small bakery business plan

Bakery Business Plan PDF Example

• February 28, 2024
• Business Plan

Creating a comprehensive business plan is crucial for launching and running a successful bakery. This plan serves as your roadmap, detailing your vision, operational strategies, and financial plan. It helps establish your therapy bakery’s identity, navigate the competitive market, and secure funding for growth.

This article not only breaks down the critical components of a bakery business plan, but also provides an example of a business plan to help you craft your own.

Whether you’re an experienced entrepreneur or new to the food&beverage industry, this guide, complete with a business plan example, lays the groundwork for turning your bakery concept into reality. Let’s dive in!

Our bakery business plan is designed to encompass all crucial elements required for a thorough strategic approach. It details the bakery’s operations, marketing strategy , market environment, competitors, management team, and financial projections, ensuring a holistic view of the business’s path to success.

• Executive Summary : Offers an overview of your bakery’s business idea, market research , management team, and financial plans.
• Bakery & Location: Describes your bakery’s layout, features, and why its location is perfect for customers.
• Operations: Outlines daily bakery operations, including baking schedules, staffing, and ingredient sourcing.
• Key Stats: Provides figures on the size and growth of the bakery market.
• Key Trends: Points out new trends in the bakery industry, such as the rise in health-conscious and specialty products.
• Key Competitors : Discusses major nearby bakeries and how your bakery offers something different.
• SWOT: Analyzes strengths, weaknesses, opportunities, and threats related to your bakery.
• Marketing Plan : Outlines methods for promoting your bakery and keeping customers coming back.
• Timeline : Lists important goals and milestones from the beginning through the first year.
• Management: Shares info on who runs the bakery and their responsibilities.
• Financial Plan: Forecasts the bakery’s financial outlook over 5 years, including income, profit margins, and main expenses.

Bakery Business Plan

Fully editable 30+ slides Powerpoint presentation business plan template.

Download an expert-built 30+ slides Powerpoint business plan template

Executive Summary

The Executive Summary introduces your bakery’s business plan, offering a concise overview of your bakery and its offerings. It should detail your market positioning, the range of baked goods and confectionery items you offer, its location, size, and an outline of day-to-day operations.

This section should also explore how your bakery will integrate into the local market, including the number of direct competitors within the area, identifying who they are, along with your bakery’s unique selling points that differentiate it from these competitors. These could include special dietary options like gluten-free or vegan products, artisanal or locally sourced ingredients, or a particular specialty in certain types of baked goods.

Furthermore, you should include information about the management and co-founding team, detailing their roles and contributions to the bakery’s success. This could involve their culinary expertise, business management experience, or community relations. Additionally, a summary of your financial projections, including revenue and profits over the next five years, should be presented here to provide a clear picture of your bakery’s financial plan.

Make sure to cover here _ Business Overview _ Market Overview _ Management Team _ Financial Plan

Dive deeper into Executive Summary

Business Overview

For a Bakery, the Business Overview section can be concisely divided into 2 main slides:

Bakery & Location

Briefly describe the bakery’s physical environment, emphasizing its design, warmth, and the inviting atmosphere that welcomes customers. Mention the bakery’s location, highlighting its accessibility and the convenience it offers to customers, such as proximity to community centers, schools, or ease of parking.

Explain why this location is advantageous in attracting your target clientele, which might include local residents, businesses looking for catering options, or foot traffic from nearby shopping areas.

Detail the range of baked goods and products offered, from bread and pastries to custom cakes and specialty items. Outline your operational strategy, including sourcing of ingredients, baking schedules to ensure freshness, and any unique services such as custom orders or catering.

Discuss your pricing strategy , ensuring it reflects the quality of ingredients and craftsmanship involved and matches the market you’re targeting. Highlight any special offerings, loyalty programs, or community events that provide added value to your customers, encouraging repeat visits and customer loyalty.

Make sure to cover here _ Bakery & Location _ Operations

Market Overview

Industry size & growth.

In the Market Overview of your bakery business plan, begin by assessing the size of the bakery industry and its potential for growth. This evaluation is essential for grasping the market’s extent and pinpointing opportunities for expansion.

Analyze factors such as the increasing demand for baked goods, both traditional and innovative, and how consumer preferences are shaping the industry.

Key market trends

Continue by discussing recent market trends that are influencing consumer behavior and preferences in the bakery sector. This might include a growing interest in artisanal and craft baked products, the surge in popularity of gluten-free and vegan options, and the integration of international flavors and ingredients into traditional bakery products.

Highlight the demand for high-quality, fresh, and specialty baked goods that cater to diverse dietary needs and cultural tastes, as well as the trend towards more health-conscious and sustainable baking practices.

Key competitors

Next, examine the competitive landscape, which encompasses a variety of bakeries from luxury patisseries to affordable local bakeries, as well as the rise of home baking and online bakery businesses.

Focus on what sets your bakery apart, whether it’s through unparalleled customer service, a distinctive selection of baked goods, or expertise in a particular baking style or dietary niche.

Make sure to cover here _ Industry size & growth _ Key competitors _ Key market trends

Dive deeper into Key competitors

First, conduct a SWOT analysis for the bakery , highlighting Strengths (such as artisanal baking skills and a unique range of products), Weaknesses (including potentially high ingredient costs or stiff competition), Opportunities (for example, a growing interest in specialty and health-conscious baked goods), and Threats (such as fluctuations in raw material prices or changes in consumer spending due to economic conditions).

Marketing Plan

Next, formulate a marketing plan that details strategies for attracting and retaining customers through targeted advertising, seasonal promotions, a compelling social media presence, and engagement with the local community. Consider loyalty programs, baking workshops, and collaborations with local businesses as part of your promotional activities.

Finally, establish a detailed timeline that marks key milestones for the bakery’s launch, marketing initiatives, customer base development, and potential expansion goals. This timeline should guide the business towards achieving its objectives with precision and clarity, ensuring systematic progress in a competitive market.

Make sure to cover here _ SWOT _ Marketing Plan _ Timeline

Dive deeper into SWOT

Dive deeper into Marketing Plan

The Management section focuses on the bakery’s management and their direct roles in daily operations and strategic direction. This part is crucial for understanding who is responsible for making key decisions and driving the bakery towards its financial and operational goals.

For your bakery business plan, list the core team members, their specific responsibilities, and how their expertise supports the business.

Financial Plan

The Financial Plan section is a comprehensive analysis of your financial projections for revenue, expenses, and profitability. It lays out your bakery’s approach to securing funding, managing cash flow, and achieving breakeven.

This section typically includes detailed forecasts for the first 5 years of operation, highlighting expected revenue, operating costs and capital expenditures.

For your bakery business plan, provide a snapshot of your financial statement (profit and loss, balance sheet, cash flow statement), as well as your key assumptions (e.g. number of customers and prices, expenses, etc.).

Make sure to cover here _ Profit and Loss _ Cash Flow Statement _ Balance Sheet _ Use of Funds

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How To Write a Bakery Business Plan in 9 Steps

Learn how to write a bakery business plan, section by section. Get inspiration from examples of other bakeries.

If you consider yourself a talented baker with entrepreneurial dreams, starting a bakery is an excellent business idea you can do from home or from another brick-and-mortar space.

But before you launch into how to start a food business with your baking prowess, it’s important to write a bakery business plan.

Below, learn how to write your bakery business plan, section by section, using this business plan guide as a base. Follow along by downloading this business plan template and modifying it to fit your needs.

Why you need a bakery business plan

Not every business starts out with a formal plan, but those that do have an easier road to success. There are a few key benefits to writing a bakery business plan:

Objectively evaluates your business ideas

Writing a business plan helps you objectively evaluate your food business ideas —and researching and documenting your ideas allows you to take a step back and see if there’s really an opportunity there.

Builds a blueprint for moving forward

Your business plan serves as a roadmap for moving forward. Writing a business plan can identify the next steps you need to execute your idea. You can keep referring back to your business plan to make sure you’re on track for your original vision.

Helps figure out what you need

The process of writing a bakery business plan will also show you your gaps and needs. Listing exactly what you need to start your bakery business can show you what you’ll need to do to make it a reality.

Helps you get capital

A business plan helps you get capital, even if it’s a home bakery business plan. You won’t be able to secure funding for your business —whether from investors, lenders, banks, or even crowdfunding —without a business plan for your bakery.

Bakery business plan template

A bakery business plan sample template is immensely helpful, especially if you don’t consider yourself a writer. When you start with a template, you can see every section that you need to complete. Templates can also offer prompts to help you figure out what to say and how to say it.

This free business plan template , for example, offers a framework to simplify the job of writing out a business plan, so you can operate with confidence. It helps you analyze the market and understand how much time, money, and resources you’ll need to start and scale your bakery business.

How to write a bakery business plan

• Executive summary
• Company overview and description
• Market analysis
• Management and organization
• Products and services
• Customer analysis and segmentation
• Marketing plan
• Logistics and operations plan
• Financial plan and projections

1. Executive summary

The executive summary section of your bakery business plan summarizes the document and its contents. Remember, this is meant to highlight what’s to come in your business plan, not serve as a summary of your business idea.

Focus on your business’s core strength to draw in your reader. Keep it concise and to the point—you don’t want to lose your reader before they reach the meat of your baking business plan. Think about a hook to grab your audience’s attention.

Remember your target audience for the business plan and cater the executive summary to their needs. You might even have a few different versions of your executive summary to appeal to different readers, such as investors, lenders, or business partners.

The executive summary should be about a page in length and answer the following questions:

• What is your brand?
• What does your bakery do?
• What does your bakery want to do?
• What is the following text about?
• Why should your audience care?
• What highlights should readers be excited about?
• What do you sell and how is it different from your competitors?
• Who are your customers?
• What is your marketing strategy?
• What is your current and projected financial state?
• How much money do you need to get started?
• Who is involved in the bakery?

2. Company overview and description

This part of your bakery business plan should drill down further into your business idea. Here, you’ll want to identify your bakery’s business structure — sole proprietorship, li imited liability corporation (LLC) , general partnership, etc.—and business model .

You’ll also use this section to talk about the baked goods industry and about your specific niche within it—whether you’re offering keto-friendly, gluten-free, or otherwise lifestyle-specific items; cakes; catering; frozen desserts; savory pastries, etc. Cape Whoopies , for example, sells gourmet whoopie pies made in Maine. Its bakery business plan would make note of that in the company description section.

The company description should also outline your vision and mission statement and your value proposition . Your vision and mission statement encompass what you hope to do with your bakery, and your value proposition sums up why people would want to buy from you.

Use this section to talk about your team, including key personnel and their salaries. The bakery La Monarca , for example, would identify its two founders as well as any board members or employees.

Finally, list your short- and long-term business goals. Your business goals should be quantifiable and measurable, eliminating subjectivity. You’ll also want to put an estimated timeline for your business goals and when you hope to accomplish them.

3. Market analysis

The market analysis section of your bakery business plan quantifies how big your potential market is and validates that there’s enough demand for your business.

This section of the bakery business plan should explore the following:

• Industry trends
• Laws and regulations for the food industry
• The demographics of your target customer
• Where, why, and how they shop
• The size of your target market
• The price people are willing to pay for what you sell

You may also include a SWOT analysis , which identifies your strengths, weaknesses, opportunities, and threats, as well as a competitive analysis , outlining the competitive landscape and where your bakery fits in.

business structure of your bakery and whether you’ve elected to incorporate as a sole proprietorship, a limited liability corporation (LLC) , a corporation, or something else.

Don’t stress over the name of your bakery business too much yet—you don’t have to use your official incorporated name as your public-facing name forever. You can always file for a DBA (doing business as) or just publically drop the “Inc.” or “LLC” at the end of your name. Balkan Bites , for example, is technically an LLC called “Balkan Bites LLC.”

You’ll also want to include information about the makeup of your team, even if you plan to run the business yourself. Here are some other people and entities you might include:

• Owner . Who is the owner of the bakery?
• Business partner(s) . List and identify the role of any business partners you plan to work with. Make sure you note the ownership percentage breakdown.
• Management team . It helps to visualize the team with an organizational chart to show how roles and responsibilities are structured and contribute to your bakery’s bottom line.
• Financial advisers . Maybe they’re not in-house, but you might have contracted financial advisers or accountants helping you to manage finances.
• Employees . Even if you don’t plan to open your bakery business with employees, you might have plans to hire staff in the future. Make note of that in this section.

5. Products and services

In the products and services, you’ll list which products and services you’ll sell through your bakery. You’ll likely sell something like cakes, cookies, chocolates, pies, or even baking kits, and potentially branded merchandise products .

As far as baked goods go, consider more narrowly defined niches within the overarching bakery niche. For example, products that are tied to a specific culture, like a bakery that specializes in Italian cookies or French pastries, or event-related baked goods, like wedding or birthday cakes, all present excellent niches. You could also offer gluten-free, sugar-free, organic, or dairy-free goods.

The business plan should cover how many different types of products you’ll offer, and if you plan to release new recipes, or limited-edition or seasonal items.

