How to start a small bakery shop in 8 easy steps: Concepts for Success

Are you considering opening a small bakery shop and wondering where to start? Have you maxed out storage and space in your home baking business? If you are ready to take the leap to become a bakery operator, it’s important to proceed with both eyes open and be financially and mentally prepared. Here are eight easy steps:

1. Create a business plan and conduct market research
Make sure that you have a thorough business plan. This will allow you to look at your business from different angles. A comprehensive business plan is essential for structuring your business. Your accountant should help you create one. To start running your bakery, you may need to secure funding. So, this is a document that lenders will require before they process a commercial loan application. The business plan should explain in detail who you are, where your bakery shop will be located and how you will be successful. Your bakery operation business plan needs to include the following elements: an executive summary, company overview and bakery chop description, market analysis, business offerings, location analysis, investment plan, financial projections, vendors/suppliers, management team, and marketing plan.

Before launching your bakery operation, you must conduct market research to check whether there is enough demand to open your bakery shop successfully. Doing market research on trends and local markets will provide additional insights. It will also help you develop the best selling strategy for bakery products. 

Remember that when opening a bakery shop, you must respect the same safety and health regulations as you would when setting up a restaurant. 

2. Find the best space
“Location, location and location” are the three most well-known words in commercial real estate. I suggest you hire a retail real estate representative to work with you to find your ideal and best location. Try to find a spot that is easily accessible and has maximum visibility, facing a busy street and a street that gets heavy foot traffic or offers plenty of parking spaces and a loading zone. Avoid being too close to other bakery shops. Finally, check the area’s demographics since areas with higher incomes, younger populations and a dining-out culture often attract more bakery shop customers. An ideal location would be near schools, universities, shops, apartment buildings, and office buildings since people in these areas often order sandwiches for lunch or as an after-school snack.

3. Think of the kind of service options you will provide
Determine what style of service you want to offer. Will your bakery operation be a ghost bakery operation, also known as a virtual, dark or cloud kitchen, which operates for delivery and takeout? The orders are received online or by phone, while the kitchen mainly makes products for delivery apps. 

Will it be counter service, self-serve, sit down, takeout, delivery, etc.? Will you be crafting gourmet or artisan bakery products? 

Will you sell pie by the slice? Will you offer pre-made bread dough with recipes on how to bake them? 

4. Choose a brand and name
Whether you sell low-budget bakery or gourmet products, you should create your own memorable brand. When naming your bakery shop, the name should be unique and easy to pronounce. Once everything is evaluated and selected, you must implement the brand consistently across various platforms, including your website, social media platforms, marketing materials, store signage, uniforms, delivery vehicles, and more.

 5. Design your bakery shop
After defining your brand, take some time to design an attractive interior for your bakery shop properly. The interior design of your operation needs to match your brand identity and the colour palette you have chosen for your logo design. Choose appropriate furniture and equipment, decorations, lighting, packaging, and eye-catching signage. These 4 Ps are the critical ingredients for the success of your bakery shop: product, price, place, and promotion. 

6. Create an enticing menu
First, make a list of every single item you are planning to sell and another list of all the ingredients you need to order. Your menu should offer various bakery items and other food items like coffee and tea, bread, pastries, salads and sandwiches. Will you make gourmet cakes, vegan pies or vegetarian sandwiches? Now, it’s time to name and describe your menu items. Make sure you know how much it costs to make everything on the menu and how much gross profit you will generate per transaction. Make sure to account for all of your expenses, from overhead and inventory costs to employee benefits and compensation, to repairs and maintenance. Next, you will have to establish proper and exact recipes and procedures.  

7. Recruit and hire employees
Your management team and employees will be the face of your pizzeria, so make sure they will represent you in the best way possible. Look for positive candidates with warm personalities. Make sure to look for competent, reliable and experienced cooks, cashiers, delivery drivers and customer service representatives who can help you deliver quality products and services to your customers. Train your employees using the appropriate tools and training manual to offer the highest quality of service in your bakery shop. 

8. Market your bakery shop
Always promote your bakery shop through various marketing channels like social media platforms, websites, online directories and word-of-mouth.

Diane Chiasson, FCSI, president of Chiasson Consultants Inc., has been helping foodservice, hospitality and retail operators increase sales for over 35 years by providing innovative and revenue-increasing food service and retail merchandising programs, interior design, branding, menu engineering, marketing and promotional campaigns. Contact her at 416-926-1338, send her an email at chiasson@chiassonconsultlants.com, or visit chiassonconsultants.com.