Bakery Business Plan, Setup Cost, License, Permit

Introduction to Bakery business plan, licenses, permission, and cost involved in: people in India are igniting their passion for food through their open food business undertakings. Apart from that, the trend of starting up self-business cannot be kept aside if we are about to discuss regarding food business as that has hit the country and stimulated a lot of people, especially women to open their own hotel venture. Recognized as retail or for wholesale, baked items are sold to customers in the Bakery.

A guide to Bakery business plan, setup cost, license, permission

The tradition of selling baked products has been there for several years.  However, it has also changed over the years due to the recognition and wish that the art of baking has received. While grocery stores and hypermarkets are keen on selling pre-sliced bread, pastries, and cakes, many still desire to get their kind of flour baked from a small artisanal Bakery. This may be because of its taste and for its age-old household culture. The recent trend of commercialization of baked goods has augmented the quality characteristic in the profession of baking. Thus, the passion for baking is now gathering up into the big and small Bakery business.

Follow the suggested ideas to open a Bakery business in India:

1. Create a Bakery business plan

Before knowing about how to start a Bakery business in India, you must create a Bakery business strategy as it will aid you in streamlining the processes, critical to the budget circulation and preparation for the future growth of your baker. It majorly should include:

Summary of the Bakery Business Plan

• Business Overview
• Industry Analysis
• SWOT Analysis
• Operations Plan
• Financial Analysis
• Marketing Plan

The steps on how you can start up a successful Bakery business plan here.

2. Choose a location for your Bakery business

One of the major steps about starting a Bakery business in India is to select a good place. For a Bakery, the prominent location is a well-known market or high-end shopping lanes where footfall is majorly available. Ideally, front area stores on the ground floor which are simply accessible and noticeable are ideal for having kitchen operations at one level and have a serving area and items display at another. However, this is subject to your budget constraints and space availability.

For a 1000 sq ft area separated between two floors, the rental charges must not be more than Rs 60-70k. Your expenses would be approximately around Rs 1, 80,000 to obtain the place where the Bakery will function.

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Also, while finalizing the Bakery location, it is vital to ensure that the place has an appropriate water supply and drainage ability. You must also need an appropriate legal agreement for your property as it is also needed in the documentation and other licenses. You must even get a NOC-No Objection Certificate from the property landlord that he has no problem that his store will be used for the food business. This post will guide you on how to select the ideal location for a Bakery store.

3. Get all licenses needed to start a Bakery business in India

Similar to the QSR plan, the Bakery business also requires 5 licenses: GST Registration, FSSAI license, Police Eating House license, Local Municipal Corporation Health License, and the Fire License. Out of all the permissions, FSSAI, GST, and Local Municipal Corporation Health License are the vital ones to have at the starting of the business. Once you begin your operations you can acquire the other two-Police eating house and fire license. However, it is acclaimed to have all licenses before starting for hassle-free operations of the Bakery.

• Food license: You can apply online, at the website (www.fssai.gov.in) or it can be done through various organizations that charge about Rs 5,000 for the complete documentation and license charge. It is directed to get a 5-year food license to evade renewal costs every year. The charge for the five years FSSAI licenses is around Rs 15,000.
• GST registration: It can be availed with the aid of a CA.
• Health license: You can avail of the municipal corporation’s health license charge with the assistance of a local municipal health inspector. This would be around Rs 3,000.
• Fire license: One can get the fire license by payment of Rs 1,000-2,000, after the setup of fire extinguisher cylinders.

4. Get manpower needed to open a Bakery

As you are aware that QSR and food truck doesn’t need proficient, Bakery shops need a professional workforce because of the presentation and taste play a vital role in case of baked goods. For a high-end Bakery, you require a head chef, Commi level Chef, Chef  De Parties, and helpers, along with service boys and cashiers. The total manpower necessary in the Bakery is around 15. The remuneration of the chefs, Commi, and helpers are based on their experience.

5. Purchasing Equipment required to start a Bakery business

The kitchen equipment is expensive for a Bakery business as each piece of equipment is made up of stainless steel which is long-lasting and tough. The major apparatus required in the Bakery is the oven, Planetary mixers, cooling fridge, deep fridge, working table, cylinders, gas stove, storage utensils, and others. Unlike food trucks or QSR, the Bakery needs new equipment for improved efficiency. But to reduce the cost, you can get the working table in second hand.

6. Design the display area of the Bakery business

The display area or the front end of the Bakery business must be well planned and fashioned in a manner that each item is noticeable to attract walk-in consumers. You mainly needed a Display fridge for pastries and cakes. Other than the fridge, the display area must have a display rack or proper storage for the items.

7. Install a POS and billing software in your Bakery

The POS software is currently not the only software as it is having powerful integrations such as Inventory management and billing. While purchasing the software, you should know whether it can manage the shelf life of the baked products, robust inventory management as your baking will have perishables food items. The price of POS software differs based on the features you are planning to have inbuilt but a typical POS Software with modest features will cost approximately Rs 30,000 per year.

