How to start your own cake business
Want to know how to start your own cake making business but don't know where to begin? Read our guide to help you develop your very own cake company.
Are they good enough?
It might be a silly question to ask yourself but if you are looking to start making a little bit of money or even developing it into a full time business, you need to make sure that your cakes are delicious before you start your venture. Competition is fierce and you need to make sure it isn’t just your family and friends liking your cakes to be polite! Perhaps attend a local bake sale at a school or church fete, ask for feedback and get genuine opinions of your cooking!
Find your niche
Are you looking to go down the cupcake route? Or would you prefer going into the wedding industry? It’s essential to decide which niche you are going into before you start to break into the market. Cake businesses are becoming more popular so there is plenty of competition, by finding a specialism you may be much more successful than just a generic cake company. Specialising will also help you fine tune your brand so you can target your customers more effectively.
Some ideas you of routes you can go down is specialising in vegan cakes or making wedding cakes! The wedding industry is a real money maker and more and more people are becoming vegan alongside concerns for animal welfare!
Have you got the skills?
A lot of us are home bakers and if ‘home baking’ is your unique selling point then that’s great but, you need to make sure you have the skills professional baking skills needed in order to produce delicious bakes. Consider taking a course in order to develop your cake making skills to ensure you can offer a variety of professional looking cakes.
Make it legal
When you start any business you need to inform HMRC you’re self-employed so that they’re aware that you need to pay tax through the Self Assessment tax system. You need to do this even if you’re going to be running your home baking business part-time or if you have another job.
In order to register as a self-employed baker, you’ll need to register for a GOV.UK Verify account. A GOV.UK Verify account gives you access to the government’s range of online services, including HMRC’s Self Assessment portal.
Once you’ve created an account, you’ll need to provide some basic details about yourself and your cake business, including contact details and the type of work that you carry out.
You’ll also need to decide on a name for your business. Before deciding on a name, it’s a good idea to search online to make sure that there are no other baking businesses using the same name.
Another regulation when you’re starting your cake business is that you’re required to register your premises with the local authority’s environmental health service at least 28 days before you start trading. This doesn’t cost you anything and your registration can’t be refused. Someone will come to your home and check your food preparation area. To get contact details for your local authority, use the food business registration tool.
When pricing up your cakes, you’ll also need to factor in how much money you need to pay yourself for the work. This is something that’s important as you don’t want to end up making a loss.
Make sure you record all of the expenses you incur when running your baking business. Cake boxes, ingredients, ribbon, cupcake cases, boards, electricity/gas and marketing costs all need to be accounted for. There are also a number of “hidden” costs involved in selling baked goods from home, such as fuel (for delivering your cakes), postage and time spent baking, cake decorating, washing up and delivering orders. Even bookkeeping time can be accounted for in your costs.
You’ll also want to look at the competition. What is there pricing at? Can you be competitive?
People need to discover your wonderful cakes, so it’s important to think about marketing strategies. As well as going to local events with your cakes and using social media to reach potential customers, think of other ways.
If you’re specialising in wedding cakes, you may be able to put flyers in a wedding dress shop, or develop a relationship with a local wedding venue, for example. If you’re making vegan cakes, perhaps you can get permission to put flyers in a local vegetarian restaurant, or write a guest post for a popular vegan blog. You could also try Google Pay Per Click (PPC) ads or Facebook and Instagram advertising, although remember to narrow the audience down to your local area so that the adverts are only appearing for people within your delivery zone.
The power of social media is massive. Use it!
You make a product that looks beautiful, so photographs are key.
Set up a simple website with important details like what you do, where you’re based, and how people can place an order, and add plenty of mouth-watering photos. There are loads of free website builders.
Also set up social media accounts for your business, and keep them updated with posts and photographs. It’s important to interact with other people on social media, so spend a few minutes each day liking and commenting on other people’s posts, and following relevant accounts to get your interaction up.