Starting Your Bakery: Tips to Increase Your Chances of Success

The bakery industry is a tough one, but it can be profitable if you have the right products and price points. Before starting up in this business, some things should always be considered.

To succeed as an entrepreneur selling baked goods from your home oven or commercial kitchen requires careful planning, so make sure these tips don't get overlooked when you’re thinking about opening up a shop!

In the quest to start a bakery, here are 17 helpful tips:

1. Type of bakery you’d like to open

You're considering opening a bakery, but what type of baked goods should you make? The decision is important because it will affect your future business. There are many types to choose from and they all have their pros and cons. Consider this list before making up your mind:

• Specialty bakery 

Specialty bakeries are perfect for those who plan on specializing in a certain type of baked good. These bakers have the opportunity to focus their work and become well known, which could lead them into other fields where they specialize even further!

• Grab n’ go bakery

Bakery items such as sandwiches, pies & other pastries can be sellout items for the lunch crowd if they are designed for grab-and-go consumption. A mobile solution is also an option - this involves delivery services or trucks that travel around to your customers at peak times.

• Traditional bakery

The type of bakery that uses pre-packaged dough improvers or mixes for baking is the most common. This format makes it easy to train staff and grow your business, but many customers won’t care how you do things as long as they taste good! The challenge with this style of bakeries is there's already plenty in circulation so creating demand may be difficult - especially if another one pops up close by.

2. How will you sell your products?

Knowing how to attract customers and where you’ll be selling your products go hand in glove.

• Delivery

Online orders and delivery means you don't need an office or store, you just have to be creative with your website and marketing!

• Counter service

This small space option is the perfect solution for those who want their customers to be able to walk in and buy products. Counter-service allows you to  socialize with your clients and become a presence in the neighborhood with a fraction of the cost and footprint of a sit-down bakery. 

• Sit-down

More and more bakery owners are considering the benefits that come with sit-down bakeries. You can have an indoor seating area where customers enjoy your fresh baked goods while they sip on a coffee or tea, just like in any other casual dining establishment! If you don't own enough space for this type of setup there are always outdoor options - it all depends on what kind of business model works best for your particular situation.

• Wholesale bakery

A wholesale bakery is a perfect business for those who are looking to break into new markets but have limited resources. Since you won't be starting with many clients, this venture may seem riskier, but once your clientele grows so do the orders! 

• Food truck

Food truck bakeries are an interesting choice for those interested in going where the crowd is. If you want to be mobile, have the option of more than one location, or expand quickly without investing too much into your business start-up fees - this might just work out great!

3. Come up with a great marketing strategy

The best way to get people excited about your bakery business is by generating buzz. There are several ways you can do this, but the most important factor to keep in mind is attracting the right customers and getting creative with marketing!

• Conduct market research

Conducting market research is the first step in any marketing campaign because this gives you insight into your target audience. This includes demographics for a business area and competitor analysis to see what products customers are choosing over others.

Finding out what your audience is interested in will help you create a marketing strategy that caters directly to their needs.

4. Build your bakery’s branding

Determine how you want your audience to feel when they see or interact with your business, and start communicating in ways that convey this. 

This means answering these questions: 

What level of sophistication do we wish for our customers? How will people recognize us; as a specialty company or a social hub where everyone is welcome at any time? 

There are many approaches one can take here depending on your target market - so think carefully and then get branding!

5. Have a website for your new bakery

This is likely to be your first point of contact with customers, even if you have a storefront or sit-down operation. You might roll the dice on Wix but without solid design skills, it’s bound to end in frustration. I would advise finding a reputable website developer that can create a site tailored specifically towards whatever your brand and business goals are; these guys generally have cheaper maintenance costs too.

6. Find ways to advertise 

There are so many different options for advertising: print ads, signage, flyers, or newspapers. What's important in this type of promotion is that it has a clear call-to-action that entices potential customers to come to your shop or visit you online.

