I notice there are quite a few posts on Rose’s blog and in the forum from people who are thinking about starting a business, either from home or in a dedicated location.  I did a search because I’m thinking that way myself! I also notice there are some very talented blog & forum members who are already running their own businesses. They’ve been generous with their advice on aspects of this topic, big and small!

How about a thread on taking your passion for baking public? What are your thoughts, worries, questions, ideas? Maybe we can help each other in this area, as we do with all the nitty gritty questions about baking.

I’ll start things off with a couple of urls that you might find interesting. These are about a bakery in Montreal Canada. For me, they demonstrate that there’s more than one way to run a bakery when it’s your passion, and not just about making money.

http://www.youtube.com/watch?v=dXY8MJAF2q8
http://www.chowhound.com/topics/404732

Carol, this is fantastic!

Thanks for the info Carol.

Great thread idea!

Cupcake bakeries are all the rage right now. We have 2 in Denver, and the one over by Regis University (32nd and Lowell or something like that) called Happy Cakes is my favorite—those ladies do some fantastic flavor combos. Also, many other bakeries are producing cupcakes now.

Personally, It’s my dream to own a tea shop. I bake part time for Capital Tea, and am having a great time learning about the business.

Someday…

I’ve just placed an order for a Broilking Cadco OV-250 quarter sheet countertop commercial convection oven.  It is cute like a button, and many home pros and caterers use it.  You can bring it to the customer’s site and use it as a great oven.  I can’t wait to post my home results from that oven!  There are issues, but I think it will be a great tool in my home/business regardless.  It will be great to bake pies, tarts, and cookies!

hectorwong - 03 April 2008 04:50 PM

I’ve just placed an order for a Broilking Cadco OV-250 quarter sheet countertop commercial convection oven.  It is cute like a button, and many home pros and caterers use it.  You can bring it to the customer’s site and use it as a great oven.  I can’t wait to post my home results from that oven!  There are issues, but I think it will be a great tool in my home/business regardless.  It will be great to bake pies, tarts, and cookies!

Congrats!

I just “googled” it and saw a picture of it. Pretty neat unit. Looking forward to your review.

a dream!

http://www.chow.com/stories/10901

I’ve been chatting with Patrincia, curious to ask her how much she would charge for such fantastic ganache cake with the ‘inexpensive’ car cutout on top!  Ganache and raspberries is definitely one of the cakes of luxury that people would pay top $$$ for such delicacy.

We have been talking about double or triple of the cost of ingredients!  Fellow bloggers have shared to use ruler near the $4 per slice generalization for home baked cakes that uses top ingredients.

I have been never charging by the cost of ingredients relation.  Surely, I need to make sure the cost of ingredients are covered.  But I think cakes can be more labor hours than cost of ingredients.  So somewhere in between is the ideal scenario.  You also need to ‘discount’ since your cost of running the business is zero to low (retail lease, taxes, staff, advertising, etc).

To stay out of trouble from the IRS, you are allowed to receive gifts.  What I’ve been telling my people is how much money the previous person paid me, based on the number of servings.  Then I say:  I expect that as a minimum plus tips and plus how much more or less you think the cake is worth after you see it completed and compleated!

Also, caveat and be aware, that many people ask home bakers for cake, to save in $$$  It is ok to be a good Samaritan every now and then, but really, don’t get burned or burned out, as we need to take care of one thing the most:  stay healthy in your oven, and keep your hobby in your heart alive and going.  Once you do it for slavery, your creativity ends.

hectorwong - 07 April 2008 02:48 PM

You also need to ‘discount’ since your cost of running the business is zero to low (retail lease, taxes, staff, advertising, etc)

But you can’t purchase ingredients at wholesale, and you can’t bake in mass quantities, so it actually takes a lot more of your time and money to produce a quality homemade cake.

Absolutely!  the most wholesale or mass work I do, is to whip extra stuff and freeze ahead whatever I can.  There is just no other way, and I do believe that baking ahead when possible is still “baking from scratch and fresh!!!”

