Start Up Cost?

Business By sillyjodes Updated 6 Nov 2008 , 1:00am by JoAnnB

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sillyjodes Posted 5 Nov 2008 , 8:32pm
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I'm thinking about starting up my own cake business when my hubby gets out of the military. Until then, I think we move too often for it to work. I have several years to put some dough under the mattress (sorry for the pun; I couldn't help myself). I'm just not sure how much I should budget for start up. Any resources?

8 replies
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JoAnnB Posted 5 Nov 2008 , 8:37pm
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A lot depends on where you will be living. In very few states, you can be licensed in your home and your start up is inspection/license fees, insurance and possible a second refrigerator.

In others, you would have to build a separate kitchen. I put a kitchen in my garage for around $20,000 but I did not need commercial stove, etc. Just a lot of sinks.

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sillyjodes Posted 5 Nov 2008 , 10:12pm
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We are unsure of where we will live. A lot depends on his job prospects. I'm trying to get a feel of what my options are. If I can only afford a home business, then, we'll have to try for an appropriate state. I'm still new at cake decorating, but it has become a passion.

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indydebi Posted 5 Nov 2008 , 10:33pm
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If you open in a commercial location:

Try to find a shop that already has or has had a kitchen in it. The water pipes for the sinks will already be there, the drainage will already be dug, the wiring for the kitchen equipment, etc. Trenching thru concrete floors to install drainage pipes is very expensive. Upgrading the wiring to support a commercial ktichen can get pricey. Balancing your air exchange (drawing out the hot air and pushing in the air conditioning) can get pricey. Health dept approved flooring and wall treatments add to the cost.

If you plan to have an in-house eating area (you will sell foods that they can eat in your shop), you will have to plan for a customer access, handicap accessible restroom. If it's counter-retail (they buy the cupcake and leave), then you only need one restroom for you and employees .. no public access.

Just to give you an idea ... I leased what is referred to as "an empty box" ... just 4 walls and a floor ... and I had to install all of this stuff. My contracting bill was $28,000.

I have more equipment than you'll probably need because I also cater. But I think the only extra equipment I have that you won't need is a 6-burner stove, a deep fryer, and a commercial dishwasher. Everything else I bought you will also (most likely) need .... ovens, 2-door freezer, 2 stainless steel worktables, 3 compartment sink, hand-washing sink, 20-qt mixer, grease trap, refrigerator. (My walk-in refrigerator was used and only cost me $1200.) My total equipment cost was $48,000. YOu can probably get by with way less than that and when you start buying, check craigslist and ebay for some things like shelving. I found some great deals there.

Whatever storage space you think you'll need (as far as stainless steel shelves, mop-room storage, etc) ... double it. I already owned 3 of the big stainless steel wire shelving units and thought I was set .... I now have 6 and am trying to figure out where I can put 2 more.

Budget an amount for smallwares. Your one set of baking pans works fine at home, but as you go commercial, you will need duplicates. Four or six or more of your most popular pan size (like the 8" or 10" round, for example) to start. NSF rated food containers and lots of them. I have something like 6 sets of measuring cups so that I always have a clean one handy in the size I need when working. Double-triple decorating tips.

Just a short list to get you thinking and get you started.

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andrea7 Posted 5 Nov 2008 , 11:05pm
post #5 of 9

I started with a big box and it costed me $24000.00
This is what I got...
-a architect to plan the space
-all plumbing and vents to the roof
-all the electrical
-all city permits
-insurance on the building
-paint and other costs
-built half wall to seperate studio from kitchen
-rent and utilities for three months
-all city code issues (handicap stuff, self closing door etc.)

The equipment I bought....
-4 6" tables new
-20 qt mixer used
- 4 metro shelves new
-two deck elecrtric oven used
- three door fridge new
-one door fridge used
-all bowls, spatulas colors etc. new
-three compartment sink used
-hand sink used
-two 3 feet tables used
-rolling cart with 35 full sheet pans used
- 5 q mixer new
-a 8 feet table new
-6 chairs new
- a couch and coffee table new
-complete office, table, chair & accessories new

I think I did awesome on the spending, but i'm excellent with budgets and knew how to get deals and negotiate, negotiate, negotiate!!!!

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sillyjodes Posted 5 Nov 2008 , 11:21pm
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Thanks, I know I have a lot to learn and think about. I'm going to try and save, save, save, so I'm ready.

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littlecake Posted 5 Nov 2008 , 11:49pm
post #7 of 9

wow, i put my dough in an old i paid my back taxes...the shoe is pretty flat....)*=

it costed me 28K soup to nuts to open.

if you get to a place that allows home bakeries, it will be a lot less!

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mndy204 Posted 6 Nov 2008 , 12:10am
post #8 of 9

I love to see this kind of thread, I learn so much!

I live in a state (Missouri) where home bakeries are not allowed, but I would love to one day be able to sell cakes and earn a living doing this. Is it worth it for me to start saving now to eventually open a bakery or should I just do cakes for friends and family?

Do cake companies take off quickly and are they able to stay in business for a long time or does it just all depend on the area and the baker and all of that?

I'm probably asking questions that are hard to answer, this is something that is just floating in my mind and I've become somewhat frustrated since finding out I can't be a home baker. thumbsdown.gif

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JoAnnB Posted 6 Nov 2008 , 1:00am
post #9 of 9

Opening a storefront is a huge burden. In order to answer most of your questions, you should begin a business plan. however, no, baking companies do not become self-supporting right away. Typically, other sales are required to support the business (lunches, and other food items)

Of course with the right location and fabulous newspaper coverage you can get a kick start. You will find that inorder to make enough cake to keep the expenses paid, you need to work very long hours with help.

Read through similar threads in the business section. you will find out a lot more.

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