Baked goods are always popular. Who doesn’t love scarfing down a delicious cake at the end of a stressful day? Sugar really is the food of the gods and cupcakes can cure a lot of problems.
In recent years, cupcakes have become a sought-after product. People buy boxes of cupcakes as a treat, or as a gift, and cupcake towers are also a great alternative to a traditional wedding cake. If baking is your passion and you love nothing more than baking piles of cupcakes in your kitchen, perhaps it is time to take your hobby to the next level and start a cupcake business. Read on to learn more about how best to do this.
What Type of Cupcake Business?
There are different ways to build a cupcake business and some of them need less start-up capital than others.
The cheapest way to sell cupcakes is by baking in your kitchen and fulfilling local or online orders. Doing it this way means you don’t need to rent commercial premises and all the costs that entails. However, it is only an option if you can convert your domestic kitchen into a suitable commercial baking area.
A food truck is another good option for a cupcake business. Food trucks are often seen at outdoor events like festivals, fairs, farmer’s markets, etc. It’s a good way to reach a lot of people in one area. You could also park your food truck in a regular spot where people like to congregate, such as a park. In time, you’ll attract repeat business and build a steady trade.
Finally, the most expensive business model is to open a cupcake bakery or café. To do this you need to rent commercial premises and hire staff, as well as furnish and equip the place. The downside is the additional cost of starting such a business, but the upside is the potential for upselling other baked goods and beverages. For more information about selling or buying a business head over to Nash Advisory.
Write a Business Plan
Once you have figured out what kind of cupcake business you want to build, you need a business plan. This is a detailed analysis of your business model, competitors, how you plan to market the business, your anticipated costs and profit margin, etc.
Lenders always ask to see a business plan before agreeing to any business loan, so if you need cash to start your business, spend a lot of time crafting a watertight business plan. You don’t need to stick to the plan like glue once you get your business off the ground, but it will provide a useful road map and help you anticipate any future issues.
Set up an office for your new business, so you have somewhere to store paperwork and your small business laptop.
Licenses and Permits
Catering businesses and any businesses in the food sector usually need permits and licenses. Research all of this before you try selling cupcakes as a business. Health and safety are very important and falling foul of licensing requirements could be costly on many levels.
Finally, one last tip is to iron out any tweaks with your recipes before you start the business. Have a mix of different cupcake recipes to appeal to all tastes, and regularly test your cupcakes on friends and family, for some honest feedback.