Is Starting An Full Time Home Bakery Worth It?

Business By shalsays Updated 28 Apr 2016 , 8:09am by MacJones

shalsays Posted 13 Apr 2012 , 4:33am
post #1 of 19

Hi all!

I'd like some advice from home based bakers. Do you find that your business is truly worth it? Do you make a substantial amount to live off of or is it more extra money thing? I have a chronic illness, I just started a new job this week. I'm finding it very hard to get through each day. I'd love to work from home, especially baking. Baking is my passion. I live in a cottage law state, so no problems there. I just don't know if I should quit my job, and pursue going full out in the home bakery thing or suffering at my job. This job is considerably high paying, so that makes it hard to give it up. But I have been miserable everyday, it is not a job I want. Plus battling with my symptoms every day makes things harder. Anyone ever made a move like this? I'd just like to see what kind of general success home bakeries have.

Thanks!

18 replies
jason_kraft Posted 13 Apr 2012 , 5:06am
post #2 of 19

As a first step I would recommend putting together a business plan to get a handle on what your anticipated costs and revenues will be. When starting a new business you can expect to lose money for at least the first year, so you would need to have enough in the bank to pay both your living expenses and the business expenses for at least a year.

You'll also need to take into account losing medical insurance if you quit your current job.

scp1127 Posted 13 Apr 2012 , 9:01am
post #3 of 19

I have a separate commercial kitchen on the ground floor of my home. Because it was built debt free, I made a profit from the very first order. I didn't want it to be big at first, just something to do because I was bored. But it has grown despite my efforts to keep it smaller. Tomorrow my revenue is $1700.00 for one day, my biggest yet, and no wedding cakes. I have wholesale, corporate, national, and individual clients and my bakery is only 1 1/2 years old. I have to turn down business.

I have owned three startup businesses in my life, one of those being a marketing company. But before I opened, I had to re-learn the marketing tools that work on the web. I guess my point is that with the right preparation, the sky is the limit on income. Right now I have outgrown my huge 1200 sf bakery and my equipment. In the last few weeks, I have had to buy more pans, stagger oven space, have outgrown my three big KA mixers, and have had to add more work stations. I need a fourth oven and a commercial mixer. I never though I would need them. But I'm having fun and my daughter has jumped in right beside me. She is 17 and has mastered all of my recipes. She may want it when she finishes college and she spends every available moment in the bakery.

In the coming months, I will open a small retail bakery in my target city, but all baking will be here. I'm just building my clientele before I pay rent somewhere. I have all fixtures, decorations, displays, and equipment for the bakery already purchased, again debt free. I have always been a careful planner. I also never stop studying business issues, baking practices, and the market.

My commercial kitchen took two years to plan and build. I didn't just jump in and wing it. The public face of a business is important if you want to make serious money.

Under CFL, you will have to structure your business and your growth around what works for that license, but it can easily make you the living you want with a good businees plan that leaves no stone unturned and has all real numbers. And if your CFL business grows the way you want, a commercial kitchen in your home may be a growth opportunity.

I hope you get to realize your dream. No matter how big I get, I can still schedule things around my personal schedule. This would be great for you if your health is a concern.

MimiFix Posted 13 Apr 2012 , 11:30am
post #4 of 19

Long term - yes, a home bakery can make enough money to live on. But I doubt as much as your new "considerably high paying" job. Short term - don't count on having a good income, especially if you are new to the business.

You need to remember that running a business takes a good deal of work; and a baking business is also physical work. Since your health is an issue, I hope you rethink adding more stress to your body.

With most new situations, it takes us time to settle in. And many new jobs can be taxing until we get used to them. Your new job must be very frustrating, especially since you're not feeling well. If you're thinking about quitting, I hope you take "starting a home bakery" out of the equation. You would be replacing one bad situation with another.

For now, I suggest you follow advice from Jason and Susan to write a business plan. It will at least show you the steps necessary to starting a home-based baking business. And I hope you feel better, soon.

labelle24 Posted 13 Apr 2012 , 3:18pm
post #5 of 19

At the end of the day, you should do what makes you happy.