You’ll also want to consider other non-bakery items. Dough Dealer , for example, doesn’t actually do any baking, so it doesn’t sell any baked goods. Instead, it sells kits with baking supplies online, as well as merchandise. You can do the same thing with a print-on-demand company .

6. Customer analysis and segmentation

The customer segmentation section of your bakery business plan should discuss the different groups of shoppers you intend to target with your bakery. Include the following information about each of your segments:

• How old they are
• Where they live
• Where they work and what they do
• Education level
• What technology they use
• Their values, beliefs, and opinions
• Common behavior patterns
• How they shop

Here’s what a customer segmentation section might look like: Levain serves a few distinct geographic markets in Puerto Rico, including San Juan, Aguadilla, Mayagüez, and Rincón. Each of these regions represents a specific customer segment for the bakery, and they may have different shared characteristics. So Levain adjusts its promotional and marketing strategy according to its audience.

7. Marketing plan

Your marketing plan is a high-level overview of how you plan to promote your bakery. The marketing plan should outline which channels you plan to use for marketing and advertising, as well as any budgets you might have. At a minimum, this section of your bakery business plan should define the following:

• Price : How much your products cost and why.
• Product : What you’re selling and how you differentiate it from other goods in the market.
• Promotion : How you’ll get your products in front of your ideal customer.
• Place : Where you’ll sell your products, including online and in-person.

Zero-sugar cookie brand Sundays used email marketing to promote its bakery business and build buzz pre-launch. The brand allowed people to subscribe so they would be alerted when the online store launched. This approach is also an excellent tactic for email list-building .

Here are some more resources to help assemble the marketing section of your bakery business plan:

• How to Build a Marketing Plan That Actually Works
• 7 Inspiring Marketing Plan Examples (and How You Can Implement Them)
• Driving Growth: 12 Best Marketing Strategies Any Small Business Can Execute

8. Logistics and operations plan

Your logistics and operations plan outlines exactly how you’ll create and sell products and fulfill orders. Be sure to address each of the following:

Identify where you’ll purchase the raw ingredients you need to make your baked goods and where they’re produced. Will you purchase anything pre-made from suppliers or make everything from scratch?

Outline whether you’ll make, wholesale, or even dropship your products. Describe how long it takes to receive raw ingredients and how long it takes to produce your baked goods. You’ll also want to think about a contingency plan: How will you handle a busy season or an unexpected spike in demand?

Where will you and any team members work? Do you plan to have a physical retail space as well as the bakery? If yes, where? Will they coexist or exist in different locations?

List which tools and technology you require to get you up and running: think items like ovens, mixers, refrigerators, etc., as well as business tools like a POS system or card reader. You’ll even list items like lightbulbs, counters, and anything else you’ll need to purchase to open your bakery.

Shipping and fulfillment

Will you be handling all the fulfillment tasks in-house or will you use a third-party fulfillment partner? Will you have a space for in-person shopping or pickup?

How much raw ingredients will you keep on hand, and where will they be stored? How much finished product can you keep on hand, and where? How will you ship products to partners if required, and how will you approach inventory management ?

The bakery Wildgrain , for example, operates on a subscription-based business model. The brand outlines how it works on its website, information that would also be suitable for the logistics and operations section of its bakery business plan.

The sourdough bakery Florets offers a subscription plan as well as in-person pickup at its Auckland-based bakery location or at a weekly farmers market.

The Protein Bakery also has a few methods for fulfillment. Customers can visit its New York City–based retail shop or order online, and other businesses can also purchase its products wholesale.

9. Financial plan and projections

The financial plan shows possible funders that you’ve done your math homework and crunched the numbers to figure out how much money you need to launch, how much you need to operate, and whether you can turn a profit.

The financial plan typically includes the following financial statements :

• Income statement
• Balance sheet
• Cash flow statement

Here’s a spreadsheet template that includes everything you’ll need to create the above financial statements, including some sample numbers. Just edit it as needed.

When putting together your financial plan and statements, be realistic and specific. While you want to be optimistic about your projected success, it’s equally important to be pragmatic. Use the information you’ve learned developing other parts of your bakery business plan to calculate accurate, achievable numbers.

Launch your bakery business with Shopify

Starting your new venture with a successful bakery business plan is a surefire way to set yourself up for success from the get-go. Your bakery’s business plan will keep you and your team accountable and aligned with your vision and goals.

When you’re ready to launch, build your website on Shopify. With Shopify, you can seamlessly integrate your retail and ecommerce tech stack to maintain complete control of your growing business.

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Bakery business plan FAQ

How do i start my own bakery business plan, how much money can you make owning a bakery, what equipment is needed for a bakery.

• Food processor
• Dough proofer
• Dough sheeter
• Bread slicer
• Refrigerator and/or freezer
• Baker’s rack
• Baking pan and dishes
• Bowls, measuring cups, spoons, spatulas, etc.
• Pastry bags
• Work counters
• Dry storage

Is a bakery business profitable?

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Bakery Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Bakery Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Bakery Business Plan

You’ve come to the right place to create a successful bakery business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their bakeries.

A bakery business plan is a plan to start and/or grow your bakery. Among other things, it outlines your business concept, identifies your target customers, presents your marketing strategy, and details your financial projections.

Sample Bakery Business Plan

The following information will provide a description of what to include in your own bakery business plan along with links to an example for that section:

• Executive Summary – The Executive Summary section provides a high-level overview of your plan. It should include your bakery’s mission statement, as well as information on your business offerings, your target audience, and your business goals and objectives.
• Company Overview – The Company Overview section provides an in-depth look at your bakery, including information on your company’s history, business structure, bakery location, and management team.
• Industry Analysis – Also called the Market Analysis, in this section, you will provide an overview of the industry in which your bakery will operate. Through market research, you will be able to discuss market trends affecting the industry, as well as your target market’s needs and buying habits.
• Customer Analysis – In this section, you will describe your target market and explain how you intend to reach them. You will also provide information on your customers’ needs and buying habits.
• Competitive Analysis – The Competitor Analysis will provide an overview of your competition (other bakeries or businesses that offer high-quality baked goods), including their strengths and weaknesses. It will also discuss your competitive advantage or your business’s core strength that will help you stand out amongst your competition.
• Marketing Plan – In the Marketing Plan section, you will detail your marketing strategies, including your community events, and digital marketing campaigns. You will also discuss your pricing strategy and how you intend to position your bakery in the market.
• Operations Plan – In the Operations Plan, you will provide an overview of your store’s operations, including your store layout, staff, and inventory management. It also includes information on your warehousing and distribution arrangements and a list of long-term milestones or business goals.
• Management Team – In this section, you will provide information on yourself as the talented baker, any business partners, your experience, and your roles in the company.
• Financial Plan – In this section of your bakery financial plan, you will include your financial statements: profit and loss statement, balance sheet, and cash flow statement. It also includes information on how much funding you require and the use of these funds.

Next Section: Executive Summary >

Bakery Business Plan FAQs

How can i complete my bakery business plan quickly & easily.

Learn more about how to write a bakery business plan using this   bakery business plan template .

What Are the Main Types of Bakeries?

A bakery can be retail or wholesale. A retail bakery sells baked goods (i.e., fresh bread, specialty items, gluten-free and vegan baked goods, and other bakery offerings) directly to customers, while a wholesale bakery typically sells products to other local businesses, like restaurants, grocery stores, specialty shops, and cafes.

How Do You Get Funding for Your Bakery?

Bakeries are most commonly funded with personal savings and bank loans. Credit card financing and angel investors are also popular forms of funding for bakeries. Potential investors or lenders will often want to see a well-crafted business plan before considering providing funding.

Learn More:  Seeking Funding from Angel Investors vs Venture Capitalists

Where Can I Get a Bakery Business Plan PDF?

You can download our free bakery business plan template PDF here . This is a sample bakery business plan template you can use in PDF format.

Bakery Business Plan Template

Written by Dave Lavinsky

Bakery Business Plan

If you want to start a bakery business or expand your current one, you need a business plan.

Over the past 20+ years, we have helped over 5,000 entrepreneurs and business owners create business plans to start and grow their bakery businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a bakery business plan step-by-step so you can create your bakery’s business plan today.

Download our Ultimate Bakery Business Plan Template here >

How To Write a Business Plan For a Bakery

Executive summary.

The executive summary is the introduction to your business plan, although it is often written last. It helps investors and lenders quickly decide whether they are interested and should read more, so the first page must get right to the point. Include a concise description of your bakery (or bakery concept if you are a startup), a short analysis of the market, proof that customers are willing to pay for products, and an explanation of the unique qualifications that ensure your bakery will be a success.  

Company Overview

This section of your bakery business plan provides a comprehensive look at the company’s history. Include details on your bakery’s legal structure, founding, location, and current business stage, as well as your past accomplishments and unique qualifications. Clearly explain anything that makes you a strong competitor in this market, such as existing contracts with retailers, a head baker with impressive restaurant credentials, or exclusive access to award-winning recipes.

Finish Your Business Plan Today!

In this section you should also give an overview of the type of bakery you operate or will operate in the future.

For example, do you or will you operate a:

• Traditional bakery (selling breads, biscuits etc.)
• Commercial bakery
• Bakery specializing in wedding cakes
• Wholesale bakery
• Doughnut shop
• Pastry shop
• Bakery Cafe
• Food truck bakery
• Home Bakery

Industry Analysis

This section assesses that bakery industry and how your bakery fits into the existing landscape. Address any challenges that you unearth with a solid strategy for success. Also keep in mind that your market is not the entire baked goods market. Rather, it is your niche of that market.

For example, while the baking industry in the United States generates more than $30 billion per year in revenues, your bakery will only comprise a fraction of that amount depending upon your geography, focus, etc. So, zero in on the specific products and customers you plan to target and focus your analysis on those elements.  

Customer Analysis

This section of your plan details your bakery’s target audience, that is the customers you will serve. Note that in many cases, a bakery might target multiple market segments. Do you plan to target brides to be? Children’s birthday parties? Upscale families who regularly hold private events for 100 or more guests?

Or do you primarily serve walk-in customers. This segment usually comprises neighborhood resident who know about your bakery, and who tend to visit regularly.

Even if you’re not a commercial bakery, you might serve local delis, grocery stores and bodegas. Clearly, it helps a bakery’s sales if it has a greater number of distribution points. The same is true in the case of restaurants. A bakery can supply breads, bagels, cakes, pastries and other products to restaurants and hence create a larger customer base.

Whatever target markets you serve, clearly define them in your business plan. Detail the demographics of each. For example, are they wealthy males and females? Are they college students? Are they local restaurants? Whatever the target customers, you need to identify and detail them so you’ll know their needs and can better serve them.

Likewise, discuss the psychographics of your target customers. Are they price conscious? Is quality the most important issues they will use to judge your bakery? Do they insist on reliability and premium service?

In addition to documenting the demographic and psychographic variables that define your target market, detail how your bakery will meet their unique needs.

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With Growthink’s Ultimate Bakery Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

This section of your bakery business plan details your direct and indirect competitors. Direct competitors are other companies who fulfill the same need for the same target market, most likely others selling similar baked goods. Your indirect competitors are those who fulfill a different need for the same target market, or those who fulfill the same need for a different target market. An example of an indirect competitor could be a nearby coffee shop.

In your plan, name and describe your direct competitors individually, and explain what sets your bakery apart from them. Create a more general category for your indirect competitors and discuss them as a whole.

Finally, detail your areas of competitive advantage and what will make you distinct. Most successful bakery owners identify products that no other local bakeries offer, such as a treat that is exclusive to your bakery and that drive customers to frequent your store. Also, based on the demographics and psychographics discussed above, you may be successful being the only local bakery selling nut-free cakes, or making vegan and gluten-free baked goods with local and organic ingredients.  

Marketing Plan

Your bakery marketing plan explains how you will penetrate your target market, based on the four P’s: Product, Price, Place, and Promotion.

The Product section explains all the products and services your bakery will provide. Price refers to the price points at which you will sell each item, along with your reasoning for choosing those prices. Place explains all your distribution methods, such as your retail stores, your company website, and third-party retailers. Promotion defines the ways you will entice customers to purchase your baked goods, such as free samples and web advertising.

In addition to describing the four Ps your bakery marketing strategy, you should explain how you will retain existing customers through loyalty programs or other methods. Also, in this section of your plan, particularly if you are startup retail bakery, you should detail the design and display of your location.

Clearly, your bakery’s storefront should be designed in a way that attracts walk-in customers. Consult an interior designer to get insight on how to create a warm and inviting ambience in your bakery.

Operations Plan

The operations plan explains the processes by which you will turn your vision into a reality. It includes the everyday short-term processes involved in physically baking your products, managing your retail space, packaging your baked goods, conducting sales transactions, choosing and working with vendors, and delivering the finished products to your customers among others.

Your operations plan must also include the long-term processes involved in growing your company, such as introducing new products or retail stores, achieving specific sales milestones, and hitting other important business-oriented goals such as hiring new employees, launching new locations, etc.  

