Bakeries are without doubt a very popular type of food service establishment as they allow bakers to express their culinary creativity while also catering to the needs of a unique market. People with non-culinary backgrounds can easily dive into the industry just by opening a home bakery.
However, note that starting a bakery comes with a wide range of unique challenges that are different from other types of businesses.
Have it in mind that a lot of research, effort, and resources go into starting even the smallest bakery business. People most often believe that just completing a Bakery and Confectionery course is enough and end up underestimating the possibility of a bakery failing even due to the smallest mistakes.
Therefore, if you are considering starting your first bakery, start by getting a good understanding of these all-too-common bakery startup mistakes and how you can avoid them.
10 Biggest Mistakes To Avoid When Opening a Bakery Business
Table of Content
- Not Carrying Out Enough Research
- Refusing To Learn New Baking Skills
- Not Checking If You Need Licenses And Permits To Operate
- Not Having Any Capital Investments
- Sourcing Products at the Retail Level
- Creating a Menu Haphazardly
- Poor Product Pricing
- Not Serving Fresh Foods
- Do Not Over-Promise And Under-Deliver
- Underestimating The Maintenance Costs Of A Physical Location
Not Carrying Out Enough Research
Irrespective of where you intend to start your bakery business and the target market you intend to reach, it is very important to carry out loads of research. Here are key things to research about;
- The type of location, rent, and bills: Note that this will ensure you know your expenses estimate beforehand and help manage finances better.
- Your potential demography: Right before you make any substantial investment, it is imperative you know the exact kind of consumer base you expect. Get a good understanding of the people, preferences, and institutions in the area. A simple example would be that a bakery around schools will draw in more children, while one near corporate offices will demand more sugar-free, organic, and vegan products as professionals tend to be more health-conscious.
- Competitors: It is very important to note who you are competing with, their top-selling products, the areas they are lacking, etc. In addition, try and find out about past failed bakery businesses to learn from their mistakes.
Don’t forget that researching is a continuous process, especially when it comes to businesses. It begins from your first day at the bakery course and will have to continue even when your bakery is operational. You will need to compile data and analyze your monthly orders and ensure you adequately understand where you are lacking.
Refusing To Learn New Baking Skills
While you might feel you have already mastered several baking skills, know that new knowledge comes out every day. As an entrepreneur, it is important to keep an open mind and be willing to learn, grow and expand your expertise. Note that by signing up for a baking and pastry-making course, you will be able to hone key basic baking skills and learn advanced ones.
According to experts, things like these will help you expand your menu, gain more customers, and boost your income.
Not Checking If You Need Licenses And Permits To Operate
Have it in mind that the food service industry is heavily regulated on a federal, state, and local level, and you need to get your licenses before opening your bakery. The last thing you want to happen when your bakery starts operation is to be asked to stop because you are not allowed to sell your baked goods.
Have it in mind that aside from losing the opportunity to earn, you may be asked to pay fines, and this will also cause you to lose more money. Owing to that, ensure to visit the appropriate local government agency to find out what documents you need to start your bakery.
Not Having Any Capital Investments
It’s can be quite tasking to start a bakery operation, and even more challenging if you start one without adequate funding. When starting a bakery, you have to worry about getting a commercial space, insurance, outfitting your space with equipment, hiring and training staff, stocking your kitchen, and paying for utilities.
You need a significant amount of money to cover these costs. Aside from that, it may take a few months after opening for your bakery to become profitable; therefore, you will need cash on hand to cover costs for several months after opening. Having capital will also allow you to purchase in bulk, which, in the long run, will save you money.
Sourcing Products at the Retail Level
When starting a bakery, it is pertinent to avoid purchasing any of your food items or supplies from supermarkets and retail stores. You must find a way to purchase all your supplies in bulk from wholesalers and distributors. Therefore, invest time into finding the right suppliers for your business, and ensure that you are getting the best price on the market.
You always need to understand that your menu can make or break your new bakery business. Have it in mind that failing to put some thought into creating one can impede your success. As a new bakery, it is recommended that you focus on one or two main products, such as customized cakes, cookies, or bread.
Immediately you start feeling more comfortable with running your business and know which items are bestsellers and profitable, you can expand your menu. To ensure you have a menu that works for you, let your customers know what makes your products stand out. In this present age, this could be your use of organic ingredients or that you supply your bread to some restaurants.
Poor Product Pricing
Also, note that pricing your menu items too low or high can have a massive influence on the success of your bakery. If your prices are too exorbitant, it will discourage customers from patronizing your bakery. But if they are too low, you will end up losing instead of making good profits and money.
To avoid such adverse situations, ensure to extensively consider the prices you will assign to your baked goods carefully. In addition, make sure you charge a competent amount from the beginning to ensure that you won’t have any need to increase those several times to meet your overheads or earn profits.
To come up with the right prices, take into consideration all the elements that go into baking. This will include the ingredients, packaging materials, and the time and effort that goes into the baking.
Not Serving Fresh Foods
In this line of business, you must always ensure that your food is fresh and that you only leverage high-quality ingredients. Every day people make mistakes when cooking. One of the most common mistakes is using old ingredients or outdated recipes. Have it in mind that stale food will result in a badly-tasting item and make it more likely for food poisoning to occur. Here are some vital tips that can help you avoid these pitfalls:
- To be safe, don’t use any refrigerated ingredients older than one week.
- Keep your refrigerator at an optimal temperature, just below 40 degrees Fahrenheit
- Ensure to go through the expiration dates on food before you buy it, and make sure to follow them closely.
- Keep a log of the groceries you have so that you will know when they expire.
Do Not Over-Promise And Under-Deliver
According to experts, it is always important to focus first on your product line before designing your physical bakery location or online store. It is more important to have products people are willing to buy, rather than just having a place to sell baked goods.
Also, consider making unique baked offerings that are not sold elsewhere. Find a unique niche for your bakery – French, custom cakes, Latin or Asian styles, or artisan loaves of bread. If your plan is to start an online bakery business, then your products should have a longer shelf life than if they were being sold in the store. It’s also pertinent to understand what type of customer base you want before opening your doors.
Underestimating The Maintenance Costs Of A Physical Location
Your rental cost is just one part of paying for a location; there are other costs to look into like utilities, insurance, ground maintenance, driveway snow removal, and waste collection. If earmarking resources for marketing or interior design isn’t possible then focus on getting more exposure through social media or an online store while seeking a location that will be affordable.
Although starting and running a bakery can be very exciting, also note that this sort of business is not for the faint-hearted. Avoiding some of these common mistakes early can help you gain momentum, and have a proper sense of what you are doing.