How do you know if you want to go into business? I've recently been doing 1 or 2 cakes a month for the past few months for friends and family. They're the latest ones in my gallery. I'm learning as I go but there's only so many cakes my immediate circle need. I work part time so could only manage 2 or 3 a month of the type of cakes I'd like to make. Is it worth starting a business for that small an amount?
Unless you can get a cottage law license in your area that is not enough. If you are doing 3 or 4 a week than maybe it's time to consider that.
Thanks for replying kakeladi. I'm in the uk so the laws are different. I believe it's easier to set up a small businesses from home here.
There used to be loads of uk bakers on cake central a few years ago. Not sure where they all went.
Hi louglou! I'm a UK home baker, and I've been having the same dilemma as you. I think its pretty easy to set the business up, all you need is insurance, a food safety qualification (which you can do online) and let HMRC know, i think. Maybe a couple more things. I have a similar amount of orders as you, just here and there. Eventually I will start my own business, but I thought I'd take a couple of years and get my basic skills up to scratch. Are you an experienced baker and cake decorator? There's quite a lot to think about isn't there.
Where I am in the US, if you are caught selling baked goods out of your home without the proper inspection and licensing in place, you can have legal charges pressed against you. For that reason, I do not accept compensation for things that I bake because it is not worth the risk. If at any point there were projects or requests that I felt needed reimbursement, I would have to go through the legal channels first to avoid the possibility of prosecution. My current home would not pass state health standards since I have an indoor pet (dog), so if I wanted to make it a business I would have to rent out a commercial space which is definitely not do able when just starting out.
If there it is easy enough to obtain the legal rights to bake it your home, I think it would be worth it just for the piece of find that comes along with going about it the proper way. Best of luck!
I am in the UK. I work fulltime (not cake related) but have recently taken the plunge and set up as a REGISTERED home baker - there are many home bakers who are not correctly registered and I guess that's up to them but if I am charging someone for a cake I think they deserve to know I am going to pay tax (if appropriate), that I have some knowledge of basic food hygiene and have appropriate insurance etc.
I have informed HRMC that I have become self employed (no charge),completed a level 2 food hygiene certificate (online approx cost £15), taken out public and product liability insurance through the British Sugarcraft Guild (£20 for the year for members) and also informed my local council and been inspected by their EHO to receive a 5* food hygiene rating (no cost).
I am lucky, I think, because I don't need to rely on caking income for my living and because I don't advertise probably wont do more than 8-10 orders in the year, but l still felt that even at this small scale I should become legit and therefore, in my mind, justify charging what I think is a fair rate for my products.
In the UK having a dog in the house doesn't necessarily present a problem - I have an akita and still got a 5* rating.
Hep275 - what did you have to do to get the 5* food hygiene rating? Did you need to make changes to your kitchen?
Hep275 - Thanks so much for your detailed post. I think sometimes the logistics of setting up the business is made out to be so much more complicated than it actually is. Is the process of letting hmrc know quite tedious? I'm just wondering, because I'm definitely going to take the plunge and go for it. x
Some uk councils are no longer doing inspections for home bakers as they class us as low risk. Mine sent me a link to the safer food better business site which has a pack i had to work through in advance of the visit and went through with the EHO but a lot didnt apply to me. You need to give particular attention to HOW you clean and what products you use. Some of this is also covered in the online food hygiene level 2 certificate (my EHO also wanted to see my certificate) and some is, to be honest,common sense. There are particular BS numbers that you should look for (but I use tesco anti bax or Milton spray and those are fine). I also use disposable cleaning clothes otherwise you need to detail how you clean your cleaning clothes. I take a fridge temperature reading as it needs to be kept under 5 degrees - again there is info in the food hygiene course about key temperatures. You dont need to have a dishwasher but if you do that's good cos of the temp they wash at. You need to have separate (from your washing up sink) hand washing facilities and I use paper towels for drying hands - not bathroom towels - again covered in food hygiene. They will expect there to be hot water - sounds obvious but if you get chance to look at say restaurants sometimes they dont get good food ratings because of things like that. You also need to be aware of allergies - there are 14 - I dont claim to be allergy free and while I do sometimes bake gluten free, I would never take a job say nut free as I do have nuts in my kitchen and I am not using separate bowls/cutlery for their preparation. There is also info on trading standards site about food labelling - but you will need to provide allergy labelling - basic labels can be bought online or if you have a Booker cash n carry store you can get them there as well. As I said in my original answer I dont bake a lot so it was helpful for me to know that I only need to record temp/cleaning routine etc when I am baking for a customer, not every day but tbh, the fridge temp is so easy to do everyday. I asked questions about storing eggs (not in fridge is fine!) and traceability - I generally buy baking products from the supermarkets and although bigger business needs to be more robust about recording batch numbers etc its not really practical for me - he was happy that labels etc are kept until say a week past an item would have been consumed just in case there was any comeback.
As regards the HMRC - no problem at all. There is a form on their website to fill in. If you have ever done self assessment before (which I had) you will have a UTR (unique tax reference) which you need to quote on the form.
If you are also Facebook users, maybe think about joining a group called Cake chat - I belong to it and there is always folks asking about setting up and home inspections etc. I cant guarantee I have remembered everything but hopefully this does give you some answers or point you to other places where you can find info. Please do contact me (if there is a facility on this site to do so) if you have other questions, happy to help where/if I can. Helen
I realised after I had posted this this morning that I also needed to say you should inform your home insurers that you are running a business from your home - some wont cover you - mine wouldn't so we had to find another insurer but that was straight forward. You should also inform your mortgage lender - again some don't like it.