Management Team

This section provides biographies of the key members of your company’s management team, with an emphasis on strong business skills. Focus on educational background, previous experience with successful start-ups, and other elements that demonstrate your and/or your team’s ability to build a company. A strong advisory board can help make up for weaknesses provided you clearly articulate how your advisors will directly impact the company’s growth.

Financial Plan

The financial plan is often the most difficult part of the business plan to write, yet it is the section that potential investors and lenders spend the most time analyzing.

Provide a list of all revenue streams, including their relative importance and timeline for implementation, as well as the amount and expected sources of outside funding. Include a summary of past (if applicable) and projected Income Statements, Balance Sheets, and Cash Flow Statements. The assumptions made in these documents must be reasonable and verifiable based on an analysis of similar companies.

Make sure you don’t miss anything when putting together your financial projections or you could lose credibility in the eyes of readers of your plan. For example, make sure you adequately enter costs which most bakeries incur such as space (owned or rented), equipment (planetary mixers, cylinders, gas stove, cooling fridge, deep fridge, storage utensils, etc.), electricity and water, staff, furniture and décor, licenses, insurance and legal fees.  

The appendix includes your full financial projections, as well as any other documentation that supports the claims made in the business plan. For example, it might include a list of key existing customers or letters from potential partners. Likewise, if you’re a startup bakery, including sketches of the proposed store design should appear in your appendix.  

Putting together a business plan for your bakery business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the bakery business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful bakery business.

To further help you, we have other articles on key aspects of how to start your bakery . and running it effectively. Specifically, our bakery marketing plan will help you develop the best promotions strategy. Our bakery startup costs post will let you know what costs to expect.

Bakery Business Plan FAQs

What is the easiest way to complete my bakery business plan.

Where Can I Download a Bakery Business Plan PDF?

You can download our bakery business plan template PDF here.

Our bakery business plan PDF is a free resource to help you get started on your own business plan. This is a business plan template you can use in PDF format for a bakery, home bakery, wholesale bakery or any other type of bakery.

What Is a Bakery Business Plan?

Why Do You Need a Business Plan?

If you’re looking to start a bakery or grow your existing bakery you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your bakery in order to improve your chances of success. Your bakery business plan is a living document that should be updated annually as your business grows and changes.

What Are the Sources of Funding for a Bakery?

Bakeries are usually funded through small business loans, personal savings, credit card financing and/or angel investors. This is true for a home bakery business plan too. This is true for a wholesale bakery business plan, a home bakery business plan and a commercial bakery.

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Other Helpful Business Plan Articles & Templates

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Bakery Business Plan

Ready to turn your love for baking baked goods into a successful business?

To ensure that your business endeavor happens to be a flourishing one, write a business plan specifically crafted for your unique bakery business.

From helping you finalize the bakery location to evaluating the financial position of your business- a detailed plan uncovers every detail essential to kickstart a successful bakery business.

Writing a business plan can get complicated. With this step-by-step guide, you will have all the information essential to write a bakery business plan . Also, download our free bakery business plan template and modify it to fit your needs.

Ready to dive in? Let’s get started.

Key Takeaways

• Conduct a detailed industry analysis of the bakery market to understand market trends, target market, and the growth scope of your business.
• Outline the business goals and devise a business strategy that is in line with your bakery’s branding image.
• Analyze the competitive landscape of your business and identify local businesses that will offer direct and indirect competition to your business.
• Make calculations, assumptions, and projections to form key reports such as income statement, balance sheet, Cash Flow statement, and Break-even analysis.
• Determine the operations of your bakery business by outlining the procedures, processes, and equipment required to kickstart the business.
• Determine the baked goods and services you will sell through your bakery business.

Why is a bakery business plan important?

A business plan helps achieve your business objectives by creating a roadmap that will guide your bakery business in a strategic direction. An actionable well-drafted plan offers an in-depth view of your business idea and are a few benefits you must know:

• A business plan instills clarity in your business idea. All the ideas that were messed up in your mind start getting a clear point of view once you start writing a plan.
• A business plan is your checklist to understand what different aspects of the business need- the resources, equipment, manpower, licenses, etc.
• It helps crystallize your business vision and what it aims to achieve in the bakery market.
• A business plan optimizes the bakery operations and brings down the operating expenses by ensuring the resourceful allocation of bakery resources.
• A plan evaluates the financial aspects and viability of your bakery idea before you actually invest money in the business.

And, of course, a well-crafted plan will get you essential funds to get started in the bakery market. Moving forward, let’s craft a spectacular plan for your bakery business.

How to Write a Bakery Business Plan: A Complete Guide

From writing an executive summary to creating your financial plan- let’s decode the key elements of writing a business plan.

1. Get a business plan template

Before you start writing a business plan, consider getting a sample template to simplify the entire plan writing process.

A lot of information goes into writing a comprehensive business plan. Addressing all the key components in brief details is a challenging task.

However, by using a template, you can add structure to your plan. Not only that, it will help you organize the information clearly in a cohesive manner. With appropriate prompts, you will know exactly what to write in each section.

We know you would start searching for a template. Well, the Upmetrics business planning template is perfectly relevant and suited for your bakery business. It’s intuitive, modern, and available for free download.

Need Assistance Writing a Bakery Business Plan?

Get Upmetrics’ business plan template, import data directly into the editor, and start editing using Upmetrics AI Assistant.

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2. Write an executive summary

The executive summary is a concise description of your entire bakery business plan. It highlights the key findings and entices the reader to delve further into your business plan. So make sure to keep it interesting.

A well-drafted executive summary includes an answer to every question, a potential investor might have.

For instance,

• What is the core objective of your bakery business?
• What are the pain points of your target customers and what solutions can you offer?
• What type of baked goods will you offer?
• What is your target market?
• What is your marketing strategy?
• What are the financial highlights of your bakery business?

As you start writing, remember that the executive summary should summarize the plan and not your business idea.

Lastly, fit your compelling summary description in 1-2 pages.

3. Conduct a competitive and market analysis

The market analysis section paints a clear picture of your ideal target market, bakery industry trends, and your competitors in the market. In a way, this section is your chance to validate the potential success of your bakery shop.

The market analysis section of your bakery plan must include:

Market share, growth potential, and industry trends

Identify your targeted available market (TAM) through thorough market research and determine your share in the bakery market. Analyze the emerging trends in the bakery market and assess your growth potential as a retail bakery.

Understanding of the target market 

Who will be your potential customer at a bakery shop?

It gets much easier to succeed in the market when you have a clear understanding of who your target customers are.

In this section of customer analysis, you will create a buyer’s persona of your ideal customer by understanding their psychographic and demographic details.

Competitor analysis

This is an equally important part of the market study, where you evaluate the position and competitive landscape of your bakery shop.

Begin by identifying your top competitors and evaluate your strengths, weaknesses, opportunities, and threats against other bakeries. Establish your competitive edge and show the potential investors that your business stands a promising opportunity in the competitive market.

Want to Perform Competitive Analysis for your Business?

Discover your competition’s secrets effortlessly with our user-friendly and Free Competitor Analysis Generator!

4. Prepare a company overview

The company overview section of a bakery’s business plan is a brief description of your bakery business concept, its legal structure, location, and value proposition.

Be creative and write a compelling section that can propel the readers’ interest in your business idea.

Wondering what to include in your bakery’s company overview section? Let’s check:

• Type of bakery business: retail bakery, specialty bakery, cloud bakery, mobile bakery, etc.
• Business structure: Sole proprietorship, LLC, partnership LLC, corporation, etc.
• Mission statement
• Value proposition
• Quantifiable business goals and milestones
• History and background of the bakery, if applicable
• Partnership and ownership structure
• Name of owners/ partners
• Operating hours
• Service style

Drill down to details and make this section an engaging read.

5. Describe your products and services

After describing your bakery structure and mission statement in the previous section, you will now outline the product and service offerings of your bakery shop.

As a bakery business, you may sell a variety of delicious baked goods such as pastries, cakes, fresh bread, cookies, tarts, pies, donuts, sweet buns, etc. Add this to your product section and also non-baked goods such as savory snacks, coffee, etc, if it’s on your menu offering.

Specifically mention, if you will have products for special diets, i.e. gluten-free, keto-friendly, sugar-free, vegan baked goods, etc.

6. Bakery store design and layout

An effective bakery business plan must include a blueprint of your bakery shop’s layout and design to demonstrate the bakery’s concept practically to the readers.

Mention your bakery size and the space allocated for the back of the house and front of the house operations. Also, explain how the proposed layout will increase the efficiency of your business operations in great detail.

In this section, you will also talk about the decor and theme that will create a warm ambiance for your target audience. Keep in mind that the decor should reflect the branding image you want to create in your target market.

Offer an immersive experience to the readers while explaining this section.

7. Prepare a bakery marketing plan

The marketing plan offers a detailed outlook of marketing strategies you will use to market and promote your bakery shop. Consider it as a roadmap that will guide you in building a brand of sustainable value in the market.

So how do you build a perfect marketing plan?

Begin by identifying the marketing channels and different types of digital marketing campaigns that will work best for your potential customers. Now, allocate the monthly budget to different marketing activities. Lastly, devise a marketing strategy for each channel with a clear plan of action.

Here are a few marketing strategies that are popularly used by successful bakery businesses:

• Social media platforms for brand development
• Email marketing for promotional offers
• Video content such as easy baking recipes, tips, tricks, etc
• Online workshops and live sessions
• Influencer marketing
• Tasting events and sampling
• Customer testimonials

Now detail all your plans in this section and show your investors that you have a solid way to establish your business’s popularity in its target market.

8. Outline your organizational structure

In this section of your bakery business plan, you introduce the management team and employees at your shop. Also, highlight the organizational structure and hierarchy of employees in the organization.

Begin by introducing the owners and their role in your organization. Highlight their experience in the bakery industry and the key skills that can benefit the business.

Introduce your talented baker and their role in recipe development and standardization. Show their experience in the baking field and prove their asset worthiness.

Draw a clear flowchart depicting the flow of authority and responsibility in your bakery business. It is your chance to show the investors that you have a team and knack to take this business on a successful path.

9. Create a logistics and operational plan

The operations plan of your bakery business plan is a strategic document highlighting the processes, procedures, and resources needed to efficiently run your bakery shop.

A well-planned operations plan is like a business manual that has answers to all the questions one might have while running a bakery shop.

Wondering what to add to your operations plan? Well try to include answers to the following questions to make it detailed and comprehensive:

• Physical facilities: What will be your bakery location to produce bakery goods? Will you serve customers from that location or a different shop? Are you planning to sell the bakery goods online?
• Suppliers: Where will you get the raw materials and supplies for producing bakery goods? Who will supply non-bakery items like scones, sandwiches, and savory snacks?
• Inventory: Where will you store the raw material and ingredients? What will be the shelf life of these ingredients? How will you manage the stock levels? What are the minimum thresholds for different items and how long it takes to stock them?
• Production: Who will bake the goods? How long is the process? Will everything be made fresh or in batches to be stored for a few days? Will there be recipe cost cards for each menu item? How will you meet an unexpected spike in demand?
• Bakery Equipment: What type of bakery equipment will you require? Will there be a POS system at your store? What other technologies will you use? How will you take online orders?

The amount of precision here will help you regulate your operating expenses once the bakery starts serving the customers. Proper planning is advisable at this stage.

10. Create a Financial Plan

And now comes the most exciting part for investors- a financial plan. The figures in financial statements are helpful in determining the viability of your business idea. So this section holds a considerable weightage in terms of whether you will get funding or not.

To ensure you create a comprehensive financial plan, including financial projections for these key components:

• Cost of starting a bakery shop
• Sales forecast
• Revenue projection
• Operating expenses
• Pricing strategy
• Income statement/ Profit & Loss statement
• Break-even analysis
• Cash flow statement
• Balance sheet
• Business ratios

In this section, you will also evaluate your funding requirements and identify the funding sources for your business. i.e. bank loans, SBA-guaranteed loans, angel investors, and personal savings.

Having realistic financial projections at hand will help you realize your financial goals while evaluating the sustainability of your bakery business.

However, creating the projections for all these elements from scratch can get overwhelming. Additionally,  you also need to work on visuals and graphs to add impact and clarity to your plan.

Well, there is an easy way. Create your plan with the Upmetrics Financial forecasting tool . This tool will generate key reports and visuals that can be easily downloaded and added to your plan.

We hope this sample plan will guide you in writing a perfect business plan. Now, let’s move forward and check the industry trends ruling the bakery world.

Bakery Industry Highlights 2023

Before you open a bakery, here are some latest highlights from the bakery industry, you may find helpful:

• Bakery market size: The US bakery market size was valued at $99.47 billion dollars in 2023. It is projected to grow at a CAGR of 2.08% between 2023-2028.
• Retail Bakeries: According to IBIS World , there are 8,780 independent retail bakery shops in the US.
• Bakery consumption: In 2022, Americans consumed 8.6 billion kilograms of cake and pastry goods, a sizable amount compared to other countries.
• Bakery trends: There is a growing trend of providing healthier alternatives, i.e. gluten-free baked goods in the bakery market. The organic and gluten-free baked goods market grew by 2.45% in 2022.
• Market Saturation: 55% of commercial bakery revenue in the US is generated by 3 major players- Grupo Bimbo, Flower Foods, and Campbell Soup.
• Specialty bakery market: The US Specialty bakery market share is expected to grow by 10.54 billion US dollars by 2026.