If you are in a position where you are financially stable enough to take the plunge into starting your own business - recognizing that you will likely not be "rolling" in the dough for the first year, I would say go for it. I started my business a year and half ago solely because I love it. Fortunately I own 2 other very successful businesses for which I have GM's that run the day-to-day affairs, and I only need to check in periodically. This gave me the flexibility to make time and learn from my mistakes without the pressure of worrying about how I would pay my mortgage each month (as well as stay home with my children as much as possible). If you have a well paying job, I would assume you have some savings and this might be a very real possibility for you.

My biggest concern for you would be your health. Unfortunately just because you're working from home doesn't mean you can relax. I built my cake business up to a place where I turn a very respectable profit, but there are days that I am on my feet for 14 hours. If you don't have a passion for what you're doing, it's pretty easy to get burnt out. Like I said, at the end of the day, you need to make sure whatever career choice you make, it is one that is best for your health (physical and mental).

Good luck with your new adventure!

KoryAK Posted 13 Apr 2012 , 5:16pm
post #6 of 19

In this business, the sweat to dollar ratio is pretty poor. Yes you can make a living but you have to work damn hard at it. I have a successful cake shop and and I would totally trade it for a high paying day job (and oh, to have health insurance!) and my hobby back.

shalsays Posted 14 Apr 2012 , 3:45am
post #7 of 19

Thanks everyone! icon_smile.gif

Everything is very informative. I unfortunately do not have enough savings to support a whole year, so I think thats out. I'm only 21, I still have health insurance through my parents. My current job is prn (but I work 40 hours anyways) so I don't even have an opportunity to get benefits. Im going to talk all this over with my parents this weekend. I realize at this point a substantial business is not an option, but I'd like to be able to do a cake or two a week. I'm thinking about going to therapy, get my illness and problems more controlled and trying another job in my career area. Then go on to trying to get a cake business running after I've saved enough and be more apt to being successful. Thanks for all you advice!!

Osgirl Posted 14 Apr 2012 , 5:08am
post #8 of 19

scp1127-How neat for your daughter! That would be awesome being able to bake and learn like that! icon_smile.gif

neekole Posted 14 Apr 2012 , 5:31am
post #9 of 19

Id worry about your health insurance also, but id say build up a clientele and see where it goes from there you need to make a plan not just jump into things!

scp1127 Posted 14 Apr 2012 , 2:19pm
post #10 of 19

I do not work myself to death. In fact, except for the growing pains in the last few months which I fixed immediately with more equipment, I would call it a part-time job. I don't have to work and would never put myself in a position to work for less than I would be able to make in another field.

I will outline how to not work yourself to death.

I own everything, no debt, no bills except for ingredients. Because I charge a full market rate, that windfall is profit on my investment, which I saw immediately with every sale. That time to save the money was also my time to perfect my business plan.

When I open my retail shop, I still will not work full time. It's like with my construction business. I didn't personally build the walls. I have a business plan that supports my actual commitment to a specific amount of hours. For my retail shop, I will still bake from my existing kitchen, making my rented space limited to retail sales area only (HD compliant). This will be much smaller than a bakery with a working kitchen (my buildout and rent will minimal in comparison). I even have a plan for manning the store at zero cost to me.

This is why I preach planning, education, experience, and a business plan. Yes, you can kill yourself, but why? With a solid marketing plan for customers and growth in your business plan, employees make you money. My employees will be paid piece work, making them and me money with every product baked. No wage loss from employees on their phone, surfing the web, chatting, goofing off, taking a nap when I'm not there. All wages will be attributed to production. Piece work is different from independent contractors. My job is not to bake or man the shop. It is to make sure I have the consumer base and growth to make it work. With piece work, employee quality control takes care of itself too.

By the way, for the shop, all equipment, fixtures, and decor are already purchased. Again, zero debt.

So many people get excited and jump into opening a business. With my experience, I still planned for two years. My business plan is done for the retail shop but I'm just waiting for my customer base to increase to where the shop will be able to support itself immediately. No two year wait for a profit for me.

If you open a store or home business and then wonder if possibly enough customers will find you, like your product, and maybe buy again, good luck. The marketing plan to support the business must be in place. A marketing plan should also include a specific mathematic formula for planned growth.

Strategic planning is the difference between killing yourself and making a great living.

