A cake decorating supplies business is a business that is involved in the sales and supply of everything that is used in the decoration of cakes. Cake decorating supplies are in high demand because no baker will bake a cake for a client without taking out time to decorate the cake.

Examples of cake decorating supplies are; cake turntable stands, cake decorating brushes, fondant and gum paste cake tools, gum paste wire and tape, fondant imprint mat, pastry bags, piping bags or decorating bags, piping tips (or tubes), decorating bag holder, cake airbrush and piping nozzles.

The cake decorating supplies business is a subset of the cakes market industry and available statistics show that the global cake market size was estimated at USD 42.94 billion in 2019 and it grew to USD 44.05 billion in 2020. The industry is projected to reach USD 55.78 billion in 2027 with a CAGR of 3.3% from 2020 to 2027.

Steps on How to Start a Cake Decorating Supplies Business

  1. Conduct Market Research

If you are considering starting a cake decorating supplies business, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your cake decorating supplies business should be to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source information that will help you maximize your business, give you a clue of what your potential market will be looking out for from a cake decorating supplies business and also to help you operate your cake decorating supplies business with less stress and build the business to profitability in the shortest time possible.

a. Who is the Target Market for Cake Decorating Supplies Business?
  • Bakereries (Cake makers)
  • Households
  • Catering and baking schools.
b. Is Cake Decorating Supplies Business a Profitable Business?

Yes, the cake decorating supplies business is profitable. This is supported by the fact that the industry is projected to reach USD 55.78 billion in 2027.

c. Are There Existing Niches in the Industry?

It is important to state that there is no known niche area when it comes to the cake decorating supplies business.

d. Who are the Major Competitors?
  • A & J Cake and Candy Supplies
  • America Cake Decorating Supplies
  • American Cake Decorating
  • Annette’s Cakes and Supplies
  • Art Is In Cakes, Bakery & Supply
  • Bake It Pretty
  • Bakers Bodega
  • Blake’s Decorette Shop
  • Bryant’s Cake and Candy Supplies
  • Cake Crafts
  • Cake Supplies 4 U
  • Classic Cake Decorations
  • Country Kitchen SweetArt
  • Ella Vanilla
  • Global Sugar Art
  • Gloria’s Cake & Candy Supplies
  • Kitchen Krafts
  • Layer Cake Shop
  • Lynelle’s Cake Decorating
  • Lynn’s Cake and Candy Supplies
  • Make It Sweet
  • My Sweet Source
  • Over the Top Cake Supplies.
e. Are There County or State Regulations or Zoning Laws for the Cake Decorating Supplies Business?

No, there are no county or state regulations and zoning laws for the cake decorating supplies business, but players in this industry are expected to work with the existing regulations governing such business in the county or state where their business is domiciled.

f. Is There a Franchise for Cake Decorating Supplies Business?

No, there are no franchise opportunities for the cake decorating supplies business.

g. What Do You Need to Start a Cake Decorating Supplies Business?
  • A Feasibility Report
  • Business and Marketing Plans
  • Business Licenses and Permits
  • Delivery Vans or Bikes
  • Insurance
  • EIN (Employer Identification Number)/Federal Tax ID Number.
  • A Corporate Bank Account
  • Employees
  1. Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a cake decorating supplies business are;

Creative Cake Decorating Supplies Business Name ideas
  • Cake It© Cake Decorating Supplies, Inc.
  • Designer Factory® Cake Decorating Supplies, LLC
  • Evergreen© Cake Decorating Supplies, Inc.
  • Cake Solutions® Cake Decorating Supplies Company, Inc.
  • Rose Johnson™ Cake Decorating Supplies Company, Inc.
  • Mary Wills™ Cake Decorating Supplies, LLC.
  • Daniel Lazarus© Cake Decorating Supplies, LLC
  • Pius Daylong® Cake Decorating Supplies, Inc.
  • Sally Bennard© Cake Decorating Supplies, Inc.
  • Simon Greene™ Cake Decorating Supplies, LLC
  • Teila Crew® Cake Decorating Supplies, LLC
  • Zoe Morris® Cake Decorating Supplies, Inc.
  • Cloe Tinker© Cake Decorating Supplies, LLC
  • Decorate Angels® Cake Decorating Supplies, Inc.
  • Martha Ozone® Cake Decorating Supplies Company
  • East End™ Cake Decorating Supplies, Inc.
  • Selena Borke® Cake Decorating Supplies, Inc.
  • Rita Pita© Cake Decorating Supplies, Inc.
  • Loveth Setula™ Cake Decorating Supplies, LLC
  • Rave Moments™ Cake Decorating Supplies, Inc.
  1. Register Your Business

a. What Type of Business Structure is Best for Cake Decorating Supplies Business?

When it comes to the business structure of a cake decorating supplies business, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC
  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.
c. What Type of License is Needed to Open a Cake Decorating Supplies Business?
  • General Business License
  • Zonal Permits
  • Signage Permit
  • Proof of ownership, proper identification, and vehicle license
  • Proof of district-issued food manager identification card
  • Copy of license for the service support facility and/or a recent inspection report.
d. What Type of Certification is Needed to Start a Cake Decorating Supplies Business?

