I never used a comercial kitchen.. I am "legal in home baker"... thus why I went thru all the hoops... & eventually to culinary school, I am one of those that Larkin121 says follows the rules :0)

Have you tried churches??
Have you tried catering company's (you never know if you use the kitchen on their off hours) ??
Or even a resturant??? Maybe a mom & pop place that might like some extra cash for use of their kitchen???
I realize that these ideas might mean baking at night but most of my work is done from 12am to 5 am anyway as I am too busy being "mom" any other hour of the day :0)

How about a vendor truck?? I know I saw a thread on this the other day & it peaked my interest as I have often thought of this idea but have lacked the gumption to figure it out :0) & I also saw an article in Entrepreneur too on this same subject just today..
Don't despair as it will work out when you least expect it and it wil come as a wonderful surprise ;0)

use google to search cakecentral.com and then the terms you want. Works way better than the search on here.

If you can get licensed for in home baking, I can't imagine why you'd choose not to and do it illegally. My understanding is it takes a little time and not much money at all.

I, personally, just want to be allowed to build a 2nd kitchen in my home for business use, but even that is not allowed (unless it's commercial... and that's just not gonna happen).

Churches, btw, based on what I've read in other threads almost never work out - not many have fully licensed commercial kitchens, and those that do can't rent it out as non-profits, or something like that. Finding a caterer is probably my best bet... or renting from the shared space kitchens that exist, though they are a bit far from me. Quite costly, of course.

Larkin121 I hear you.. am waiting for DH to retire so I can put vision into reality instead of up rooting everytime & starting over.. it an't happening either... :0)

Larkin - Here, the fee for a license is $35, plus you have to take a food safety class and pass the exam, get a hep A shot...and that might be it. So yeah...I would gladly do those things to become licensed, even if I didn't have any jobs lined up. I just have one little issue...where to do the baking! LOL. My city requires a separate kitchen from your personal one. (It sounds like yours does, too.) It must have a separate entrance from the main entrance to the house; a triple sink plus a mop sink; employee bathroom (must be a different bathroom than one in your house); and the list goes on. The lady at the health dept said they almost never license home-based cooking businesses.

I contacted a church, which was very willing to let me use their kitchen. Unfortunately, when I visited it, it needed major work. The ovens were disgusting and had rusted areas...I can't imagine they would pass inspection, even after a good cleaning...and there were other issues, too.

I also contacted a donut shop in my neighborhood. They close around 3pm each day and are considering letting me use their kitchen after that. Problem is, I need a place where I can leave things. If I'm working on a large cake that might take more than 1 day to finish, I wouldn't want to leave it sitting on the counter where it might get in their way the next day...or where something might happen to it. And I couldn't exactly load it into my car, take it home, then bring it back the next day. (What a pain, plus it would be illegal to have the cake in my home.) Not to mention toting my mixer, tools and toys back and forth every day. LOL.

So.....I'm not giving up on the idea. I don't give up very easily...LOL...but they sure make this tough!!

cakemom, thanks for the encouraging words! I also saw something about a vendor truck a few days ago. I think it was an article about a baking business in Austin, TX. I'll have to look into it, but it seems that you would still need a "real" kitchen as you would have to have electricity 24/7 for refrigerators and air conditioning. (Summer temps here get up in the 100s and I don't even want to think what a cake would look like if left in an un-air conditioned truck! LOL

I hear you & understand the process.. but here's more food to think on (I know I can't sleep tonight):
- if the shop is willing to let you use their space invest in lockable crestcors.. you should be able to find them at any resturant supply place (or check on going out of business sales), not sure of price but worth it for protection of your gear & product should it not need the fridge..
- If you go the truck route you may have to rethink your ideas & go with things like cupcakes & cookies...
- one of the articles I read on the truck thing is that someone had an airstream retro fitted to their specs... might be possible :0)
& oh by the way did you check with the Dept of Ag in your state?? in VA we go thru them not he Dept of Health... just a shot..

Think out of the box, it's there for you to discover :0)

Yep...called Dept of Ag first. They directed me to Dept of Health.

