So, Ballpark, How Much $ To Open Up A Business?
Business By berryblondeboys Updated 7 Feb 2007 , 2:31am by alicegop
An amazing possibility has just blown into my life to do a partnership business and it's in the embryonic stage, so what are ballpark figures so that I can make my DH have a heart attack? Renting a storefront in a major metropolitan area too (though in the burbs).
Melissa
Do you know what the cost per square foot is to rent a building in the desired area? Are there any spaces available that are already functional? If not, do you have an idea of what a custom buildout costs? Once you figure out that...do you already have equipment and furnishings? Do you have an average of what your monthly overhead will be? 
Overwhelming, huh?
As I said, embryonic stage!
We know nothing yet - just a great idea. We will probably try to get a place that already has a decent set up so as to not have to recreate the wheel, but you know - who knows!
Melissa
Should say that I don't think we will do a full kitchen, just a place for selling and small food/baked good items and drinks and then seating. yes, it is cake related, but not typical - can't divulge more! LOL
Melissa
I'm in the middle of the process so I'm happy to share what I've learned so far. I'm also a caterer so my kitchen may be more intense than a kitchen just for bakery-type cooking.
If the location already has a kitchen or had a kitchen, you will save a fortune! There are huge costs to trench thru a concrete floor to install all the pipes and drains that will be needed. Special wall & ceiling coverings, approved and mandated by the health department are also costing me a lot.
I will have an 8-burner stove, convection oven and a deep fryer. The exhaust hood must cover all of these items. At $1000 a linear foot, I'm looking at $8,000 just for the exhaust hood. The air conditioning must be upgraded to accommodate the heat in the kitchen and the negative flow that the exhaust hood will affect. what size water heater is in there and/or what size will you need installed to accommodate kitchen use?
I paid a kitchen designer for the floor plan and his advice was fabulous! Best money I ever spent! The stuff I thought I would buy used vs. what I thought I should buy new was totally backwards. Plus he came up with good workflow plans and staged the equipment appropriately. And the little things you need! A hand washing sink is required for every 25 feet. My space is 27 feet long, so I'm installing two of them. I could put just one in the middle and be fine, but you should plan and factor convenience for those working in the kitchen.
Don't forget to factor in non-store expenses. Will you have any deliveries or have a "company car"? Commercial insurance rates are much higher than a standard personal auto policy. I bought a delivery van but my agent made me switch my personal vehicle because I also use it for picking up supplies and for small deliveries. I would not be covered on my personal auto policy in an accident that happened while doing a business run otherwise.
Signage ..... what is the cost of a sign? Is there a large display sign by the side of the road that you'll need to get a sign for in addition to the one that goes on your store (i.e. the sign at the entrance to a strip mall or multiple store fronts that has the sign of all businesses in that mall)? If so, what is the monthly space rental fee for this sign?
Common Areas: Your rent is not just the cost of the building. There is also "common area" maintenance fees (parking lot upkeep, lighting, snow removal, etc.)
Plan for growth ..... I'm installing a walk-in refrigerator/freezer that is about 10x12. My husband keeps telling me I may have to "compromise" and just get the 2 or 3-door refrigerator instead. I'm digging my heels in on this one. No one ever goes down the road and complains that they have too much storage space! With food catering AND cake baking AND cookie making, there is no way a 3-door 'frig is going to handle my space requirements for very long! The exhaust hood is another "plan for growth" item. Once it's installed, it's installed!!! While anything is possible, it's just not that simple to adopt the "oh, I'll just get a bigger one later!" 
But compromise can work. I originally wanted just a 6-burner stove. Kitchen Designer said I needed a 12-burner. After some "discussion" 
we compromised on the 8-burner.
If you're interested, I'll be happy to PM any dollar details of my costs thus far.
thank you so much. I'll have to keep that all in mind for the future. Boy, other businesses are probably LOTS cheaper! LOL
I think I'm going to do the home thing (licensed) and then go from there. I don't think I'll ever want to run a full restaurant or anything like that as I woul d be a slave to the kitchen and I already feel I'm that! LOL
Melissa
even a liscensed home baker cost some money.
you have to have a seperate commercial kitchen in most places. you need to do some research for your area before you get to far with your plans...because they will change depending on the rules.
good luck!
Should say that I don't think we will do a full kitchen, just a place for selling and small food/baked good items and drinks and then seating. yes, it is cake related, but not typical - can't divulge more! LOL
Melissa
Melissa, how exciting for you!!! I am small potoatoes and not a caterer..they need different requirements because they make food on premiss and I know that the grease traps can be up to 12 to 15 thousand to install.
