Student Magazine For Next Generation

The Ultimate Guide for Starting a Bakery Business


People around the world have loved bakeries for generations. The history of baking dates back to Ancient Greece and the Middle Ages and since then has evolved into a form of art. Yes, baking is a form of art. One that requires accurate measurements, a good sense of the baking process, and a love for the craft. The modern-day bakeries usually draw in huge crowds, as the pleasure of walking into a warm bakery with freshly baked goods is incomparable. Undoubtedly, a bakery presents itself as a lucrative business opportunity. According to a report, the global market value for bakery products reached around $331.37 billion in 2020.

If you love baking, it would be a good idea to open a bakery. However, starting a bakery business is not a cakewalk, as a lot goes into opening a bakery. While your baking skills and talent can fuel the industry, jumpstarting it and driving it to success requires proper planning. Certain ingredients go into opening a bakery business.

Step-by-Step Guide for Opening a Bakery

In this guide, we will guide you through the necessary steps of starting a bakery business, one by one, so that you can realize your dreams.

Step 1: Formulating a plan for the business

The first step in kickstarting a successful business is formulating a well-thought-out plan. With a good plan, you will keep your expectations in check while putting your dreams into perspective. You first need to determine the type of bakery you want to open. It could be a traditional bakery with daily need essentials or a cake bakery for selling pastries, cakes, and certain baked goods. It would help determine whether you want a pack-and-go establishment or want to provide a café-style space where the guests can sit and enjoy the baked goods. There are endless possibilities when it comes to adding elements to your bakery and determining its vision. However, it would help if you were specific in your decision as a flimsy plan can affect your budget significantly.

When formulating a plan, you also need to determine your target customers. Before you start looking for a rental space, contractors, and suppliers, this has to be done. Your target customers could be foodies, influencers, or other businesses and establishments like schools. You can even decide on catering specifically for special events. Identifying the market is of prime importance, as it determines most of the other elements of your business.

Step 2: Assessing the Budget

Opening a bakery can prove to be quite costly. This is why it is important to keep your budget in check from the get-go. You would need to determine the startup cost, which refers to the amount required to procure raw materials, tools, equipment, council approvals, and the rental space. In most cases, the business does not profit in the initial stages, so you need to assess your break-even point. It would help if you sustained your bakery until you reach break-even, so it is important to have a proper plan in place. Keeping your financials in check in the early stages will help make important budgetary decisions later on.

Step 3: Registering the business

Businesses often leave the formalities of obtaining permits and registering the company for the last moment. It is advisable to complete this process early on, and maybe even before starting the bakery construction. Getting started on the right foot will help you keep your books clean. In addition to this, you will be eligible for tax refunds as well. Some important permits for starting a bakery business include food operators’ licenses and council approvals for plumbing, health, and the building. This can be tricky as there are many red-tapisms involved in the process. You can consider taking advice from the experts who will help you save time and money on these processes.

Step 4: Determining the space for the business

Determining the space for your bakery business is very important as the location can make or break a business. Even if you are thinking of starting a home bakery business, it is important to pick out a place for a commercial kitchen. When you are looking for a space to start your business, it will depend on the type of establishment you want to set up. A café-type bakery would require more space than a buy-and-go style bakery. You should keep the customers’ needs in mind when selecting the location. It should be accessible and at a place where people tend to frequent. Another factor you should consider is whether the site is close to the suppliers.

Step 5: Shopping for baking and kitchen equipment

When starting a bakery business, the tools and equipment in your home kitchen will not cut it. In a commercial bakery kitchen, the bakery goods need to be produced in bulk. Getting the right equipment will help you run your bakery kitchen efficiently. The chances are that a significant amount of startup capital will go into buying these tools and equipment. Prepare a list of all the essentials you need, whether a stand mixer, commercial baking ovens, sheeters, or bread slicer. Your equipment needs will depend on the type of bakery you will be opening. If it is a cake business, you would need a fridge, fondant sheeter, and glass display solutions, in addition to the basics. If it is a café-style bakery, you need coffeemakers, toasters, and other such equipment.

Step 6: Hiring the helping staff

Running a bakery business is not a one-person job, as it is difficult to manage all the elements of the company on your own. It is important to hire skilled and attentive staff who you can rely on for running your business smoothly. The type of staff you hire depends on the bakery establishment. If it is a small establishment, you can start with smaller staff size. However, a big café-type bakery would require more staff to cater to the different needs of the customers. You can also consider outsourcing some parts of the business administration, like bookkeeping. This will give you more time to focus on the other aspects of your business.

Step 7: Develop a pricing strategy.

You know the amount of effort to produce each baked good you offer in your bakery. However, you also want your baked goods to be affordable for the customers. It is important to develop a good pricing strategy for your bakery items, which considers the production process, the time, and the cost of the raw materials. You should also factor branding, packaging, and advertising into the pricing strategy.


Starting and running a bakery can be a challenging process. With this useful guide, you will be able to navigate the process of creating a bakery business a little more easily. It might seem like the tasks are endless, but once you develop a clear plan and strategy, you will be able to kickstart a successful bakery in no time. Another thing you can consider for your bakery business is personal accident and sickness insurance for your employees. This personal insurance cover can prove to be very helpful in protecting your employees from unforeseen circumstances leading to illnesses or injuries. To know more about personal accident insurancevisit our website.