Secure Startup Funding For Your Cake Business
In developing your cake business plan, you might have determined that you need to raise funding to launch your business.
If so, the main sources of funding for a cake business to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a cake business that they believe has high potential for growth.
Starting A Cake Business: 5 Things You Need To Know
Thinking of starting a cake business? We’ve teamed up with the directors of The Cake Professionals to share the top five tips for people needing to know how to set up a cake decorating business!
Been thinking hard about whether starting a cake business from home is right for you? Ready to take the plunge? That’s great congratulations! However, going from home baking to starting a cake business is a really big step and it’s important to take your time and make sure you understand precisely how to set up a cake decorating business from start to finish.
Don’t be daunted though, CD& S and Phil and Christine Jensen, founders of The Cake Professionals are here with everything you need to know for starting a cake business!
Lets start with the simple stuff first time travel! If we could sprinkle some magic icing sugar over ourselves, and teleport back six years, what would we really want to tell ourselves?
The Cake Professionals team.
Who Identify Your Target Market
You could choose to concentrate on custom cakes, which would likely get you a lot of birthday orders. In that case, your target markets would be parents, offices and residential communities, and you could find them on Facebook and LinkedIn. If you specialize in a certain kind of cake you might want to focus on selling wholesale to local grocery stores, restaurants and cafes, which you could find on Google Maps and Yelp.
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Learn How A Cake Decorating Business Works
There are a lot of misconceptions about running a cake business.
People think its just a hobby, and you can bake or decorate a two tier wedding or birthday cake in an hour. Well, I dont know about you, but I sure cant.
While this may start out as a hobby for you, its definitely got the potential to become a full-fledged business.
To get there, youd have to really understand how the industry works.
Passion and a talent for artistic culinary creations are a must if youre starting a cake decorating business, but its not enough. You have to have the organizational and business acumen for success.
Fortunately, these can be taught.
Like any business, cake decorating takes hard work and long hours. But you can make those hours go by a little bit faster by learning the right way to run a cake decorating business.
And the best way to do that is to go work for a cake decorator!
Now, Im not saying go take a full-time job working 9-5 for some corporate store. If you have a friend whos been doing this for years, thats a great place to start. Or go talk to the owner of your local bakery and ask for advice or suggestions.
Look to understand how a cake decorating business can grow with more ovens and more help, and how that plays into your own vision for starting a cake decorating business.
It doesnt need to be for long, but you have to understand what starting your business looks like.
Learn secrets, tips, and techniques to make your business as efficient as possible!
So How Did I Start My Cake Business
It starts in a hospital. Me, stuck in a hospital to be precise for over two long, sucky months fending off a sudden autoimmune condition that left doctors baffled. Prior to this, I had just wrapped up a Business degree at uni and was in the midst of clocking up some serious hours as a pastry chef in hopes of one day conquering the world of haute patisserie.ßSo at the age of 24, I found myself quite suddenly caught in a whirlwind of medical complications, infections, MRIs, tests, seizures, memory loss, stroke, ICUs, operations .. you name it. Call out any medical division in a hospital and I can betcha a slice of tiramisu that at some point, I was there.
Like I saidsucky.
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Start A Dessert Boxes Business
Samantha Khater from Sydney, New South Wales, Australia started Dessert Boxes over 5 years ago, a dessert boxes business.
- Revenue: $150,000/ month
- Location: Sydney, New South Wales, Australia
Dessert Boxes.com.au was born out of our frustration of having to send and receive boring gifts which would end up being thrown away, dying, never used, and at best, re-gifted.
So, a week before Valentine’s Day last year, we launched a Nutella themed Dessert Box! We collaborated with the biggest dessert makers in the industry, and within five days, we sold over 400 boxes! We searched for the best products on Instagram and did Google searches to find Nutella themed products.
This was our first ever Dessert Box:
For further info, check out these books and products:
Amanda Bradford started Bradford Bakery, a catering business, over 1 year ago:
My name is Amanda Bradford and I own Bradford Bakery. I started in the culinary industry 15 years ago and have done everything from restaurants to the Dalai Lamas 80th birthday cake and celebrity catering events.
Choose A Location For Your Bakery Business
One of the first steps to how to start a bakery business in India is to decide on a good location. For a bakery, the ideal location is a reputed market or high-end shopping streets where footfall is high. Ideally, front area shops on the ground floor, which are easily accessible and visible, are apt for the bakery business. It is advisable to have a 500 sq ft shop, divided into two floors, to build a functional kitchen on one level, and have a display cum serving area at another. However, this is subjective to the space available and your own choice.
For a 1000 sqft area divided between two floors, the rent should not exceed more than Rs 60-70k. Your expenditure would be around Rs 1,80,000 to acquire the place where the bakery will operate.
