Craft baking, it seems, is a growing trend. Research by IRI shows that sales of baking products have been rising steadily, up by 62% since 2007. The market research and shopper insight firm says this trend is driven partly by families being keen to get back into the kitchen and cook for themselves, but also by celebrity baker shows on television.
But whether the products the craft or artisan baker makes are cakes, croissant or loaves of bread, the aim has to be to turn a passion for baking into a profitable business, writes Andre Erasmus. And this is not easy, given the costs of equipment, ingredients and marketing.
A start-up artisan, cottage or craft bakery will also have to consider the competition and ways to be better than them – and this could be another craft baker or a major industrial bakery selling the same or similar products in your area.
The best advice would be to compete on quality not price. This might not be easy at the outset, but the consumer is a fussy person – we all know that, as we are all consumers and we like what we buy to be top class.
After that, a unique selling point (USP) would be a distinct advantage and can, obviously, set you above the competition.
But, most of all, you need a market, outlets for the product and a wholesale price as well as guaranteed supply and delivery to allow your business to compete with the industrial giants out there.
Quite simply, the industrial bakery can outpace the artisan or craft bakery in most facets – better equipment, bigger output, a broader delivery network, beneficial banking support due to its investment and better bargaining power as a result of all of these factors.
So, the craft baker needs to come up with something to counter this and that would be the quality of its unique selling point.
A business plan, marketing strategy and advertising opportunities would be priorities in setting up the business as turning a passion for baking into a profitable venture takes guts, perseverance and fortitude. It is not going to be easy.
Ongoing costs, such as ingredients and raw materials, packaging and promotional expenses must be factored into your budget. Prices should take into account things such as employee labor and the cost of the premises, including rent and utilities (i.e. water and electricity), in addition to the cost of the goods used to make the finished product.
Return on investment (ROI) for expensive equipment is easier for the industrial bakery as the output is higher and so, too, will turnover be better.
The baking oven
Of all the equipment required for bakery, one of the most important is the oven. This is part of any industrial bakery’s basic equipment and can be used to produce the majority of the products needed.
Rack ovens are used to cook multiple items at a time, while convection ovens are used to speed up baking times and allow for even cooking. Using modern commercial ovens has many benefits and can produce a large amount of baked goods, allowing for an increase in production within the business.
Modern ovens are very efficient and also cost effective, producing more products in a shorter amount of time. These commercial ovens also allow for a safer operation and ease of use by employees and shop owners alike.
Since commercial bakeries often need to produce baked goods in a high volume, these machines are very reliable and will allow bakeries to significantly increase their profit levels.
If you are considering taking your passion for baking from your own kitchen into the market, consider the above and be prepared to have the guts to support your plan. It is hard but rewarding work.