A small cake cafe can get away with a "portable" grease trap if needed, those are installed under the sinks and only cost a couple of hundred dollars and a lic. plumber can install them....( if you need it) the only draw back is that you need to clean them every week!
I didn't need one..thank goodness, I'd be heaving all over the place..yuckky..lol
ok..
Here is my breakdown, ( I can have food also if I wanted it because I"m covered under a "shared Space inspection"...there is a spa and a small restaurant in my basement and we are in the lower level of a hotel..it's like adding another restaurant in a mall food court..lol)
I needed first month and last months rent...3 thousand.
I bought used equipment, 6 rack convection oven with steam valve ( if I want to make bread I can !!) 2 thousand.
used 3 bay sink, 300 dollars
regular electric 5 burner stove ( got away with that..said it was for personal use only!!! I boil water to make my meringue icing.) if you use gas you have a WHOLE lot of things to comply with...but NOTHING cooks like GAS!!
2 door freezer, 1 door fridge ( and they could be larger!) 3 thousand for both.
20Q mixer, 1,200 to 3 thousand...( still working off my 5 Q KA and bringing my 4.5 KA from the house..lol)
assorted steel tables, Shelving, counters garbage cans, they have to be the "step on kind" about 1,500 to 2 thousand.
The only thing I have missing is a small exhaust fan they asked me ( landlord) asked me to put in, cos he doesn't want the spa to smell like cake even though EVERYONE LOOOOOOVES the smell..lol) I need an electrician to put it in and that can cost any where from a couple of hundred to 1g.
I had to get some electrical lines in that cost 5,000 but I didn't pay for that, for some reason the landlord did!! I had issues with my first oven..got screwed!!
then I needed money for my supplies and you need to have "capitol" which is back up money for the time you're sitting there twisting your hands waiting for customers to show up! I'm kinda running out of mine!! lol
soooooooo, I feel...that whatever I had....I needed to have 2x as much! lol
Good luck to you.
I was going to PM you this information...but I figured that it would help someone else to make up their mind to do it or NOT do it..lol
I am going to be introducing Tea sandwiches in the next couple of weeks. Oh..I did have a coffee machine, but no one bought it...the day I took it down, someone actually asked me if I sold coffee..lol
This is one of the most informative threads, I have seen. I don't have a bakery business, yet, but I do work in a family owned business. There are so many unexpected costs that are associated with any business. You have to remember to start small and master a few things than you will be able to accomplish even more.
Licia
RisqueBusiness, you are in FL right? How did you not have to use a grease trap? Also I know about the three compartment sink, then the handwashing sink, and the mop sink. Do you really have three sinks??? Also do you have a rest room? Did the state rewuire a vent hood? I think that crazy for a cake business. Thanks for your help.
An amazing possibility has just blown into my life to do a partnership business and it's in the embryonic stage, so what are ballpark figures so that I can make my DH have a heart attack? Renting a storefront in a major metropolitan area too (though in the burbs).
Melissa
This sounds so fun! Good Luck on your venture, I am wanting to start something like this one day. Although the town I live in already has 3 long-standing bakeries and several cake decorators.
Thanks for all the great info on the $ for start-up you guys!
RisqueBusiness - thank you SOOOOO Much! That helps a lot. makes me really glad that Virginia still allows home baking as I would really like to have my feet under me and KNOW this will go somewhere before I have to spend thousands on a "what if", you know?
Though, I'm sure if this ever takes off, I would prefer a commercial kitchen for OH so many reasons! Now, off to make my grocery list so I can make a bunch of dummies to photograph and cookies to photograph as well. Gotta start somewhere and I wasn't good about taking photos of things I've done - DOY!!!!
Melissa
I believe Risque Business is in fl.....as am I .....and I'm still going through the process of trying to do a HOME based bakery in Florida...(it's been a nightmare!!). But from what she said....GREAT info...and the prices are about right!! But I have the added cost of BUILDING an attachment (room) to our house for the kitchen! If VA allows actually home baking...as in out of your own personal kitchen...you're going to save a fortune!!!
as for the grease trap...I was told by the dept of ag that if my LOCAL county/city health dept required a grease trap...then I would need one. If not, then I wouldn't!! I'm required to have one...but I can get the cheap under sink one....NOT looking forward to cleaning the darn though!! But to save $$$...I'll suck it up and make my hubby clean it!! 
and there is no way around all those darn freaking sinks...at least in fla anyway!!
Wow - Congratulations!! Sounds very interesting 
I hope this 'embryotic' stage develops into a full blown child! 
Ok, totally baaaaaaad pun but I had to do it. 
