Starting A Cake Business, What I Am Learning. Warning Long..

Business By bmoser24 Updated 17 Aug 2010 , 5:36pm by icesk8ermom

bmoser24 Posted 15 Jul 2010 , 5:29am
post #1 of 34

Yep, i'm on pg 15 of 200+ more pages. I have been reading for HOURS and have read many pleas for info, on starting a business using a commercial kitchen. IF anyone talks about making cakes, charging , Licensed characters.....many will jump in to correct that person. But, i have noticed that it's hard to get answers about getting legal. Mostly, i'm sure, because it varies state to state and even county to county. But the sad thing is ...there is nothing, silence. A few try to help, and boy thats sooo appreciated! Even if it doesn't directly apply to the poster, it's still encouraging to get a reply. Any reply.

I have owned a business before, and am an ED for a non profit now, so i do understand the administrative side - AKA the business side. I love to create and work, so i understand the passion side too. Against my DH better judgement, I have decided to venture into cake making, as a business. Only because i get alot of requests for cakes and cannot continue doing it for free. AND I don't want to break the law, (even though i don't agree with them, lol). I can't believe HOW hard it is to find out info on "how to"from the officials, as well as, how hard it is to comply with what is known. I am determined now. HA

This is my journey (it actually began 2 yrs ago) icon_cry.gif , hope this helps someone.

33 replies
bmoser24 Posted 15 Jul 2010 , 5:34am
post #2 of 34

I will be posting what and how I find out my info. Remeber it may not be the same where you are, but it may give you some ideas, and maybe someone might give me some ~ TFL
Blessings

leah_s Posted 15 Jul 2010 , 8:07am
post #3 of 34

If you guys would put your state (at least) in your profile, we'd know where you're from and could help more specifically. Also, there's an extensive list of states that license home kitchens, etc, at the top of this forum.

Licensing varies not only state by state and sometimes county by county, but because of zoning, can vary block by block.

cr8zchpr Posted 15 Jul 2010 , 8:20am
post #4 of 34

I'm in California, Los Angeles to be exact, so any information would be appreciated as well. I just now started my research as I have been doing it from home and a friends restaurant kitchen. I would like to open a studio but I too am stumped about where to start. I know at least for my area that a home business in forbidden, so I must get all the licenses certificates insurance etc... needed, so here too starts my quest. I am happy to know that I'm not at this alone... even if we are far apart... icon_smile.gif

Doug Posted 15 Jul 2010 , 11:13am
post #5 of 34

really very "simple" no matter where you live.

Given that you have already:

Written a business plan and lined up the financing. -- this exercise will enlighten you to just how much it will cost to do and the amount of time it, if ever, it will take to turn a profit and under what conditions. Right here could be dead in the water.

&

Consulted an attorney re the best way to set up your business: sole proprietorship, LLC, ect.

&

Talked with an accountant about all the bank accounts, etc. you will need.

(the last 2 of these three can be concurrent with the following)


1. If want to be home based - check state law re: "cottage" or home-based food business. If state says No -- dead in the water. If state says yes, then check county. If county says No -- dead in the water. If county says yes, then check your specific locality (city, town, district). If it says no -- dead in the water.

If dead in water -- only option is to open store front of some sort. Regardless of home or store front next comes:

2. Find out the zoning regulations for your location. If it's not zoned for it, then your either have to get a variance, rezoned or if you can't get those, you're dead in the water. Zoning often comes with certain requirements which could affect such things as amount of sq. ft. you can dedicate to a home business, # of parking spaces, and on and on. Meeting the requirements may cause modifications to your plan such as switching from home based to store front or vice versa or having all cakes by delivery only and no pickup.

3. If zoning is ok -- then find out who control this type of food production. Best place to start is the Health Dept. It may be them or it could be state dept of agriculture (as it is in NC). They'll then fill you in on all the rules, regulations, requirements and what you inspections you'll need. Again may have to have a change of plans or do remodeling or..... all depends.