You don’t need any certifications to start a cake decorating supplies business.

e. What Documents are Needed to Open a Cake Decorating Supplies Business?
  • DBA
  • EIN
  • Business and liability insurance
  • Federal Tax Payer’s ID
  • State Permit and Building Approval
  • Certificate of Incorporation
  • Food Handlers’ License
  • Business License
  • Business Plan
  • Employment Agreement (offer letters)
  • Operating Agreement for LLCs
  • Insurance Policy
  • Online Terms of Use
  • Online Privacy Policy Document
  • Contract Document
  • Company Bylaws
  • Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a cake decorating supplies business, usually you may not have any need to file for intellectual property protection or trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

  1. Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Cake Decorating Supplies Business?

A cake decorating supplies business will cost from $5,000 – $100,000 to start and that can easily go higher depending on your overall business goals and objectives.

b. What are the Costs Involved in Starting a Cake Decorating Supplies Business
  • The total fee for registering the Business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $1,300.
  • Marketing promotion expenses for the grand opening as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
  • The cost for hiring a business consultant including writing a business plan – is $2,500.
  • Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – of $2,400.
  • Other start-up expenses include stationery ($500) and phone and utility deposits ($2,500).
  • Rent (Lease) of Store Facility – $75,000
  • Operational cost for the first 3 months (salaries of employees, fueling, payments of bills et al) – $30,000
  • The cost of storage hardware (bins, rack, shelves) – is $3,720
  • The cost for store equipment (cash register, security, ventilation, signage) – $3,750
  • The cost of stocking with cake decorating supplies – is $35,000
  • The cost of launching a website – is $1,200
  • Miscellaneous – $5,000
c. What Factors Determine the Cost of Opening a Cake Decorating Supplies Business?
  • The size of cake decorating supplies business
  • The choice of location
  • The required licenses and permits
  • The cost of hiring and paying a business consultant and attorney
  • The cost of branding, promotion, and marketing of the cake decorating supplies business
  • The cost of the insurance policy covers
  • The cost of registering the business
  • Cost of recruiting and training your staff
  • The cost of the purchase and customizing of uniforms
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

It is not compulsory to build a new storage facility for your cake decorating supplies business. The nature of the business makes it possible for you to operate from a rented storage facility.

e. What are the Ongoing Expenses of a Cake Decorating Supplies Business?
  • Supplies
  • Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
  • Salaries of employees
  • Delivery vans and bikes maintenance
  • Insurance
  • Marketing costs
f. What is the Average Salary of your Staff?
  • Chief Operating Officer (Owner) – $38,000 Per Year
  • Store Manager – $30,000 Per Year
  • Merchandise Manager – $29,630,000 Per Year
  • Accountant (Cashier) – $28,500 Per Year
  • Salespeople – $26,800 Per Year
  • Delivery Driver – $26,000 Per Year.
g. How Do You Get Funding to Start a Cake Decorating Supplies Business?
  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for a loan from your bank/banks
  • Source for soft loans from your family members and friends.
  1. Write a Business Plan

a. Executive Summary

Rita Pita© Cake Decorating Supplies, Inc. is a registered and licensed cake decorating supplies company that will be based in Montgomery, Alabama but operate all across major cities in Alabama.

Rita Pita© Cake Decorating Supplies, Inc. has been able to secure all relevant licenses and permits to operate throughout the United States. We will ensure that we abide by the rules and regulations guiding the cake decorating supplies industry.

b. Products and Service

Sale and supply of cake decorating supplies such as cake turntable stand, cake decorating brushes, fondant and gum paste cake tool, gum paste wire and tape, fondant imprint mat, pastry bags, piping bags or decorating bags, piping tips (or tubes), decorating bag holder, cake airbrush and piping nozzles et al.

c. Mission Statement

Our mission is to build a highly successful cake decorating supplies business that will grow from one store to different locations all around key cities in the United States of America. We want to become a one-stop cake decorating supplies store.

Vision Statement

Our Vision is to become one of the preferred choices when it comes to the cake decorating supplies business in the whole of Montgomery, Alabama.

d. Goals and Objectives

The goals and objectives of a cake decorating supplies business are to provide a retail outlet where people can go to buy a wide range of cake decorating supplies.

e. Organizational Structure
  • Chief Operating Officer (Owner)
  • Store Manager
  • Merchandise Manager
  • Accountant (Cashier)
  • Sales Girl or Sales Boy
  • Delivery Vans and Bikes Driver.