GimeSomeCake Posted 6 Apr 2014 , 10:06pm
post #11 of 19

To the lady with the home business... I think that's absolutely awesome! I'm helping my wife, because that's what she wants to do and its her passion. We also live in a cottage state and decided to do pretty much as you have done. She is working her butt off, but so far so good. It's a lot of hard work, however the clientele is building and there are more repeat customers, this in the span of about 9 mos or so?

 

Your right about the business plan and the marketing part of it. I decided to take a business class from the company my son (MIT grad! yea!) works at. And using simple techniques this class teaches we have garnered a great amount of business. If at all interested I'd love to trade techniques!

 

To the young lady that originally wrote this ad. You can do anything you want to do, I'm so sorry about your illness. I hope and pray that you feel better and that God grants you your desire to work doing what you want. Trust me... I make a lot of money... working at a job that I DON'T like... and making a living doing what you want makes a HUGE difference.

howsweet Posted 7 Apr 2014 , 12:15am
post #12 of 19

Quote:

Originally Posted by GimeSomeCake 
 

To the lady with the home business... I think that's absolutely awesome! I'm helping my wife, because that's what she wants to do and its her passion. We also live in a cottage state and decided to do pretty much as you have done. She is working her butt off, but so far so good. It's a lot of hard work, however the clientele is building and there are more repeat customers, this in the span of about 9 mos or so?

 

Your right about the business plan and the marketing part of it. I decided to take a business class from the company my son (MIT grad! yea!) works at. And using simple techniques this class teaches we have garnered a great amount of business. If at all interested I'd love to trade techniques!

 

To the young lady that originally wrote this ad. You can do anything you want to do, I'm so sorry about your illness. I hope and pray that you feel better and that God grants you your desire to work doing what you want. Trust me... I make a lot of money... working at a job that I DON'T like... and making a living doing what you want makes a HUGE difference.

Apparently doing this as the sole source of income for a household is rare, but that's what I do. I find the hardest thing is competing against people who have another person bringing in the primary income.  Because it turns out that most people either don't know how to, are afraid to or just won't charge enough for their cakes so that if they did want to support themselves with their business they could. I routinely compete against people charging half what I must charge to survive. 

 

And people don't believe they are undercharging and think that if you can sell your cake for more, you must just live in an area where things cost more.  I got into an argument with a woman on this forum who was undercharging. Essentially I told her that was way too little and she countered that I was completely wrong, she could definitely make a living on what she charges. And besides,  she and her cake club have all gotten together and agreed what prices should be (ridiculously low). By crazy coincidence, it turned out that she lives in my large metropoitan area and that I don't get customers in her cake club's area of influence. Which is something that had always perplexed me as I sell most of my cakes 40-60 minutes away even though I live nearer the affluent area she and her backwards collusion buddies serve.

 

So it's so nice to hear that you are making a business plan and taking business classes. Hardly anyone takes any of this into account. And congrats to your son!

 

Btw, the OP hasn't been back since April of 2012- I hope everything worked out for her. As for the cake business and doing what you enjoy- at this point, I definitely see an advantage of making lots of money and hating what you do. The business climate in cakes has taken much of the joy out of this for me and I'm not making a lot of money.

CStanford Posted 28 Apr 2014 , 6:39pm
post #13 of 19

SCP1127, would you care to provide a link to your website? 

howsweet Posted 28 Apr 2014 , 7:01pm
post #14 of 19

ASCP1127 hasn't posted since 2012 - you may not get a response :smile:

MimiFix Posted 28 Apr 2014 , 7:15pm
post #15 of 19

Sure do miss her...

howsweet Posted 28 Apr 2014 , 7:30pm
post #16 of 19

AShe sounds like a smart cookie.

Natka81 Posted 28 Apr 2014 , 7:32pm
post #17 of 19

click on scp1127 she has a website listed on her profile. nice girl building smart succesful business.

MimiFix Posted 28 Apr 2014 , 7:42pm
post #18 of 19

Sadly, Susan's website and Facebook pages have been inactive for quite a long time. We tried contacting her, to no avail. That's one of the downsides to interacting with people on a forum. We become friends and then one day they are gone. 

MacJones Posted 28 Apr 2016 , 8:09am
post #19 of 19

I have found Earn Honey to be great at times for finding part time jobs. Most of them will make it easy on you and may even try to steer you away because they focus on full time jobs, but a good one can find a part time job for you. I used them when I was just out of college.

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