Guide to opening your own bakery business

Whether it’s a home bakery, a retail shop, cafe, counter service or bakery food trucks, bakeries are an important business across the world. Think about how many people in the entire world eat bread, cake, or other types of pastries, then you’ll have a vague idea of how large the market is. You may be thinking of setting up your own bakery, whether for the passion of it or simply for its economic potential. Whatever the case, you’ll quickly realise that it’s not as easy as it looks.


A bakery is a technical business and requires technical and administrative skills to set up. Sometimes  many people fail even before they begin. We have put together this guide to help you open your own bakery business. There are 7 steps to follow to set up a successful bakery.


  1. Write a plan

I do not think you should do anything without a plan, especially when it has to do with business. This is the first and one of the most important steps because it lays out the roadmap; showing what the business is about, how it should be run, products and services, strategies, and financial projections. In fact, you’ll come to realize that a business plan helps with most of the other steps in this guide.


A bakery business plan should have an executive summary, company description, business offerings, market analysis, management and ownership, marketing strategy and financial projections.


  1. Get your capital

It is true that idea is golden, but even the biggest and most viable ideas need money to run. There are a lot of things to buy and spending money on. You must raise funds to get your baking equipment, stocking the kitchen, leasing a space, setting up the space, getting insurance, and so much more. If you do not have the funds, you may need to get a loan. You can apply for small business loans, commercial loans, or lines of credit.


Ensure the loan is medium to long term because your business needs a gestation period (several months or years) to find stability and break even before it starts to yield profit.


  1. Find a space

Unless you have a large home and it meets all legal requirements for a home bakery, you would need to find a commercial space for the business. For retail bakeries, it is best to set up in an environment that has your target market and demographic. Population and the lifestyle of your target is also a big factor because bakeries will sell better in commercial areas where lunch breaks are common.


The location you choose should also be close to suppliers, easily accessible, must meet the size requirement, and must be safe, not prone to crime, and healthy.


  1. Get your permits

You’d be operating illegally without obtaining the necessary permits and licenses you need for a bakery. There are so many regulators for the food service industry on the federal, state, and local level. Just be sure that the permits you get are those meant for your locality, as each type depends on the laws guiding the location of your business. With the right licenses, you can operate with your eyes closed and have no worries of a shutdown or other penalties.


  1. Tools for the job

This is the stage where you order the equipment you need in your bakery. These range from those used in dough preparation (mixers, sheeters, dividers, dough scales, worktable, etc), baking (convection ovens of different types), and storage (racks and shelves, etc) to display items and cleaning and ware washing equipment.


  1. Hire and train your staff

You can’t do everything yourself. You need the right hands taking care of different segments of your bakery. Hiring the right people, in the right number and arming them with the knowledge and skill they need are very crucial for your success. If you run a retail bakery, two major areas of focus are the front-of-house and back-of-house. While one person can handle front-of-house duties (taking orders and working the cash register), you would need two or more people handling the actual baking.


  1. Publicity and opening

I categorized the two steps in one because they serve the same purpose- getting people to know the place and patronize subsequently. You may need to place ads on the local newspaper or get your business on the billboards. Organizing an opening/launch is another amazingly effective way to publicize and get people to try what you make. This is your chance for a first impression; do not blow it.