Big Opportunity In The Horizon....what Advice Do You Have?

Business By Motta Updated 6 Feb 2010 , 4:08am by Kitagrl

Motta Posted 3 Feb 2010 , 4:12am
post #1 of 53

I saw an ad for a bakery for sale. It's already set up as a mainly wedding cake business (which is what I want to do). All the equipment is new. She'll give me all her recipes, client lists, pans, remaining product, etc. She said the business is doing well but she has to sell due to health reasons. THe price is reasonable considering I don't have to do anything but start baking and advertising - no investment in equipment. Other costs will be there, though. eg. insurance, etc.

I am extremely interested but I only have one year of decorating experience. I am confident I can make the cakes but I am worried about the time commitment in a new business. Plus, it would take me longer to make the cakes until I get improve.

Anyone with advice for me? Anyone just jump into a store front before?

52 replies
LaBellaFlor Posted 3 Feb 2010 , 4:14am
post #2 of 53

Research. And really think about the time commitment. Working in a bakery is not 9 to 5 hours. I used to have to be there at 4 in the morning sometimes...and I wasn't even the owner. As the owner, your looking at long hours.

CakeForte Posted 3 Feb 2010 , 4:18am
post #3 of 53

What kind of business experience do you have?? The act of cake decorating itself means jack squat if you don't have that.

Motta Posted 3 Feb 2010 , 4:31am
post #4 of 53

LaBellaFlor - yes, it's the time commitment that's my biggest obstacle.

Currently, the bakery is open M-F 10-5:30 and Sat 10-4. I would like to make it Mondays by appt only and keep the 10am opening time T-F. I want Sat to be 10-2pm only. Don't know if that's possible yet due to restrictions for businesses in that strip but that's a question I have.

CakeForte - I agree with you. I have years of retail business experience but the food service industry is new to me. I have approached the idea of cake design as a business from the start and I've read the E-myth. It's not enough but I want to have my eyes totally open so I don't just dream; it has to be viable. I have a young family to think about.

I honestly did not even consider a storefront for me but this opportunity is pretty sweet (no pun intended). I wonder if this situation would ever present itself again.

mandysue Posted 3 Feb 2010 , 4:39am
post #5 of 53

I don't know how you bakery owners do it. I daydream about trading my day job for a FT job at cake decorating....the rush of creating masterpieces all day long...but then I think, "Geez, I'd have to make a LOT of cakes to cover $1000 or whatever in rent each month!" And if I only made enough money to cover the expenses, what's the point? So, I keep churning out cakes from my kitchen and don't have to make so many that I hate it!

So, those are my thoughts, clear and concise, although they'd probably turn on a dime if I had the opportunity to buy a bakery!

Good luck, whatever YOU and your family decide!

this-mama-rocks Posted 3 Feb 2010 , 4:56am
post #6 of 53

Is a joint venture with the current owner a possibility? I think you need more time to see if this is a viable commitment for you, both financially and timewise.

I'm thinking you run/manage the place, while she remains a silent partner and gets a percentage. Or, you lease it from her for 6 months, then re-group with her and decide then.

Good luck!

Mensch Posted 3 Feb 2010 , 6:32am
post #7 of 53

I own a bakery. People always say, "Oh what a fun job, decorating cakes all day!"

Um, NOT!

I do NOT decorate cakes all day. The actual cake decorating takes up about 15% of my working day, the other 85% is everything else: baking, cleaning, customer care, cleaning, washing dishes, paperwork, cleaning, making cake boards, worrying about money/weather/insurance/employees, oh, and did I mention cleaning?

Mike1394 Posted 3 Feb 2010 , 6:58am
post #8 of 53

Ask to see her finacials for the last yr. If she isn't willing run away fast.

Mike

ayerim979 Posted 3 Feb 2010 , 8:00am
post #9 of 53
Quote:
Originally Posted by Mensch

I own a bakery. People always say, "Oh what a fun job, decorating cakes all day!"

Um, NOT!

I do NOT decorate cakes all day. The actual cake decorating takes up about 15% of my working day, the other 85% is everything else: baking, cleaning, customer care, cleaning, washing dishes, paperwork, cleaning, making cake boards, worrying about money/weather/insurance/employees, oh, and did I mention cleaning?