Download a sample Bakery business plan

Need help writing your own bakery business plan? Well, download our bakery business plan pdf and write your plan section-by-section with utmost precision.

Upmetrics templates are perfectly suited for entrepreneurs who need a little help to kickstart their business planning. Import the data into the editor and start planning.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

Write your business plan with Upmetrics

Optimize your business planning with Upmetrics .

With more than 400+ business plan examples , we offer invaluable guidance to help you write a cohesive business plan.

Whether you are writing a business plan to strategically grow your business or attract investors, Upmetrics’ invaluable resources like AI assistance, forecasting tools, and step-by-step guides will serve you perfectly.

Let’s bake a recipe for success together.

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Frequently asked questions, what should be included in a bakery business plan.

An effective bakery business plan must include:

• Executive summary
• Business overview
• Industry and competitors analysis
• Bakery goods and services
• Bakery design and layout
• Operations plan
• Key management team
• Financial bakery plan

How long should my bakery business plan be?

A bakery business plan should be not more than 15-20 pages including graphs, visuals, and charts. You are likely to lose the interest of investors with a lengthy plan. However, keeping it extremely short is also not favorable, as it would not cover important details. So try using crisp content for your business plan.

Can a bakery business plan template help in setting clear business objectives and goals?

Absolutely yes. A template offers a variety of prompts that will help you to write each section clearly and cohesively. Moreover, you will get a variety of bakery-specific examples that shall help in clearly determining your goals and objectives.

Do I need to have financial projections in my bakery business plan?

Yes, financial projections are important to assess the viability and profitability of your business idea. If you are planning to seek investor funds, this section is of crucial importance. Investors will evaluate the financial section and determine whether to invest or not.

Can I use the same bakery business plan template for different locations?

Yes, you can. However, you need to alter the content of your business plan for different locations and target markets by making specific modifications.

About the Author

Vinay Kevadiya

Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more

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Bakeries bring joy and convenience to their communities, but the customers aren’t the only ones who will benefit from this small business. The owner has a lot to gain too. Imagine calling a kitchen filled with tasty treats your office. Starting a bakery will be hard work, but fun at the same time. With equal parts passion and elbow grease, you can start a business that has customers lined up around the block waiting for a chance to try your delicious treats. This guide on how to start a bakery will help you figure out how to get your business off the ground.

How to start a bakery in 12 steps

Once you have the recipes chosen and perfected, you'll need to focus on some of the other elements associated with starting a bakery: picking the right location, create an inviting atmosphere and learning to manage your finances. Let’s learn more about these aspects.

1. Choose a bakery format

There are multiple bakery formats that you can choose from. There are even some options without the overhead startup costs of a pricey store location. These are a few bakery formats worth considering, but feel free to get creative.

Counter style. This format is the most typical and recognizable format of a bakery, and it has its benefits. Very little space is required in the front of the bakery if you simply offer a counter that customers can order from. (Of course, you’ll still need space in the back for your kitchen.) Usually, there is no dining space, which keeps this type of bakery a lean and efficient operation. But this format does limit your options for serving food and keeping customers on-site where they might order more food and drinks over time.

Bakery and cafe hybrid. This option has plenty of seating for customers, which can allow you the space you need to serve meals if you want to expand past baked goods. Even if you don't, you can still add seating if you want to encourage customers to stick around for a while. You may want to add coffee or tea to the menu, as well. Plus, if you offer comfy seats and free Wi-Fi, you’ll likely find success amongst the working crowd.

Food truck. Starting a food truck is a cost-effective venue for opening a bakery and can help you reach a variety of customers. Take your baked goods along for the ride and park your food trucks at street fairs, by offices and at special events. Generally, you won’t have the space to bake in the truck. But you can easily pack up your truck with baked goods you made in your home or commercial kitchen space.

Home bakery: Not ready to make the leap into renting spaces or buying industrial-sized equipment? Keep things simple and opt to start a bakery from home instead. You’ll require less startup capital and can easily sell your goods online, at local farmers markets, or offer catering services . You may even be able to make deals with local coffee shops or cafes to sell your goods in their locations by offering them a cut of the profits.

» MORE: Best food truck financing options

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

2. Write a business plan

Writing a bakery business plan is hard work, but it’s a step that will help guide you and provide focus. A business plan can also show stakeholders, such as investors, lenders and potential partners, where your business is heading.

A strong business plan will provide you with a structure to organize your ideas, plans, goals, services or products, financial plans and operational structure. Although you'll want to customize your business plan to suit your needs, it should generally contain the following information:

Executive summary . The executive summary should outline your business’s purpose, where it currently stands, where you see your business in three to five years and why your business will succeed.

Market analysis . Here, you’ll share an in-depth analysis of your industry, market and competitors.

Products and services . Provide a detailed look at exactly what your business will be selling. When you're starting a bakery, this section can look at your menu and how the bakery format you chose in the first step will serve your customers.

Marketing and sales plan . Explain how you’ll market and sell your bakery to customers.

Financial plan and projections . You should provide at least three years of financial projections as well as any financial data from your business’s past performance. You’ll want to prove that you have a plan to take your bakery from an idea to a profitable enterprise.

All in all, your bakery business plan will be a lot of information to pull together, but completing this document will ensure that you have a strategy to develop and grow your business.

Choose a Business Entity

As you’re writing your bakery business plan, particularly the business organization section, the question of how you plan to structure your business will likely come up. Choosing a business entity is an important step to starting a bakery (or any business). You may want to consult a business attorney, accountant or another resource to help you decide what type of business entity to form, as this decision will affect your taxes, legal responsibilities and more.

To start, you might consider one of the following most common types of business entities:

Sole proprietorship. Unincorporated business that either has one owner or is jointly owned by a married couple.

General partnership. Unincorporated business with multiple owners.

Limited liability company. Also known as an LLC; registered business with limited liability for all of its members.

Corporation. Incorporated business; most common types being an S corporation or C corporation.

Choose a Business Name

You may have already decided on a business name , but if you haven’t yet, now is the time. Once you have an idea of what you’d like your business name to be, you'll need to make sure it hasn’t already been taken by another business.

A quick Google search should be your first step. You can also search for trademark filings with the U.S. Patent and Trademark Office. Finally, a secretary of state business search will uncover if another business in your state is operating under your dream name.

If your budget permits, you can also hire an attorney to do this research on your behalf. You’ll save a lot of time and have some added peace of mind that you are legally safe to move forward with the name of your choice.

3. Find the right location

The next step in learning how to start a bakery is narrowing down your search for the right business location . If you’re opening a brick-and-mortar location, finding a commercial real estate agent who specializes in finding business spaces for purchase or rent can make your search much easier. Try to find someone who primarily assists the tenants, not the landlords, with the rental process.

You’ll want to make sure your agent has years of experience in your chosen community — that way, they’ll know what fair prices are and the best locations. They may even be able to help you find a restaurant lease that comes with some of the required bakery equipment like large refrigerators or ovens. Make sure the space you rent comes with plenty of room to store equipment and extra baking supplies.

If you’re more interested in the food truck route, you won’t need a real estate agent to help you with that. There are specialty car dealers online and in person that sell food trucks and trucks that can be adapted into food trucks.

To get a better deal, you may want to search for a used food truck on websites like Craigslist. Or, you might ask your local food truck owners, they may be looking to sell their own truck or know of other owners who are.

4. Get the appropriate licenses and permits

Each state will have different regulations, so you must check with your local government to see what business licenses and permits you’ll need to start a bakery in your area.

Even your city or county may require specific business licenses and permits. You should review the government websites for your state, county and city to make sure you have all the documentation you need. Your needs will vary depending on what type of bakery you start, but you may encounter the following licenses and permits when starting your bakery:

Sales privilege license. If you're opening a retail location, you’ll probably need a sales privilege license. This type of license will be necessary to sell your goods in a retail format. This allows your company to collect your state’s sales tax alongside what your goods cost.

Food handler's license. Any business that handles food will need a food handler’s license or a food and safety certificate. You will need to prove that you have the proper knowledge regarding food handling and storage. The owner will need this license as will any employees who assist in the cooking of your baked goods.

Catering license. If you choose to pursue a catering-style bakery business, then you may need a catering or food vendor license. This generally applies if you make the food yourself and deliver it, not if you prepare the food in the client’s kitchen.

Kitchen health and safety inspection. Any kitchen space will need to pass a health and safety inspection in order to be properly certified. Researching these rules is especially important if you want to learn how to start a bakery from home.

Zoning laws and permits. If you’re running a bakery out of residential space, you’ll want to review your local zoning laws to see if you can operate a business out of your home. In this case, other permits may be necessary. For example, a permit may be required if anyone is coming to your home to pick up food.

Homeowner association rules. If you want to start a bakery from home, you’ll need to check the homeowner association rules and regulations first to make sure that operating a business out of your home is allowed. This is more commonly an issue that affects those who live in townhomes or condos.

4. Register for taxes and obtain an EIN

All businesses have varying tax, licensing and employer requirements. Learning about these requirements before you start a bakery will help you avoid costly and time-consuming mistakes. Your chosen business entity, as well as some other factors, will affect the business taxes you’ll be responsible for paying. If you haven’t already, it’s a good idea to consult a tax professional to make sure you’re aware of your tax responsibility and on track to file the appropriate paperwork on time.

If you plan on hiring employees to help you run your bakery, you’ll also need to apply for an employer identification number , also known as an EIN or business tax ID number. You can do this through the IRS and this number will be used when filing your business’s income tax return or payroll tax return, as well as when you’re opening a business bank account, credit card or filing for a business loan.

Even if you don’t need to obtain an EIN — sole proprietorships and single-member LLCs without employees are the only businesses that don’t — there are still benefits of getting an EIN you should consider.

6. Brand your bakery

Finish this sentence: Break me off a piece of that…. You know exactly which crunchy candy bar goes with that song, right? Well, that’s because of branding. Good branding is key. The colors, logos, music, taglines and packaging can all tell your bakery’s story to the world.

There is no reason your bakery can’t make a splash thanks to some solid business branding. These are the following areas where you can start planning your bakery’s branding:

Color scheme.

Social media.

Product names.

Ask yourself, what story do you want your brand to tell? Then use that story to guide each of your branding decisions. Your story should be unique.

You want a name and logo that is immediately recognizable. The same goes for your decor and packaging.

Establishing social media pages for your bakery is also crucial to getting the word out about your new business while building your brand at the same time.

7. Separate your business finances

Starting a bakery can feel like a very personal affair, but you should do your best to separate your business and personal finances. One of the best ways to do this is by opening a business bank account. For some businesses, this step may be legally required.

When you open your business bank account, you’ll have to decide if you want a business checking or a business savings account. Usually, new businesses will be best served by a business checking account. Businesses that are more established, and have plenty of cash on hand, will probably prefer a business savings account so their money can grow with interest.

Either way, it's best to have some form of a business bank account to keep your business finances organized and running smoothly. The last thing you need to worry about is confusing your personal expenses with your business ones come tax season.

Another way to help keep your business and personal expenses separate is to obtain a business credit card . While you have several options available to you, you may also consider a business credit card with a 0% introductory annual percentage rate offer, which can be particularly helpful to cover any initial startup costs of your bakery. Keep in mind, though, you will need to make sure you have a plan to pay off your balance by the time the introductory offer ends for this to be a beneficial tool.

8. Secure business funding

Starting a bakery can be an expensive endeavor, so you should first find an answer to the following question: How much does it cost to start a bakery?

The answer will vary based on your location, type of bakery and required equipment, but you need to find a rough answer so you can plan your funding options accordingly. If you need help financing your new bakery, consider the following options:

Startup business loans. Finding funding as a new business can be difficult, which is where startup business loans come in. These can be anything from an SBA microloan to a small business grant. It’s worth noting that SBA loans are the most coveted funding option for their low interest rates and long repayment terms. While traditional SBA loans aren’t easy to qualify for — especially as a new business — the SBA microloan program can be a good alternative.

Business line of credit. With a business line of credit , you’ll have access to a maximum credit limit that you can borrow against for any business expenses. You’ll only pay interest on the amount of capital that you borrow from your credit line, and you don’t need great credit to qualify, which makes them appealing for new businesses.

Equipment financing. Bakeries require a lot of equipment, so you may want to consider equipment financing to help with the upfront costs. And since the equipment will serve as collateral on the loan, they are also easier to qualify for than some other funding options.

9. Decide on your menu

Remember the cronut? The combination of a donut and a croissant created by the famed Dominique Ansel, owner of Dominique Ansel Bakery in New York City, was so popular that people would line up around the block to try to get one. A few years later, however, the cronut isn’t exactly making headlines anymore — which is why it was smart for Ansel to also sell other baked goods, including classic favorites.