Marketing Plan

a. SWOT Analysis
Strength:
  • Excellent operational history
  • Robust relationships with key stakeholders
  • Experience and trained professionals.
  • Excellent customer testimonials.
Weakness:
  • The owner is new to large scale marketing
  • We will need a loan to purchase the latest vans and bikes
  • The owner is currently running the business solo
  • Lack of economies of scale.
Opportunities:
  • The rapid growth of the cakes market (Increase in the number of people ordering cakes)
  • Build upon existing clientele
  • Online market, new services, new technology, and of course the opening of new markets.
  • The cakes industry is embracing unique designs and creativity.
Threat:
  • The first year will be financially tight while we gain customers and pay off loans
  • Competition in the area could increase
  • Management of employees requires time, money, and efforts
  • The regulatory department could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses.
b. How Do Cake Decorating Supplies Businesses Make Money?

Cake decorating supplies businesses make money from the sale and supply of cake decorating supplies such as food coloring, cake turntable stand, cake decorating brushes, fondant and gum paste cake tool, gum paste wire and tape, fondant imprint mat, pastry bags, piping bags or decorating bags, piping tips (or tubes), decorating bag holder, cake airbrush and piping nozzles et al.

c. Payment Options
  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer
d. Sales & Advertising Strategies
  • Introduce your cake decorating supplies company by sending introductory letters to bakeries, catering schools, households, and other stakeholders in and around the city you intend to cover.
  • Advertise your cake decorating supplies in community-based newspapers, local TV and radio stations
  • List your business and services on yellow pages ads (local directories)
  • Leverage the internet and mobile apps to promote your cake decorating supplies brands
  • Engage in direct marketing and sales
  • Deliberately brand your cake decorating supplies vans and bikes
  • Encourage the use of word-of-mouth marketing (referrals)

Financial Projection

a. How Much Should You Charge for your Product/Service?

Generally, the price of cake decorating supplies depends on the type, size, and brand of the product.

b. How Much Profit Do Cake Decorating Supplies Business Owners Make a Year?

It depends, but the available report shows that on average, a cake decorating supplies business owner should net more than $60,000 per year assuming they have a steady clientele.

c. What Factors Determine the Amount of Profit to Be Made?
  • The capacity of the cake decorating supplies business
  • The location the cake decorating supplies business is covering
  • The management style of the cake decorating supplies business
  • The business approach of the cake decorating supplies business
  • The advertising and marketing strategies adopted by the cake decorating supplies business.
  • The number of years the cake decorating supplies business is in business
d. What is the Profit Margin of a Cake Decorating Supplies Business?

The profit margin of a cake decorating supplies business is not fixed. It could range from 25 percent to 45 percent.

e. What is the Sales Forecast?

Below is the sales forecast for a cake decorating supplies business. It is based on the location of the business and other factors as it relates to such startups in the United States;

  • First Fiscal Year: $240,000
  • Second Fiscal Year: $430,000
  • Third Fiscal Year: $550,000
  1. Set Up your Shop 

a. How Do You Choose a Perfect Location for Cake Decorating Supplies Business?
  • The demography of the location
  • The demand for cake decorating supplies in the location
  • The purchasing power of businesses and the residents of the location
  • Accessibility of the location
  • The number of cake decorating supplies businesses, and bakeries in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al
b. What State and City are Best to Open a Cake Decorating Supplies Business?
  • Phoenix, Arizona
  • Fort Smith, Arkansas
  • Lakewood, Colorado
  • Columbus, Ohio
  • Delaware City, Delaware
  • Chicago, Illinois
  • Boston, Massachusetts.
  • Los Angeles, California
  • Las Vegas, Nevada
  • Atlanta, Georgia
c. What Equipment is Needed to Operate a Cake Decorating Supplies Business?
  • Vans, bikes, or drones
  • Delivery bags and casing
  • Relevant software (Apps).
  1. Hire Employees

When it comes to hiring employees for a standard cake decorating supplies business, you should make plans to hire a competent chief executive officer (owner) shop manager, merchandise manager, accountant (cashier), salespeople, and delivery drivers.

  1. Launch the Business Proper

To make sure you get a fair share of the cake decorating supplies market in your location, you should focus more on getting your business known. This is where you should do massive publicity for the business. You can also choose to do a soft opening to make people around you aware of your business.

a. What Makes a Cake Decorating Supplies Business Successful?
  • Choose a good location
  • Partner with the leading cake decorating supplies manufacturers to work with
  • Make sure your shop is stocked with different brands and types of cake decorating products
  • Hire only competent, hardworking, and trustworthy staff
  • Be deliberate with your marketing sales approach
  • Encourage the use of word of mouth to promote your cake decorating supplies business
  • Leverage all available online and offline platforms to promote your cake decorating supplies business
b. What Happens During a Typical Day at a Cake Decorating Supplies Business?
  • The shop is open for the day’s work
  • The shop and products are cleaned and well-arranged
  • Walk-in customers are attended to
  • Deliveries of orders are made
  • Marketing/website upkeep
  • Supply ordering
  • Administrative duties
  • Stocks are taken and reports are written
  • The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Cake Decorating Supplies Business?
  • Customer services skills
  • Interpersonal skill
  • Business management skills
  • Work experience in the cake decorating supplies industry
  • Experience in managing people
  • Experience in business administration
  • Experience in handling relevant software apps.