Its funny you mention that Mensch: People come up to my mom all the time and for some reason think she has a lot of money. And that shes living the great life worry free. My mom's like if they only knew.

It's so stressful that you end up hating it sometimes.

I believe that owning a business is very challenging mentally and physically and you have to be prepared for it. Because some customers may leave you speechless and you have to know how always think 1-2 steps ahead of them.


I wish you the best of luck and keep us posted.

indydebi Posted 3 Feb 2010 , 12:52pm
post #10 of 53
Quote:
Originally Posted by Motta

I have years of retail business experience but the food service industry is new to me.


What kind of experience? Working in retail is WAY different than owning a retail business. Working in retail is WAY different than working in the food industry. And owning a food industry is way different than anything else.

What is your experience in bookkeeping, purchasing, logistics, sales & marketing, human resource law, handling taxes, scheduling, advertising (I hated advertising decisions!) payroll, costing and price structures, etc? NOt sure what line of retail you were in, but I always use the example of "I don't sell shoes where people can impulse buy something they don't really need, nor can they return it so I can sell it the next week so I can sell it to someone else." Just in the way the product is handled is WAY different than retail.

As mentioned above, it can be scary knowing you have to make $1000's of cakes just to meet the rent. What kind of volume does your business plan say you need to meet and can you meet that?

Bonniecakes08 Posted 3 Feb 2010 , 1:54pm
post #11 of 53

[quote="indydebi"
As mentioned above, it can be scary knowing you have to make $1000's of cakes just to meet the rent. What kind of volume does your business plan say you need to meet and can you meet that?[/quote]

Indydebi I was hoping you would chime in here. I wanted to post this question a while ago, and now is a good time - When projecting sales on a business plan, what statistics are most important to determine if we can produce enough income to sustain a business - ie population of area, incomes, number of households? I have all the statistics, but now what? TIA

leah_s Posted 3 Feb 2010 , 2:14pm
post #12 of 53

health reasons could simply be "I'm sick of running this business."

Definitely see the financials.

Definitely write a detailed business plan.

Be prepared - seriously - to work 80 hours a week for the first year, 60 hours per week for the second year. Don't plan on vacations.

As others have said, being able to decorate is a small, small part of this business.

Can you fill out tax forms? Do you know what tax forms to fill out? How about permits? Can you build a website? Do you know how to advertise effectively? This business is more about business than decorating.

Bonniecakes08 Posted 4 Feb 2010 , 1:21am
post #13 of 53

Does anyone out there have any information about projecting income on a business plan?

ShopGrl1128 Posted 4 Feb 2010 , 1:50am
post #14 of 53
Quote:
Originally Posted by Mensch

I own a bakery. People always say, "Oh what a fun job, decorating cakes all day!"

Um, NOT!

I do NOT decorate cakes all day. The actual cake decorating takes up about 15% of my working day, the other 85% is everything else: baking, cleaning, customer care, cleaning, washing dishes, paperwork, cleaning, making cake boards, worrying about money/weather/insurance/employees, oh, and did I mention cleaning?




This is EXACTLY my life right now, I got up at 5:30am this morning and left the shop at 6:30pm, I forced myself to run out to Wendy's at 3:00pm to grab some lunch, I practically swallowed the whole thing.

I'm an-one woman show right now, and it's A LOT of work, physical work and mental work.
Yes, the cleaning part SUCKS, it takes me about 2 hours at the end of the day to clean my tiny shop, and I do dishes several times a day.

This week is brutal, I have 2- 4 tier cakes, 2-2 tier cakes and one 3D car+ 3 simple cakes I keep in a display case for last minute customers, It's a lot for me but I can't turn away business, I'm practically breaking even right now.

Remember, it's A LOT of work.

indydebi Posted 4 Feb 2010 , 2:32am
post #15 of 53
Quote:
Originally Posted by Bonniecakes08

Does anyone out there have any information about projecting income on a business plan?




Most projections are a shot in the dark, but you do need to start with some basic info.

If you email me your email address, I'll send you a copy of my biz plan, to give you an idea of the format and type of info.