When figuring out how to start a bakery and make your menu, keep Ansel in mind. It’s OK to set and follow trends, as long as you're known for having some reliable staples available too.

That way, when everyone is over the latest trend, they know they can still come to you for their favorite classics. Ansel now has multiple bakery locations in New York, Los Angeles and London and sells new inventions (like frozen s’mores) and timeless baked goods.

10. Obtain bakery equipment

To turn your bakery into a legitimate, profitable business, you'll need commercial-grade bakery equipment to help you churn out all those baked items out without your tools breaking down in the process.

What equipment is needed to start a bakery? You may need to obtain:

Decorating tools.

Sheet pan rack.

Refrigerator.

Holding cabinets.

11. Price your products

When you're trying to price your food products, it's important to remember that pricing is determined by your expenses, operating costs, taxes and the market. To calculate the pricing of your baked goods, therefore, you’ll first need to figure out your monthly business operating costs. This will help you calculate how much you’ll need to make to cover the total cost to run your business.

Then, you’ll have to divide your production costs and overhead costs into your operating costs. Production costs take everything into account that’s needed to produce your baked items, such as ingredients and equipment. Overhead costs are expenses that are not direct costs — think advertising, accounting, labor, etc.

Once you’ve figured out your breakeven point and the production costs per baked good, you’ll be able to come up with pricing. For example, let’s say you own a cupcake business and it costs you $2,000 a month to operate your bakery. You project to sell 250 cupcakes per month.

To figure out how much you should charge per cupcake, you can divide the number of projected cupcakes into your monthly operating costs. If you divide 2,000 by 250 you should get eight. This means you should be charging $8 per cupcake just to cover overhead expenses.

Now, let’s factor in production costs. Let’s say each cupcake costs you $5 to produce. Add this cost to the minimum cost to cover your operating expenses (eight plus five) and you should get $13, which represents the minimum amount you should charge to cover your total operating expenses.

You can then decide how much profit you want to make and add that to the price of each baked good.

12. Set the atmosphere

The last step in learning how to start a bakery is customizing your space. If you choose to go with a storefront or cafe-style bakery, it’s time to amp up the atmosphere.

When it comes to the atmosphere, there are a few tricks of the trade that will help you create a successful bakery. For example, put your most eye-catching baked goods (like those fancy frosted cakes) at eye level in your display shelf. Less exciting staples like bread can take up some of the space on the lower levels of your display or behind the counter.

When you're setting the atmosphere, creating a good first impression is key. Just like a well-designed restaurant has a stellar entrance area, find a way to make that tempting freshly baked cookie smell waft into the entryway of your bakery.

Similarly, you can invest in plush couches, cozy decor and oversized coffee mugs. Make sure your customers feel at home. As the owner, get to know your customers. It’s important to train all of your staff members to be equally friendly. And of course, a free sample or two never hurts.

This article originally appeared on JustBusiness, a subsidiary of NerdWallet.

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Do you have a knack for baking? Special bread or dessert recipes that your friends and family are always chatting excitedly about? Ever wanted to open your own bakery but just don’t know where to start?

Check out these sample bakery business plans and get inspired to start building your own bakery today. You can also read our comprehensive guide on how to write a bakery business plan .

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• How to Write a Bakery Business Plan

Tyler Martinez Author

Tyler Martinez

Business Plan for Bakeries Guide

Do you live for the smell of freshly baked bread or the endless buttery flakes of a homemade croissant? Have you perfected your family's baklava recipe? Perhaps you’d like to start a bakery and share your happiness with a base of hungry customers. 

While many avenues of the restaurant industry are highly competitive, there seems to be infinite space in the market for pastries, desserts, and bread. When people need a treat, they need a treat — and they often flock to bakeries to get one. 

Baked goods can be created from only a few ingredients, but they require masterful technique. Baking the perfect loaf of miche, frying churros to perfection, and building a perfectly set and balanced French entremet can take years of practice.

Once you've figured out what kind of bakery you'd like to bring to life, it's time to get down to brass tacks and write your bakery business plan. 

Why You Need a Bakery Business Plan

Bakeries are usually fairly specialized operations – they focus on morning pastries, desserts, doughnuts, bread, cakes, pies, vegan baked goods, bagels, cookies, or even cupcakes. A business plan is crucial for opening a new bakery to assess the market and match the baker’s skills and talents to an opening in your local area. 

Some bakeries require little overhead and start-up costs, and many small bakeries operate on a skeleton staff of the owner and an assistant or two, but operations can range up to full-scale industrial bakeries that supply loaves and pastries to grocers nationwide. Defining your place in that vast market is part of the goal of a business plan — as is helping you seek out funding, and creating a roadmap to guide you on the long and complicated process of starting a business.

How to Write Bakery Business Plan (Description, Examples, Proposals)

Business plans tend to be formulaic, as they're meant to convey a fairly specific set of information to whoever's reading it — often potential investors. That's why this bakery business plan template can be such a helpful tool for imagining and planning your bakery. 

Download a customizable version of the business plan template below and read on to learn more about how to make it work for your bakery.

Related Restaurant Resources

• Bakery Business Plan Executive Summary
• Bakery Financial Plan
• Bakery Operations Plan
• Bakery Industry Market Analysis
• Bakery Management Team

Bakery Business Plan Template

Use this free bakery business plan template to easily create a great business plan that organizes your vision and helps you start, grow, or raise funding for your bakery.

Elements of a Bakery Business Plan

Bakery plan executive summary.

As the first section of your business plan, the executive summary is your prime opportunity to make a great impression with a concise summary of your bakery’s concept. An executive summary introduces key elements of your business plan like an overview of the budget, the business’s mission, market, and core values. It’s also a chance to communicate your full vision for your bakery’s products and services.

The kind of bakery you're opening will determine the type of funding you are seeking and the potential investors you attract – consider the audience of your business plan and how you might persuade them to keep reading and potentially invest.

Company Overview

The company overview and executive summary work together to provide a quick look at your business plan, but the company overview is more practical than attention-grabbing. It works as a glossary for the rest of your business plan by defining the products, information about ownership and the company structure, and your vision for the customer experience.

Consider including information about the jobs your bakery will create and your beliefs about labor and hiring practices, the location of your bakery, and the style of service – will your bakery be a counter service dining room or a house of made-to-order custom confections?

This is also a good opportunity to introduce the aesthetic vision of your bakery to stakeholders – paint a picture with architectural mock-ups, a color palette, logo design, and a description of the ambiance of your bakery. Is it a cozy spot to have an intricate dessert after dinner or a minimalist grab-and-go for bagels and coffee? Let the readers know.

Team and Management

Baked goods are often labor-intensive and require specialized ovens, surfaces, and equipment to prepare, bake, decorate, and sell. As such, bakers are highly-skilled workers that have an exclusive and desirable skill set — and your bakery will only be as good as your baker’s skills.

This is why it’s crucial for your business plan to include information about the management and team structure of your bakery. If you are the baker and business owner, consider what roles you will need to fill and who to hire to help you run your business, or if you plan to run an individual or family business.

Some bakeries have storefronts while others deliver custom orders directly to the customer – how you plan to deliver your baked treats to your customers might require you to hire additional staff. Others employ dozens of bakers to produce large quantities of consistent treats and how you plan to train, delegate, and compensate those workers is important as well.

Don’t forget to include information about who will be creating marketing and publicity for the bakery – will you market your business, hire a marketing professional or firm, or hire a manager that can market your business in addition to their other duties?

Consider including information about what kind of jobs you plan to create, whether they are full-time or part-time, how you will hire or train skilled bakers or chefs, and what kind of benefits you plan to offer.

Sample Menu

While you might want to avoid writing down any intellectual property related to your great-grandmother’s croissant method, a sample menu is a crucial part of your bakery’s business plan because, so often, the concept and the product for a bakery are closely aligned.

Your sample menu provides a lot of information to partners and investors and prompts you to start thinking about some of the finer details of your business. Consider how you will make and deliver your products and what specialized and potential costly equipment for large-scale production and storage are required. 

For instance, will you require a large deep fryer for doughnuts and fritters, or a 55-gallon stand mixer for large batches of dough, icing, and meringue? On the other end, have you begun to budget for the things like food-safe gloves and delicate decoration tools that your bakery might regularly require? 

Beyond being a valuable asset to the information you provide potential investors, building a sample menu is a good exercise for ensuring that your business plan is airtight before you present it to banks or partners.

Restaurant Menu Templates

Use these menu templates as a starting point for your menu design or to give your menus a refresh.

Market Analysis

Unlike some other types of restaurants, bakeries often compete with other bakeries that don’t provide a similar product or experience. Consider the customer’s options in your market when choosing a bakery to patronize in a situation – whether seeking breakfast bagels, intricate pastries and coffee, a full boulangerie, catered desserts, or other complex confections.

As such, your market analysis should include how you plan to attract a segment of the customers seeking the goods, services, or combination that you plan to provide – how will you compete with or stand apart from the grocery store bakeries or the other donut stands in your area?

Completing a market analysis will be as productive for you as it is informative for your investors by revealing opportunities to enter an opening in the market and make the best of that opening.

Marketing and Publicity

Planning a marketing and publicity strategy will flow naturally from finding an opening in your market to enter. Use your market analysis as a stepping stone for your marketing and publicity plan

Opening a bakery is a good chance to capitalize on the intrigue and hype that a “grand opening” event can generate. The best customer of a bakery is the loyal, regular customer — people have strong affinities for specific baked goods and will be loyal when they find a product that provides the sensory and emotional experience they’re seeking.

Word-of-mouth marketing from regular customers, especially if they are incentivized to talk about your bakery with a loyalty program or branded merch (strong tote bags work particularly well for carrying spoils from bread shops), is a valuable assertion of your bakery’s quality. 

Social media and online marketing are almost expected of restaurants these days and a concerted social media strategy can help to bring both local and tourist customers to your doors. Create your restaurant marketing plan in advance, and sum it up in this section.

Branded Graphics

One of the most exciting aspects of building a cohesive brand across your business plan is creating branded graphics that convey your brand’s concept to both potential investors and customers. Think about how you might represent the ethos of your bakery and the experiences that you plan to offer your customers through branded graphics and the design of the documents in your business plan.

Read this next

How to brand a restaurant: restaurant branding ideas and examples.

Learn how to market your restaurant and build a lovable restaurant brand.

Business Operations

The business operations section includes information about customer service, the point of sale , sales and inventory tracking, accounting, equipment, and the supply chain of the products on your menu. Consider the role you plan to play in the business – will you be executing are sourdough recipe perfects over a decade of practice or hiring the best natas makers you can find? 

Bakeries focus on baked goods, but they can offer a range of products and services in addition to delicious foods with intricate combinations of flavors and textures. Include detailed expectations of the customer experience in the business operations sections – how will you deliver or hand off your good to customers or collaborate with them to bring their confectionary imaginations to life? 

Also, you might consider in more depth in this section how you expect interactions between any staff you hire, and your customers will go. How will you train your staff to interact with customers and which staff members do you expect to handle which parts of the customer experience?

Cafe and Bakery POS Comparison Tool

A free, customizable Cafe and Bakery POS Comparison Tool to research and compare point of sale systems in one Excel spreadsheet or editable PDF.

Financing and Loans

If you are seeking to secure funding, have already secured partial funding, or have a plan to fund your bakery, it is crucial to include that information in your business plan. Provide potential investors with information about other investors and detailed financial plans about the projections of profit and expenses of your business.

Include information about how you expect investors to be involved with the business and any benefits they might incur by investing, such as discounts or access to menu previews.

For more information about finding funding for your bakery, check out The Complete Guide to Restaurant Financing and Loans , where we outline 11 different types of restaurant funding options.

The Complete Guide to Restaurant Financing and Loans

Whether you’re opening a new restaurant, expanding your concept, or renovating within your existing four-walls, you’re going to need capital to make it all happen.

Sales Forecasts and Operating Expenses

The operating expenses for a bakery include the costs of labor, insurance, products, supplies, rent, and more, and there might be supply chain or operations expenses that are unique to bakeries, such as the cost of importing quality chocolate or other global ingredients that are worthwhile to consider.

One common analysis to include in a business plan is a break-even analysis which compares how much sales are required to break even with the cost of expenses each month. Investors will be interested in the potential for profit and loss before they contribute to your business, but to produce a profit a loss statement for a restaurant that isn’t open yet will require some educated projections. 

A cash flow analysis details how you plan to spend on labor, supplies, and operations to show investors that the bakery can support itself without additional investments. Consider how the cost of supplies, labor, taxes, maintenance on equipment, cleaning supplies, and paper or plastic balance at the end of each fiscal quarter.

How to Present a Bakery Business Plan Sample

There are a few ways to prepare to communicate with investors about your business plan and get them interested. As you write and edit your plan, you’ll have become the world’s only expert on your bakery. Remember that the way you talk about your business should be tailored to the situation you find yourself in.

First, send your business plan to investors and banks far and wide – put your concept and plan in the hands and minds of as many people as possible. You can’t hear no (or yes!) unless you ask.

