From hobby to home baking business…..
Deciding to turn your hobby into a business is for many a daunting prospect. I have been there and hope I can help you by sharing some of my experiences.
Find your niche market….what are you best at and focus your business on this, be it wedding cakes, celebration cakes, cupcakes, special dietary requirements or vegan cakes for example. Be brave and limit what you do so you can excel in it. If you spread yourself too thinly you lose your identity and just become another cake maker. Find something that differentiates your business from the competition. This will help give your business a unique identity and develop your brand. Be prepared to say “NO” to customers who ask you to make something outside your niche product. Fresh products sell locally so you need to stand out from the competition. Initially you will need to be prepared to put in long hours – keep the faith as hard work and long days will pay off if you have a good product.
Create a unique look. Consider a small order of business cards. These can be ordered online quite cheaply through companies such as vista print. I always attach a business card to my orders. This is a cheap way to advertise to a whole new audience. Guests, for example can easily obtain your details if they like what they see.
Register yourself as self-employed with HMRC. You will need to do a tax return even if you make a loss or are under the tax threshold in your first year of business. Please note this is the procedure for the UK but will vary internationally.
Complete a food hygiene certificate to level two. I completed mine online and there are lots of companies offering this. The cost for this varies but is around £20-£30. You would be surprised at the number of times I have been asked if I have one mainly from other businesses who may feel threatened.
Equipment -you don’t need to start your business with every bit of equipment on day one. I started with a hand held electric mixer and only when the business really started to pick up did I invest in a stand mixer (I now have 4). I couldn’t manage without them now. Home baking is a relatively low cost business to venture into. You can add equipment over time as your business grows.
Maximise profit. Invest time in research, to source good quality ingredients at good prices and check out your local wholesalers. Scour the internet for reliable supplies of boxes and other equipment you may need. Be prepared to invest in stock to get the best prices for non-perishables.
You will need public liability insurance. This will give you piece of mind and protect you against any potential litigation issues. It will not cover you for negligence. It is up to you to read the small print.
Consider your pricing policy carefully. This is a difficult one to gauge but do not under-price yourself. There will always be someone who will undercut you but if you concentrate on being the best, forget the rest. Consider the time it takes you to make your product and make sure you are working for a reasonable hourly rate. If you feel like you are working for peanuts your original passion could become resentment.
Register with the local authority Food Standards Agency. The FSA make home visits so be prepared. Order a Safer Food Better Business Pack and complete the relevant documents before your inspection. I made a few additional purchases to keep in line with the guidelines including a fridge thermometer and some industrial cleaning spray. This is a generic pack for all food businesses so it won’t all be relevant but the environment health officer will be able to see you are serious in building a safe food environment and are a planning to run a professional business. The FSA will arrange a convenient date for a home visit and won’t just turn up when it’s a private home. They are just as interested in your paperwork as inspecting your home so make sure this is in order. They want to be assured that your knowledge of safe food handling and storage is adequate and you will be awarded a food hygiene rating following your home visit if you meet their requirements. This is not as scary as you may think. They want you to succeed in your business and are happy to give help and advice. This service is free for the registration and inspection.Please note this is the procedure for the UK but will vary internationally.
Keep track of your income and expenditure from day one. It is easier to keep track if you do this regularly. Consider having a separate account for your business (it doesn’t have to be a business account) which will be a great way of seeing deposits paid in and for paying for anything relating to the business. This makes life so much easier when it comes to doing your tax return at year end.
Marketing – there are lots of free ways in which to market your new business so don’t jump in with websites or other costly platforms. My business was two years in before I finally invested in a website. I will do a future blog on the best ways of marketing your new business but initially stick with Facebook, Twitter and Instagram. These worked wonders for my business and are totally free.
Enjoy –and most importantly enjoy each little success. These are what will keep you motivated.
A million questions immediately flood your mind ….. where to start, who to tell and so much more.
I have always been a rule follower and didn’t want to break regulations but didn’t have a clue where to start. So below I have summarised some of the things I have learnt that you will need to consider when starting your business.
I wish you every success in your business journey.