Nowadays, a lot of people are interested in opening their own startups and want to pursue their passion freely and openly. With a major disruption witnessed in the Restaurant industry, we see more and more people setting up their own restaurant venture every day.
It doesn’t matter if you are a professional or a novice cook, every food enthusiast is not following his/her passion and is joining the food business.
Apart from cooking ventures, people have now started joining baking industry too and a lot of small and big bakeries have started opening up all around Delhi recently.
If you are one such aspiring baker who wishes to transform your passion into a reality then this article is a must-read for you. In this article, we will discuss the different steps and costs that you will need to consider when setting up your own bakery shop.
Depending on your bakery shop, you might end up investing anywhere between 1 lakh to 15 lakhs.
Here are detailed steps on how you can set up your own bakery business in Delhi.
Step 1: Evaluate your Financial Condition
The first thing that you need to evaluate is your financial condition for availing credit or loan from a bank institution. Now, this part is a little tricky because there are different styles of bakery shops that can be opened by a user and each of these bakery styles would require different investment amount. So first, you need to check your financial situation and then determine the type of bakery that will be more suited to your financial conditions.
If you are trying to start small and don’t have a lot of money to invest or avail any kind of credit from banks or other financial situations then you might need to open a home bakery. However, if you do have enough money for renting a space for your bakery and have enough credits to get a loan then you can open a proper bakery shop where people can sit and interact with each other.
Basically, your financial status will determine the type of bakery that you will be able to open up and since Delhi is a costly city, make sure that you have sufficient investors to help you out with the financial aspects.
Step 2: Choose the Perfect Location
Once your financial status is determined and once you know where you actually stand, you can start looking for an appropriate location for your bakery business. If you are planning to open a home bakery then you can simply skip this step as your home space will be the area from where you will be doing all the work. Home bakeries are much easier to set up and have reduced chances of loss as a lot of investment isn’t required. You already have space and the essential equipment, all you need is a marketing strategy and an efficient logistics system.
On the other hand, if you are setting up a proper bakery shop with/without dining option then you need to search for the perfect place. There are many areas in Delhi which are swamped with shopping centers and other eatery shops which will make a good location for your bakery shop. However, you need to consider the rent of the area and you also have to determine the scope of your market. If there are already a few well-known and popular bakeries in the area then your bakery might not go as well until you offer something unique to your customers.
You will need to consider all these things when choosing a location and have to weigh the pros and cons of a particular location before making any choice. Once you have found the perfect place for your bakery, you will need to sign the lease and rent it as soon as possible.
You can check out online real estate websites or contact some commercial brokers to find the perfect location but remember that time is of the essence and good places in Delhi go soon. So don’t waste too much time and be swift in your space renting.
Step 3: Get the Licenses for Starting your Bakery
Once you have your location and finances in place, you need to get all the essential licenses that are required to run a bakery business.
You will need to get a total of five licenses to open your bakery shop: FSSAI license, Local Municipal Corporation Health license, GST Registration, Fire license, and Police Eating House license.
While you can get the last two licenses: fire and police eating house license, after starting your bakery it is important that you get all the rest of licenses beforehand. Once you apply for these permits, a health inspection will be carried out at your bakery space to determine if your kitchen area is fit for baking or not.
You can follow the below steps to get all the important licenses and permits in place before setting up the bakery:
- First, you need to apply for Food license which can be done online via fssai.gov.in. You will need to pay a license fee and will need to fill out a couple of papers to get this started. You can do it yourself or you can take the help of an agency but remember that an agency will charge you service fees which will increase the licensing amount. Make sure that you purchase a few years’ license so that you don’t have to pay renewal fees every year.
- You also need to do the GST registration for your bakery business. For this, you can contact a Chartered Accountant or you can find the procedure online to apply for this license on your own.
- You will also need to contact a local municipal health inspector to get your Local Municipal Health license. The fee for this license would be somewhere around 3,000 INR and an inspection of your bakery space will be conducted prior to giving you the license.
- To get the fire license, you will need to install appropriate fire extinguishers and will need to pay a fee of 1,000-2,000 INR.
Step 4: Get the Necessary Kitchen Equipment and Ingredients
Once you have your bakery space and all the necessary licenses in place, you can start setting up your bakery kitchen. Always remember that this will be one of the important steps of setting up your bakery.
You cannot compromise on good quality kitchen equipment so don’t go looking for cheap tools. You need durable and high-quality kitchen tool which will be helpful to you and can be used for a long time.
The major kitchen equipment that you would need to purchase is a freezer, oven, mixers, gas stove, countertops, and so on.
You will also need to get all the baking tools which are essential in the starting and then slowly you can expand your utensils base.
Apart from purchasing the kitchen equipment, you will also need to get a vendor for your baking ingredients like flour, sugar, fresh fruits, and so on. If you form a partnership with a vendor, it will cost you less in the long term as you will get fresh ingredients in bulk.
However, if you purchase the ingredients from the supermarket then it will certainly cost you more which will be a burden in the long term.