I just don't understand why people can pull over on the side of the road and sell vegetables out of the back of their dirty truck, but I can't sell cakes out of my very clean home kitchen! LOL

But seriously, in this time of high unemployment, it seems like they would HELP people start businesses, not make it nearly impossible to do so!

Please don't throw us all under the bus because some states have more relaxed laws. I have an accountant who helps with all my tax stuff, I have a health inspector that comes out and checks my kitchen twice a year, and I pay the legal fees to have my home be a business.

indydebi - I totally understand what you're saying. I WANT to become licensed, pay taxes, protect myself from lawsuits, advertise, grow my business, etc. I don't want to work on the sly (and I'm not), but I can't afford to build out a commercial kitchen or pay $320 per day to rent one. That would be extremely irresponsible to pay $320 to bake a cake that you sell for $50.

You said yourself that banks want to see 2 years of profits before giving you a loan...not that you have baked lots of cakes for free, but profits. You can bake for free to your heart's content and become the most in-demand baker in town, but in 2 years you're still not going to get that loan because you don't have any sales to show for it. Believe me, I understand that it's a Catch-22!

I'm not looking for nor expecting this to be easy...not at all. I'm just looking for guidance from people who have been there. How do you get that loan? Do people just go into debt on credit cards for 2 years until they can (hopefully) get a bank loan? 2nd mortgage on their house?

Would you mind sharing your story? How did you start your business, get a loan, etc? Thanks indydebi!

banks want to see two years of SALES HISTORY, not necessarily profits, although profits would be a good thing Banks understand that a new business goes thru a cycle of "getting there" and rarely show a profit the first year. They are looking for trends and your business expertise and how you are handling the business thus far.

Yes, I 2nd mortgaged my home, my car, and used some credit card credit to get started. (Advice to those coming up: AVOID credit card credit!). I always told folks, "I mortgaged everything I own and a few things I don't!"

YOu're right .. you can't spend $320 a day to make a $50 cake. That's where folks need to take a REAL look at what they are doing. Are they doing a "business" level volume? Or are they doing a hobby level and (just using a play on words, here) "playing" at being a business?

Opening a business is no joke, folks. It's a real and scary investment .... "investment": that means real money and real risk. That means real volume. It means real blood, sweat and tears. I'm not saying anything that isn't already known and recognized on this site. We all know this.

THere is no such thing as "kinda" legal or "kinda" a real business. You either are or you aren't. If you are, then you know what's required to be a business. If you're not, then you're not .... don't try to fool yourself that you are, or try to justify that you are but for some reason don't have to follow the rules that "other" businesses have to follow.

But you CAN be a real business that is small... not all businesses need to be large and huge volumed. What you need, Johnnycakes, is somewhere to rent that will be cheaper. It might take a lot of time and work to find it, but I bet you can find it.

I don't plan to front $30k to start my business, because I know that I have options for even an hourly rent here... even if it's overpriced and a little far. When I start my business (about 3 years out, probably, my children need to be a bit older), I'll start with an hourly, as needed rent. The profit will be little to none at that point, because hourly is more expensive than monthly. However, my cakes are priced to insure that with rent, ingredients, labor, etc, I will either profit or break even.... I expect to walk with little to no profit in the beginning, using hourly rent. But that time will count as sales experience and will build a customer base.

As I get more customers, I can look to moving to a monthly rental... which, with a bigger clientele, is more cost effective.

If you can find something similar, you shouldn't need a giant loan. Unless you are looking to have a storefront, or a bakery, perhaps. In that case, you need a ton more start up money than renting on an as needed basis.

Here's a reality check about starting a business...It's not fun and games:
http://www.washingtonpost.com/wp-srv/artsandliving/comics/king_sally_forth.html?name=Sally_Forth

If you're selling or bartering product, you're receiving income, and you should check with your local dept of health to see what the regulations are.

Just to add, I started out of my home, and am still home-based. I'm lucky that I was able to do that in my state, but I did all the paperwork to get legal before I sold anything. It's not impossible.

Thanks for the advice, Debi. Believe me, I'm not playing at anything. This is very serious for me and I hope it doesn't sound like I think it's a joke or easy or anything of the such. I understand that a business takes investment and risk. I have a business plan of how to advertise and market my business, pricing structure, etc, and I have a niche product that no one else in my city sells. I'm ready to put in the hard work required to build a successful business. But I also need some guidance, as most people do.