Also, while finalizing the location of the bakery, it is essential to ensure that the place has a proper water supply and drainage facility. Get an appropriate legal agreement for the property as it is also required in paperwork and other licenses. You should even get a No Objection Certificate from the property owner that he has no problem that his place would be used for food outlet purposes.
This article will help you .
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Step : Plan Your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
Luckily we have done a lot of this research for you.
What are the costs involved in opening a cupcake business?
Youll first need to decide if youd like to invest in a cupcake franchise or start your own cupcake business from the ground up. Yummy Cupcakes and Gigis Cupcakes both offer wonderful franchising opportunities. Take the time to consider your options and ensure youre making a sound business decision one that aligns with your overall vision for the company.
Start-up costs vary, depending upon your business model. Will you be offering cupcake delivery or a full-blown storefront? Will you work out of your home kitchen or are you envisioning an industrial kitchen? Below is a list of materials youll need, with actual cost ranging anywhere from $50,000 to $300,000.
- Rental space, outfitted with all the necessities of a commercial kitchen
- Baking equipment and kitchen gadgets
- Accounting and CRM software applications for proper management of accounts
What are the ongoing expenses for a cupcake business?
Who is the target market?
How does a cupcake business make money?
Regardless of how you decide to structure the business, your profit will be made through the sale of each cupcake. Similar to donut shops, most offer special pricing for orders of a dozen or more cupcakes.
Register Your Cake Business With The Irs
Next, you need to register your business with the Internal Revenue Service which will result in the IRS issuing you an Employer Identification Number .
Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.
Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number as your taxpayer identification number.
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How To Start A Home
If you’re ready to start baking up profits, here are the steps to launching your home based baking business.
Have You Got The Skills
A lot of us are home bakers and if home baking is your unique selling point then thats great but, you need to make sure you have the skills professional baking skills needed in order to produce delicious bakes. Consider taking a course in order to develop your cake making skills to ensure you can offer a variety of professional looking cakes.
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Charge A Decent Price
Do you have any idea how much a professional wedding cake costs?
Phone a few of your local bakers for quotes. The average wedding cake cost $582 in 2016 not exactly cheap.
So, I undercut the competition. But I dont go too crazy, because wedding cakes arent cheap to make.
A three-tier cake might use eight recipes worth of ingredients which could easily be, say, 16 blocks of butter plus eight bricks of almond paste and fondant, three cake boards, three cake tins youll probably have to rent, wooden dowelling and a significant amount of electricity.
Add on gum paste, edible glitter, ribbon, gel colorings and so forth. Plus, tool fund money for buying handy things like cake levelers and tilting turntables. Then, factor in labor, which will be significant.
My rule of thumb is to charge 250% of the ingredient costs, including nonreusable supplies like cake boards. I may charge more for a time-consuming cake, such as one covered with gum paste roses.
I generally net a profit of about $150-$200 per wedding cake and Im still cheaper than the professionals.
So Here I Was Post Recovery Skinny Semi
I bounced between random jobs at the time to keep things afloat but I knew I needed to embark on a new career path. The only question waswhat? Starting a business couldnt have been further from my mind. What I needed was a safe, secure job which paid the bills and put some stability back into my life. I mean.. who on earth starts a business under such circumstances?!?
Cue random phone call from a friend one day
Hey, do you make those pretty colourful cakes? The ones with the sugary figurines..?
Oh, why you asking?
Its our anniversary and I just thought to ask if you would make one for us, were happy to pay,
So that night, I taught myself how to make the sugary stuff , then proceeded to cover & decorate a novelty cake for the first time and *cue confetti drop*
My first sale was born. Cha-ching!
. But broken rules aside, something had gone off inside me.
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Step : Define Your Brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren’t feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we’ll give you helpful tips and advice for creating the best unique logo for your business.
If you already have a logo, you can also add it to a QR code with our Free QR Code Generator. Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.
How to promote & market a cake business
Word of mouth will, ultimately, be your strongest marketing tool. While building your reputation, consider free online resources, such as social media and local business registries. If you become a member of any organizations, inquire about their online listings, which is often offered free of charge to members. Distribute mailers within the community and become a sponsor for local charity events. Many communities have charity events that feature local chefs take part in these to gain exposure.
Approach wedding and party planners in the area. These professionals are often asked for recommendations. If you partner with the right ones, your business could soar with very little marketing effort.
Create A Staffing Plan
If youre working from home by yourself, you might not need additional staff yet. But as you grow, you need to have a staffing plan in mind.
Figure out how much help you need with your business. Where will you find them? What kind of traits do they need to have? How will you schedule them?
When starting a new business, a great resource is friends and family.
So reach out to yours for help as you get started. And once you start growing even more, Craigslist and Indeed.com are great hiring channels.
As your cake business becomes bigger, you cant continue to do everything by yourself. If you do, youll either slow down to the point that you cant keep up with demand, losing business. Or your service will be so poor since youll be so rushed that youll lose business.
Regardless, your business cant grow without help. And its important to have a plan to bring on that help.
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