4. Register your business name -- usually at county tax offices. While there find out if any tax you have to pay beyond business license.

5. Get a business license -- usually from the lowest level tax authority

(so for 4 & 5 where I live -- county for name, city for license. Can be accomplished in one afternoon)

6. Call state tax dept or go to their website -- find out if you have to collect sales tax, and if so at what % (could even be a split amount), how to report it and get a STATE tax ID #. nota bene: a state tax id # is separate from federal. You must have state ID if required to collect taxes. The need for a Federal Tax # depends upon how your business is set up. In some cases you just report as part of your income using your SS#, in others it will have a Fed Tax # If necessary, also get Fed ID #.

Now "all" you have to do is:
open bank accounts (do this as soon as you know it's a "GO" and will have to start paying fees)
get a line of credit (you will need it!)
do all the set up work (could be simple, could be very extensive!)
get insurance
do all the inspections
do all the advertising
grand opening

an excellent resource is the Small Business Administration. Lots of free info and templates to help start a business.

"..." <<<< indicate sarcastic "as if!" tone of voice.

kger Posted 15 Jul 2010 , 12:25pm
post #6 of 34

Yay, Doug! That should be a sticky.

dreamcakesmom Posted 15 Jul 2010 , 1:09pm
post #7 of 34

Yay Doug!! Amazing- succinct. I've been researching and researching, etc. I've read articles online, looked at the MA SOS website for info, bought books, and wow it is a lot to take in but I plan on moving forward. I am still working on my business plan and am starting to look at getting start up funds. Luckily a book I bought has some good contact info for getting small businesses going. Wish me luck!

Aeropanda Posted 15 Jul 2010 , 1:30pm
post #8 of 34

I truly appreciate your post, Doug! I am still very new, and haven't progressed far, but want to be able to easily reference this as I move through these stages. Thanks so much!

cakesdivine Posted 15 Jul 2010 , 2:21pm
post #9 of 34

bmoser24 we have to know where you are located. There probably is a CC'r in your area that might be able to guide you through but unless we know where you are no one can help you because the laws are different everywhere.

Doug's post is great, but still has many holes that only your local authorities can answer for you. And yes, getting correct information from those entities can be like pulling teeth! And can also depend on who you talk to, and on what day. It stinks, I know but we all must navigate those waters if we want to be in business legally.

bmoser24 Posted 15 Jul 2010 , 4:50pm
post #10 of 34

Wow, great info! Thanks Doug. for the business info. I'm sorry Leah you are right, dont know what happened to my profile, I'm in Nevada, near LAs Vegas. Even though i live only 70 mi. away, the laws change. I am trying to figure out just what I CAN do, and what i WANT to do. Along with the business end, like what Doug mentioned....there are other considerations.
Q-1) Can I have a commercial kitchen @ home?
a) In Vegas(Clark co.) no, only on commercial property, in Pahrump(Nye co.)yes with some constrictions.
This was hard to find out(started 2 yrs ago) , alot of phone calls. Finally I talked with someone at the building & saftey. Found out someone had built a commercial home kitchen on residential property. Had to be completely sealed from living quarters or better yet detached. Then the health dept call....yes, but i have to submit plans before i start,for review. Must have it's own bathroom, yes with toilet.

Now, do I WANT to spend $$$'s to do this, and I believe if i do, i should go in quickly...not slowly build, only because NRS laws can change quickly. I would hate to start and find the rules change. This happened on another building project we had and was horrible and costly, almost stopped the project.