EMAIL it, please. do not PM.

heavenlys Posted 4 Feb 2010 , 2:55am
post #16 of 53

Not to discourage people from chasing a dream but owning your own business is a HUGE commitment. You are responsible for everything. The business bills your bills payroll which then makes your responsible for others financial security.

I wear way more hats now than I did as legal homebaker. I love what I do but sometimes I don't like it. Cuz what comes with it is OVERWHELMING!

bills, solicitors, accounting, advertising, scheduling of staff, food orders, insurance, planning events, psychic (for the customers who forgot it was their kids 1st bday) organizer, maid, visionary, customer service, that is only a bit of what comes with it. And if you are lucky you get you get to occassionally get elbow deep on sugar and remember why you do it

snarkybaker Posted 4 Feb 2010 , 3:02am
post #17 of 53

Quoting myself:

Quote:
Quote:

If you post on this board, you are going to get an awful lot of " Hooray for you...follow your dream" type advice, but the truth of the matter is that you need to sit down and write a business plan. Do the math!!! Do the math!!! Do the math!!!

You can literally bankrupt yourself and ruin your family's finances for a good decade if you jump before you do the math and know what you are getting into.

95% of women-owned small businesses fail in the first 3 yrs. Even the venerable IndyDebi ended up closing her business ( which the SBA would consider a business "failure") inside that window. Now she was smart, and had a solid Plan B. Do you?

Unless you can spend about 70 plus hours running a business for the first couple of years, you really should either try to find a job decorating, or stay small enough to work out of your house. I'll bet money the cupcake baker is broke in 18 months. This isn't an easy business and no one here is doing you any favors by encouraging you without telling you to spend your time and money to open a food service business. The hours suck and the money isn't all that and a bag of chips for 95% of people in the industry.

Get a SCORE mentor, write up a business plan, try to get a bank loan for your business, and get back to me in 6 months. Then I can tell you whether or not opening a retail bakery is a good idea.




This woman is leaving the business for a reason. I suspect that if the business were really doing that well she could hire a decorator and do the books etc. herself and not give up a successful business that she probably worked very hard to build.

I suspect that her business is getting by, not thriving, and the cuts in hours you are talking about may very well cause the business to no longer be profitable. BUT DO THE MATH!!

Motta Posted 4 Feb 2010 , 3:16am
post #18 of 53

Well, if you meant to scare me....MISSION ACCOMPLISHED! icon_lol.gif

Actually, I'm not scared to learn whatever I need to run a business. I'm naturally curious and a fast learner so it's not an obstacle, in my opinion, to have not run a bakery before. I'm also the type to ask for help - accountants, lawyers, friends with businesses, etc. I even asked my aesthetician today who has owned her shop since she came to Canada from Poland 20 years ago with no previous business experience. Talk about gutsy.

Anyways, my point is that I can and will learn the business end. Your comments have really helped me realize this so far and I thank you all.

The 2 biggest problems I have are:

1. Can I do this with having two small children? I currently have their two Grandmas watching them while I work 3 days a week at my current job. I would be giving up time with my kids for the next 4 years until they are both in school full-time.

2. Is it truly a profitable venture? The financials will tell me more but, generally, is this a good business to get into? For those that own bakeries, is the money enough to keep you here? Are the profits enough to keep you motivated to continue being an owner/operator?

Deb_ Posted 4 Feb 2010 , 3:22am
post #19 of 53
Quote:
Originally Posted by Motta


I am extremely interested but I only have one year of decorating experience. I am confident I can make the cakes but I am worried about the time commitment in a new business. Plus, it would take me longer to make the cakes until I get improve.

Anyone with advice for me? Anyone just jump into a store front before?




I put in bold print 2 comments you made that are red flags to me.

I am being 100% honest with you when I say that I don't think 1 yr experience is nearly enough to jump into buying a bakery.

As others have said there is a HUGE difference between making a few cakes a week from home and buying a full fledged bakery.

As an owner of 2 businesses (1 of which I employ 12 people) I would advise you to step back from this and really think about what you'd be getting into.

You have to be ready to work a lot of hours to be successful. I'm ALWAYS the first one in and the last one out....you have to be willing to do that...it's not a 9 to 5 option.

