Transitioning from a home baker to a storefront is an exciting but challenging step. Here are five important things you need to know to make this transition successfully:
1. Financial Management:
- Running a storefront demands a much greater financial commitment compared to a home-based operation. Once you're clear on your current numbers, you'll need to determine what it will take to cover that new set of expenses. Calculate your startup costs, including rent, utilities, equipment, staff wages, and inventory. Consider how you'll fund your business, whether through personal savings, loans, or investors. Having cash and good credit isn't necessarily enough to do it alone. Make sure you know what you can afford and be honest with yourself in determining if the new undertaking is realistic.
2. Business Planning and Research:
- Before diving into opening a storefront, conduct thorough market research. Identify your target audience, analyze competitors in your area, and understand local consumer preferences. Develop a comprehensive business plan that outlines your goals, budget, pricing strategy, and marketing tactics. Are you looking for retail space that is customer facing, or could you be equally successful with a commercial kitchen zoned for your needs?
3. Legal and Licensing Requirements:
- Opening a storefront involves legal obligations and permits. Depending on your location, you might need a business license, health permits, food handling certifications, and more. Find out if you're operating under the Health Department or Department of Agriculture and ensure you're clear on what is required to comply with all the necessary regulations to avoid any legal issues later on. Have you seen a lease for this type of space? Familiarize yourself with what areas you'll be able to negotiate and determine what the requests are that you'll want to make. This area can be overwhelming at times, so be sure you have somebody on your team to guide you appropriately.
4. Scaling Up Production:
- Moving from a home kitchen to a storefront typically allows for, and often requires, an increase in production capacity. How will this impact your menu, ingredients, staffing, packaging options, and other needs? Once you have determined your product offerings, you'll need an equipment list. Assess your equipment needs and ensure you will have the necessary commercial-grade appliances and tools to meet demand. Do you buy the equipment new, used or maybe a combination of? Did the previous tenant leave anything behind? Do you need to add electricity and/or water to your space? If so, what else is needed? In order for your architect to draw up the MEPs (mechanical, engineering, plumbing plans), you'll need to know what kind of lighting you'll have, where your sinks will go, how many bathrooms you need, if a water fountain is required, all electrical requirements, and SO much more. Even if there was a food business in the space you're considering, the laws and regulations change over time so you may need to make some construction modifications.
5. Marketing and Branding:
- Establishing a strong brand and marketing strategy is crucial for attracting customers to your storefront. Ensure that you've created a memorable and appealing brand identity, including a logo and packaging. Not everything you were able to get away with online will transition well to a storefront, so reevaluate your branding and understand how it will be impacted with your store. For example, can this logo be designed to go on the building? Is it scalable? How will it look on your uniform? Through this analysis, you may learn that it's time to rebrand. While it certainly adds to the list of unexpected costs, it could make all the difference and be worth the investment.
Remember that transitioning from a home baker to a storefront requires careful planning and execution. It's essential to be adaptable and open to learning from your experiences to make your business successful in the long run. Having been down this road, it can be incredibly overwhelming with so many unexpected challenges along the way. If you'd like to discuss this phase of your journey, schedule a 1-on-1 consultation. We'd love to help!