If you’re interested in starting a bakery business, there are many things to consider. You must choose the right type of bakery to open, develop a marketing strategy and find the appropriate business location.
Bread and pastry bakeries sell a variety of baked goods, including breads, cakes and cookies. They can also provide catering services.
The first step is to determine if you want to start a traditional bakery or a specialty bakery, which means focusing on a specific type of product. Having a speciality bakery can help you attract a more targeted customer base and make your business stand out from other local bakeries.
Depending on the type of business you have in mind, the equipment you need will vary. If you’re planning on baking cakes, for example, you’ll need to invest in a commercial oven and a refrigerator. In addition, you’ll likely need a pastry case and a work bench to prepare dough for baking, according to Sullivan.
Rent is the biggest startup expense for a bakery, Sullivan said. The costs can range from $3,000 to $25,000 a month. But if you’re willing to pay more, there are some options for financing a new bakery, such as small business loans and personal loans.
You may also need to get your business registered with a business name and tax identification number (EIN) through the IRS. Having an EIN is important because it will allow you to file business taxes, such as your income tax return or payroll tax report.
Another thing to keep in mind is that if you plan on using your bakery as a business location, you will need a commercial building license or business permit from your local government. The requirements will vary by state, so it’s important to check the regulations in your area.
If you want to run a retail bakery, you’ll also need a sales privilege license from the state. This allows you to collect your state’s sales tax alongside the prices you charge for your products.
In addition to a license, you’ll need to apply for the proper permits. Some of these can include food seller permits, food truck licenses or a business tax ID number for employees.
The cost to register a business varies by state, so it’s important to research the rules in your area. You can also check with your city or state to see if there are any incentives available for business owners, such as tax credit.
After you have the necessary permits in place, the next step is to create a marketing plan. This plan will outline what you’re going to do to attract customers and build your brand.
You can use a variety of tactics to advertise your bakery, such as traditional signs and newspapers or social media advertising. You can even consider opening a website to increase your business’s online presence.
When determining how to advertise, it’s a good idea to do some market research and understand what your competitors are doing in order to find out what customers expect from a bakery.