Renting Kitchen Space - Hourly Rate?
Business By amandamotley Updated 8 Apr 2013 , 1:34am by Annabakescakes
Like a lot of CC members, I've been decorating cakes for awhile and have really been wanting to start a small business on the side. Thanks to all the CC tips on businesses, home licensing, etc., I found out that Georgia doesn't license home bakeries, and have had absolutely zero luck finding a place to rent space. Until I did that, I couldn't go about getting inspected, business license, cards, website, etc. I've been very careful about orders that I've accepted (very close friends and family only) and haven't made any money yet. I've had a ton of people ask for a card, but couldn't give them one or take their orders!
I think I've found someone to rent from! She seems wonderful, has a chocolate boutique where she is willing to display my products, knows all the ins and outs of starting a business here...it just seems great! Just wanted to share my excitement (which is hopefully not premature), as well as ask a quick question -
Anyone out there who rents kitchen space know a ballpark hourly rate? She is saying $20-$30 an hour.
Thats about the average price per hour.
You should really see if she'll rent to you monthly. You'll come out better especially if you run into a cake that gives you problems.
Congrats and good luck!!
Like a lot of CC members, I've been decorating cakes for awhile and have really been wanting to start a small business on the side. Thanks to all the CC tips on businesses, home licensing, etc., I found out that Georgia doesn't license home bakeries, and have had absolutely zero luck finding a place to rent space. Until I did that, I couldn't go about getting inspected, business license, cards, website, etc. I've been very careful about orders that I've accepted (very close friends and family only) and haven't made any money yet. I've had a ton of people ask for a card, but couldn't give them one or take their orders!
I think I've found someone to rent from! She seems wonderful, has a chocolate boutique where she is willing to display my products, knows all the ins and outs of starting a business here...it just seems great! Just wanted to share my excitement (which is hopefully not premature), as well as ask a quick question -
Anyone out there who rents kitchen space know a ballpark hourly rate? She is saying $20-$30 an hour.
What do you get with paying $20-30 hourly?
Here's a few questions to ponder:
Do you have to clean the floors? Handle any equipment maintenance? Are you able to use any of her equipment, if so, which pieces are okay and which are off limits? Is this a kosher kitchen? If so, will it affect you using the kitchen? How is the chocolatiers relationship with the town health inspector? Are you allowed to leave some of your equipment, supplies, decorations at the kitchen? If so, is there an additional fee for such storage? (Health inspectors want to know if you'll be doing this too.)
Like a lot of CC members, I've been decorating cakes for awhile and have really been wanting to start a small business on the side. Thanks to all the CC tips on businesses, home licensing, etc., I found out that Georgia doesn't license home bakeries, and have had absolutely zero luck finding a place to rent space. Until I did that, I couldn't go about getting inspected, business license, cards, website, etc. I've been very careful about orders that I've accepted (very close friends and family only) and haven't made any money yet. I've had a ton of people ask for a card, but couldn't give them one or take their orders!
I think I've found someone to rent from! She seems wonderful, has a chocolate boutique where she is willing to display my products, knows all the ins and outs of starting a business here...it just seems great! Just wanted to share my excitement (which is hopefully not premature), as well as ask a quick question -
Anyone out there who rents kitchen space know a ballpark hourly rate? She is saying $20-$30 an hour.
What do you get with paying $20-30 hourly?
Here's a few questions to ponder:
Do you have to clean the floors? Handle any equipment maintenance? Are you able to use any of her equipment, if so, which pieces are okay and which are off limits? Is this a kosher kitchen? If so, will it affect you using the kitchen? How is the chocolatiers relationship with the town health inspector? Are you allowed to leave some of your equipment, supplies, decorations at the kitchen? If so, is there an additional fee for such storage? (Health inspectors want to know if you'll be doing this too.)
Just a question.... how is renting out a space worth $20-30 an hour? I have had cakes that have taken upwards of 17 hours! So let's do the math... 17 x $25 (we'll go in the middle of $20-30) = $425 plus the cost of materials for that particular cake= $30... so we are looking at it costing me $455 to make this cake and now I would have to charge above and beyond that to even break a profit! !?!?!?!??!?!?!?! But that was on my most complicated cake (that i made for a friend and charged $100 for it which they "hemmed and hawed" about)... but even for smaller cakes say it takes 5 hours to complete. 5 X $25= $125 plus materials of say, $10. So for a fairly simple 8 inch 2 layer cake it would need to be priced over $135 to make some money. And I usually would charge $50-$60 for it.... I just don't see how it's worth it. Just my opinion.
