Every joyful celebration, whether a birthday party or a wedding, is incomplete without bakery items. Those who have creativity can decide to choose a bakery business. But before proceeding further, many of you have a question – how to start a bakery business?

The bakery business has experienced continuous development over the past five years in the United States. There is growth of 3.6% and the bakery industry has projects worth $11.7 billion.

In this blog, we will learn how to start a baking business by taking all the measures. So stick your eyes here as many interesting things will get unlocked.

Why Start a Baking Business?

Plenty of reasons are there to justify this question. Some of them are listed below.

  • Complete control of the product
  • Flexible schedule to balance work-life
  • Work-from-home opportunities as you can start a bakery business from home
  • Low start-up costs and minimal equipment
  • Opportunity for growth because successful bakeries can easily expand their product offering.

How to Start a Bakery Business? Let’s Define the Steps Here

How to Start a Bakery Business Let's Define the Steps Here

1. Generate Business Strategy

A proper business strategy is the first step to establishing your new business. It helps business owners to identify the current status of the business and future goals to achieve. Always consider the below elements to create a strong bakery business plan for a bakery business.

  • Name: Keeping a business name is essential as no business can be run nameless. However, you must search the US Patent and Trademark Office to check if the name has already been taken or not.
  • Market Analysis: No business beginning is possible without an in-depth understanding of the market and competitors.
  • Products: It’s a bakery profession and you are about to make and sell bakery items. Always decide what bakery items you will sell and ready the menu before going ahead.
  • Perform Market Research: The bakery business is a local business and it’s important to analyze the local business environment. Local market trends, budget, competition, and target audience are the key elements to accomplishing it.
  • Investment Planning: Keep your investment planning ready before beginning a bakery business. It’s an essential part of your bakery business plan.

2. Register Your Baking Business

Are you making a strategy for how to start a baking business? Don’t forget to register your business. Like any other business, bakery businesses also need registration. Because the bakery is related to food, a food service license is necessary for this kind of profession. Business owners can apply through the health department offline or in online mode. The cost of the permission process can vary from $100 to $1000.

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3. Create a Financial Plan

Financial planning is a crucial component of any business. A budget roadmap is essential for a bakery business like any other profession. When it comes to budgets, you must have good investment planning. However, every business has different plans including product, size, location, and strategy.

Do market research and find out the estimate of establishing a business as a food truck bakery or a bakery store. The investment in setting up a business includes purchasing materials, business registration fees, and labor costs.

4. Insurance for Baking Businesses

There are various risks involved in the bakery business. Fire, bakery equipment damage, and labor injury are the risks that come under this. Opting for the best insurance plan for your baking business is the right move.

Insurance options can help in covering losses that may arise due to any misfortune. General liability insurance, commercial property insurance, and business income insurance are some available options for insurance.

5. Make a Business Entity and Gain License

You have set everything, but getting a business license is also a non-negligible entity. Each state has different rules and regulations. So to check what business licenses and permits your bakery business will need, you must consult with your local government.

In the case of a bakery business, you can check with a cottage food expert or attorney. It will be helpful to advise the best possible way to proceed ahead.

As per state rules, business owners need to take a food manager license from the health department.

6. Use Proper Invoicing Software

Use Proper Invoicing Software

Invoicing is a part of any business that keeps billing methodical. However, traditional invoicing is time-consuming. You can have the upper hand by switching to invoicing software and availing of a bakery invoice template. This invoicing software speeds up the billing process by providing in-built invoice templates.

Moon Invoice is a great platform to gain a cake invoice template. The platform provides a high diversity of invoicing templates to create invoices for every business. Bakery owners can easily create bakery invoices in just a few clicks.

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7. Get Your Equipment and Supplies

There is certain equipment required for a successful bakery business which is listed below.


The commercial-grade ovens are high in price, which can be around $100K.


Large-capacity stand mixers with special dough hooks are required in the bakery business.


Refrigerators are crucial for the wholesale bakery business because storing perishable food like cream and milk is essential.

Bakery POS System

The investment cost for a bakery POS system can be $1000 to $5000. The bakery application development can be $5000 to $20,000 as per the features and complexity.

Decorating Tools

Bakery items are about creativity and decoration. Certain tools are essential for decorating pastries and wedding cakes.

8. Promote Your Baking Business

No business success is achievable without business promotion. In the case of the baking business, more emphasis is given to the local business especially when you have set up a new one. You can do business marketing in two ways.

Offline Marketing

To promote your bakery business, you can easily collaborate with local business entities. Advertise your business in the newspaper or share business pamphlets within your circle.

Online Marketing

Online marketing involves the setup of a Google My Business Profile, social media promotion, and a website for your bakery profession. These initiatives will help you gain fresh customers.

What Is the Expenditure to Start a Bakery Business?

The overall investment in a bakery business depends upon the type of bakery business you start. The average cost of starting a retail bakery business is between $10,000 and $50,000. Here is a bakery startup expense breakdown.

Leased space

The cost of leased bakery space can be $900 to $6000 per month along with other deposits and fees.


Utilities like electricity, water, gas, and internet service can be around $1000 to $2000 per month.

Bakery Equipment

There can be a $20,000 investment in bakery equipment and other cookware. Dough proofer, oven, mixer, bakeware, refrigerator, and sheet pan racks are some bakery equipment required.

Pre-opening expense

The pre-opening restaurant startup expense can be around $20K to $120K, depending upon the size.

Outdoor Space

The investment in outdoor decoration can be about $1000 to $40,000. It includes decoration, signage, landscaping, lighting, and seating.

License, Deposits and Permits

Business licenses and other legal permits are important for the retail bakery profession. The investment cost for this can be $2,500 to $200,000.

Starting a Baking Business From Home

Thinking of starting a bakery from home? This kind of option is perfect for those who would like to initiate a business from home. The core advantage of starting a baking business from home is that no lease expenses are applicable.

Below are some facts about the home bakery business.

  • No financial risk is there so it is a safe journey.
  • Home-based bakery businesses are always well-planned.
  • Things are never rapidly happening, and they are more gradual.

How to Start a Home Bakery?

Baking a business from home requires planning, legal requirements, branding, and pricing of items. You can start a bakery business from home in these three phases.

Start in your kitchen

It’s the beginning and you can start in your kitchen. At the initial stage, you can bake for your friends and relatives. Also, it is like a practice phase, so you can try making new items and improving the quality.

Part-time baking

Once you refine the quality, you can later on join part-time baking. You can start taking small orders that take less time to finish. Meanwhile, you can also start marketing and promotion of your business. Also, keep an appropriate price for your baking items.

Full-time baking

In this phase, you will become expert enough to take orders. You can source clients and bake for their orders. Gradually, you can explore more and expand your business to gain a bigger goal.


So here we end with how to start a bakery business. Like any other business, a bakery business needs hard work, dedication, and proper business planning. Moreover, the bakery business is a story of creativity, so never ignore it. With the right approach, you can uplift your baking profession.