How Can I Start My Own Bakery Business From Home – 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 ahead.
From UK Home Rule to baking and selling your cakes at home, here’s what you need to know.
How Can I Start My Own Bakery Business From Home
When you start your home baking business, you will need to tell HMRC that you are self-employed so they know you have to pay tax through the self-assessment system. You should do this even if you intend to run your home baking as a side business, part-time or if you have another job.
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To set up as a sole trader – the simplest business structure – all you need is an HMRC reference to register your business. If you want to start a limited company, the process is a bit more complicated. See our step-by-step guide to setting up a limited company for more information.
Butterwick Bakery, a confectionary company based in the Midlands, shares the story of how the bakery started in this video:
Firstly, you should consider getting a food hygiene certificate, especially a level 2 hygiene certificate if you are new to food handling. This is a good way to understand the rules that must be followed.
Home businesses also undergo a food hygiene inspection, where you get a hygiene grade from one to five. The local authority organizes your house after registering your company.
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In general, your kitchen and premises should be clean and in good condition. You must follow good food hygiene practices in your kitchen, including cleaning and protection against contamination and pest control. However, your home baking business is not held to the same standards as a large commercial space such as a restaurant.
Ideally, you need a separate refrigerator for personal food, but if that’s not possible, you need to know what food is for your business and make sure there’s no cross-contamination.
Pets must not be kept out of the kitchen and food preparation areas. Children are not allowed to go into the kitchen while preparing food.
Finally, remember to follow food labeling guidelines and Natasha’s law when providing allergen information.
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The Food Standards Agency has a number of resources you can use for home baking, including safe food, better business packaging based on risk analysis and the principles of critical control points (HACCP).
We also have a health and safety guide for restaurants, catering and hospitality companies that may be useful in your cake business.
Another rule for establishing a cake industry is that the premises must be registered with the municipality’s environmental health service at least 28 days before starting to trade. It does not cost you and registration cannot be refused. Someone comes to your home and inspects your cooking area. Use the food industry registration tool to find contact details for your local authority.
Note that the rules listed in this article are guidelines. It is always best to seek advice from your local environmental health authority if you are unsure about anything.
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When starting a bakery business, it is important to think about business insurance. Public liability insurance and product liability insurance (usually sold together) can cover you if you sue the public for an injury.
For example, you may have a claim against you if someone gets sick after eating your cake or if you spill an expensive vase while delivering the cake to the customer’s home.
There’s also storage insurance and equipment 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 apartment is rented, you must get permission from the landlord to run 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 company to run your home baking business.
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There are a lot of bakery businesses out there, so you need to think about how you’re going to stand out. You can specialize in vegan or gluten-free bakeries, for example, or focus on children’s party cupcakes or wedding cakes.
Because 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 in-person delivery or pickup.
Your website should include important information such as what you do, where you are and how people can order, and add lots of interesting images.
A Google Business Profile is an important part of any local advertising strategy. This means your business will show up on Google search and Google Maps when people are looking for cake businesses in their area. If customers can’t visit your home to buy your cakes, you can hide your home address in your business information and still be visible locally as a delivery business.
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Create a Twitter account, Facebook page and Instagram account for your company and update them with posts and photos.
It’s important to interact with other people on social media, so spend a few minutes each day liking and commenting on other people’s posts and following 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 share them on Instagram? This is a great way to start a bakery authority as well as create a new revenue stream for your business.
Even if you run your bakery business from home, it’s a good idea to let people know 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 offer people free samples, sell cookies, and hand out flyers and brochures to promote your cookie business.
Since you have your own business, you need to keep records of your income and business expenses so that you can enter this information when filling out your tax return.
Our guide to tax-deductible expenses will help you figure out which expenses you can deduct. Remember that you should keep your receipts as HMRC may ask you to provide proof of your expenses.
You should also use a budget calculator and choose the best business bank account to keep your personal finances separate.
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People need to find your beautiful cakes, so it’s important to think about marketing strategies. In addition to going to local events with your cakes and using social media to reach potential customers, consider other avenues.
If you specialize in wedding cakes, you can send brochures to a wedding dress shop or develop a relationship with, for example, a local wedding venue.
If you make vegan cakes, you might get permission to hand out flyers at a local vegan restaurant or write a guest post on a popular vegan blog.
You can also try Google Pay Per Click (PPC) ads or Facebook ads, but be sure to limit your audience to a local area so that ads are only shown to people in your delivery area.
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Download our free business plan template to outline everything from your initial idea and financial investment to your marketing strategy and growth plans.
Harpreet Kaur is the owner of dessert restaurant company Oh So Yum and shares tips on how to grow your business.
If you’re not planning to start a cake business, there are plenty of creative business ideas you can start from home. Why not consider:
Do you have more questions about starting a home baking business? Ask them in the comments below.
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As the UK’s largest provider of business insurance, we protect more businesses than anyone else. Why not take a look now and create a quick, customized home baking policy?
We create this content for general informational purposes and should not be construed as advice. Always get professional help. Read the full disclaimer
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How To Start A Bakery At Home: Laws, Licenses And Marketing Tips
© Copyright 2023 Simply Business. All rights reserved. Simply Business is a trading name of Xbridge Limited, which is authorized and regulated by the Financial Conduct Authority (Financial Services Registration Number: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG. The life of a cake maker is not for everyone. It has demands and pressures like any other job. There will be issues and problems that only your cake friends can relate to. It is much more than just cleaning the ice.
It’s also a lot more admin than people think. I said I spent 75% of my time