To grab people’s attention, use an engaging tone and make sure to feature high-quality images of your baked goods!

7. Secure business funding

When opening a new bakery, it's important to assess the capital and start-up expenses. Bakery businesses cost varying amounts depending on location, space rental, license fees, and inventory purchase.

What are your financial capabilities? Are you willing to part with more money than what is budgeted for in order to not only start but also quickly grow a successful business at an early stage? How much revenue do you need in your first months in order to cover your costs and stay in the game? 

These are all important questions to ask yourself when planning your baking business.

8. Choose the right location

The best baked goods in the world will be useless if you're operating on an island with no one to see them. Before opening your bakery, consider where it will be located and how accessible that spot may be. Make sure there's public transportation or other retail nearby so people can get their fix of your five-star bakery when they need it!

9. Write a business plan

A bakery business plan is a crucial component of a successful enterprise. It will help you shape and grow your company, as well as stay on top of trends in the industry! Here we go:

The first section should include an executive summary that summarizes all key points for potential investors or stakeholders. The overview includes information such as what products are offered along with their benefits; why these services meet current demand; plus how they differ from competitors' offerings by price point, quality, expectations etc.

A business plan will serve as the backbone of your company and provide you with a roadmap to success. Make sure it's detailed!

10. Secure permits and licenses

If you have a business, then licenses and permits are essential. However, obtaining these can be difficult if you’re unfamiliar with the process and don’t know exactly which licenses are required for your operation. You might not even be told how long it will take for approval or processing - so make sure to give yourself plenty of lead time!

11. Select your bakery equipment

Buying cheap, unbranded bakery equipment can be a big risk. After all, I learned this lesson the hard way! So don’t do it unless you know what you’re getting into - it might not be worth the low start-up costs.

Investing in high quality bakery equipment could save you a lot of time and money down the road. For the most part, branded names will offer you better results than their generic counterparts. Whatever you buy should not only be  economical, but durable.

12. Decide on your menu

Keeping your menu simple is essential for success. People are more likely to order something they recognize, so it makes sense to keep things familiar and straightforward to start out. The best way of doing this? Feature classic or favorite items with descriptions and a price list; there’s no point in trying out new recipes when everyone loves Cookie Dough Supreme already :)

13. Know your profit margin

The price of your products is important to the success and longevity of your branding. Before you start selling, find out what things will cost by researching current rates for your items - that way, there won't be any surprises!

14. Build a great team

When I say “team”, it's not just about employees. You need to consider all the people who are influencing business decisions and investments (ie. suppliers, investors, etc.) when making hiring decisions for your bakery.

The right people are key to your success! The perfect fit for your business should be an employee that is willing and ready to work within your business plan and sales goals. People who believe deeply in what you do will show up for your business and value your company. As an entrepreneur (especially at first!), always keep these passionate folks in mind when looking at potential employees or contractors.

15. Have a good relationship with your suppliers

Building a good relationship with your suppliers is crucial to success. You should order from them consistently rather than shopping around, as over time, many of them will recognize your loyalty with discounts or a higher level of service. If there are any problems or changes on either end, both parties involved (you AND supplier) need to work together quickly to continue doing business smoothly.

16. Sell your ingredients

If you're using good ingredients, shout about it! Tell your customers what makes your baked goods special and how a little bit of time invested in the selection process can yield big rewards. Give the history or story behind each product so there's always more than one reason why people should buy off your shelves rather than someone else’s. Your customers will get an added benefit of being able to see where their food comes from and all the care that went into it.

17. Know your recipes

When you first open your bakery, focus on driving customer experience and training the staff to know each product inside and out. Let staff try your baked goods beforehand so they understand what everything tastes like, what ingredients are in the recipe, and why customers should get excited about it! 

You don't have to be a professional baker to run your own successful baking company. WIH has created an inclusive community where anyone can come and share their passion for food with others who love it just as much. Join the community today! #whiskithere with us today!