Just a question.... how is renting out a space worth $20-30 an hour? I have had cakes that have taken upwards of 17 hours! So let's do the math... 17 x $25 (we'll go in the middle of $20-30) = $425 plus the cost of materials for that particular cake= $30... so we are looking at it costing me $455 to make this cake and now I would have to charge above and beyond that to even break a profit! !?!?!?!??!?!?!?! But that was on my most complicated cake (that i made for a friend and charged $100 for it which they "hemmed and hawed" about)... but even for smaller cakes say it takes 5 hours to complete. 5 X $25= $125 plus materials of say, $10. So for a fairly simple 8 inch 2 layer cake it would need to be priced over $135 to make some money. And I usually would charge $50-$60 for it.... I just don't see how it's worth it. Just my opinion.
And there's the rub!
Rent, whether you have a shop or rent a kitchen, must not exceed your profits and overhead costs.
I'm renting a kitchen for a steal. Why? because I have to clean/tidy up the kitchen AND my food costs are low. I had to do months upon months of culinary math prior to deciding to rent. I analyzed the food cost of every recipe I'd be using (choco. truffles & Chocolate Wedding cakes) and every base cake and charge according to the most expensive item. (That food cost item will never exceed over 31%-- I'm working to get that % down without sacrificing quality.)
On the topic of renting kitchen space, I came across this website on craigslist. I just posted a wanted ad for renting kitchen space. Hope this helps anyone looking for a space.
http://www.commercialkitchenforrent.com/
I rent space for $250/month. I get my own fridge, freezer and a huge shelf to keep all my stuff. I just have to clean up after myself. My goal is when I leave to have it look the same way as when I got there. I'm really lucky that I don't have to do any deep cleaning. I just clean my dishes and counter. I actually am able to tell the person who does the cleaning if I need any deep cleaning done. I am so thankful for this space and the wonderful people I rent from. Because I am so lucky to have found this, it confirms that I'm doing what (I believe) I'm meant to do.
I'd definitely ask about monthly rental as well. When I inquired at one kitchen they said $25/month. That would really add up when I have a lot of big jobs. Monthly is the way to go.
Those are great questions to take with me - thank you! If I understood her correctly, storage space is an option and is included in the $20-$30 range. She does not, however, provide refrigerator space. I can bring my own fridge in and pay a little more to cover the power it will use. I will eventually be renting by the month (I hope), but I have an 8-5 job, and just do cakes on the side, and can't justify the expense at this point. Someday, though!
SarahsSweets, I definitely see where you're coming from, but I don't really have another option if I want to be legal (other than finding a place to rent for less, which I'm not sure that I can do). I think I can just build it into the price of my cakes fairly easily, as long as I can have everything ready to go when I set foot in the kitchen!
I am also looking for a kitchen to rent. As far as how it will affect my prices, I am worried!
I am also looking for a kitchen to rent. As far as how it will affect my prices, I am worried!
Me too. I will most likely be signing a lease in the next week or so....I think I will need to make an additional 6 cakes/month to cover it. You need to figure out what your profit is now, and then what you will need to afford the rent...I am renting monthly, though, not by the hour.
And there's the rub!
Rent, whether you have a shop or rent a kitchen, must not exceed your profits and overhead costs.
Also remember in that $20-$30/hour, that you are not paying the water bill, the electric bill, the gas bill, the sewer bill, the dumpster bill, the security system, the fire extinguisher costs, the annual or semi-annual kitchen cleaning fee (some places hire a professional to come in once or twice a year to "deep clean" the kitchen), the insurance on the equipment, the tenants insurance, buying the soaps and cleaning supplies for the mop sink, for the hand-soap dispenser, for the comm'l dishwasher, for the floors (my first purchase just for soaps for my kitchen was $700). You also did not lay out $50,000 for the equipment that you'll be using.
MamaBerry makes a good point .... when you take that step to become a "real" business, meaning to get legal/licensed,etc, then you start to realize what "real" business expenses are. It's an eye opener, all right! 