Perhaps you’re at a networking event for local small restaurant owners and financiers. You might want to have a 30-second elevator pitch prepared so that you can communicate everything you need to about your plan for a bakery quickly. Be sure to include something exciting or make an opportunity for questions to keep people talking.

Once you secure a meeting with a potential investor or partner, you’ll want a more detailed presentation that presents all the key elements of your business plan – for a bakery, that will likely include the products and services at the core of your business.

It’s good to anticipate potential questions and prepare answers for questions you encounter for the first time. When networking, be honest and genuine, even if you don’t have a ready answer for each question that comes your way – investors will be interested in your charisma and savvy just as much as your ability to build a detailed plan.

Related Bakery Resources

• How to Open a Bakery
• How Much Does it Cost to Open a Bakery
• Bakery Name Ideas
• Best Bakery Websites
• Bakery Marketing Ideas
• Bakery Branding
• Bakery Design Ideas
• Bakery Menu Ideas
• Bakery Licenses and Permits
• Bakery Equipment List
• Bakery Floor Plan
• Bakery Supplies

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How to Open a Bakery: Starting a Bakery Business Steps

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Unleash Your Inner Baker: How to Start a Bakery

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A bakery is a terrific business for people passionate about baking and wanting to become entrepreneurs.

Over the past fifteen years, our team has helped hundreds of entrepreneurs and small businesses in the United States and worldwide start and grow bakery businesses. This guide shares the actionable insights, tips, best practices, and expertise we’ve developed after helping over one hundred thousand brands.

If you’re considering starting a bakery , this comprehensive guide will help you understand the steps and essential factors to consider.

Why a bakery is a good business idea

A bakery can be a fulfilling business for many reasons, including the following:

• Creative expression. Operating a bakery provides an outlet for creativity. You can experiment with different recipes, designs, and flavors. A bakery’s products often reflect the creativity and passion of its bakers. And you don’t need to have a culinary degree to open a bakery. A patisserie may focus on creating ornate pastries inspired by French techniques, while an artisan bread bakery might experiment with ancient grains and unique sourdough starters.
• Healthy demand for fresh baked goods. People worldwide love fresh baked goods, and there is always a demand for quality products. A neighborhood bagel shop can become a morning staple for residents seeking a fresh start to their day. Similarly, a gluten-free bakery provides fresh, delicious options to those with dietary restrictions. My wife loves gluten-free bakeries, and we try to find unique ones when we travel in the U.S. or internationally.
• Community connection.  Bakeries often become integral parts of their communities. A family-run donut shop, for example, can become a cherished local institution where memories are made over sweet treats. A bakery cafe might serve as a community hub, allowing people to meet, work, and share ideas over coffee and pastries.
• Potential for growth and diversification. A thriving bakery has room to grow and diversify its offerings. A bakery that starts by specializing in wedding cakes can expand into custom cakes for all occasions, becoming a go-to resource for celebrations. Meanwhile, a small-town bakery known for its bread might expand into wholesale, supplying local restaurants and stores with high-quality bread.
• Rewarding work. Something is rewarding about providing people with comforting, delicious food. It’s why many people love the restaurant business. For example, a vegan bakery can take pride in offering plant-based alternatives that delight vegans and non-vegans alike and help those on a Paleo or similar diet. And a bakery that employs and empowers disadvantaged individuals in the community provides baked goods and a sense of purpose and social impact.

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The cons of owning a bakery

But don’t be fooled; a bakery business isn’t all sugar and spice. There are some less appetizing aspects you’ll need to consider:

• Demanding work hours. Operating a bakery often requires early mornings and long hours. However, different types of bakeries can navigate this challenge differently. For example, a bakery specializing in sourdough bread can use the long fermentation process to its advantage, baking in the off-hours. On the other hand, an online bakery could have more flexibility in baking and delivery times, allowing for a more balanced work schedule.
• High overhead costs. Equipment, ingredients, utilities, and staff wages can add up. But again, the type of bakery can influence these costs. A home-based bakery avoids the high rent of a retail location. A specialty bakery, such as a macaron shop, can limit overhead by focusing on a single product line, reducing the need for a wide range of ingredients and equipment.
• Intense competition. The bakery business is highly competitive. However, bakeries that carve out a unique niche can stand out. A bakery offering globally-inspired pastries can differentiate itself in a market full of traditional bakeries. Similarly, a bakery that caters to dietary restrictions, like a gluten-free or a keto bakery, can attract a dedicated customer base with limited options elsewhere.

How to Start a Bakery:

• Understanding your bakery concept and target market
• Developing a strong business plan and financial projections
• Setting up your legal structure and obtaining the necessary permits
• Calculating startup costs and funding your bakery
• Navigating bakery licenses, permits, and regulations
• Crafting your unique baked goods menu
• Securing necessary bakery equipment and suppliers
• Building a brand and marketing your bakery
• Choosing the perfect retail location for your bakery
• Sourcing quality ingredients for your baked goods
• Crafting the perfect pricing for your baked goods
• Hiring and training your staff
• Implementing efficient bakery operations and workflow
• Implementing a bakery marketing strategy

What you need to start your bakery

1. understanding your bakery concept and target market.

The first step in starting a bakery is defining your business idea and understanding your target market .

Your bakery could be a traditional brick-and-mortar shop, a bakery-café, or even a home-based or online bakery.

For example, a French patisserie would appeal to customers who appreciate fine pastries and European culinary traditions. A gluten-free bakery would cater to those with specific dietary needs (like Paleo) or those seeking healthier alternatives. Meanwhile, a local cupcake shop might focus on the community, creating custom cupcakes for birthdays, celebrations, and events.

2. Developing a strong business plan and financial projections

A strong business plan and solid financial projections are crucial for any business, including bakeries.

For example, a bakery focusing on wholesale would need a business plan that includes strategies for attracting clients like restaurants and grocery stores. A high-end pastry shop in a bustling city must account for higher overhead costs in its financial projections. A family-owned bakery in a small town would need to consider local demand and purchasing habits in its business plan.

3. Setting up your bakery’s legal structure and obtaining the necessary permits

The legal structure you choose for your bakery will affect your liability and taxes.

Different types of bakeries might choose different structures. For instance, a home-based bakery might start as a sole proprietorship, the simplest structure, offering complete control to the owner.

On the other hand, a bakery-café planning to expand to multiple locations might benefit from starting as an LLC or a corporation to limit the owners’ liability and facilitate potential investment.

Hire an expert to form your company and save time. Our trusted partners can help: Northwest ($39 + state fee) or Bizee ($199 + state fee) . We recommend Northwest. After evaluating the leading registration companies, Northwest stands out as our top choice due to its competitive pricing, exceptional customer support, and commitment to privacy. Pay just $39 + state fees and you'll get a free year of registered agent service, articles of organization, privacy, and client support from local experts.

Furthermore, each type of bakery will need to navigate local health department regulations and obtain necessary permits. A bakery truck , for example, would require a mobile food facility permit, while a brick-and-mortar bakery would need a retail food facility permit.

4. Calculating startup costs and funding your bakery

Starting a bakery involves several costs, from equipment and ingredients to marketing and staff wages. Plan on spending at least $25,000 to $50,000 on equipment and supplies and legal startup costs.

For example, a gourmet cupcake bakery might need high-end baking equipment to produce consistently perfect cupcakes and funding for branding and marketing to stand out in a crowded market. A small, local bakery might have lower equipment costs but need to budget for local advertising and customer relationship efforts. If self-funding isn’t an option, you might consider financing your bakery business via loans, investors, or even crowdfunding, depending on the type and scale of your bakery.

5. Navigating bakery licenses, permits, and regulations

Bakeries must navigate the necessary licenses, permits, and regulations , which vary by location and type of bakery.

A home-based bakery might need to comply with specific local or state food laws and home kitchen inspections. A bakery-café serving drinks and sandwiches would require a health department permit and potentially a liquor license. A bakery food truck would need a mobile food facility permit and must comply with various local and state regulations regarding food service vehicles.

6. Crafting your unique baked goods menu

Creating a unique menu is critical to setting your bakery apart. This means developing several signature items that customers can’t get anywhere else.

For instance, a vegan bakery could offer a variety of plant-based donuts that taste just as good, if not better, than traditional donuts. A bakery specializing in bread may use organic or locally sourced ingredients to create unique loaves. An artisanal bakery might feature a rotating menu of seasonal pastries and desserts highlighting local fruits and flavors (and my favorite, olive bread). A gluten-free bakery would need a menu of delicious, gluten-free treats to appeal to people with dietary restrictions or preferences. A bakery focusing on traditional bread would need various types, from basic loaves to artisan bread like sourdough or ciabatta.

7. Securing necessary bakery equipment and suppliers

Starting a bakery requires significant investment in professional-grade baking equipment and finding reliable suppliers. Although you can start baking at home, scaling your business typically requires commercial equipment and dedicated space.

For example, a bakery focusing on bagels would need a commercial-grade mixer for large batches of dough and a boiling station for the bagels. A specialty cake shop would need decorating tools and a variety of cake pans. A small home-based bakery would need to maximize efficiency in a smaller space, investing in multi-use equipment like a countertop convection oven and stand mixers.

Among other things, you’ll need to consider the following:

• Equipment for dough preparation: (commercial mixers, tables for kneading, dough sheeters, scales, and related equipment). You may also need refrigerators to store dough.
• Storage equipment: (shelving, racks, trucks, carts, dollies, etc.)
• Baking equipment: convection ovens, deck ovens if you plan to bake artisan products, and even revolving ovens if you plan to cook in volume and sell wholesale.
• Display and sales equipment: (refrigerated or unrefrigerated, depending on your needs, and boxes for baked goods).
• Small items: (bowls, storage boxes, knives, aprons, staff uniforms, etc.)
• Cleaning supplies: (gloves, chemicals, scrubbers, sponges, etc.)

8. Building a brand and marketing your bakery

Creating a unique and compelling brand is critical to differentiating your bakery in the market.

For instance, a vegan bakery might craft a brand around sustainability and animal welfare, appealing to eco-conscious consumers. A French patisserie might leverage traditional French recipes and baking techniques to build a brand that embodies authenticity and sophistication. A bakery that caters to celebrations and events could create a joyous, festive brand image . A bakery with a 1950s retro theme could use social media to showcase its vintage décor and unique dessert creations. A health-focused bakery might host baking classes or wellness events to engage with health-conscious customers. An online bakery specializing in cookie delivery could use targeted advertising and influencer collaborations to reach potential customers.

Remember, your brand is not just your bakery name , logo design , and tagline but includes your bakery’s atmosphere, customer service, packaging , and online presence.

9. Choosing the perfect retail location for your bakery

The location of your bakery can significantly impact your success.

The right location depends on your bakery’s concept and target market. For example, a bakery specializing in grab-and-go breakfast items might thrive in a busy downtown area where commuters can quickly pick up something on their way to work. However, the trend toward remote work can make a downtown-based bakery tricky.

Some of my favorite bakeries have been destination bakeries that were globally known for one or two unique items. A destination bakery, famous for its decadent pastries, might do well even off the beaten path, where customers are willing to travel for their unique offerings. An online bakery, however, would need a suitable space for baking, packing, and shipping rather than a customer-facing storefront.

10. Sourcing quality ingredients for your baked goods

Sourcing quality ingredients is essential for any bakery.

The type of bakery and your menu will determine what ingredients you need. For instance, an organic bakery must source organic flour, sugars, and other baking ingredients. A chocolate-focused bakery might invest in premium chocolates from renowned chocolate makers. A local-focused bakery might prioritize sourcing fresh fruits, dairy, and other ingredients from local farmers and suppliers.

11. Crafting the perfect pricing for your baked goods

Finding that sweet spot for your bakery item pricing isn’t just about the numbers—it’s culinary art!

It’s about blending your expenses, operating costs, taxes, and the market temperature into a perfect recipe.

Kick things off by calculating your monthly business operating costs. An exact number will help you determine what it takes to keep the bakery lights on.

Next, calculate your production and overhead costs. The production costs are all about the ingredients that go into your baked masterpieces and the necessary equipment. Overhead costs include advertising, accounting, labor, and more.

Now comes the moment of truth—calculating your breakeven point and the production costs per baked good. This will give you a pretty clear idea about pricing.

Imagine you run a cupcake business that costs you $2,000 monthly to keep the ovens hot and the lights on. You plan to sell 250 cupcakes each month.

To determine the price per cupcake, divide your monthly operating costs by the number of cupcakes. In this case, 2,000 divided by 250 gives you eight. So, $8 per cupcake is your magic number to cover overhead expenses.

But we’re not done yet.

Let’s add in the production costs. Suppose each delicious cupcake costs you $5 to whip up. Add this to the minimum cost to cover your operating expenses (eight plus five), and you have $13. This is the rock-bottom price you need to cover all your operating expenses. Selling cupcakes for even a penny less means starting a business guaranteed to lose money.

Finally, add on your desired profit margin to arrive at the final price of each baked good.

