in the future; hence it is better to take the safer side.
- When you have a baking business, you will create a logo and a brand image for your marketing collateral. It is better if you get the logo and brand name registered under the Trademark authorities.
- If you are concerned about the GST registration, then you should not worry about it. It is applicable for businesses that make more than INR 40 lakhs annually, and we don’t think a home-based, newly setup business will be reaching that benchmark. Hence, don’t worry; you can skip it for a while.
- You will be starting this business alone, so you don’t need to register it as a company in any way. Instead, we suggest you should partner with your family member or a friend and call it an LLP. One-person company registration is a good idea, but if the formalities bother you too much, you can quit the process.
Be confident about the menu you create.
Every bakery business has a list of items that it sells. You need to be 100 percent sure about yours, whether they taste good, whether they need any improvisations. You can seek feedback from your friends or colleagues, no doubt. Choosing the right cakes and other baked items is important for your bakery business success. No one likes a lousy bakery that does not even have a menu in place. So, create interesting recipes, test on your loved ones, and add them to your menu.
Assemble all the requisite resources needed.
Seeking good quality ingredients for all baked items is a dire need. You should never compromise on the resource quality to save costs. Hence, we suggest contacting the best organic supermarkets and stores and have all the ingredients in stock all the time. Most importantly, you need to have all the ingredients in place as you cannot expect when you will receive an order. There should not be any chaos when an order comes in, and you are short of ingredients. So, whether there is an order or not, have all the essentials in place in your kitchen pantry.
Baking is like an achievement, and to achieve these bakery goals; you need the right equipment. It is an oven, spatulas, spoons (not the ordinary ones, but the measuring spoons), bowls, baking pans, cake cases, mixer, blender, and so on. The list is long, and only a good baker knows it well. Our suggestion is investing in excellent-quality baking supplies and equipment, and there should be no compromise.
As you stock the ingredients, you need to ensure that they are well on time and have not surpassed the expiry date. You can maintain a simple spreadsheet if a stock management system overwhelms you in the beginning.
Set the pricing system.
You don’t have to sell cheap cakes or give away free cakes as a promotion. It is not the best strategy, even if you are starting it from home. Remember that your baking skills are excellent and cannot be compared with the bakery near you. People will come to you for a reason because your cakes are unique and mean to them and not because you sell cakes at low prices. Hence, do not set low prices for your cakes and other baked items. Ensure that you render proper justice to your baking skills and abilities.
It is advisable to charge three times the ingredients used, but it is not always the ideal way to do so. Trust your intuition, ask your friends, and the very first customers and they can give you proper feedback about the same.
Arrange for the delivery options.
We know that home-based businesses face the delivery issue often. It could be the daily meal service or delivering cakes at the doorstep. Don’t worry; you can have some measures aligned for your business. You can deliver the cakes on your own if you have a vehicle and organize all the tasks on time. You can even ask for other delivery services. If you plan on something huge, you can have an in-house delivery team. You can even provide the pickup option to your customers. They will love it if they know you bake the most delicious cakes.
It is okay to be a little confused about this, but don’t worry. You will figure out a feasible option at the end once all the things are set in place.
Promote your bakery business well.
As we mentioned, planning and promotion are two important constituents of a bakery business and should not be missed at all. Hence, promote your business in the best possible manner. Enlist the help of younger ones in your house as they are more proficient in technology, especially social media.
The cakes are ready; the photos need to be done. Picture-perfect cakes need to be captured well and posted on social media channels. If you want, you can also create a YouTube channel and document the journey of every cake creation. Buy a domain name and invest in a good website. People will reach out to you easily if you have a good website and social media presence.
Instagram is the handle you should be visible on a regular basis with your cake pictures and behind-the-scenes moments. You can go old-school and get all the marketing materials printed, such as fliers and brochures, and distribute them in your neighbourhood. Get the visiting cards printed as you can hand them over when you are at an event or a function. You never know when someone needs a baker.
Lastly, it is advisable to upgrade your baking skills and experiment with something new in your home-based bakery. Attend more workshops, socialize with all kinds of people, and ensure you are in touch with the latest trends. Get ready to bake your next cake for a reason or as a cupcake. All the best!
FAQs
The steps to starting a bakery business from home include researching regulations, registering your business, developing a business plan, securing financing, purchasing equipment, developing recipes, creating a website and marketing your business.
Depending on where you live, you may need a license to operate a bakery business from home. Check with your local government for specific licensing requirements.
Basic equipment you will need includes an oven, mixer, baking pans, and utensils. You may also need items such as a refrigerator, cooling racks, proofing pans, and a bread slicer.
Depending on your local laws, you may be able to bake goods from your home kitchen. Some areas require a commercial kitchen, while others may allow you to bake goods in your home kitchen if you meet certain criteria.
The cost of starting a bakery business from home depends on the equipment and ingredients you need to purchase, as well as the licensing and other costs associated with your business. Generally, the cost of starting a home bakery business can range from a few hundred dollars to thousands.
You can market your bakery business from home through word of mouth, social media, a website, and local events. You can also create a business listing on popular online directories such as Yelp and Google My Business.
Pricing your bakery products depends on the cost of ingredients, labor, overhead, and your desired profit margin. Consider also the cost of similar products in the market, and the value your products offer.
You may need to hire employees for your bakery business from home, depending on the size and scope of your business. Consider hiring employees for roles such as baking, customer service, and delivery.