I’ve just briefly counted how many buttercream roses where on Rose’s World Cake, I think close to 1000.  I have about 50 left, which are been used quickly, rather sad to see them go before the 1 year that mousseline buttercream can be frozen!

hectorwong - 07 April 2008 02:48 PM

I have been never charging by the cost of ingredients relation. Surely, I need to make sure the cost of ingredients are covered. But I think cakes can be more labor hours than cost of ingredients.

The way the 3x or 4x ingredient cost formula was explained to us at baking school was that it gave you a ballpark figure to work from that would at least cover your ingredient cost, overhead (including labour) and, the baking gods willing, some net profit so you could stay in business. Professional bakers, whether working from home or in a commercial setting, also have to factor in “what the market will bear.” The lesson seemed to be that managing quality, speed, efficiency, ingredient cost, etc. is a constant juggling act in commercial operations, as they try to serve a specific market niche to a standard that the owner has set and wishes to maintain.

Hector’s absolutely right that doing custom work is very labour intensive! I can only guess that aside from talent, skill and creating a buzz, the bakers who get to do it AND make a living, are in a market that will support high-end work. But I have NO IDEA how this applies to the many other ways a baker can “go commercial” (from home, etc.) That’s one of the reasons I started the thread! It’s good to see the kitchen “chatter” continuing, so we can dream aloud and talk about some of the nuts and bolts aspects of making our dreams a reality.

There’s lots of good “start a business” advice at various government websites, some of it specifically tailored to baking operations. One I found said about pricing that bakeries usually use a markup method based on costs and suggest that the new owner:
1) Set up a cost book listing individual ingredients and their costs.
2) Set up a ‘cost of recipes’ book listing the costs for producing specific items.

I also found an interesting website with a few free sample business plans (one of them for a tea room, Roxanne). The plans are fiction, of course, because they’re just there to entice you to buy the software. But it’s all food for thought ... and dreams?
http://www.bplans.com/Sample_Business_Plans/Restaurant_Cafe_And_Bakery_Business_Plans/

There is this button cute bakery called Sweet Nothings (http://www.sweetnothingshawaii.com).  They have been around for near 2 years and booming.  It is a sugar free bakery; sugar intolerant and people on diet are loving it, as you can google the articles and media press this bakery is receiving.  The éclairs, napoleons, cheese pockets, and other pastry are exceptional.  There is a true need for a sugar free bakery in Hawaii since Type I diabetes is the highest among the Asian community.  When you walk into this bakery you can see the love, as the owners are not bakers for profit but everyday people who have been deprived from pastry due to sugar intolerance!

Sweet Nothings also makes a small assortment of small cakes, sold either whole or by the slice.  The cakes looks tasty and have a unique home made appeal, not commercially plastic perfect. 

Customers often request to make larger sizes and also wedding cakes which they haven’t been able to fulfill because there is NO cake decorator on staff.

I’ve just came home, after spending 2 hours as their cake decorator, and what I want to share with you is how happy I was.  My mission is to improve the look of their pastries and handle the custom cake orders.  Also, to do all the piped writing, something I don’t normally do, but what a better way to get perfect at it and for a good cause!

I have a baker and a basic cake assembler, who will bake all the cakes and layer/frost.  My first 2 hours turned into the worse piped writing nightmare.  I was so unfamiliar with their frosting, the consistency was odd, the piping tips were disorganized, and there was no professional turn table!  But I think I was able to pull it thru, as the owner wants me to come back, and he was pleased when I asked him to buy a tip #3 and a Ateco turntable!  Indeed, I found the kitchen setup perfect, the refrigerators to drool for, and a nice commercial sink!  I will be working for a couple hours each evening, a few weekends, and hopefully my influence will be visually present when I am done with their make over!

I want to remind ourselves, that sugar contributes so much to the texture and chemical interaction of regular cakes and pastry.  I am a real-sugar baker, and what a better way to learn about sugar than by baking without it!

That’s wonderful news Hector - you will be able to learn so much about the business!

Hector:
Congrats…enjoy! Sounds like an amazing opportunity.