I'm not doing "business" volume because I can't advertise/do shows/sell to local markets/etc because I'm not licensed. I can't get licensed because I don't have a commercial kitchen. I don't have a commercial kitchen because they rent for $320 per day and I can't afford to spend that on a kitchen because I don't have the business volume to justify it. I don't have the business volume because.........Catch-22. I'm just at a brick wall and looking for advice from people who have been there to find a way around it.

Do you bake for free until you build up a client base? But even doing that, how can you bake a cake for a wedding or catered event if the caterer could be sued for allowing your (unlicensed) cake to be served?

Do you get licensed from the start, even before doing "business" volume, and go into enormous personal debt for a few years so you can legally build your business?

I mean...there has to be a starting point. You don't just roll out of bed one day and have 6 cake orders and realize you could make some money. Everyone has to start somewhere and I'm just wondering how you all did it.

JohnnyCakes, not implying you or anyone else is "playing" ..... was just trying to illustrate the difference between a business and a hobby.

As someone mentioned above.... yes, you (generic you) can be a small business, but still, the numbers have to justify it. Using the $50 cake example, one can't pay even just $10/hour for a kitchen and sell a $50 cake. One would have a min of 4 hours (or more) wrapped up in kitchen time. The math just doesn't work. So a "business" volume needs to be maintained to justify the cost, no matter how big or small the business is.

A 3-compartment sink costs the same, no matter if you are washing one cake pan or 37 cake pans in it. A comm'l oven costs the same, no matter if you are baking one cake a day or 37 cakes a day in it. A kitchen rents for the same rate per day/hour, no matter if you have an order for a 6" cake or a 300 serving wedding cake.

The first thing a person really has to do is a business plan. Cost out what is needed. Maybe do 2 of them .... one assuming a rented kitchen and one assuming your own comm'l place of biz. This is the first mandatory starting step to even thinking about opening a biz.

Oh absolutely, one cannot do a small cake with an hourly rental and come out on top. Completely agree. One would have to have a minimum set, and likely, in the begging, (if it's as needed rental) take on fewer large orders rather than a steady stream of small ones. And there will still be some loss in the beginning, if you do take just one cake order at a time, if it's not a large wedding cake. The loss is not quite comparable to a second mortgage, though.

If I make an anniversary cake for 50 people, at my price structure it's gonna be $250 (without fancy gumpaste flowers or figures). If I can make it in 5 hours (baking + decorating), at $25/hr, I'll pay $125 in rent, let's say $50 in ingredients, including boards and structure and all that (depends on flavor, but let's just use this example). So we're at $175 now. That leaves $75. Let's take off another $25 for other expenses, in general, for the business, and we'll have $50. Yeah, not much profit there, is there, but it's not a loss at that point, and that's all you can hope for when first starting out. Likely the smallest cake I could do an not go totally broke doing it would be a cake for about 35 people, or the standard baby shower/b-day two tiered cake I do. $175. I wouldn't do cakes for less servings with the hourly rental option.

When one cannot do an hourly, as needed rental, then for sure there is going to be loss at first. There's no way out of that... you'd have to have enough rental money saved up for several months of losing the entire amount. I'm well aware of that. So the fact that i have access to an hourly option makes me lucky (but not as lucky as those who get to use a home kitchen!)

Johnnycakes, is there nowhere with a monthly rental option for you? Rates here, in a big city, range from $300 a month for part time use to $900 a month for "full time" use (which I think is 40 hrs a week according to them). Were you to find something like a deal for $500 a month, you'd need a couple thousand to float on for a few months...til you could have a few cakes a month to at least cover that rental cost + business costs. The ones here are not long term contracts, so if it wasn't working, you can back out after 3 months....

Debi, I really do appreciate your advice and hope I'm not coming across as rude. If I am, I certainly don't mean to. Written word doesn't translate well sometimes.

I do have a business plan and know my costs. I know that some costs are constant, regardless of the amount of business you do. But no one just starts big. Everyone has to "get there" somehow. Somehow, you have to be able to bake those $50 cakes one at a time until you build the business to where you're baking 37 cakes a day. And you have to be able to do it without going completely broke in the process.

