Starting your own business is a hugely rewarding enterprise. Congratulations for taking the first steps! This article will help you to think about some of the issues you’ll need to tackle in the early stages of setting up your cake-baking business.
First Questions
Setting up a cake-baking business isn’t something that you can do overnight. As well as the initial idea, you’ll also need training, investment, equipment, and a marketing plan.
Let’s assume that you are already travelling down the path towards a cake business. You’ve given it some thought, and looked at the competition. This means that you’ve considered all of these questions:
- Who will Buy Your Cakes?
- What occasions will they be for?
- Who are your competitors?
- How will your cakes be special?
- How much do your competitors charge?
- How do their cakes compare to yours?
- Will your cakes be better, cheaper, or more imaginative?
- Where will you bake your cakes?
Set-Up Costs
SKILLS. Do you have the appropriate food, health and safety training? Has your premises been certified for professional baking? These will add to your Set-up Costs.
EQUIPMENT. Keep a record of everything that you buy for the baking business – from spatulas to cupcake trays and food colourings.
BUSINESS FEES. You may need to hire an accountant, a web developer, a marketing consultant, a copywriter, a printer, and a designer – depending on your planned marketing activities.
MARKETING. Allocate a good portion of your budget for Marketing and Advertising – ads in press and online are costly.
Developing Your Product Range
This is key to your success. Your product range must fit in with other products that are offered in the area. It must be priced appropriately – no use charging twice what a nearby bakery does. This stage involves plenty of research, including performing a SWOT analysis to understand your strengths, weaknesses, opportunities, and threats. Visit bakeries and supermarkets, and contact party planners to find out where people usually buy their cakes, and how much they would spend.
Taste everything you can find, and decide what will make your cakes better! Research popular or trendy flavours, designs and styles of cake; hold a tasting panel and get other people’s input too. Only then will you be equipped to select a small range of products for your launch.
Drawing Up Your Marketing Plan
Sometimes, a business ‘just takes off’. Friends and family mention the service, orders begin to mount up, and the business quickly becomes sufficient. It can happen. But it’s rare. So, although you could depend on word-of-mouth to promote your business, a marketing strategy will spread the word much faster. After the investment of time and money you’ve already made, you’ll want to start making ends meet as soon as possible. Right?
Great. Your marketing plan needn’t be a complex business document – it doesn’t even need to be professionally formatted. It could be a sheaf of notes written during a brainstorming session in the garden. Or you could get a professional to do it. (The university near to us is always looking for projects for its business students – so try asking around.)
Don’t be afraid to start it yourself. The content of your marketing plan should include the following:
- Who is my target market? (Working mums, schools, party planners?)
- What do they want? (Don’t guess – ask them!)
- Where do they find details of the services that they use?
- What do they read? Do they have internet access?
- How much do they spend on a food shop / children’s party?
- What can I offer to encourage them to try my cakes? (Free samples, vouchers, referral discounts?)
- Where should I place an advertisement? How can I measure the results?
- How can I get featured in the local press?
- Do I Need a Website? What information should be on it?
- Do I have access to anyone or anything that I could use for free advertising? (For example: could you hold a sample tasting at the school or church fete? Do you know someone who works in a large local company – and wouldn’t mind passing out samples or leaflets? Do you know the owner of your local shop, who would be able to stick up a poster? Is there a party planner in your area?)
Setting a Great Example…
If you need support and advice, it’s a great idea to join your local business associations or chambers of commerce. You’ll benefit from the friendly support of a community of like-minded people who are setting up a business of their own. When yours is established, keep in touch with the Network: you never know how it could continue to help you.
