How To Start Your Own Bakery Business

How To Start Your Own Bakery Business – Wondering how to start a bakery business from home? You’re at the start of an exciting journey – our 10-step guide will help you get going.

From baking according to UK house rules to selling your cakes from home, here’s what you need to know.

How To Start Your Own Bakery Business

When you start your home baking business, you’ll need to tell HMRC that you’re self-employed so they know you have to pay tax through the self-assessment system. Whether you run your home baking business as a side job, part-time job, or second job, you need to do this.

How To Start Your Own Bakery

To set up as a sole trader – the simplest business structure – all you need to do is tell HMRC to register your business. If you want to set up as a limited company, the process is a bit more complicated. See our detailed guide to setting up a limited liability company for more information.

Butterwick Bakery, a sweet bakery business based in the Midlands, shares the story of starting a bakery business in this video:

Firstly, you should consider getting a food hygiene certificate, ie a level 2 hygiene certificate, if you are new to working with food. This is a good way to understand the rules to follow.

Home businesses are also subject to a food hygiene audit, where you will be given a hygiene score of one to five. Once you have registered your business, the local authority will arrange a home visit.

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As an overview, it is important to keep your kitchen and surroundings clean and in good condition. You must follow good food hygiene practices in your kitchen, including cleaning and preventing contamination and pest control. However, your home baking business will not be measured by the same standards as a large commercial space such as a restaurant.

Ideally, you need a separate fridge for your personal food, but if that’s not possible, you’ll need to clarify which food is for your business and make sure there’s no cross-contamination.

Pets should be kept away from the kitchen and food preparation areas. Children should not be allowed in the kitchen while food is being prepared.

Finally, make sure you follow food labeling regulations and Natasha’s Law when it comes to providing allergen information.

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The Food Standards Agency has a number of resources you can use for your home baking business, including the Safe Food, Good Business Pack, which is based on the principles of Hazard Analysis and Critical Control Points (HACCP).

We also have a health and safety guide for restaurants, catering and hospitality businesses which may be useful for your cake business.

Another rule of thumb when starting your cake business is to register your premises with your local authority’s Environmental Health Service at least 28 days before you start trading. It costs you nothing and your registration cannot be declined. Someone will come to your home and inspect your food preparation area. To get your local authority’s contact details, use the Food Business Register tool.

Note that the rules we list in this article are guidelines. It is always best to seek advice from your local environmental health authority if there is anything you are unsure about.

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Business insurance is important to consider when starting your bakery business. Public liability insurance and product liability insurance (usually sold together) can protect you if you are sued by a member of the public for injury or damage.

For example, you could be sued if someone gets sick after eating one of your cakes, or if you knock over an expensive vase while delivering a cake to a customer’s home.

There’s also stock insurance and tool insurance, as well as employer’s liability insurance if your home baking business has employees. Go to our home baker insurance page to get started.

If your home is rented, you must obtain permission from your landlord to operate your business. However, the law says that your landlord cannot unreasonably refuse or delay their permission. If you own your home, you may need to get permission from your mortgage lender to operate your home baking business.

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There are a large number of bakery businesses out there, so you need to think about how to differentiate yourself. For example, you could specialize in vegan or gluten-free baked goods, or focus on cupcakes for children’s parties or a wedding cake.

As cakes are difficult to transport, you need to have a good understanding of your local market as most of your customers should be close enough for delivery or collection.

Your website should include important details like what you do, where you are and how people can order, as well as plenty of stunning photos.

Your Google Business Profile is an important part of any local advertising strategy. This means your business will appear on Google Search and Google Maps when people search for a cake business in their area. If customers can’t visit your home to buy your cakes, you can hide your home address in your listing and still appear as a local delivery business.

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Create a Twitter account, a Facebook page and an Instagram account for your business and update them with posts and photos.

It’s important to interact with other people on social media, so take a few minutes each day to like and comment on other people’s posts and follow relevant accounts.

Another idea could be to record video tutorials and baking tips and post them on YouTube or TikTok. Or why not publish your recipes as a cookbook and promote them on Instagram? This is a great way to establish yourself as a bakery authority while creating a new revenue channel for your business.

Even if you’re building your bakery business from home, it’s a good idea to get out there and tell people about your business and build a reputation locally.

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Consider applying for a stall at local events, including food markets and festivals. You can give people free samples, sell cakes and hand out flyers and brochures to promote your cake business.

Because you run your own business, you need to keep track of your income and business expenses so you can enter this information when you complete your tax return.

Our guide to tax deductible expenses will help you understand which expenses you can deduct. Remember to keep your receipts as HMRC may ask you to provide proof of your expenses.

You’ll also want to use a budget calculator and choose the best business bank account so you can keep your personal finances separate.

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People need to find your amazing cakes, so it’s important to think about marketing strategies. Consider going to local events with your cake and using social media to reach potential customers, among other things.

If you specialize in wedding cakes, you can place flyers in bridal shops or connect with a local wedding venue, for example.

If you bake vegan cakes, you might be able to get permission to post flyers at a local vegan restaurant or write a guest post for a popular vegan blog.

You can also try Google Pay Per Click (PPC) ads or Facebook ads, although remember to limit the audience to your region so that the ads are only visible to people in your delivery zone.

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Download our free business plan template to map out everything from your initial idea and financial investment to your marketing strategy and growth plans.

Harpreet Kaur owns the confectionery business, Oh So Yum, and shares her tips for growing your business.

If you are not ready to start a cake business, there are many creative business ideas that you can start from home. Why not consider:

Have more questions about starting your home baking business? Ask them in the comments below.

Start Your Own Bakery Business With This Step By Step Guide

As the UK’s largest business insurance provider, we protect more businesses than anyone else. Why not take a look now and create a quick, customized home baking insurance policy?

Sam has over 10 years of experience writing for financial services. He specializes in shedding light on complex topics from IR35 to ISA and identifying emerging trends that the public wants to know about. Sam spent five years at Simply Business where he was a senior copywriter.

We prepare this content for general information purposes and should not be taken as advice. Always seek professional advice. Read our full disclaimer

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