SOOOO, hubby suggested i first look at renting a kitchen, first. So i'm off on another trail today! Actually started yesterday...a step ahead LOL. Let you know what I find out.
Can't wait to hear from you too!
God Bless~

bmoser24 Posted 16 Jul 2010 , 4:02pm
post #11 of 34

Yesterday I actually went to 4 places looking for a kitchen to share. Shared kitchen = renting from an existing business. And no luck. Reasons...too small, insurance purposes, getting ready to sell business. I have a few more to reply.
As apposed to renting a licensed kitchen or incubator(sp?), i think they call them. We have no rental kitchens here, in Pahrump. In Vegas, 70 mi away, I found 1. He wants $300 a mo. no contract (less with) for 8 hrs a wk. That ='s $37.50.Wow. I better find out how much with a lease.
I get set hours, and can split them up as needed. I get 2 shelves of storage 1- cold 1-dry.
There is also a closed skating ring out here, has a snack bar, but no oven. They rent out for special events. If she will rent me space cheap, i might buy a used oven or lease. Thinking...
*Note - Shared kitchens arnen't always allowed by County health...i will have to investiagte further. I never take only one official's word.

Sucrea Posted 16 Jul 2010 , 4:35pm
post #12 of 34

I am in southwest Washington and have had trouble getting answers from officials. They send me one place and then that place says that they don't deal with that or they don't return my calls at all. I finally did find out what I need to do but it is more for a store front and I just want to rent a kitchen and then deliver the cakes. It is a very confusing process. My plan is to take it slow and keep giving cakes away until if ever I do get licensed! Good luck everyone!! If anyone in Washington wants to send me a message, I would love to talk and help each other out!!

sugalips Posted 16 Jul 2010 , 4:48pm
post #13 of 34

Doug...you're a hoot! icon_lol.gif Thank you for all the details! You should write for the "Dummies" books! icon_wink.gif

bmoser24 Posted 17 Jul 2010 , 10:52pm
post #14 of 34

I was able to talk to someone from the health Dept., a very helpful someone, and I found out that yes, more than one permit can come out of one commercial kitchen,but It just has to make sense to them; you have to have a set time, and area to work from. I also found out there are commissaries that rent out kitchen times. These are widely used for businesses such as , pardon the expression..."roach coaches". These vendors store, prepare thier product for the day - go out- come back and drop off. Thier product is not supposed to go home with them. The thing is that I am accoutnable for the conditions, by the HD, while I'm there. even if someone else leaves a mess. Something to look at in the agreement, see how that is handled.
Thats what I'm looking into, this kind of facility.Unfortunatly it is 70 mi away. I would have to ride in with my hubby, two days a week and schedule cakes around these days. Hmmm.
Now, I have to ask myself...Do i like decorating and making cakes this much? Or, is most of the appeal due to I'm doing what I like at home?
All other local restraunt kitchens, senior center, bakeries have turned me down. they say it's a liability, too small, or too busy.
So far...steps
1. Find a kitchen-
2. Get inspection ..oh thier trying to figure what catagory i fall under...catereer?? She will call me Mon. This determines the inspection fees!

chilz822 Posted 23 Jul 2010 , 11:04pm
post #15 of 34

bmoser, where are you now? I'm following your adventures closely as I am on the same path (different state!)
icon_smile.gif

bmoser24 Posted 28 Jul 2010 , 4:48pm
post #16 of 34

I'm sorry, was a hectic week....wow it's nice to know someone is out there!!!
Ok, to catch up...I found a place!!!! It was my last resort. I found a snack bar at a roller rink of all places. It's only used part time, weekends..spec events. It had freezer, fridge, micro, but NO oven. But, considering..that is the least of my problems - go figure. **I learned to approach ppl a little different, there has to be something in it for them is seems. Believe it or not i'm only paying $35 wk. Period. I can use sun-thurs.
HD will not charge me for plan review, because it's already inspected. If not careful, you could pay for 2 services. I really had to point the out, without stepping on toes. I found an 1.5 cf oven at costco.com for $300. not what i had in mind, but hey, gotta start somewhere. It's 110, and fits on the counter. I figure if i get a bigger place someday, i can always use 2 ovens, prob wont always need a big 220. Next...licensing
so...
1. found a place
2. made a contact @ health dept. and i learned WATCH MY WORDS...lol, very important just how you phrase things, and approach ppl. I had to stress about delivery, fillings, customer procedures. I kept it real simple. I deliver finished product, I wont use parishable fillings to store in kitchen, and customers would not be coming to kitchen.
3. I found a company that you can get free or real cheap professional qlty business cards and website to match. Vistaprint.com they have it all. car mags, shirts, banners, I'm gonna use the site as a digital business card, and can always upgrade to store front, accepting credit cards.
4. Oven will be here tomorrow.