Step 5: Consider the Logistics and Management
Next, you need to consider the logistics for your bakery business and how you are going to manage everything. You need to figure out how you are going to deliver the baked goods to your customer and will need to decide if you are planning to do home deliveries or not.
If you have planned to open a home bakery, then logistics will play a major role in the success of your bakery business. You will need to get the ingredients from the vendor, make the deliveries, get the payments, and so on.
In the starting, you can take help from your other family members and ask them to deliver the bakery products or get something for you. However, if this becomes too much then you can easily hire a person to manage the logistics section.
Trust me, it won’t cost you a lot and will save you a lot of headache and effort too. The next important thing to consider is the payment option. Are you accepting COD or do you prefer NEFT transfers?
A lot of bakers take 50% advance in cash which is a smart choice and then take the remaining payment after the delivery.
You can use quick systems like UPI, Net banking, etc. to broaden your base as most people perform electronic transactions these days.
For delivery, you will need to decide if you are going to go deliver each cake, cupcake, etc. yourself or are you going to ask your clients to pick it up.
A lot of bakeries also utilize radio taxis or other delivery services for themselves but this will take a small percentage out of your profit so you have to carefully plan it. In Delhi, you have swiggy or foodpanda delivery services that can be employed.
However, remember that the traffic in Delhi is quite bad so make sure you choose your delivery services carefully and try not to provide delivery services to clients who live too far off.
Step 6: Hire the Manpower
Depending on the size of your bakery business, you will need more helping hands to get it started. If you are opening a home bakery then you might not need as many staff members, you can easily take the help of your friends and family members.
However, if you are opening a high-end bakery shop then you might need to employ at least 4-5 people who will be the Head Chef, helpers, servers, cashier, delivery person, etc.
For a small bakery shop, you may need 3-4 people like a head baker, helper, cashier, and waiter. On the other hand, if you are opening a big bakery shop then you would need more manpower to actually work your bakery business.
So, make sure you decide how many people you will need and then get the best, hard-working staff for your bakery.
Remember, a happy and dedicated staff means a happy, successful bakery.
Step 7: Take Bakery and Kitchen Management classes
If you are going to be the main baker of your bakery shop or if you are going to help the head baker of your bakery, either way, you need to take baking courses. Taking baking courses will help you in understanding how to quickly prepare a recipe and will also give you ideas to add a little personal touch to it.
If you are opening a high-end bakery shop then you might need to get your entire staff in baking and kitchen management lessons.
This is important because learning is the key to a successful business. So, make sure you attend several bakery related workshops to better your bakery business and get the most out of your staff.
Step 8: Create a Display Area for your Bakery
Once your bakery is all set up and you have everything in place to inaugurate the place, you need to consider where your delicious cupcakes and muffins will go to lure the customers in.
If you opening a home bakery then this might not be of too much concern to you but if you are opening a proper bakery shop, you need to determine and carefully design your display area.
You will need a display fridge which will keep your pastries, cakes, etc. looking fresh and scrumptious and it should have proper racks to keep each item carefully and separately. You should have enough storage space in your display fridge to place your baked goods in a noticeable manner.
A lot of bakery shops often display their products through the window which is a good way to lure more people into your bakery.
So, carefully plan your display area because this could actually make or break your bakery shop.
Step 9: Market your Bakery Brand
Finally, you need to brand your bakery with an appropriate logo and name. This is important because the name of your bakery shop will play a major part in luring in the customers so make sure you choose a catchy and trendy name.
Try to avoid bakery names with your family member’s names as they usually don’t attract a lot of customers. Make sure that your brand logo is nicely designed and looks attractive to customers and also get a well-designed menu for your bakery shop.
For marketing your bakery business, you will need to explore all the areas like social media, pamphlets, billboards, etc.
Make sure to get a nice and catchy display board for your bakery shop so that more customers are tempted to try your bakery. Also, getting some 20,000 – 30,000 pamphlets for your bakery will be good in the starting so that you can spread the word about your bakery business.
Apart from that, make social media your marketing tool. Use Instagram, Facebook, Twitter, Pinterest, etc. to display your bakery items and take professional photographs to get more customers.
Ask your friends and family members to spread the word out about your bakery business. You can also host a bakery sale in the starting to get noticed but don’t do this too often as you will end up making no profit with this strategy.
Step 10: Talk to Bakery Owners and Baking Experts
A crucial part of opening any business is to assess the market and talk to other people in the same business to get a feel for it. The same goes for bakery business as well. So, talk to other bakery owners and get an estimate of how much time it took them to successfully run their business and what all shortcomings you might need to avoid.
Go and check out different bakeries and see what works well for them and how you can implement it in your bakery shop.
Always try to get as many baking tips and hacks as possible because these will help you in not only making a delicious baked good but will also help you save a lot of time and money.
Managing your bakery business will be an ongoing learning process so make sure you try and gather more information to better your business slowly and steadily.
So, what do you think? Ready to start your own bakery business now? Just remember the above-mentioned steps and you will easily be able to start your own bakery in Delhi in no time at all.