Hello all! It's been about three years since I posted in here... In June 2010 I opened my little bakery and WOW what a rollercoaster it has been! Currently I have about 1800s/f, split in half, so about 900s/f for my kitchen and 900 for display cases, office, consultation area, storage, etc... I have been looking to move to a larger spot because sales are good, space is tight and I'm now surrounded by FIFTEEN other bakery places... From specialty cake shops (4) to cupcake shops (4) to coffeehouses that offer baked goods (2), to a whoopie pie company (1), to a gluten free baker, (1) and there's even one that doesn't make anything just brings it all in from here and there and sells it in one location with coffee.. to one chocolate themed shop that does all chocolate, to the diner that makes their own stuff and sells it... Let's just say within a 3 mile radius of my shop, it's NUTZ!
Iam holding my own with all that competition, but I think the other side of town needs a bakery! I know the grass ain't always greener.. but it is where I worked for 15 years in a grocery store bakery that was usually the top in sales.. I can't take them down, but I would like to take a piece of their business! =) The problem is that, in that area, there are no small spaces available to lease... I've got it down to three options and I feel like I'm going crazy trying to decide which option to take. I need a "house hunters" episode to help me decide... LOL...
Option 1- 4880s/f in a strip mall, next to a grocery store (not the one I worked at). It has a kitchen built in, it has a fire hood, it has a massive water heater, it has a beautiful bar space built into it.... It's the one I WANT. BUT, 11 years of neglect have taken their toll.... the floors, the roof, the ceiling, the bathrooms... nothing is up to code, and renovations would cost about $161,000 rent is $8/sf as is... and the landlord has offered 2 years free rent if I do all the renovations. I am not a gambler, so I only wanted a 5yr lease... that makes the loan payments awful steep... and then to add the rent in two years just makes it worse... It's a great spot with a lot of traffic, in a busy strip mall, but I get a queasy feeling when I think of spending all that money on some stingy NYC developer who let the property fall apart.
Option 2- A 2900s/f space about two miles up the road from option 1. It's a lease to own type of deal. The building is listed at 300,000. It would need about 100,000 in renovations, but the space has been well maintained, so it may need less... It was a restaurant at one time, but most recently, it was offices. There is a stable tenant on the lower level. There's an extra building out back that could be leased as an office or effieciency apartment. there's a garage out back for storage, and there may be an option to use a portion of the lower level if necessary. I don't think I'm ready to be a huge property owner. I get the idea of building equity and all, but what's to say that I can sell it for more than I buy it for... what if our economy doesn't improve and I end up trapped in this huge mortgage? Again, I'm queasy....
Option 3-- ????? Square footage. It's my call. It's about 3 miles from the first option, up the road, down a road and around a corner. It's being renovated from a furniture warehouse into a banquet hall. Two rooms with capacity of 150 in each. All new construction. Shared walk in cooler and freezer. Caterer gets their side, I get mine. I get to have tables outside, I can set whatever hours I want. I get big signs and shared advertising with the facility. I get to lay out the floor plan any way I want. The bathrooms and all are going to be built to code. I get shared use of the banquet rooms, and I get all the business from that banquet facility. BUT, I don't think that the location is the best.... and if the facility fails, then I'm going to go down with it.... If I was a brand spanking new biz, I would grab it, but I'm established and I have a vision of what I want to do.... I'm not sure that being off the beaten path and behind a post office and a brand new banquet hall will give me the traffic I want/need to support the jobs I want to create in all of this.
I'm so torn... Any words of wisdom from Ya'all?
AWhat are the demographics like on the other side of town? There may be a reason why the grocery store bakery is the top seller there.
For the different options you'll need to plug the numbers into your business plan to see how the changes in costs and estimated revenue will work over the long term.
holy cow those are some big spaces! i couldn;t even give a recomendation... my bakery is 1200 sq feet,old and adorable. $350 rent each month. i really wish you the best of luck with your decision though!
Do your homework first. The grocery store may be able to block you since you will be in direct competition to their bakery. It all depends on local laws/ordinances. There may be a reason that there are no other bakery business on that side of town.