Anyway, this is what I want to do as a career, so I'll continue looking for a cheaper kitchen or some other way to make the dream happen.

JohnnyCakes, not taken as rude at all! We're just having a good conversation!

Larkin, I'm looking for that now (monthly rental, or even hourly that doesn't require an 8 hour minimum and an outrageous price). I looked at a church kitchen, but it was such a mess, I don't think I could have brought it up to code without replacing everything...and then it still wouldn't be MY kitchen, so that's not gonna happen. I might have mentioned that there's a donut shop that is considering letting me use their kitchen after hours. My question about that is...What if a health inspector stops by unannounced to inspect MY business on a day I'm not there? Does that create a problem? And if the donut shop has the kitchen in a mess that day, could that cause the HD to shut down MY business or fine ME? What are my obligations and responsibilities if I'm renting a shared kitchen?

It's been suggested that I contact a caterer about sharing their kitchen, but I think it would be very difficult to share a kitchen with a caterer. What if we needed the oven at the same time? Plus, I don't want their smelly food odors to be absorbed by my delicious cakes! I guess that's true in any case...I wouldn't want to "share" (use at the same time) a kitchen with anyone.

For me, I think the donut shop would be a good option, assuming they take all financial responsibility for maintaining the kitchen equipment. And of course that he won't charge a fortune and will let me rent hourly and as needed.

Whew, just made it thru this thread. Fabulous advice from Debi as always.

To start you own business, even with a bank loan, and especially so these days, you simply have to have money in the bank. Literally. You want a $30K loan, you'll likely need $10K-$15K in savings. The bank is not going to assume the risk of your biz for you. You have got to have "skin in the game." If you don't have the assets to pledge as collateral or the $ in the bank, then you simply are NOT ready to start your business.

And as for people not being able to sue you if you're unlicensed, hogwash. Anyone can sue you for ANYthing. The expense is in defending yourself. They might not win, but you'll spend more in defending yourself than it would have cost to get legal in the first place.

Remember, I got caught with the wrong type of license when I started selling cakes. I got that fixed by throwing a bunch of $ at the problem and upgrading my kitchen. I got caught with a simple question, "Mmm, who made the cake?" HD called within a couple of days.

You can't be a little bit pregnant and you can't be a little bit legal/illegal. The laws are pretty simple. Either you can sell cakes out of your home with specific rules about being inspected etc or you can't. If you can't then you can't. Work to get the laws changed.

And if you accept any form of "consideration" (anything of value such as $, goods, or services) you are selling and you are in business.

Amen to all of the above!!
Very well said & I completely agree.... Financing is not easy (don't go the credit card route you'll regret it!!), finding the space isn't either but it can be done... With each challenge we overcome it's gets better..... it's just taking more time to dig deeper, think farther out of the box, and even more resillance than one thinks they have.

Johnnycakes try your county's "economic development authority".. generally this oragnization offers classes on what it takes to start up a business in their area.. This includes mentors who can help you with the many minefields you are navigating... I used the one in VA & while they had not a clue about bakers I used their modeling & examples, plus free advice to get started.. Also check with your local & state cake clubs I am sure someone in your area has much wisdom to share.

Thanks all for the spirited conversation !! :0)

Another great resource for finding locations and cheap equipment are food company sales reps (GFS, Sysco, USFoods, etc). They know which of their customers are closing up shop, which ones operate only 3 days a week, which ones have mentioned leasing out their down time. My Sysco rep directed me to a couple of great buys this way.

All good advice and thank you for it. You were all new in the business at some point and I'm sure you can relate to some of these frustrations/brick walls! I appreciate your willingness to help.

Cakemom, I actually did contact a company here (recommended by the Health Dept) that provides office spaces for 30 new businesses. Some of the offices are built out as commercial kitchens while the others are "regular" offices. The spaces are offered at lower-than-normal rents, everyone shares a fax, copier, etc. Plus they offer business advice. It is something you have to apply for and be accepted, and I think you can stay with them up to 4 years. If you haven't "made it" by then, well....... Unfortunately, I've left 2 messages with them which haven't been returned. And maybe that's for the best as I'm not totally sure that's the way for me to go.

