From breakfast biscuits to whimsical wedding cakes, the baking industry covers a wide range of edible goods. And with limited shelf life, regional bakeries continue to reign supreme. The result is ample opportunity for opening a new bakery business.
With that said, food-based businesses are some of the riskiest ventures to launch. The vast majority will fail within their first year. Given the stakes involved, aspiring bakers must make the right moves when opening their new bakery.
Let’s take a look at several useful tips for opening a profitable bakery:
Decide on Retail or Wholesale
Many bakeries are largescale operations selling their baked goods to hotels, restaurants, stores, and other businesses. Others are of the “mom and pop” variety, baking in small batches and serving consumers directly. While many operational aspects overlap, several key differences exist between retail bakeries and wholesale ones. For example, industrial-scale bakeries utilize demand management to save money, whereas smaller operations focus more on supply-based ways to lower costs. With that said, the most significant difference between retail and wholesale bakeries is scale; small shops sell small batches, big factories sell big orders.
Determine the Menu
Very few bakeries, big or small, sell more than a dozen or so different products at one time. While you might want to make dozens of different types of baked goods, it’s best to stick to a handful of items. Expanding your menu can happen later. A limited menu at the start will keep costs low and help you hone your craft.
Develop a Signature Product
Most successful bakeries become known for one or two popular offerings. Consider developing a truly one-of-a-kind menu item, whether it’s a killer cupcake, mouthwatering muffin, or scrumptious scone. If you haven’t determined what it is, your customers may do so via their wallets; if one item sells out every day while others get thrown out, take the hint and start selling more of the popular product and less of the other one!
Design a Thoughtful Workspace
Instrumental to the early success of fast-food restaurants like McDonald’s was the revolutionary way they approached kitchen management. The kitchen floor was tailored with a specific workflow in mind. Every step every worker made from one station to another was calculated along with the cooking process to maximize efficiency and reduce waste. Startup bakeries should do the same.
Digitize Your Business Day One
No matter how quaint your little bakery looks on paper, it’s still operating in the 21st century. It needs an active social media presence, an updated website, and dynamic digital marketing apparatus. In the age of COVID-19, it’s also a good idea to set up online purchasing options. These need to be in place from day one.
Design a Great Logo
Like any business, big or small, a great logo doesn’t hurt when opening a bakery. Either design it yourself with rough edges or hire a graphic designer to create a professional image.
Develop a Network of Suppliers and Vendors
The cost of your ingredients and other supplies will play a critical role in a bakery’s ability to turn a profit. While it’s difficult to negotiate discounts at the onset, building relationships with a network of suppliers and vendors will lead to better prices down the line. This will be especially easy to do if you can buy at greater volume due to growing sales.
Donate Your Leftovers
Despite their best efforts to throttle production to match sales, most bakeries end up with loads of unsold food at the end of the day. Rather than throw it away, consider donating it to local shelters and other organizations helping persons in need. It’s an easy way to help the community, so why not?
Opening a food service business is never easy. Bakeries are no different. But knowing which moves to make and buttons to push will help maximize your chances of business success. Happy baking!