A lot of aspiring bakery owners think that the only way to open a bakery is to invest a hefty sum of money and set up a new retail business from scratch. While this is often the most popular option, there are actually a number of alternatives that may be more suitable for the majority of first time entrepreneurs.
1) Opening a Brand New Bakery
The normal way of starting a bakery is to formulate a business plan, get the necessary financing for the venture, choose a name, incorporate a company, rent an appropriate retail space, renovate the outlet, purchase or lease equipment, get all necessary licenses, confirm menu items together with pricing and costs, draw up a marketing plan and open for business.
This is generally the preferred method as the entire business is brand new and will be set up according to the entrepreneur’s vision and dreams. When most people think of opening a bakery, they also regard it as starting a new business, as opposed to buying one that has already been established.
2) Buying an Existing Bakery
An alternative to starting a bakery from scratch is to buy an existing bakery that is for sale and to continue operating it without many changes, or to give it a makeover as required. Depending on the price, condition and performance of the business, this may be a good choice for first time owners who do not want to go through the risk and hassle of setting everything up themselves.
At the same time, with an existing bakery, inexperienced entrepreneurs are able to get a better picture of the level of sales that is achievable as well as the required operating costs. In short, there should be less start up risk as the business is already a going concern.
3) Starting a Home-Based Bakery
Opening a bakery that is based from your home is an ideal solution for lots of people, ranging from those who do not have the capital to open a shop, to prudent first timers who would like to get a better feel for the business before making a significant investment. In addition, a home-based bakery is suitable for anyone who wants to start small and focus more time on baking instead of trying to run a store and managing a team.
Without any rental costs and other overheads, home bakeries take a lot of the pressure out of owning a normal bakery so that you can concentrate on baking. You may not generate as much sales revenue, especially from walk-in customers, but you will certainly get valuable experience in marketing and supplying your baked goods to events, caterers and non-retail customers.
4) Investing in a New or Existing Bakery
One of the best ways to own a bakery is to invest in a new or an established bakery that is run by an experienced baker. This means that you will not own all of the business, but you will still be an owner. Furthermore, if you’re just a financial partner, you can learn all about how the bakery operates without having to do much, or if you prefer to get a real taste of the action, you could get involved as a managing partner to assist in some part of the operations to learn on the job.
Either way, you will be a bakery owner, have a greater chance of making money and most of all, if you’re new to running a bakery, you’ll acquire priceless tricks of the trade on how to run a successful bakery. The hard part about this strategy is to find a good partner who is willing to accept you as an investor and co-owner. Take your time to identify a capable partner as he or she can literally make or break your investment and either teach you appropriate or inappropriate ways to operate a bakery business.