~Blessings

Tiffany0481 Posted 28 Jul 2010 , 5:07pm
post #17 of 34

Sounds like you are well on your way!! Good luck with everything!

cakeprof Posted 28 Jul 2010 , 5:17pm
post #18 of 34

bsmoser--Congrats on finding a space. There is one thing I want to ask you because I see a potential difficulty.

So you can only use the kitchen Sun-Thurs, will this not be a problem for Saturday orders? Would you not have to have the cakes for Saturday completely done by Thursday? This seems like a long time for cakes to sit before delivery--especially in a public venue with other people moving in and out of the kitchen (pokey fingers).

bmoser24 Posted 29 Jul 2010 , 3:01am
post #19 of 34
Quote:
Originally Posted by cakeprof

bsmoser--Congrats on finding a space. There is one thing I want to ask you because I see a potential difficulty.

So you can only use the kitchen Sun-Thurs, will this not be a problem for Saturday orders? .




Yes, I agree..I would do all baking ( and freeze), fondant, icings, decorations, during the week when I have any time i want, have everything ready to go and finish cake Fri night,Sat early am. I can use kitchen either early or late. I'm not useing parishable fillings, so cakes can sit and will have to be delivered Sat by 11icon_surprised.gifo, when kitchen is being used.
I think boxes sealed will help deter fingers.
It's not my perect situation, but it will get me started. I will find my needs soon. The real important part is the ppl are very easy to get along with there.

Motta Posted 30 Jul 2010 , 1:08am
post #20 of 34

I'm following you too, bmoser24! Great job in finding a place and thanks for all the helpful advice. I will look for updates!!

bmoser24 Posted 30 Jul 2010 , 2:46pm
post #21 of 34

I sent off paper work for health dept. hopefully i will hear from them soon, the yearly inspection under "bakery" or bake products costs $166.
They almost let me list under a "catereer" which was $125. I looked into business licenseing and i need 2, 1. local - $50, 2. state - $200 (up from $100 last yr - 100% increase! wow)
Before i apply for my local i need the following-
State license $200, State sales tax permit $100 security fee-refundable +$15, planning dept $10.,Business name filed w/county $20?. Total $872 in fee's
Still need insurance??? going to check the hartford, and the oven $300. ..plus gas !
Oven coming today! LINK http://www.costco.com/Browse/Product.aspx?Prodid=11401327&search=993316&topnav=bd&Mo=0&cm_re=1_en-_-Top_Left_Nav-_-Top_search⟨=en-US&Browse=1&N=5000097&whse=BD_564&Dx=mode%20matchallpartial&Ntk=Text_Search&Dr=P_CatalogName:BD_564&Ne=4000000&D=993316&Ntt=993316&No=0&Nty=1&Nr=P_CatalogName:BD_564&Ntx=mode%20matchallpartial
...hope i like it, it's from Costco-so if not they are good about returns.
Have a blessed day.

kakedeco Posted 30 Jul 2010 , 2:55pm
post #22 of 34

Following your venture too! I hope all works out wonderfully for you! Looking forward to the reviews of your oven! Take Care and GOOD LUCK!
~Kathy

rmelendrez Posted 30 Jul 2010 , 3:01pm
post #23 of 34
Quote:
Originally Posted by cr8zchpr

I'm in California, Los Angeles to be exact, so any information would be appreciated as well. I just now started my research as I have been doing it from home and a friends restaurant kitchen. I would like to open a studio but I too am stumped about where to start. I know at least for my area that a home business in forbidden, so I must get all the licenses certificates insurance etc... needed, so here too starts my quest. I am happy to know that I'm not at this alone... even if we are far apart... icon_smile.gif




I am in So Ca and became legal this year and I would be happy to share some 411 and point you in the right direction. Please feel free to PM me and we'll go from there.

