Three industries where you cannot go wrong in business are housing, energy and food. With population growth, you are guaranteed a growing pool of potential customers. Those things also happen to be essential. For the most part. Speciality foods like cakes are not exactly essential but very much in demand and represent a great start-up business opportunity. Here are some things you need to consider as well as keys to success for cake baking business.
Before we discuss equipment, capital and customers food safety comes first. We live in a country that has experienced outbreaks of both cholera and typhoid in the recent past and we cannot ignite the importance of this. Food safety is included in most cooking classes if not all and is necessary for licensing.
A lot will depend on where you are. Food regulation is decentralized and handled by your local authorities. There is no single central law or process for Zimbabwe. Please seek your local authorities licensing department or health and safety department for licensing.
Another you have to think about immediately in Zimbabwe is the power situation. Electricity supply is erratic, not enough so to base a business on at any rate. One thing to consider funds permitting is a gas-powered oven. This will come in handy if a 14-hour power cut is visited upon you the day before that big client’s cake is required.
You will also need to make a considerable investment in small equipment such as cake tins and/or baking forms such as silicone. A host of cake decorating equipment to enable you to bring through beautiful designs. Scales and measuring equipment too are necessary.
The cake market is huge, to say the least. There are a variety of reasons people would need cakes. While there are the seemingly obvious reasons such as occasions and celebrations that’s only the top of the iceberg for the savvy cake maker. Coffee shops, eateries and restaurants are also great markets for your cakes. This is not just for regular cakes if you have a speciality cake you make you can find a constant market in other people’s businesses. Also, consider office settings where a company may want to start a cake Friday (doughnut Friday where I work) for employees.
Know your product
It’s essential to absolutely know your product completely. There are important issues to consider with cakes such as cake types, density and decoration options. The idea may seem like you just bake and decorate but not every cake can work with every type of decoration. Knowing this will prevent you from taking customer orders from hell. It’s also essential for planning purposes. Some cakes need to sit while others like fruit cake need to mature.
With a small operation this may not seem such an issue but it’s a relationship that is important from the start. Quality suppliers are key to succeeding in this business. It’s important to have a reliable supplier who stocks a wide variety of your needs. This can be something as simple as decorations like 100s & 1000s to more complex needs such as fondant and mascarpone. Create good relationships with them because you’ll likely need their help many times along the way.
Cakes can be delicate so consider transportation options carefully. The customer collects is still the most prevalent method but has the potential disadvantage of poor handling. Also consider having a delivery partner, who can transport the cakes taking special care with them.
This is where you need to put your effort. The size of your business will be determined by your ability to reach customers. Your greatest marketing tool is a satisfied customer. So make it easy for them to recommend your service to others. Social media at the very least is necessary. Websites are becoming cheaper and easier to build and maintain so that could be useful to you as well. There’s a lot of good content on this site about the effective use of social media. Networking is important, keep relations with customers healthy at all times. Make them feel important through their order.
Keys to success
Pricing and Costing
If you fail at this part you may as well shut up shop. Baking is an exact science and so is decorating, you know exactly what goes in. When quoting customers you usually only have a few seconds to give a rough estimate. The problem here is you need to include all costs. The last thing you want to do is omit something that greatly increases the cost to you.
Depending on the pricing model you use the cost will be VERY important. A good rule of thumb is to use cost-plus pricing. Say cost plus 150%. So you charge 250% of all costs including non-reusable items such as boards and packaging. All this while trying to find your place in the market needs a careful understanding. The important thing to remember is that there are energy costs you are trying to recover and compensation for time. Make it worth your while.
Policies and procedures
This is probably the most important thing I will share with you in this article. Having set procedures and policies for dealing with customers is essential! Always have a set procedure preferably known to the customer as to what will happen. That includes steps to confirming their order, payment procedures, contingencies and even dispute resolution. Yes, it’s a lot. Speaking to people in this business this is one they all stress. So plan it. This is not a bridge you can simply cross when you come across it.
Being everything to everyone sounds like a good idea until you have to actually be everything to everyone. Know your cakes, what you can do and what you cannot do. Saying yes to every order is a recipe for confusion at the least and a listing on Name and shame them or worse. The idea is to provide service that creates good recommendations which you can use going forward. A boutique approach may be useful in this regard, stick to what you are excellent at while you practice what you are not yet excellent at.
There’s a lot of business and opportunity out there, what you need to do is stand out. There’s that rule that says be the first, best or only. It’s a good one to use in this business. Be the first to offer something, this isn’t limited to a recipe, you could be the first to offer a payment method or design process. Being the best is obviously the most defensible position but there’s a lot of people out there in the business and that’s a hard claim to stake. Being the only one who makes a speciality cake is sure to set you apart in the business.