How to Open a Bakery

Owning a small business is rewarding, both personally and financially. There’s no better boss than yourself, and if you set up your small business the right way you just might screw around and turn a profit. One type of small business with low overhead and huge potential reward is a bakery.

If you want to run your own business and enjoy the sweet flavor of success, you should learn how to open a bakery. Owning and running a bakery will make you the talk of your community — who doesn’t like fresh baked goods? Yes, opening any small business is stressful, but a bakery is a vital part of any good neighborhood, and the locals would much rather you open your bakery than for someone to plant another Starbucks.

Want to know how to open a bakery? Start small with these tips and you’ll be pounding out dough before you can say “scone”.

Read How to Open a Financially Successful Bakery

Five Steps to Opening a Bakery

How to Open a BakeryLots of small business bakeries started out as family affairs — people didn’t open bakeries because they were interested in baking, they did it because they already knew the art of baking and needed some way to pay the rent. If you are learning how to open a bakery out of a desire to run your own business and not because you have a long line of bakers in your family, you should probably go out and take some lessons in food production in general and baked goods in particular. Aside from lessons in turning out the perfect bagel, here’s the basic steps to opening a bakery.

1. Do your prep work. Any time you start a business there will be financial considerations. Your first step is to talk to your bank about taking out a small business loan. Though the daily operation of a bakery is inexpensive, starting one from scratch is not cheap by any means.

Where does the money go? You have to rent or buy a spot for your bakery, renovate that location to your specifications, perform further renovations as required by your local health inspector, and purchase cooking and bakery supplies.

I don’t want to repeat the oldest cliche in the world, so I’ll just say that picking your location is crucial to any neighborhood business. A good bakery location is somewhere with lots of foot traffic — a shopping center, busy intersection, a lot next to a school, or a spot that’s visible from any place where people congregate. The busiest bakery in my hometown is right next to the town’s busiest gas station — an unlikely but highly profitable location.

2. Apply for licenses and permits. Depending on your local laws, you will need any number of special permits and licenses before you can open your bakery’s doors and serve your baked goods to the neighborhood. The fastest way to find out what kinds of permits you need is to call up the courthouse and ask for info on starting a small business. At the same time, get in touch with the local health inspector to find out what regulations and requirements exist for a restaurant in your area.

Some bakeries don’t have “dine-in” options — pick up your dozen doughnuts and walk out — but if you want to provide seating for customers, you’ll also have to talk to the fire marshal to get a declaration of how many people are allowed to be in your restaurant at once. These permits and licenses are some of the first pieces of physical evidence of your small business — hang them up in your space as soon as you get them. You’ll be surprised at the sense of pride you get from a few simple pieces of paper.

3. Bake delicious food. This is easier said than done. The world’s greatest businessman can lose his shirt if his biscuits are inedible. The best way to make money with your bakery is to lure as wide a range of customers in as possible. You do this with good food and a wide selection.

Think of the different kinds of diets people are on and offer fresh baked goods that fit that lifestyle — there are tons of people who need “sugar free” or “low fat” foods, and if you’re in a big urban area you’ll need to offer kosher, gluten free, and other specialty goods as well. If you know of a successful small bakery nearby, pay them a visit and take mental notes. Imitate what works and avoid what doesn’t.

There’s a popular doughnut chain that lights up a “hot” sign when their doughnuts are fresh from the oven — believe it or not, their business goes through the roof when that light goes on. I’m not saying you should ape the “hot” sign directly, but take a cue from the success of people who have paved the way for you.

4. Maintain customers and support your neighborhood. Most of the money you make at your bakery will be from early morning customers. Hopefully, you’ll have “regulars” who come at a certain time each morning for their coffee and kolaches. When you have a captive audience, hand out free samples of a new product. Ask your regulars what they want from your bakery. There’s no better source of info on how to open a bakery than asking bakery customers.

If you support local causes, you’ll be even more popular and can enjoy the free advertising that comes from supporting local schools and other groups. Try to get your bakery’s name in the program at the local high school basketball game or musical.

5. Make your bakery the “go to” spot for special occasions. People in your community are going to get married, have kids, need funeral services, and throw parties. Why would they buy a commercial product when they could get their delicious cakes and baked goods from a local source? When you get your first “gig”, promote yourself as much as you can. Word of mouth is your friend, and special occasions are great opportunities for people to spread the word about your bakery.

Learning how to open a bakery is more than learning the above five steps — you need to be handy in the kitchen and serve food that keeps people coming back. But with a basic understanding of the steps to opening your own bakery, owning your own business and being your own boss seems that much easier. If you plan to open your own bakery, be prepared to gain a few pounds in the process. There’s nothing more fattening than testing your own business model over and over again, especially when that business plan is glazed and stuffed with raspberry jam.

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