But, most importantly and I cannot stress this enough, that in CA it is illegal to use your residential kitchen for food prep for sale. Our state will and has knocked on doors and it's not worth the risks/fines.

gingerbreadtogo Posted 30 Jul 2010 , 3:08pm
post #24 of 34

I rent a commercial kitchen hourly, I've been thru the ordeal of health dept. Between permitted kitchens not being ready, and HD slowness it has been close to 2 yrs. Today I hope is my final issue, which is getting my "personal vehicle" inspected for delivery of finished, packaged items (cookies, gingerbread houses). I have found that the HD in the county I'm working in, is not quick to respond to me.

Good luck to you..and may it be a quick process now that your moving along.

Lisa
In N. California

bmoser24 Posted 30 Jul 2010 , 9:21pm
post #25 of 34
Quote:
Originally Posted by gingerbreadtogo

I rent a commercial kitchen hourly, I've been thru the ordeal of health dept. Between permitted kitchens not being ready, and HD slowness it has been close to 2 yrs. Today I hope is my final issue, which is getting my "personal vehicle" inspected for delivery of finished, packaged items (cookies, gingerbread houses). I have found that the HD in the county I'm working in, is not quick to respond to me.

Lisa
In N. California



I hope all goes well, you are very patient. It's gotta pay off soon.Please let us know what happens.

bmoser24 Posted 31 Jul 2010 , 3:18am
post #26 of 34

Oven came in, a little small but it will work. I can only fit a 12" cake pan or half sheet size pan. I'm not used to convection ot electric ..period.
It's perfect for cupcakes, pies, cookies. I'll have to make it work to get started. Hopefully i'll get so busy, Ill grow out if it by the holidays. I think I have an idea for the oven to get more productivity out of it.
This is just to get started, I'm trying to sell my cakes and getting a feel for the market without spending a ton of money and still do it legally. My last business lost 30,000. ouch. Starting a little slower this time, but at least I'm starting!
My friends call me "driven"...lol.

icesk8ermom Posted 12 Aug 2010 , 3:31am
post #27 of 34

How are things going?

mrscunningham Posted 13 Aug 2010 , 9:58pm
post #28 of 34

BMoser,

Are you planning to rent from the kitchen in Las Vegas for the $300 a month? Do you mind if I ask how you found it? I am in Las Vegas and have not been able to find anyone who rents shared space.

bmoser24 Posted 16 Aug 2010 , 4:08pm
post #29 of 34

Hey all, well it's been a little busy around here. Just had a wedding cake that was a pain, but it's done. Was beautiful. I have started to move into my rented kitchen. Still waiting for the HD inspection though. Funny thing I was only looking for a place to cook, and that place wants to sell my product on the week ends. What a blessing! I have been making stuff there for them to sell and seeing what sells, how to package, and pricing. BTW "chocolate crack" a recipe i found here is a big hit!!! They called me at home on Fri. to bring more on Sat. I could hear customers in the background. I think this will help pay my rent and i can use whatever i'm making and have on hand. I know i'm not completely certifited on my own yet, but i feel confident that i have filled out all the paperwork, paid all monies, and am working out of a certified kitchen, so i'm going for it, in some areas. **Please note, some counties WILL fine you! Mine will not, they just try harder or push to get you licensed. Maybe they will actually help. Gonna check on my inspection today.
The oven i bought, the Waring, i took back to costco. It could only fit a 12". I found a pizza oven on craigs list and love it. 20"
I am starting to get my name out there, and ppl are trying to get something for very little....but it is preparing me, making me think about what i do, and why i do it, including pricing and ppl handleing.
TFL ~ Blessings

gingerbreadtogo Posted 16 Aug 2010 , 4:16pm
post #30 of 34

Good for you..How great it's going so smoothly. I finally got my last inspection for vehicle delivery . Permit is in hand.

Lisa

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