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How to start a Bakery and make it a success

Posted by Damian Roberti on

So you love to bake? We'll make it a business! 

I'm going to give you the top five things I learned when I started a retail bakery and how I would recommend you actually start one yourself if you're looking to do this. This took many years to learn. Of course, when I first started, my wife and I had a handful of these that I'm going to go over with you that I really honestly should have done a little bit more research on. Uh, but it was a great learning experience and it gave me an opportunity to get a taste of how to operate and run my own bakery. Uh, so we actually had an Italian bakery that we specialized in. We had over 40 different cookies. We had pastries and gelato, we did panini sandwiches and freshly made bread. We had a variety of products. So I'm going to dive into it and let's get right into that list.


I'm going to go from the top. Number five down to, uh, the number one takeaway that I had learned from operating a retail bakery. So number five, business plan. When you dive into opening any business at all, especially one that's a retail where you're going to be renting, you have a landlord, you've got a lot of utilities, you've got a lot of expenses to get up and running, create a business plan. Now, it doesn't have to be perfect plan. It can literally be a simple one sheet, one page type of business plan. But sit down and figure out what it is that you want to do with your business. What are the goals you want to do? Uh, so what you want to achieve, figure out how much money you have available to put into it. Figure out a marketing concept and some advertising and promotional.

How are you going to get the word out about your product? How are you going to get your word out locally about your business? Um, and, and have a mapped out plan as far as what you're going to make and what you're going to offer. Specifically the products. Um, and what is it going to take to do that? Figure out what type of equipment you will need. Are you going to have to have display cases? Are you going to have to have for us, we actually created our own gelato so we actually had a gelato machine on the property, um, that we were making gelato ice cream and such. Um, so figure out everything that you really want to do. Figure out your brand. How do you want to create a brand? What do you want it to be? What's the, what's the logo going to look like?


What is it that you're going to be selling specifically? Cause there's a vast variety of baked goods obviously from Italian baked goods to Spanish pastries and such, um, to classic American cookies and cupcakes. Figure out what it is so you can narrow it down, but definitely have some type of plan in place to allow you to move forward. All right, so next up you definitely want to have financing. Now as you create that business plan, you're going to have a better understanding of the, of finances. It's going to take for you to open one up. What I mean by that is you, if you find a spot, you find a location, you want to make sure that you go to the location, you know the exact amount that that rent is going to be every month. If they have any build-out available, what is your maintenance fees going to be?


Cause there's a lot of retail locations that also have a maintenance fee to maintain the property around it. Do you have to put a grease trap in? How much is your insurance going to run every month and so on and so on. So you want to cover the entire parameters to understand what is it going to really take to get started initially and how much you'll have to come out of pocket to get this up and running. One of the things that we didn't quite understand was the expense for the equipment. So we ended up adding on additional panini sandwiches. So we actually had to buy a sandwich prep table, which costs nearly $3,000 for a simple table just by itself. Um, and then the bakery part of it where we were doing breads, we had to have a special oven. Um, and so on and so on.

There was a ton of equipment that we really didn't factor in when we first started because we kept expanding and offering a multitude of other products which incurred more equipment and more types of ingredients as well. Okay. So number three, do not offer too many items. We got really excited when we had our bakery. We had the ability obviously to create whatever we wanted and sell what we wanted. But we really did step over the line. I think of too many things which can kind of spread yourself thin. Plus having a multitude of ingredients and inventory on hand to create those products can sometimes be a big problem and a potential hazard for your finances by offering too many things. So the one thing I learned is focus in on maybe half a dozen or just a handful of particular products that you want to do.

Uh, and then if you want to incorporate some sandwiches or you want to bring in gelato, something to that effect would be fine. We ended up bringing about like as mentioned 30 or so different types of cookies. We had eclairs, we had canolas, we had pastries, we did a lot of other things and then adding on the breads and it just really over kind of overwhelmed ourselves with the variety of stuff because with that, with those different types of product comes with it, different equipment and different ingredients and have to have all of that on hand all the time. So narrow down your menu and if you make some changes or add to it, maybe you can take away some of the things that you initially started or take away. Some products that don't sell very well but always keep your S your menu selection kind of to a minimal, at least when you first start because that way you can build on it.

If you're, if you're getting success and you're getting a lot of business and a lot of foot traffic in your shop, you can always add to it. But from the gate, from the get go, don't overdo it. Okay. So we got, uh, number three. So number two, insurance permits and inspections. Keep this in mind on an annual basis. Normally your insurance renews or you've got permits every new annually, and you've got inspections that may be either every month or maybe every six months or every year or so. But keep in mind the expenses for all of things and the insurance and permits and things for your, that never goes away. Of course, that's pretty much a fixed expense that you're going to incur every year. But I'm saying this so you can keep in mind putting aside the money that you need to maintain all of those different permits and the different certifications and certificates from the County, the city, the state, and all of that good stuff.

So that is something that we definitely learned about when we first dove into this. There is quite a few, uh, that's going to be dependent upon the city and the County that you ran. Of course, even your state, um, as far as how many different permits and insurances and different things that you're going to have to have. But they all cost money and it's normally done either, um, every six months or every 12 months. So do keep that in mind as well. So the number one, and I'm getting to a really, really quick, keep this nice and short and sweet and one thing to keep in mind when you want to start your own bakery, retail bakery, business number one location. That is something that we learned big time. The location that we had was good, but it wasn't great to be honest with you.

Now for us at the time, it was really an issue of the budget, the type of how much rent that we could get. It was really the only place that fit our budget at the time. And it worked out for us. Okay. But there was a ton of obviously better places within the city and within the County that we were in. But location is so critical. It's so crucial to the success of a retail bakery. Not one that's online because it's a totally different business model. But if you're running a retail bakery, I can tell you firsthand experience, make sure that you have a very busy, a lot of foot traffic type of shopping center. If you're independent, the building is separate from a shopping center. Make sure you're in an area that has a lot of traffic or at least gets a lot of drive by traffic and such.

But you want to make sure that you're out in front of one of the main roads, main highways, or near something like a mall or close to them all. Make sure that your location has a lot of foot traffic. Now, the reason why I say it's different than online because now that we're online, a hundred percent of our business, uh, through our internet, um, sales, we can be in a lot of places, uh, basically everywhere, globally we could be anywhere because we have websites that do that for us. It's a different type of business. When you're in, you're anticipating and expecting foot traffic and you've got to have some, you have to have those feet coming through that, that retail spot. So when you're actually reliant upon the traffic of people coming into your front door, make sure you're in a highly trafficked area. Okay, so really quick, I hope that gives you a really quick outline of the top five things that we've kind of taken away that we've learned from operating our retail bakery.

Um, definitely something that you have to experience yourself and of course your experience will be totally different, but these are the top five things that really had a big impact on the success or the non-success of your retail bakery. If you want to start one. So if you have any questions about starting a bakery, please do let me know down below and I'll get to our subscriber questions. Thank you everybody for all of the questions that you guys do send in. We try to get to them as quick as we possibly can. And I will see you guys on our next video.

 

 

 

 

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