I've been decorating for 8 years, and all the time it's been as a hobby. This year I decided to start the business and I checked all the regulations and I need a commercial kitchen. I'm going to rent the old kitchen of my son's school....they are charging $50 for 4 hours....for me sounds to expensive but I don't know..... I haven't been able to find another option in the area....I am in Missouri...Any suggestion will be deeply appreciated!!
O.k... Knowing you're going to put at least 15 hours of work into a wedding cake not including the time it's going to take to cool between the baking and crumb coating phases, plus washing dishes time.. If you take $250 from each cake and apply it towards a loan payment, figuring after the first three years you'll be making about 30 cakes/year if you want to keep things "small"... That's $7500/year to pay on the loan... If it costs you $50,000-60,000 for remodeling a space with some used, some new equipment, in 10-15 years you'll have it all paid off.
The lessons learned in hindsight on renting space from someone else...
1) You need a contract! I got told on a Tuesday I needed to be out today if possible, and had 5 truckloads worth of equipment stored there... and a competition cake due that weekend. Thankfully it was a competition cake and not a cake for a customer.
2) You need it spelled out what you can and can't use or do. Will they let you store your cakes there overnight??? Do you need to haul equipment in/out daily? Are they going to charge you extra for things like water/chemical use? Are you charged for your cleaning up time? How is the four hours figured (what happens if you go 1 minute over the first 4)??? You've got to have everything spelled out to Cover Thy Buns!!!
3) Considering the cost of equipment and rent is going to start making you look at the hard numbers for what it's going to take for you in terms of minimum orders to make this work. I'm a firm believer in the reality that drive gets you nowhere, action does. There have been many cake businesses that have failed over the years because of good decorators not being good at running a business. It's a challenge to have that balance between the creative and the analytical minds.
4) Before you delve into business be sure to study up on the lessons from other bakers... Have your cake contracts ready to go even for the small orders, have your responses to the bride that wants the Margaret Braun on a Beer Budget, the bride that thinks her Walmart cake is cheap (not if she figures out the portion size!!!), etc.
5) Practice these phrases to save your sanity before you take even your first order and not only set your niche in the market but also keep your business alive:
"No Money No Cakey"
"Sure you can add servings (2 days before the wedding) but I need the (Cash!)money for it today"
"I am not in competition with Walmart, or any big box retailer, or the baker up the road, my cakes are individually made for the order, I do not have the buying power of a big corporation or bakery so need to charge what I am worth to stay in business, my time is worth money, I am not a slave, I get paid to work."
"I am my own competition, I get paid what I am worth, just because the bakery up the road only charges half of what I do doesn't bother me, they have a business model that works for them, my customers are paying for my time and individualized service that they cannot get from the bakery up the road"
"If it's out of my skill level, it's O.K. to tell the customer and charge the heck out of it if they still want it"
"An emergency on YOUR part does not constitute an emergency on MY part!"
"All checks are due 4 weeks prior to the event, all payments after that shall be in cash, paypal, or credit card"..
"I'd be happy to roll delivery into the cost of the cake for an additional $.34/serving!"
"I will not undercut the baker up the road just to get an order, my time and materials are worth my going rate"
"When in doubt, TRUST MY INSTINCTS!!!!"
"(if you want a weekend off) I'm already booked up solid that weekend"
"It is far easier to move from $3.50/slice to $5.00/slice than it is to move from $1.50/slice to $2.50/slice... Position yourself where you are worth, the customers WILL come!"
Couture, you are awesome!!!
mrscake, take a good look at your pricing. If you are selling cakes for $50, then you will go in the red because you'll pay more than that for the use of the kitchen. That's why many of us have a minimum dollar amount before we even turn on the oven.
Don't fall into the trap of "how can I add $50 to the price of the cake to cover the kitchen ... people won't pay that!" kind of thinking. The use of the kitchen is just as much a part of the cost-of-the-cake as the eggs and flour. ADD IT IN.
I'm going to rent the old kitchen of my son's school....they are charging $50 for 4 hours....for me sounds to expensive but I don't know!
$50/4 hours sounds like a steal to me. I pay about $17/hour to sublet commercial kitchen space where I'm at right now in the SF Bay Area. (Where everything is obnoxiously expensive anyway...)
Some things to use to evaluate commercial space:
* What tools/equipment are available to you? How many tools/equip do you have to buy and bring in on your own?
* Do you get permanent storage space in their kitchen?
* Do you get 'fridge space to store cakes/perishables?
* Are you charged for "extras" like part of the utilities or cleaning/porter fees?
* How clean is the kitchen? Any recent health department problems?
* Do you get set hours when the kitchen is available to you? Are these hours convenient for your business?
* Who else uses the kitchen? What do they use it for?
* Will you be the only person in the kitchen when you're working or will you have to share it during business hours?
* Do they require you to have your own insurance? (Many insurance companies won't cover the kitchen if they sub-let their space.)
* Will YOUR insurance cover you if you're subletting space in someone else's kitchen?
Thanks all for the replies. Couture you are wonderful, you make me think about it for several days. Every tip is really helpful. I got minimum price for working and also I went to the appointment to see the kitchen with a list of question s!!
I appreciate the tips and the time that you expend answering me.