Sorry, I know I just posted a business question but I've got another one...
For those of you in the business...do you find that you are making a pretty good return on your initial investment or are you just breaking even and doing it because "I love what I do"?
I'm just starting out and pretty scared about the future of the business. I know forecasting and planning has a lot to do with it but I just want to hear some input and see if anyone sees a GREAT return for their effort!
I'm supporting myself and the business.
I wouldn't waste my life on something that wouldn't give me a profit....
are you already in business?...or just thinking about it?
I have a home based cake business and I love doing what I do, but I think that if I didn't make a profit it wouldn't be a business, it would be just a hobby. Don't you think?
When you first open a business, there is normally a time period where you may not make profit while the business grows. But if, after a reasonable time period, you're just covering the expenses, then I agree with Solecito ... it's not a business, it's a hobby.
I heard Dave Ramsey say yesterday re: being in business: If you're not growing, you're dying.
Writing a biz plan is (what I considered) the required first step. It will tell you your costs and what it takes to cover those costs and then some. How many cake servings do you have to sell a month, a week, a day to cover the rent and utilities?
When I was a home baker, I was limited to the number of sales I could do because of my capacity. Same when I had to haul all of my stuff to another kitchen. After many steps along the way, I'm now in my own shop with double ovens and a 6-burner stove ... enabling me to accept many more bookings. In the first 4 months of this year, my sales are 150% of all of last year. My point is that when you contemplate spending money for more and bigger space/equipment, you must also factor your more and bigger capacity and your more and bigger ability to accept more orders.
Being nervous about moving forward is a good thing ... it shows that you already understand nothing is a given and you have to work hard, every single day, to make it happen.
It's all relative and what you do with it.
Cool, thanks for the advice everyone. I agree about making sure you do make a profit or it's just a hobby.
I agree that it does take work (which I am willing to do) and some good forecasting with the business plan.
I've read lots of great marketing tips from this site that I've been incorporating.
The biz just opened so I'll keep y'all posted on my progress.