It’s a delicate balancing act, but with some practice and patience, you’ll master it—just like your favorite recipe!

12. Hiring and training your staff

Hiring and training staff is a critical step in starting your bakery.

The size and type of your bakery will determine the kind of staff you need. For example, a small home-based bakery might start with just one or two people, with the owner handling baking and administrative tasks.

A large bakery-café might need several bakers, baristas, and customer service staff. A bread-focused bakery might need to hire and train staff on specific techniques for kneading and shaping bread.

13. Implementing efficient bakery operations and workflow

Finally, creating an efficient bakery operation and workflow is critical to running a successful bakery. This includes everything from ingredient preparation, baking, cleaning, customer service, and managing orders.

For example, a bakery specializing in custom-order wedding cakes would need a clear workflow for consulting with clients, designing, baking, and delivering cakes. A busy bakery café must have efficient systems for managing rush-hour customer traffic. A bakery with various offerings may need a detailed production schedule to ensure all items are prepared and available when needed.

14. Implementing a bakery marketing strategy

A well-planned marketing strategy can help your bakery attract customers and build a loyal following.

For instance, a bakery with a unique concept, like a dog bakery making gourmet dog treats, might leverage social media to reach dog lovers nationwide.

A neighborhood bakery might focus on local SEO , community events, and partnerships with local businesses . An upscale bakery might invest in professional photography for a stunning website and high-end print advertisements.

Your marketing strategy should align with your brand and speak to your target customers.

Starting a bakery is rewarding but requires careful planning, hard work, and a passion for baking.

Remember, your bakery is not just about selling bread; it’s about creating an experience that leaves customers returning for more.

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• Business Insurance

Directors And Officers (D&O) Insurance For Small Business

Updated: Dec 21, 2023, 11:29am

Your company’s decision-makers set the goals and strategies for the business. But without the proper type of business insurance, your company’s individual officers could be exposed to financial losses if they’re sued for a decision they made on the company’s behalf.

For example, accusations of mismanaged funds or a bad investment could lead to a lawsuit.

To get the best small business insurance , you may need to buy directors and officers (D&O) insurance. It’s a good way to retain leaders, cover legal fees and attract investment opportunities.

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What Is Directors and Officers Liability Insurance?

Directors and officers insurance protects the people who serve as directors and officers of a company if they’re sued by employees, customers, vendors or others. It can cover defense costs, a settlement and other expenses that arise out of the lawsuit.

What Does Directors and Officers Insurance Cover?

Directors and officers insurance can help your company if the directors and officers are accused of wrongdoings such as:

• Causing a financial loss or bankruptcy
• Failure to comply with workplace laws
• Misrepresentation of company assets
• Theft of intellectual property
• Slander, libel and copyright infringement
• Mismanaged funds
• Discrimination against an employee

What Does Directors and Officers Insurance Not Cover?

Directors and officers insurance doesn’t cover everything. Here are examples of problems a policy commonly excludes:

• Illegal acts or illegal profits
• Personal profiting
• Pending and prior litigation
• Prior claims
• Bodily injury
• Property damage

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Three Types of Directors and Officers Liability Insurance

Here’s a look at the three types of coverage typically included in a D&O policy.

1. A-side Coverage

This part of coverage will protect the individual assets of directors and officers when there are costs that the business itself does not have to pay, which could include defense costs.

2. B-side Coverage

This part is known as corporate reimbursement, and it covers a business when it has to pay defense costs and legal settlements for directors and officers.

3. C-side Coverage

This part of the coverage is known as entity coverage and helps when a business is named in a lawsuit along with directors and officers. This type of coverage protects a business when there are direct claims made against it.

Who Needs Directors and Officers Liability Insurance?

Any business, public or private, with a board of directors may benefit from having directors and officers insurance.

Lawsuits targeting directors and officers are becoming more common. Without D&O insurance, the company’s assets and the personal assets of the directors and officers are at risk.

In addition, directors and officers insurance protects the personal assets of spouses of a director or officer. These assets could also be at risk in a lawsuit.

To attract and retain qualified executives and board members, a company needs to have a D&O insurance policy in place. An estimated 70% or more of all directors and officers have asked about the amount of their organizations’ directors and officers coverage, according to Travelers. Having a solid directors and officers liability insurance policy is one way to attract potential board members to a company.

D&O insurance may also help you attract investors. Some private equity and venture capital firms may require D&O coverage before they will invest in a company.

How Much Does Directors And Officers Insurance Cost?

The median cost of directors and officers insurance is $1,240 per year , according to Insureon. Your D&O costs will depend on several factors, such as:

• The business’s amount of debt
• Claims history
• Company revenues
• Policy limits
• Type of business

How to Get the Best Directors And Officers Liability Insurance

To get the best rates on a D&O policy, get quotes from several insurance companies. Be sure to work with an insurance professional who is knowledgeable about D&O coverage.

Read the D&O policy carefully and make sure you understand the coverage you are buying. Once you have a directors and officers policy in place, you’ll be able to reach out to potential board members and officers that you are looking to attract to your company.

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As a former claims handler and fraud investigator, Jason Metz has worked on a multitude of complex and multifaceted claims. The insurance industry can be seemingly opaque, and Jason enjoys breaking down confusing terms and products to help others make well-informed decisions.

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Business Insurance FAQ

Additional resources, business insurance.

Last Updated: March 27, 2024, 2:07 pm by TRUiC Team

Small businesses need insurance to protect themselves from a variety of risks, including natural disasters and lawsuits from employees and customers.

We'll help you find the right types of business insurance to fit your needs (and your budget).

Recommended: Next Insurance  is dedicated to matching small businesses with the right policies at the best price.

Insurance companies use several factors to calculate your monthly premium. Some of the well-known aspects include: 

• Type of coverage
• Number of employees
• Geographical location of your business
• Financial stability 
• Existing safety and security features of your building, equipment, and/or vehicles

It’s estimated that small businesses pay anywhere from $14–$124/month for any one kind of insurance coverage. 

Affordability is an important factor in choosing business insurance — take a look at our low-cost business insurance guide to learn more about pricing. Below is a chart that shows you the average cost of popular types of coverage:

Sources: AdvisorSmith, The Hartford, Hiscox, and Insureon

Compare Quotes Online

Use our dedicated small business insurance provider to generate a quick and accurate online quote created specifically for your small business.

Types of Business Insurance

The type of insurance your business needs will depend on what you do and the size of your business.

A good first line of defense — or rather, if you only were to choose one policy — then it should be general liability insurance . General liability will help protect your business against the most common risks like personal injury and property damage.

Other types of business insurance include:

Business Owner's Policy

Workers' Compensation Insurance

Commercial Property Insurance

Commercial Auto Insurance

Umbrella Insurance

Professional Liability Insurance

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Small Business Insurance by State

Business Insurance requirements can vary state by state. When looking at what business insurance you will need, as well as those that are highly recommended, be sure to familiarize yourself with your state’s requirements. Check out our guide on Business Insurance Requirements by State .

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What is covered by business insurance?

Business insurance covers businesses from losses that can happen in the natural course of doing business. This can come from various situations, like property damage, lawsuits, loss of business income, bodily injury, fire, and more.

What you choose to get covered depends on your industry and the different types of policies you choose to take on for your business.

Do I really need business insurance?

Businesses need insurance for several reasons. Depending on the state they operate in, businesses may be required to get specific types of insurance like workers’ compensation . 

In addition to this, some businesses may refuse to work with you unless you carry your own insurance, as they do not want to assume the risks and liability for your work on their own insurance.

When do I get business insurance?

You should get business insurance when you start your business, especially if you plan to start doing business right away. This way, you can be protected from the very beginning from any lawsuits, property damages, costs associated with bodily injury, and anything else that could happen to your business.

How much should business insurance cost?

The cost of business insurance for a small business is typically between $700 and $3,800 a year, but this depends greatly on what types of insurance your business needs.

We recommend doing some research into the risks faced by your business and getting a business insurance quote from a trusted source.

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I tried 10 desserts from Costco, and there are 7 I'd buy again

• I'm trying to review all of the desserts from Costco's bakery  section. 
• The Kirkland Signature cheesecake and vanilla cake with cheesecake layer are amazing. 
• I wasn't a fan of Costco's strawberries-and-cream bar cake but the tuxedo one was good. 

Costco is having a pretty great year.

On Thursday, the company reported that sales hit $57.39 billion in the third fiscal quarter of 2024, an increase compared to the same period last year. And although unique items like gold bars and faux trees are to thank, so is Costco's private label, Kirkland Signature .

Kirkland Signature product sales sometimes make up a quarter of the chain's revenue — and this includes the sweets coming out of Costco bakeries.

Recently, I headed straight to the wholesale retailer's bakery section to try all the made-in-house desserts I could find.

Here's how they stacked up and which ones are actually worth buying.

Costco's classic cheesecake seems ready to be customized.

Costco's 12-inch cheesecake is a staple in the warehouse's cakes and pies section.

Although $19 is a good price for such a big cheesecake, it's still tied for the most expensive item I purchased.

The texture was so soft that my slice fell apart as I plated it.

I liked that this cheesecake wasn't dense. Instead, it was incredibly fluffy with a texture that reminded me of a soufflé.

It was so light that it started to fall apart when I pulled a slice onto my plate. The taste made up for the messy slice — this cheesecake was super creamy and not overly sweet, with a slight tanginess to balance its flavors.

I can't wait to try it again with fresh fruit.

The chain's new banana cream pie caught my eye with its caramel drizzle.

The banana cream pie is a fairly new dessert at Costco, and when I visited, there weren't many left at my store.

It was about as big as the other cakes in this section, which are 10 inches, and cost $16.

This pie blew me away.

The pie had a good balance of flavors and textures. The crunchy graham-cracker crust held together well and added a contrast to all the creamy layers.

I liked that the banana pudding had a natural taste, not an artificial one. The caramel on top added some depth in flavor, but it was subtle.

I wish there had been more caramel, and I think I'd slice some fresh banana on top for serving next time, but overall this was one of my favorite desserts from Costco .

The chocolate-covered strawberries were available at a discount.

The chocolate-covered strawberries were in their own little cooler toward the front of the bakery section, and they were marked down from $13 to $6.

I went to Costco one day after Mother's Day, so I assumed these were leftovers from the holiday. Some of the strawberries looked a little worse for wear, but I managed to find some that didn't look past their prime.

I couldn't taste much of the strawberries in these.

The strawberries selected for this dessert were impressively big, yet they were no match for all of the chocolate they were dipped and drizzled in.

With each bite, I only tasted the rich, hardened chocolate, despite how ripe and juicy the berries were. I'd probably skip these in the future.

Costco's strawberries-and-cream bar cake has an impressive presentation.

Although this dessert was tied for the most expensive dessert I tried at $19, it was well worth that price based on presentation alone.

It has really pretty layers of strawberries, cream, and vanilla cake, plus striped white-chocolate decorations on top.

This cake seems to be a seasonal one that Costco sometimes brings back in the summer months.

The cake was just too sweet for my liking.

I wished this one tasted as good as it looked. I expected it to be sweet — it is dessert, after all — but this cake was too overly sweet to me.

I think it would've had more balanced flavors if it had a little less strawberry filling and thicker layers of cream.

The tuxedo chocolate-mousse cake was another gorgeous dessert.

Like the strawberries-and-cream cake, the tuxedo cake is a long, rectangular layer cake with a pretty design and white-chocolate decorations on top.

I loved the look of this $18 cake and thought it was the most attractive dessert I purchased.

The fudgy bits were my favorite part of the whole cake.

This dessert is extremely rich and dense, with chocolate in mousse, ganache, and cake forms.

There were fudgy, brownie-like pieces between the layers of mousse and they ended up being my favorite part of the dessert.

I'd like more of the vanilla mousse filling to balance out all of the chocolate, and I'd probably serve this with some strawberries for a fresh element, but this is a tasty and impressive dessert I would buy again.

A bakery staple, the chocolate-chunk cookies come in a pack of 24.

The chocolate-chunk cookies are a staple in the bakery section of Costco. I got 24 cookies for just $10, and I thought they'd be perfect to pick up for a potluck or other gathering.

They looked great, too — they seemed soft with some crispness on the edges.

The cookies had good flavor, but they need to be eaten with milk.

Although I prefer baking my own cookies when my sweet tooth strikes, these were a fine alternative.

The cookie was soft without falling apart, and I liked that the chocolate had a strong, sharp flavor to cut through the sweetness of the cookie.

However, these cookies were a little dry, so if I bought them again, I'd also get milk to serve them with.

What I thought were cupcakes from afar were actually some very fudgy "mini cakes."

In the bakery section, I saw a pack of what looked like six cupcakes, but once I got closer, I realized they were pretty large cupcakes or "mini cakes."

The Mini All-American Cakes are seasonal, and a few packs were available during my shopping trip to Costco.

One cake in each pack had a red frosting heart. Most of the packs had the red frosting stuck to the container, but I did find one package with an unblemished frosting heart.

Every mini cake included a generous portion of super fudgy frosting on top, and the pack of six cost $9.

