Business Overview

From birthday parties to weddings and other special occasions, cakes are an integral part of many celebrations. Industry innovations have made it possible for consumers to turn their confectioner’s dream into a reality and allow bakers to become more imaginative with their creations. Depending upon the business plan and overall goals of the entrepreneur, a cake business can be structured several different ways. Many business owners service the entire community, while targeting a specific niche market, based on their baking strengths and public need.

Who is this business right for?

Some of the most skilled chefs claim to fall short when it comes to baking. Are you one of the fortunate few who are skilled at baking? Are you passionate about the art of cake decorating and enhancing someone’s life celebration? Have you often pondered the benefits of being your own boss? If your answers were “yes,” opening your own cake business could be the perfect opportunity to realize your professional and personal goals.

What happens during a typical day at a cake business?

Each day will be structured differently from the next, depending upon the orders you have lined up and how you’ve decided to structure your business. Many cake businesses forego a storefront location, focusing solely on custom orders. If you do choose a brick and mortar location, you will need to spend additional time baking, so that custom orders are met and displays are filled regularly. Once cakes are baked and decorated, orders should be packaged for delivery.

For many bakers, wedding cakes are their biggest revenue generators. To insure the cake arrives safely to the venue and is presented correctly, these works of art are often delivered and set up by the bakers, themselves. If wedding cakes are something you wish to offer, plan on devoting a portion of each day for transporting these goods. Most prospective customers will also want to have a taste-testing session prior to placing an order. This is an opportunity to build a relationship with the client, showing them how your creations stand out above the competition. It also gives them a chance to make decisions regarding the flavors and decor of the cake.   

Cleanliness sets the professional apart from the hobbyist. A baker’s kitchen is like a sanctuary and must be treated as such. It should be thoroughly cleaned after each order is filled, and at the end of the day. Since each creation required a different set of ingredients, replenishing baking supplies is typically done on a weekly or bi-weekly basis.

During your downtime, you will want to split your attention between perfecting new recipes/sharpening your skills and tending to administrative tasks. Customers will have questions and concerns that must be addressed and books must be balanced. To insure a steady flow of clients, it’s also critical that a marketing strategy be implemented and remain a consistent part of each day.

What is the target market?

When developing your business plan, you will want to identify your target market. Research other bakers in the area and identify community needs that aren’t being met. Do any of those niches appeal to you? Organic cakes, vegan products, and gluten free options are niches you might want to explore. Do you want to specialize in wedding cakes or is this a niche you want to avoid altogether? Once you’ve identified the facets of the business that most appeal to you, you can begin to build your buyer personas and target them in marketing efforts.

How does a cake business make money?

Whether you open a retail location or focus solely on custom orders, your cake business’ revenue will be generated from the sale of each cake. Each creation will have special pricing, based on a variety of factors.

What is the growth potential for a cake business?

The baking industry exceeded $50 billion in sales in 2016, with those numbers expected to grow exponentially in the coming years. Most cake business owners start out small, working out of their homes or a small public kitchen. Many choose to remain small and local, content with servicing the needs of their community. The opportunity is there, however, to expand your cake business based on your personal and professional goals. Once you’ve established a name in the industry, you could share your secrets with other aspiring bakers, opening additional locations in your area, or on a national scale.