Yes, you are right about that, indydebi. I looked into opening another place with a girl, and I think the vent hood alone was $15,000. I thought, NO WAY. This time around, I will have rent, and then a $350 food permit bill. Not too bad.
If I rented space to another cake decorator, how would I keep my business separate from theirs if they are in the same shop? Wouldn't the public just think it is all from the same cake shop? Wouldn't their work just appear to be from my business? Of course it can be a good thing or an awfully bad thing. I don't quite understand it yet.
drowsyrn, if you are renting "kitchen" space to her, that's not the same as having her share your retail space. I'm wanting to rent my down time out but they will be in the kitchen after I close in the evening or early in the morning before I get there. They are renting my "kitchen" .... not my storefront. If you're concerned about the image conflict, be sure you talk it out and have a clear understanding before the agreement is signed.
Hey Indy...you know I love you (and I think you owe me one!) HAHA! The hubby and I are looking at a new house, for some reason he thinks the house will sell better if we demo the kitchen into a bar and rent space until we move and can re-open the home kitchen with inspections. Soooo...I know all about the expenses involved, etc. I wouldn't haggle with a prospective owner about renting-but what should I be looking for in a shared kitchen experience...for some reason I am forseeing a nightmare scenario, I have invested a virtual fortune in supplies...I can't feasibly take those all with me, but I couldn't sleep if it were all out of my "sight". Does that make sense? I am also just concerned about dynamic...I like to work like a madwoman with loud music on some cake and virtual silence on others. I AM SCARED TO SHARE SPACE!
I have invested a virtual fortune in supplies...I can't feasibly take those all with me, but I couldn't sleep if it were all out of my "sight". Does that make sense? I am also just concerned about dynamic...I like to work like a madwoman with loud music on some cake and virtual silence on others. I AM SCARED TO SHARE SPACE!
You're a big nut! 
It's called "you can't have your cake and eat it too!" You will either carry it all with you each time or you will leave it there out of sight. I can't figure out how you can do both. 
Loud music = headphones.
I am not screwing around with hourly rates and keeping track of time. It will be $350/month, unlimited access, but you have to work around my schedule (which means I'm usually outta there by 3 or 5, and if I have a catering, then I"ll be in there on Sat mornings).
So if somone uses it 1 hour per day (or 7 hours on Saturday), then it's about $10/hour, plus or minus.
If they use it 5 hours a week, then it works out to $17.50/hour (20 hours a month).
If they use it 10 hours a week, then it works out to $8.75/hour (40 hours a month).
I need to be able to budget a regular income and it's my way of "giving back" by helping someone take that next step toward becoming a legal business.
That's a fair price Debi! I am having a tough time finding the right space in my mean time though...I wish Indy and Kansas City were closer 
I am easy to work with (i think!) haha! But I do kid party cakes, and alot of decorators here do weddings-I need so many supplies to have stored at someone else shop-I feel bad that I have so much stuff! LOL! Oh well, it will all work out I am sure!
I just wanted you all to know that I approached my own church about renting the kitchen - they didn't skip a beat when they informed me the rental fee is $75.00 an hour!!!! My church also does banquets for wedding receptions, etc. and even has a liquor license, so this wasn't a new question for them. Needless to say, I haven't taken them up on the offer, but I also haven't been able to find any other kitchens to rent. Help! I'm in west St. Louis county.
I just wanted you all to know that I approached my own church about renting the kitchen - they didn't skip a beat when they informed me the rental fee is $75.00 an hour!!!! My church also does banquets for wedding receptions, etc. and even has a liquor license, so this wasn't a new question for them. Needless to say, I haven't taken them up on the offer, but I also haven't been able to find any other kitchens to rent. Help! I'm in west St. Louis county.
That sounds like what they charge for the reception room and oh yeah by the way you can use the kitchen, TOO, kind of rate. 
CindyM, Look for an American Legion post in your area. I am working with them and when I told them I couldn't pay hourly or more than 250 per month they said it wouldn't be nearly that much. They are non profit and support military and their families. But they sell food as a fundraiser so their kitchen has to be regularly inspected. Im sure the rate they gave you at the church was for a special occasion use and not for everyday business use. Well hope that helps. Good luck!
I'm looking for space in Naperville! Where is the kitchen you rent from??
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