Despite the cute name, this was one intense dessert.

I thought the tuxedo chocolate-mousse cake was chocolaty, but these mini cakes put that dessert to shame in terms of chocolate flavor.

It was so intense and rich I could only take one bite, and the chocolate flavor lingered for a long time in my mouth.

These mini cakes are best shared, and I'd need a lot of milk to finish even half of one. In the future, I'd skip these and instead grab a full-size chocolate cake.

The 10-inch chocolate cake was available in multiple different designs.

The 10-inch chocolate cake with chocolate mousse was available in a few different designs — no personalization needed.

There was a plain option, a birthday option, and a really cute springtime design with floral frosting decorations, which is what I ended up selecting.

This massive cake, which had light cutting guidelines for 16 slices in the frosting, was $16.

The mousse filling helped balance out the rich chocolate cake and frosting.

Although the chocolate cake and the mini cakes are similar, the chocolate mousse layer in the full-size cake added a much-needed lighter, creamy element to balance out the fudgy icing and rich cake.

Because of the added mousse, I'd be more likely to buy this cake again, even though I wasn't a huge fan of the mini cakes.

Costco's lemon-blueberry loaf looked great.

Costco's 2-pound lemon-blueberry loaf hit shelves around springtime.

The loaves looked incredible, with heaps of crumble topping and an icing drizzle all over. It also seemed like a good deal at $9.

This dessert offered bright flavors and a range of different textures.

I cut out a slice and was happy to see blueberries toward the top and middle of the loaf — they hadn't all sunk to the bottom.

The loaf itself was light and spongy with a good lemon flavor, which paired well with the chewy blueberries and crunchy crumble topping. I'd happily buy this dessert again, and I'd love to try it warmed with a scoop of vanilla ice cream on the side.

Costco improves on classic vanilla cake by adding a cheesecake layer inside.

I love vanilla cake and cheesecake, so I was particularly intrigued by Costco's 10-inch white cake filled with vanilla-cheesecake mousse.

The entire cake seemed like a great deal, too, at $16. It had a wavy frosting design that could easily be personalized with a message.

This cake was one of the best desserts I tried.

This was an instant favorite of mine, and I knew right away I'd buy it again for any celebrations I have coming up.

The cake was so light it reminded me of angel-food cake, and the cheesecake was rich, a little dense, and creamy. The thin frosting layer on top was just the right amount to keep the cake from being overly sweet.

It would be even better with fresh fruit on top.

There are only a few Costco desserts I'd skip during my future shopping trips.

All in all, I'd buy seven of these 10 desserts again.

There's a tie for my favorite between the banana cream pie and the white cake with vanilla-cheesecake mousse.

I'd skip the chocolate-covered strawberries, strawberries-and-cream bar cake, and the Mini All-American Cakes.

Of course, regardless of which desserts I'd buy again, I'd make sure to get them when I plan to be with friends or family because most of them were massive.

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WGS 84 coordinate reference system is the latest revision of the World Geodetic System, which is used in mapping and navigation, including GPS satellite navigation system (the Global Positioning System).

Geographic coordinates (latitude and longitude) define a position on the Earth’s surface. Coordinates are angular units. The canonical form of latitude and longitude representation uses degrees (°), minutes (′), and seconds (″). GPS systems widely use coordinates in degrees and decimal minutes, or in decimal degrees.

Latitude varies from −90° to 90°. The latitude of the Equator is 0°; the latitude of the South Pole is −90°; the latitude of the North Pole is 90°. Positive latitude values correspond to the geographic locations north of the Equator (abbrev. N). Negative latitude values correspond to the geographic locations south of the Equator (abbrev. S).

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UTM or Universal Transverse Mercator coordinate system divides the Earth’s surface into 60 longitudinal zones. The coordinates of a location within each zone are defined as a planar coordinate pair related to the intersection of the equator and the zone’s central meridian, and measured in meters.

Elevation above sea level is a measure of a geographic location’s height. We are using the global digital elevation model GTOPO30 .

Elektrostal , Moscow Oblast, Russia

CT’s minimum wage increase poses challenges for small business owners

When Connecticut’s minimum wage rose on Jan. 1 from $15 an hour to $15.69, it was good news for many workers. But for small business owners, the increase — the first in a series that will be tied to wage growth calculated by the federal government — has created concerns for the future.

The growth in the minimum wage has far-reaching implications for small businesses, said Haley Adams, owner of Hale’s Barbershop in Coventry.

“I would love to be able to provide full-time employment to every employee that I have, but I cannot because I simply couldn’t afford to pay them a full-time wage at $15.69 an hour without guaranteeing that I could get clients in the door for them,” Adams said.

“I work full time at my own business in order to supplement my income enough to provide for my employees as well as paying my own personal and business bills and taxes,” she explained.

Adams said she often worries about losing business because of the size and scale of her work.

“I don’t have the kind of business that I can replace with a kiosk,” she said. “A hands-on business like mine, where you have to work one-on-one with a person, it affects me more greatly. I have a small child. It makes you worry about if you are able to continue to provide for them and give them the life they want.”

Hale’s Barbershop is in a busy area that was once successful for small businesses owners. But now, only half of the storefronts are occupied.

Cheryl Preston, the owner of A Cupcake for Later , a bakery on Main Street in Willimantic, opened her shop 13 years ago, and has seen and felt the numerous increase-of-living costs.

She currently pays her workers more than minimum wage, but says increases still affect her.

“It gets frustrating because the people that are screaming for more money are the very people who are also screaming that you're paying $5 for a cupcake. Again, you can't have it both ways,” Preston said. “You can't get a price increase or a raise and not expect prices to go up because how does that business owner make up for the difference?”

Preston said she had to increase her prices last year, and it’s a consideration that is always in the back of her mind.

For Preston, the state’s annual increase of the minimum wage is frustrating for a different reason: It’s a raise not tied to merit.

“By just increasing minimum wage, it makes people lazy. Because all they think of is, ‘It doesn't matter, I'm going to get a raise anyway,’ or, ‘It doesn't matter, I'm going to make this much money anyway,’ because they don't have to try,” Preston said.

Preston would like to see state lawmakers consider that the profits generated by small businesses are far from that of big corporations.

“What I feel the state should be doing is the big-box companies, Walmart, Stop & Shop, those big companies that make a ton of profit, those are the ones who should have a minimum wage, not necessarily a small mom-and-pop business that can't afford it,” she said, adding that lawmakers should focus on rent control or car prices or gas costs rather than minimum wage.

At The Hoot gift store in Mansfield, owner Lisa Chesmer had several concerns about her business since the minimum wage increase in January. Reducing staff at The Hoot has been a consideration.

“It makes you be careful about how much, how many people you do have on. So we do pay close attention to busy times or slow times,” she said. “Right now, I say business has been good, so we haven’t had to really worry about that yet."

Christmas is the busiest season at The Hoot, so Chesmer typically hires more people in September. Now, everything must be weighed carefully in advance.

“Payroll is one we are careful about: How many we hire and when we hire them,” she said.

Connecticut lawmakers this session declined to pass a bill that would have eliminated the state’s tipped wage, which is prevalent in food service. Since 2017, the tipped wage has stood at $6.38 for wait staff and $8.23 for bartenders.

Peter Weeden, the general manager of Square Peg Pizzeria Storrs , has still experienced changes in operation since the minimum wage increase.

“For example, you have a server, slow day, there's no guests or very little guests. They don't make enough to cover their minimum wage. We take the difference, say, $3 more an hour, $4 more an hour in order to get up to the $15.69,” Weeden said. “You can never pay under the minimum wage. You can pay more, but you cannot pay less."

Even with the increase in minimum wage, prices have remained consistent at the Storrs branch of Square Peg Pizzeria.

“We have not had the need here to raise prices to accommodate the minimum wage yet,” Weeden said.

As a business in a college town, Weeden has had to do a little bit of everything to keep business strong and customers coming.

“I’ve had to be more hands-on as opposed to being just a manager. You know, talking to guests and taking care of the guests. We cook, we host, we do all sorts of different things that we would normally have other people in that paid position,” Weeden said.

On Main Street in Manchester, a warm atmosphere welcomes guests as they enter Penny’s Place , a breakfast-and-lunch restaurant owned by Penny Braga.

Braga says she has not drawn a paycheck since the business opened two years ago and has been forced to change her style of business. Braga says eight months ago, she paid servers $15 per hour, but to save money, resorted to paying them the lower tipped minimum wage. Now servers are paid $8.50 per hour plus tips.

While the new hourly wage for servers did cut some costs at Penny’s Place, Braga says she noticed a drop in new employees’ work ethic. After a month of training, she says she’d notice they didn’t carry out their job responsibilities and frequently would make the same mistakes on orders, which cost her more money at the end of the day.

“I would love to have a couple of part-timers in here; I’ve given up,” Braga said. “We look for help, we get somebody in here, they last a month.”

Connecticut’s minimum wage was $1.25 when Joseph Grimaldi opened the Manchester Tailor Shop in 1964.

Nevertheless he says the minimum wage is not a livable income now compared to 60 years ago.

Back then, Grimaldi recalled, he was able to live off the $400 a week the tailor shop would make. Now, earning at most $700 a week, Grimaldi said that’s why he still works at 90 years old — it’s not enough to cover all of his expenses.

“As a matter of fact, sometimes people say, ‘You still charge that kind of price?’ Which means I’m happy where I am. … What do I want to do? Take advantage of people to put an extra $50 in my pocket? It doesn’t work because those poor people can’t afford it,” Grimaldi said.

Recently, Grimaldi has had to raise the shop prices slightly to at least break even. However, he stressed the importance of not raising prices substantially because it would cost businesses their customers.

Pranay “Pete” Shah, owner of Pete’s Package Store , has been located in the same building in Manchester since 1995.

Before 2019, Shah’s business was a convenience store. Back then, it was easier to make a profit for a convenience store but it became a “dying business” as time went on, he said.

Shah said prospective employees are seeking higher pay. On top of this he believes some employees lack the drive to complete job responsibilities such as stocking shelves and need constant reminders.

Elsewhere in Manchester, The Firestone Art Studio & Café has hired more than 50 employees.

Danielle Pachkovsky, the general manager of both The Firestone Art Studio and The Claypen, works closely with the owner, Sophia Dzialo, when determining the day-to-day operations of both businesses.

Two years before the minimum wage hit $15 per hour, The Firestone Art Studio’s hiring wage was already at that level, Pachkovsky said. Prior to this, both Pachkovsky and Dzialo sat down and made a spreadsheet of their sales and labor goals to figure out how this could be done.

In addition, Pachkovsky and Dzialo use “sales forecasting” data from the previous year to determine what the current year's busiest days will be to schedule more or fewer employees on each given day. This lessens the chance of starting the day with a negative number, Pachkovsky said.

“This is the way of the future, it’s the way it’s going to be. But we also have to be realistic as a small business that it’s not easy to increase the minimum wage. But it is a necessary future that we all have to be able to handle,” Pachkovsky said.

The minimum wage will continue to rise each year because it’s based on the federal government's Employment Cost Index , which tracks workers' pay and benefits. But it’s hard to forecast how much it will increase and what it will look like for small businesses.

As business owners deal with changing times, the minimum wage is a challenge we “have to face and meet head on,” Pachkovsky said

Ilana Stollman, the director of retail operations of the Mark Twain House & Museum gift shop in Hartford, has also seen the impact of the minimum wage increase. The business plan for a nonprofit organization like the Twain House is different than for-profit outlets.

Once a minimum wage increase is announced, it disrupts the nonprofit budget, which needs to be reconfigured.

“I have mixed feelings about it because I know from a budgetary standpoint, it's difficult for a nonprofit to do,” Stollman said. “We're not making money. We're just here to support the museum.”

However, not every business has the possibility to finance increases as easily.

“We just tighten our belts and try and make it work. Trying to spend less, trying to … get higher sales, higher margins,” she said.

So far, watching expenses carefully and raising the price on some items have been enough, but there's no guarantee of finances in the next few months or years. The minimum wage increase is hard to manage when businesses already face important increases in everything from electricity to the cost of goods and transportation.

“I understand both sides because I believe people should earn a living wage. But I also know the reality of our business at the moment,” Stollman said. “If we had more funding, that could be changed. But until and unless we're getting more money to support the museum, I only have what I have.”

The increase in minimum wage also affects the cost of visiting the museum. Not every family can afford to visit the museum and that has a negative impact on opening culture to all. Stollman said she would like the government to provide more funding without nonprofits having to compete with other nonprofits.

“It's not just like you knock on the door and say, ‘Hey, we need some help.’ There's a lot of competition, there are a lot of nonprofits, and we're all looking for the same dollars,” she said.

Learn more The indexed minimum wage puts CT ahead of the region. Here's how it happened and what it means.

Maïna Durafour, Matt Corpuz and Kaily Martinez are journalism students at the University of Connecticut. This story is republished via  CT Community News , a service of the Connecticut Student Journalism Collaborative, an organization sponsored by journalism departments at college and university campuses across the state.

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