I'd advise anyone who is considering purchasing a bakery or any other business for that matter, to take a few small business courses at your local community college.

Especially in today's economy, I would not just "jump into a store front", it's way too risky.

costumeczar Posted 4 Feb 2010 , 3:54am
post #20 of 53

You also need to keep in mind that the store hours aren't the only hours you'd be working. I have people asking me all the time if I'm going to open a shop, and although it's sometimes tempting I think of the 80-hour weeks and say "no way." Especially with two little kids who aren't even in school yet, I think you should weigh the time commitment very carefully (not that you aren't, I'm just saying!)

vicki3336 Posted 4 Feb 2010 , 3:56am
post #21 of 53

Please take a moment (okay a LOT of moments) to think about what is truly important to you. When my daughter was little, I was working full time and going to school full time to realize my dream. She was eight when I finally made it. After her brothers were born six and eight years later, I decided that my career wasn't all that important and I became a SAHM. I feel so bad that I missed out on so much of my daughter's life and that she didn't get the attention as a young child that the boys did/do. I can never get that time back. Careers change, dreams change, opportunities come and go. Be VERY sure you are willing to pay the price, but remember, your children will be paying a price, too. I don't mean that women cannot own businesses and have careers and only say something since you seem a bit torn already. Perhaps you could spend the next few years getting ready to open a business by taking business courses, marketing, accounting, etc.

Adevag Posted 4 Feb 2010 , 4:19am
post #22 of 53
Quote:
Originally Posted by Motta



I honestly did not even consider a storefront for me but this opportunity is pretty sweet (no pun intended). I wonder if this situation would ever present itself again.




Just for you to think about, your children being small and needing you is also a situation that would never present itself again. And that is for sure! It is still likely that you can own a bakery in the future and when it happens you can put all your mind to it.
Enjoy motherhood and enjoy watching your children grow and learn and discover the world with you while it lasts. Everything has its time!
(not saying you would not enjoy your children if you took this business opportunity but all of us mothers know that if you put 80 hrs/week of hard work you will not be working all those hours without feeling a little guilt for not spending it with our children).

Mensch Posted 4 Feb 2010 , 5:40am
post #23 of 53

As to working 80 hours a week, well, that's just not really true. It's more like 120 hours.

I, literally, have worked every single day since the 24th of September. I have scheduled a day off for Sunday the 21th of February. Am I looking forward to it? I don't know. How do I act when I'm not working?

mamawrobin Posted 4 Feb 2010 , 6:12am
post #24 of 53
Quote:
Originally Posted by Mike1394

Ask to see her finacials for the last yr. If she isn't willing run away fast.

Mike




For sure!

ayerim979 Posted 4 Feb 2010 , 7:39am
post #25 of 53
Quote:
Originally Posted by snarkybaker

Quoting myself:
Quote:
Quote:

If you post on this board, you are going to get an awful lot of " Hooray for you...follow your dream" type advice, but the truth of the matter is that you need to sit down and write a business plan. Do the math!!! Do the math!!! Do the math!!!

You can literally bankrupt yourself and ruin your family's finances for a good decade if you jump before you do the math and know what you are getting into.

95% of women-owned small businesses fail in the first 3 yrs. Even the venerable IndyDebi ended up closing her business ( which the SBA would consider a business "failure") inside that window. Now she was smart, and had a solid Plan B. Do you?

Unless you can spend about 70 plus hours running a business for the first couple of years, you really should either try to find a job decorating, or stay small enough to work out of your house. I'll bet money the cupcake baker is broke in 18 months. This isn't an easy business and no one here is doing you any favors by encouraging you without telling you to spend your time and money to open a food service business. The hours suck and the money isn't all that and a bag of chips for 95% of people in the industry.

Get a SCORE mentor, write up a business plan, try to get a bank loan for your business, and get back to me in 6 months. Then I can tell you whether or not opening a retail bakery is a good idea.



This woman is leaving the business for a reason. I suspect that if the business were really doing that well she could hire a decorator and do the books etc. herself and not give up a successful business that she probably worked very hard to build.