RisqueBusiness, you are in FL right? How did you not have to use a grease trap? Also I know about the three compartment sink, then the handwashing sink, and the mop sink. Do you really have three sinks??? Also do you have a rest room? Did the state rewuire a vent hood? I think that crazy for a cake business. Thanks for your help.
Hi, I have the 3 compartment sink, the hand sink and I do not have the slop sink I have to go outside to through the lockers to throw out the mop water.
I am covered under the "SHARED SPACE" because I am in the basement of the HOTEL! a major chain. ( like a food court at the mall )
so I didn't need the grease trap, I looked into it on my own, because I'd rather have it in place, when it came up that I needed it.
No, I DON"T need a vent to open my business, as I wrote in my post...it's the SPA landlord that requires it, because he doesn't think a spa should smell like cookies! lol
I thought that I was going to have to scrape the walls down, they are stucco, but the inspector didn't say anthing about them, so I'm not going to mess with them right now.
Melissa,
I know you were asking about set up costs but I noticed you said it was a partnership business - if the partnership involves someone outside you & your DH/SO I would strongly recommend you get some sort of legal document about the partnership aspect as I have seen a number of businesses in our area go bust or sold for next to nothing because of problems within the partnership ie. fights over money how it is spent/share of the profits etc, 1 partner doesn't pull their weight or wants to go in a different direction, 1 partner wants to get out or sell and the other doesn't, breakdown in the relationship between the partners that type of stuff.
Not meaning to be all doom and gloom as there a lots of partnerships that work really well but it doesn't hurt to have a document to protect yourself and so everyone knows where they stand.
good luck hope it all goes well
I know, I've been doing a lot of thinking about that too. We are really not looking to open anything for like two years and in that time, hopefully, we can work out any kinks that might be there between our wishes and such. In the meantime, there's a third person interested too and that is already getting me anxious even though we all get along and have different expertise we can bring into it, it is a bit scary... I don't know if it will ever get off the ground, but it's a great idea and definitely has a market for it, but will it be us that does it? I don' t know! And no, I'm not tellin'!
LOL Melissa
I just opened a month ago and thought I would add my 2 cents. You have to account for promotional expenses too, esp the "in kind" type. For instance, I made a great contact at the biggest local radio group to do desserts for promotions/events. Pro-gets my biz on the radio, con-costing me A LOT in product. Just be careful about what you get into, make sure it is a good fit for your biz type. Please, please be better prepared for this than I was!
And a ditto to whomever mentioned the operating capital. Anticipate needing about 50% more than you think you will. Things really start slow, I know we all know that in our logic but...
I got GREAT deals on my equipment, bought it all new. If you want to PM me I'll get you the names. Make sure you have ample frig and storage space, esp storage. Actually, the installation of some of the equip (plumbing & elec) cost a lot. I think total I spent about $10,000 give or take.
Oh and the partnership thing. Just be careful. Even those you get along with or you feel are in your corner, it can get tough. Be prepared for diverging visions and the like. It is great that you all have you own area of expertise but well, it's hard to have three people who are the boss and it is only human to think of furthering one's own area first.
I wish you nothing but the best whatever you decide. There is nothing like being licensed and having the freedom to tell the world about your work. That being said, if I could have gotten licensed at home, even in a seperate add-on, I would have. So if you can I woud definintely do so. Best to you and have fun!
I agree - going in with three is probably disasterous. Two is tough enough. Heck, just in deciding who would get to name it!!! And, how to arrange it and so on... Thing is now, that is if one of us does it without the other, couldnt the other sue? (not that either of us are thinking of stealing an idea), but what if it were mostly her idea, but the key things I brought in are the things that made it a success or vice versa? Those are the things I'm thinking about now. it's really tricky!
for me 5 years ago it was 28k...soup to nuts.
i got a used 30 qt mixer for 1800.00
a new convection oven for 4000.00 (convection ovens rock!)
triple sink 500.00
stainless steel tables...
3K for the remodel on the rental property
2k for a big freezer.
500 for the grease trap....my grease trap is small....and rooto rooter cleans it out every 2 years.....i think it cost me 250.00 for the clean out last time....but dude ya better get the gas mask when they open it up!!!
my first order to the food wholsaler was about 1000.00...just to get started....WATCH OUT FOR THE SALESMEN...THEY WILL TRY TO PRICE GOUGE!
here they require a separate mop sink...
every place has different requirements...you just have to check where you are....i found the health dept to be very helpful...i called them after i rented the shop and they helped me with the layout...because certain things have to be certain distaces from other stuff.
i had no need for a cooktop stove , since i only make cakes....on the rare occaision i need to melt some carmel or something i use a hotplate.
there are alot of hoops to jump thru...but if you take it just one thing at a time....it's not so bad.
GOOD LUCK!
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