8. Do right branding and marketing of your Bakery business

Market and branding are vital for any business to flourish, and a Bakery is also one of them. Get a properly planned logo and display poster and a well-designed menu book from a professional. This will not only aid you to generate your own unique individuality but will also benefit in your branding while packing.  For the starting months, around 30,000 brochures are nice to market your Bakery. These 30,000 brochures will price you somewhere approximately Rs 30,000 in quality paper. Apart from brochures, invest some money in an excellent manner to attract clients. A fashionable display board will charge approximately Rs 25,000.

Apart from it, you should have a separate budget for restaurant software, as it could also aid you in running several advertising campaigns by using consumer data.

9. Decide on the staff attire of your manpower

Staff attire is often ignored during opening a food trade. However, they are vital as they aid to deliver a proficient look and also in the marking of the Bakery. It is dynamic that all the staff look hygienic, good, and well dressed. They can be like chef coats, t-shirts, smart shirts, and an apron.

10. Other things required to run a Bakery business project

Since it is a Bakery store, it is obligatory to have a land phone and 2 mobile numbers with two phones which will be availed at Rs 2000 each. As online booking has become a passion now, it is also significant to have online bonding. It is heavily suggested that you have your own Bakery’s website. A nice website would not be greater than Rs 10,000. Also, keep in mind to have a menu ‘Order Online’ on your website to attract online ordering consumers.

Costs involved to set-up a Bakery business

Let us go through all the costs involved in starting the Bakery includes the following-

1. Based on the rent for a cloud kitchen space allotted it costs around Rs. 25,000- Rs. 40,000 per month but to establish a full-fledged cafe it can be Rs. 70,000 – Rs. 1,50,000 per month.
2. The various equipment required as per the menu includes the cost between Rs. 5,00,000 – Rs. 10,00,000.
3. Costs involved for all the licenses and permits will cost you about Rs. 30,000.
4. Costs involved for all the salaries, and other additions Rs. 1,20,000.
5. Using POS software which is essential for the Bakery business the costs involved are Rs. 24,000 – Rs. 50,000.
6. The costs involved for marketing online and an offline charge include Rs. 40,000- Rs. 60,000 per month.

Frequently asked questions about starting Bakery business in India

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1. How much does it cost to start up a Bakery?

The total estimated capital to initiate a Bakery business in India is approximately Rs 15 lakhs. However, the charges of equipment and place of the store can lead to a considerable difference in the approximate cost.

2. How can I start a Bakery in India?

Kindly go through the below steps to open a Bakery business in India:

• Create a Bakery business project plan.
• Select a location for your Bakery business.
• Must get all licenses needed to open a Bakery business in India.
• Get staff needed to open a Bakery.
• Buy equipment required to start a Bakery business

3. Is the Bakery business profitable?

There’s no such thing as an average income for a Bakery store, as not all bakeries are equally profitable. The retailing of few items in your Bakery will yield much more profit margins than others, so it really comes down to your size, place, and products.

4. How many square feet do you need for a Bakery?

The average gross margin of bakeries was around 45.5 percent the previous year, but the average size of the in-store Bakery was on the more, hoping to an average of 1,420 square feet in the year 2015, as compared with 1,310 square feet the last year.

5. What do most bakeries sell?

A Bakery (bakeshop or baker’s shop) is set up that produces and retails flour-based food items such as cookies, pastries, cakes, pies, and bread that are baked in an oven. Some bakeries are also serving as cafés, by offering tea and coffee to clients who wish to consume the baked items.

6. How can I make my Bakery successful?
   • The place of your Bakery is a major concern.
   • Proper Pricing for your baked goods.
   • Be the first, best, or the only one.
   • Be ready to advertise your product.
   • Concentrate on your customers.
   • Diversify
   • Hire Staff who are proficient.
   • Don’t forget about promotion.

7. What type of industry is a Bakery?

A Bakery store is not only is an establishment that produces flour-based food baked items but sometimes is also blend with cafes, serving coffee and tea to people who wish to have beverages with baked food items.

8. How many types of Bakery are there?

8 types of bakeries are there and their specialty products include

Bakery food truck with sandwiches, traditional bakeries includes the biscuits and bread, Cake bakeries which bakes cakes and pies, wedding bakeries which bakes wedding cakes, café bakeries which make sandwiches and snacks, bread shops which bakes bagel, doughnut shops which makes different types of doughnuts, pastry shops which prepare pastries.

9. What is the target market for a Bakery?

Targeting the people with different varieties of confectionaries, tastes involved, attracting with different kinds of pastries, and other baked items. These attract many customers and refer others also. Customer satisfaction is the most important one.

10. What is Bakery Cafe?

A Bakery café is a retail Bakery that comprises a dining area for customers to sit and relish their food.

11. How do you attract customers to your Bakery?

Ideas and thoughts for promoting your Bakery: Rising to the occasion to win more customers-

• Attract your customers.
• Attract the people through the door.
• Offer up with free coupons.
• Be active on social media.
• Strike up a banner or hold a survey.
• Much ado about day-old bread.
• Build a website with an online ordering facility.

12. What is the revenue margin in the Bakery business in India?

The average profit for a Bakery is associated based on the overhead and materials price of producing Bakery products. But, it is estimated that the Bakery proprietors do have a 30 percent profit margin to cover functional costs and for earning income.

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