Baking at home for profit, why do it?

Baking at home for profit by starting a food business from your own kitchen is something that a lot of people try to get into. It can be great fun and grow rapidly. But only if you pair the right products with the right local audience.

The main thing you need to establish is whether you are looking to grow a business or simply cover your costs with a bit extra because you enjoy it. How you approach your costings, margins, products, packaging, and ingredients will all come down to your numbers and targets.

How to get started

With any business there needs to be a good section of planning before you start. Don’t let that stop you from starting. Set a date and stick to it, this will provide the pressure you need to move things along. We will be talking more about the legal requirements in the next section. For now you need to create a plan outlining the below:

• What is my product going to be?
• How am I going to advertise? (Word of mouth is a great thing but you need a kick of marketing before that can happen)
• How much will it cost me to produce and how many do I need to sell to reach my goals?
• Can I run it from home or do I need to hire a kitchen/ buy extra equipment?
• Do I have everything in place to comply with the law? (more on this soon)

Never forget that your time is a cost. As well as The Online Pastry School I own a marketing company called Mariner Media that specialises in helping small businesses get set up.

It still amazes me that new business owners work out all of their costs and what they are going to make with the assumption that their time is free.

If you are making £3,000 a month profit and working 10 hours a day (which is not a lot for the average business owner) then it’s not a great business. All you are doing is working your tail off to make £10 an hour and have nothing left after that. This just shows that getting staff in will end in a loss. Without staff you can’t scale up.

Make sure you take everything into account when working out your profits.

The law around baking at home for profit

When setting up a food business from home or in a rented kitchen there are many things to consider that are different to other businesses.

Food safety is the practice of making sure food is safe to be sold to the public and that brings with it many rules you need to strictly follow.

The first thing you need to do when you have decided what you will sell is work out where you are going to produce it from. Then you can start checking off the requirements ready for inspection.

The first thing you need to do is register with your local authority. You must do this at least a month before opening. Click here 

It will only take a few minutes but you cannot start trading without it.

You will then be contacted by health officers to arrange an inspection, giving you time to get the premises compliant.

Click here

for a full list of the requirements your kitchen need to meet

The second step in making sure you are compliant with the law is what we call HACCAP. This is basically a plan that shows all of the potential risks to the food you are preparing and how to avoid them.

For a free step by step template for setting up a HACCAP plan, see here

The next step is to obtain a certificate in food hygiene (I recommend level 2). This will help you understand exactly how to handle food safely and what you need to do.

This is not required by law, however, it really is very important if you wish to run a food business.

They cost as little as £10 and only take a few hours to complete. Click here  

Allergen information

You also need to understand the use of allergens. This will be covered in your food safety training but knowing what information needs to be provided by law is critical. Ignoring this can have serious consequences for you and your customers. I have found a full guide here that includes all of the information about your products you need to have to hand: Click here  

Finally, you will need to register with HMRC to let them know you plan to start a business and will be liable for tax. The type of company that is best for you to set up is better advised by an accountant, but sole trader is the most common.

That should cover the main considerations when starting a food business. With the above things checked off your list you’ll be up and running in no time.

To check the most current and accurate information, visit the food standards website here 

Want to learn over 50 step by step recipes you can use to start your own business, along with regular live classes? Sign up to The Online Pastry School now to get a 30 day free trial click here