I suspect that her business is getting by, not thriving, and the cuts in hours you are talking about may very well cause the business to no longer be profitable. BUT DO THE MATH!!




Oh my , you just hit the spot !!! You are so right and this info/advice is very helpful. Thanks for that honesty

costumeczar Posted 4 Feb 2010 , 2:18pm
post #26 of 53
Quote:
Originally Posted by Mensch

As to working 80 hours a week, well, that's just not really true. It's more like 120 hours.

I, literally, have worked every single day since the 24th of September. I have scheduled a day off for Sunday the 21th of February. Am I looking forward to it? I don't know. How do I act when I'm not working?




You'll probably end up doing paperwork on your day off. That's what I do icon_rolleyes.gif

MissLisa Posted 4 Feb 2010 , 5:05pm
post #27 of 53

Years ago I worked in a bakery that was owned by a couple that had young children. They wanted to own the bakery and also have their family time iwth the kids. Let me tell you, thre is nothing that goes together like cakes and diapers! A bakery is not a place where you can take the kids if the child care provider fall thru.

CakeForte Posted 4 Feb 2010 , 5:30pm
post #28 of 53

No one is trying to scare you or discourage you. They're trying to get you to take off your rose-colored glasses in that's it's going to be all cake when it's not. It's going to be BUSINESS first, then cake. Adding in the additional aspect of small children. Which is different than if they were older and more self-sufficient,

Deb_ Posted 4 Feb 2010 , 6:27pm
post #29 of 53

Completely agree Cakeforte.

I'm all for supporting other women when it comes to business ownership, but as others have said....our children are only little for such a short time.

There will be other opportunities. Why not take the next few years and prepare yourself for the big step of buying a business.

Enjoy your kids because before you know it they'll be off at college like my 2 are icon_cry.gif

This time will also give you the opportunity to try new decorating techniques and recipes so you'll be ready when you do buy a shop.

Good luck!

tulips_n_truffles Posted 4 Feb 2010 , 8:14pm
post #30 of 53
Quote:
Originally Posted by Mensch

I own a bakery. People always say, "Oh what a fun job, decorating cakes all day!"

Um, NOT!

I do NOT decorate cakes all day. The actual cake decorating takes up about 15% of my working day, the other 85% is everything else: baking, cleaning, customer care, cleaning, washing dishes, paperwork, cleaning, making cake boards, worrying about money/weather/insurance/employees, oh, and did I mention cleaning?




I couldn't agree with you more. People ask me all of the time what I do in my "spare" time. SPARE TIME?! WHAT?!?!

My bakery isn't solely cakes (in fact, I don't do any tiered cakes - but lots of layer cakes, cupcakes, and other desserts), I do a lot of event catering, and I'm just opening a shop rather than working from my home. I'm right there with with the other gal who hasn't had a day off since September - except I'm since July and can't wait until March 12th when I have 2 glorious days off back-to-back. Keeping in mind, I do NOT have a family to take care of - it's me and my dog - and I'm relatively young, which supposedly means I have a ton of energy. icon_smile.gif I truly cannot even imagine doing this with kids at home. I just can't think of how I would even begin to make it work.

All that being said, I also don't think anyone intends to scare you - but you do have to be completely realistic. I wouldn't give this up for anything and I absolutely LOVE what I do, but 80 - even 120 hours - is so low some weeks. I started "part-time" at 60 hours a week last summer to really focus on opening my store, and it has at least doubled since then. You just have to be prepared. This isn't like working from home or decorating a few cakes now and then. It's your reputation on the line, and you have to decide how you'd feel if you have to close in a year or less. It's not cheap! And just when you think you're getting ahead, the water heater dies and it's your responsibility to get it fixed, or your mixer craps out and you lose half a day screwing with the mess, or an employee calls in sick and you're stuck doing three peoples' worth of work, or someone dropped an order and they need a new one NOW.

You can't be too prepared. I worked out of my home for 12 years before I even THOUGHT about jumping in to a storefront. 1 year experience is almost laughable to me - just with where I'm at and what it took to get here, I wouldn't have stayed open a month - no joke!!

Just be careful and don't get in over your head too quicly - it's hell getting out.

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