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Starting your bakery is no easy task. Many people try and may fail to get their business ideas off the ground, or worse, their business flops within the first year. So, what sets a successful bakery apart from the ones that don't make it? The answer lies in a solid bakery business plan. It can help you stay organized and obtain the funding you need.

A bakery business plan can be used to gather interest from potential investors or loans from a bank. Additionally, it is helpful to you as an owner. Creating a bakery business plan allows you to thoroughly analyse every detail of your potential business. This includes things as small as the equipment you will need or as big as the space for your business.

Your bakery may start as a vision, however, evolving it into a solid plan will allow you to prove to yourself and others that it is a viable business venture.

Type of Bakery

When planning to start a bakery it is imperative to think and visualise the kind of bakery you want to run. This also includes keeping in mind the products you want to focus on and the type of business you wish to run, the amount of time you can dedicate to the business and several such factors should be considered while deciding on a type of bakery.

  • Home Bakery – It is usually a bakery that operates from home and prepares selected but unique and delicious freshly baked goodies that are delivered at home or sold via online portals. This type of bakery does not need much capital investment to start with.
  • Counter Service – This is a bakery with a counter to serve the baked goodies, but rarely does it have dining service or seating arrangements.
  • Speciality Bakery – This type of a bakery usually specialises in a certain kind of baked products, like for example, it could be a bakery serving only gluten-free products or one that specialises only in bread and savoury baked products or a bakery specialising in wedding cakes only.
  • Bakery Cafe – This kind of bakery has a seating area where it can serve people who wish to dine there and offers baked goods along with tea, beverages, probably sandwiches and other eatables that go with baked goods.
  • Bakery Food-Truck – This is a mobile shop that serves baked goods including cookies, cakes, muffins, cupcakes which does not have a solid structure but is based out of a food truck.
  • Online Bakery – A lot of bakeries are turning to this option where bakers take orders online after displaying their product list and provide home deliveries of the goodies. This type of bakery is gaining popularity since it saves the costs of setting up a shop and other logistics.
  • Wholesale Bakeries – This includes bakeries that cater to a more wholesale demand rather than retail customers.

Components of a Bakery Business Plan

A bakery business plan is a detailed guideline and a roadmap for your bakery business. It includes everything, right from the small details to the critical decisions that you’d be making while running your bakery. It is a blueprint that enlists the following-

  • Executive Summary
  • Company Overview and Description
  • Market Analysis
  • Business Offerings
  • Management
  • Marketing and Public Relations Strategies
  • Financial Projections

Here are each of the components listed with some details-

  • Executive Summary – which includes an abstract where the entire business plan and presentation is described concisely.
  • Company Overview and Description – this includes a detailed description of the entire business which is to be started including the type of bakery, the capital, the operations, etc.
  • Market Analysis – this includes a detailed study of the market for the products, the demand for it, the requirements of the market or the targeted customers and how to approach them.
  • Business Offerings – this includes information regarding what the business plan offers in terms of product varieties (for example sweet baked cupcakes, muffins, cakes or a cafe offering croissants, baguettes, sourdough bread, puff pastry, Danish pastry, bagels, etc apart from the regular sweet desserts that are popular) and the pricing and marketing techniques.
  • Management Plan and Ownership Structure – this includes information regarding the plan to manage the bakery, the number of employees needed, the staff, the skills and training required by the staff, and the ownership of the business, partners running the business, their designated or assigned work and assignment of management duties. It even entails the details of the business entity decided for the business.
  • Marketing and Advertising Strategy – this includes the plan that is devised to market and advertise the bakery products, like by sending out leaflets with certain offers or deals or advertising on social media platforms or organising or participating in events to advertise the bakery.

Financial Projections – this includes details regarding the procurement of funds for the business, from where they will be obtained and the ways of putting the funds into use for setting up the business and for future needs and expansions too.

Writing a Bakery Business Plan

To get started in the process of opening your bakery, you need to create a business plan. This will force you to look at the business from every angle. It will help you define your business, set goals, find ways to generate revenue, list expenses, identify your customer base, and examine your competition.

As part of your business plan, you’ll dive into finances. One of the numbers you’ll need to generate is the start-up cost. You’ll need to compile a list of equipment, from appliances like ovens and refrigerators to smaller items like utensils and pans. Make sure you create a full list of tools. The equipment will be a one-time hit, but you’ll also need money to live on while the business gets established.

You won’t start making profits overnight, so you need to sit down and figure out when you’ll break even and how much money you’ll need to survive until that time.

FAQs: Bakery Business Plan

1. Can a bakery business be profitable?

Yes, it can be profitable in 2020 with the right marketing strategy and setting realistic revenue goals for your bakery business. You just need to plan and estimate all the financial aspects ahead so that you can get profits from your bakery business.

2. Does a bakery business require licences?

Every food business must have to obtain all the licenses required and ensure always that they are present in the bakery. Depending on the location you might need to get different kinds of permissions so you must check what are the licenses required in your locality to start a bakery business.

3. What kind of funding may be required for starting a bakery?

If you have low capital to invest then either you can get a loan for your business or else partner with few other bakers so that you can get started with the bakery business. The funding will depend on the amount of money required for various things such as rent for the space, baking equipment, salaries of staff, costs of licenses, etc you must estimate the minimum amount of initial investment required.

4. How often should you update and re-read your bakery business plan?

Your bakery business plan should be updated every 3, 6, and then 12 months after writing the first draft. Doing this will give you a good opportunity to verify whether previous ideas have worked and include some fresh solutions.

End Note

Food businesses are one of the most profitable kinds of businesses. Baked products such as cakes, cookies, etc have a good demand among the people due to their deliciousness. Launching a bakery can provide you with a healthy return on investment, a steady salary, job satisfaction, and a sense of achievement. Reaching this point requires plenty of research and preparation as well as a carefully crafted strategy.

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