I think the best thing for me is to find a kitchen to work from and pay an hourly rate only when I use the kitchen. That way, I can get licensed but not have enormous expenses right from the start and I won't have to get a bank loan. Even if it means making less profit at the start, I think that's better - at least short term - than spending a fortune building out a kitchen or getting locked into a monthly rental contract. When I get to the point where I'm getting enough orders or (heaven forbid) the business doesn't work out, I can re-evaluate the situation.

Hey Debi, contacting local sales reps is a great idea. My previous career (before the economy tanked) was in sales and I was happy to give advice to people (who would become my future clients and remember that I was so helpful!).

Great thread. Lots of great advice given here.

whew! I was out of town for the weekend and came back to 5 more pages of comments to get through. But Im so glad I read them all. You all have great advice and Im glad to see Im not the only one with this dilemma.

Thanks Elcee, no I didnt enter any cakes in the show in Denver. I actually have never even thought about doing something like that. But thats a great idea and another way I can get my fix . And Id also get an idea how I measure up to others. Like I said before, Im pretty new at this and I have a lot to learn. Just really enjoy it. And I learn (and see improvement) with every cake.

As I mentioned in my OP, I have a full time job and this is a hobby. Thats not to say I wouldnt love for it to turn into something more. What I really wish is that way back when I asked myself that question, what do I want to be when I grow up? I should have realized I could actually do something like this for a living. At the time, baking cakes seemed like fun and I just couldnt make myself understand that fun could be a career. So Im a legal assistant, and I dont hate it, but I would much rather be baking cakes!

Thank you all for your advice and I will go back and read all the comments more thoroughly because there are some very good points to consider. For now, I will continue to bake for friends and family and gain experience and hopefully go somewhere with it. But it is too bad they make it so difficult to get started. At least now I have some more ideas and different options to look into. Exactly why I asked the question in the first place!

I have to ask: Why do you all think these very strict requirements are in place? I mean...it can't TRULY be because of health reasons or else EVERYONE (non-profits and churches included) would be held to the same standards. Someone could get just as sick from something baked in a non-profit home kitchen as they could something I bake in mine! And I understand that they don't consider the non-profit a business (although have you seen some of the salaries the non-profit execs make??? Don't tell ME it's not a business!), but they can still poison someone!

Let me tell ya...This church kitchen I checked out (hoping to use for my business kitchen) was a MESS!!! It looked like it hadn't been cleaned in years, the ovens were rusted and knobs missing, fridge had dried food everywhere, mops in the dish sink, and they were storing a lawn mower and snow blower in it! And they USE this kitchen!!!!

It seems like cities/counties would WANT people to open this type of business (or any really) as they get paid an application fee even if they don't approve the business, they get paid taxes from business revenue as well as income taxes (taxes they're probably NOT collecting from people who aren't legit), etc. So what gives?

I mentioned before that here it appears to be the lobbyists for big time bakeries. I think I read in other "Make this state legal" threads that bakeries were fighting against the bill.

You are right that it is not fully about the safety of the public - here, like I said, a bed and breakfast, daycare, non-profits can all cook food and serve to people on a daily basis. But they are not competing with the bakery business. HD said basically those groups lobbied to have the rules changed and won.

I have read through most of this thread and I heard someone mention that if you are a non-profit you could sell out of your home; so why not become a non-profit? All of your expenses would be covered and you could give a percentage of profits to your favorite charities. I am not sure how it works exactly (non-profit status) but I believe I've read in the past that one person on the board can make a salary. I don't imagine you'd want to or even be able to make a large salary but the most important thing is that you are starting the business for your cause. In addition, you would probably find willing volunteers to help. That is just a thought; I really don't know the details of a non-profit status as I mentioned, maybe someone could give some feedback on how that might work, or if it's really even possible? I am in CA

Also when it comes to a loan someone stated that you have to have 2 years sales history; I believe every situation is different. I was considering opening a franchise which is a tried and true business system (according to the bank) and I had management experience in previous jobs and own a 4 plex which I manage myself; they just wanted 10% down. You might need to see 10 bankers before you find the bank that is trying to push their loans. In this economy though it may be tough.

With anything you do; I believe if there's a will there is a way. I am now a successful business owner (not a cake business).