"The best way to predict your future is to create it. "
- Peter Drucker
The delicious scent of a freshly baked cake is wafting through the oven. You pull the cake out, decorate it and look at it in wonder. You’re so proud of your spectacular cake and you secretly wish you could start a cake business from home. Encouraged by friends and family, you begin to sell your cakes to them. But since you’re really passionate about baking, you want to grow your cake business and reach more people.
While you may be wondering how to start a cake business from home, there are many other home bakers who have already converted their passion into a successful business and have started selling cakes from home. This industry is rapidly growing and there’s heavy competition.
The cake business in India has witnessed massive growth over the last few years due to the increased demand from consumers, the burgeoning cafe-culture and of course, social media. Home-based baking, in particular, has been taken up by a huge number of women entrepreneurs thanks to these reasons. There are many initiatives which are also being taken by the Government Of India, which has further encouraged them to pursue their baking dreams. Not just women, quite a few men are also taking up home baking as a profession.
As bakery products are both affordable and easily available in the country, their consumption level has seen a rise in the past few years. According to a recent report by IMARC Group, titled ‘Indian Bakery Market : Industry Trends, Share, Size, Growth, Opportunity and Forecast 2019-2024’ , the Indian bakery market reached a value of 7.22 billion dollars in 2018.
According to another research study, the Indian cake market is projected to grow at the rate of 12.5% during the forecast period 2018 to 2023. From the past few years, there’s a high demand for customized and artisanal cakes as well. Factors like product innovations in terms of new flavours, rise in disposable income and changing consumer tastes and preferences are the key drivers of the segment. This is where home bakers come to the rescue.
Very often, getting cake business ideas and finding all the information you need can take a lot of time and effort, so to make things a little easier for you, we have come up with an informative guide of the steps you need to follow in order to start selling cakes from home.
Table of Contents:
Have a business plan
A business should begin with thorough market research. Like any big business a home based business should also start with a proper business plan. But before you set up a home based cake business, you must decide what types of cakes you want to sell. You should also come up with cake shop name ideas, identify your target market, do some competitive research and just make sure to have a cake business plan in place, which includes a complete strategy of how you want to start and then take your cake business forward.
License and Registration for food-related businesses
The next thing to think about is, do you need a food safety registration and a food license to sell baked goods? Well, yes. In India, the FSSAI license is mandatory for all food startups. It includes bakeries, restaurants, canteens, cafeterias, food franchise outlets and even small kitchens.
Developing a niche
An important part of a cake business plan is to find and develop your niche. When deciding what types of cakes to include in your offerings, the best thing to do is to be unique. Try to offer something different to your customers, like gluten-free, eggless or vegan cakes. This will help you to stand out from the crowd.
Find the best cake recipe
Keep thinking of new ideas and find out new cake recipes in order to keep the customers interested. Identify the best selling cakes from home so that you can tweak those recipes later.
Learn about baking
By this we mean, go beyond the basics of baking. Of course you know enough about cake baking to start a business, but keep updating your baking skills even after you have established your brand. Updating your knowledge should be an integral part of your cake business plan. This is what will set you apart from your competition and improve your craft in a great manner.
Types of equipment required
Your cakes are the star of the show, they’re the reason why customers come to you in the first place. Therefore, choosing the right baking tools and equipment is extremely important. Some of the most important baking tools are mixing bowls, a good quality spatula, an effective baking oven, baking tray, cooling racks, measuring spoons and a good electric food mixer, among others.
Setting up your Kitchen
Having a good, spacious kitchen is quite a necessity these days for any chef. It’s alright if you have a small kitchen, but since you are a home baker with limited help and resources at the beginning, you would not want to compromise on the kitchen space. This includes having enough shelves and tables to keep your tools and baking equipment, a big kitchen counter which enables you to work efficiently and an extra, big refrigerator to store all your cakes in, till the time of delivery.
This goes without saying. Obviously, buying the necessary cake ingredients is really important for an excellent end-product. Since most of your cakes will be customized, if some ingredients are not available in your city, then sourcing them from other places is the next step to follow. According to your budget, you can even source good quality baking ingredients and raw materials from abroad.
Inventory planning plays an important role in any food business, especially in the cake business. Stock management, or inventory planning means ensuring that your ingredients don’t go out of date and that you maintain accurate records of where all the items were purchased from. Usually for this, keeping a simple spreadsheet is sufficient for most home bakers but as your business grows, it is advisable to invest in a stock management system.
One thing that a lot of home bakers struggle with is taking good photographs of their cakes. Learning how to take high-quality photos of your delectable creations is one of the best things you can do for your cake business. Investing in a good camera for cake photography is the first thing you should do, after which good lighting and location should be the points of focus. This will help your customers see your cakes as they are, before placing an order. If you are wondering how to do cake photography, then you can learn from online tutorials and videos in a faster yet efficient way.
Proper packaging is everything, especially for cakes as they are perishable. Good packaging provides barrier protection to the product, gives information about the brand, and more importantly, keeps it safe from any kind of tampering.
Knowing how to price cakes for profit correctly is absolutely important. You have to consider a few key factors while pricing the cake, for example, the time, ingredients required for baking and overhead charges. Of course you should consider your competitors prices too, but never charge solely on the basis of what they are charging. And always remember, your cake prices can only increase if the quality and skill of your cake making increases too. For pricing accurately, most bakers use a cake pricing calculator.
No cake business plan is complete without a proper marketing strategy in place. If you are thinking about cake marketing ideas and how to promote a cake business, then one thing you must do first is making your brand logo. Then comes creating a website and separate business pages on social media sites where your customers will find all the information regarding your products and can also view the cake photos. As for offline advertising, you can distribute pamphlets around the city, if you have the budget. Attending cake fairs and exhibitions are also a fantastic way to tap potential customers. Networking is another important part of a great marketing strategy.
This includes figuring out the purchase and delivery of raw materials, shipment, packaging and transportation of the cakes to the end consumer. It is the most important part of any cake business plan, whether it is a home based or commercial business.
Managing a business is tough, be it from any sector. Starting a home business is especially hard. But in the end, it’s rewarding and worth all the time and effort that has been put in. So if you’ve read this guide and you’re seriously thinking of taking your passion for baking to the next level, then take a deep breath, smile and begin your baking journey. Bonne chance!