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WHAT SHOULD YOU KNOW BEFORE OPENING A BAKERY BUSINESS IN INDIA?

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Starting any business requires a set of procedures that need to be followed. Once you have decided to begin a bakery business, it is really essential to get to know certain essentials of the same. If you have decided on a name for your bakery and know the types of items you will sell, it is time to take the necessary steps to open your establishment. This is a process that requires careful planning, but when done correctly this can yield major returns along with personal fulfilment for you as a bakery owner. You also need to look at your niche product such as flavoured breads or some specific deserts which can add advantage to your business over the competitors.

Before you go for bakery business, you need to keep in mind the following few points:

The right type of Business Model

 Before starting a bakery or coffee shop, it is important to decide on a model for the business.

The first step in choosing the right kind of business model is looking for business insurance. Whether you choose to operate as a partnership, limited liability company or sole proprietorship, invest in business insurance to fully protect your bakery and your personal assets. Next you need to identify some high footfall areas where you could expect more customers liking your specialized product. Also if you are looking for opening a bakery cum Coffee shop, then you can go for Franchisee of a popular chain like Cafe Coffee Day or Starbucks, Dunkin Donuts etc.

Next necessary thing when deciding on a business model is the kind of delivery you would offer. If you are a custom/on-order baking bakery, then it is really essential to have good home delivery channels. Also you need to decide on special products which will be offered during festival season or for different age groups. Write out a thorough business plan that includes details on who will manage the business, how you plan to market your bakery, what your competitive edge will be and how you will finance your business, whether through loans, savings or outside investors. Also include projections of how much of each item you think you will sell on a monthly basis for the next three to five years.

Get the most suitable and a trustworthy team for carrying out further operations which will also form the building blocks of your new start-up.

While deciding on a business model you need to look at your planning which needs to be done in the most effective and efficient manner. Develop your standard bakery menu and determine how much of each food item, such as eggs, flour and vanilla, it will take to prepare a batch of everything on your menu. You also need to think over kitchen equipment you would require for making or baking purpose along with the right kind of furniture inside. How you choose your employees can also make a difference. Customers need to be treated with kindness and politeness to make their visit to our bakery more exciting and enthusiastic.

Where to start Operations?

 You need to look for the most ideal location for launching your business. For this visit your city’s official website for demographic data, which can help you to identify a location that has many potential customers. A market survey would also work towards resolving the query along with determining what potential clients desire in a bakery. You need to keep in mind your city may have specific zoning guidelines that prevent you from operating a food business at certain locations. Just look into your city’s small business department website such as Neisbud or MSME for more details. Choosing on a location is a crucial step in starting a new bakery or coffee shop business. Unless the business is a home based bakery, the location of the business can have tremendous impact on the success of the business.

Hence, it is important to look for a high-foot fall area with a floating population or a captive population. Home based bakeries can do well in areas with a captive population example an area near apartments, whereas a coffee stand or franchise chain would do well in an area like an airport with high floating population. Setting up the correct ambience plays another important role in the success of the business. Such as having proper locations for youngsters or children or elders whomever you wish to target. Hence, it is important to have a good atmosphere with facilities like clean washrooms and high-speed wifi to ensure the customers visit or stay in the premises of the organization for long-times.

Go for Registration

 Once you have decided on a business model and are keen on taking it forward with the selected location, you should now get your business registered with the correct and most suitable name for your business. Check with your state’s health services department to determine what requirements you must follow to operate a food business. Your city may have additional rules on bakery-specific food preparation and storage. Obtain all sorts of necessary licenses for opening a bakery business in your city.

Once, you have decided on the location, it is really necessary to look for registrations required for your kind of business. As per certain expert knowledge, it is advised that if your bakery has an annual sales turnover of less than 40 lakhs, then you should go for Limited Liability Partnerships. This kind of registration can be best suited for you because you can here avoid audit requirements. And if you want to go for any other form of registration, we at Starters’ CFO can assist you in choosing the right type among various alternatives available.

Now, you need to look for tax registrations. Earlier(upto 31st March, 2017), Service Tax and VAT were applicable for the bakeries or coffee shops equipped with central air heating or air conditioning facilities. And from 1st April, 2017(expected date), GST would be applicable. You can register for GST on GST India portal or can contact Starters’ CFO for any query on this matter.

Along with the business and tax registration, it is equally important to obtain FSSAI license to operate.

You can learn more about the registrations required in various forms of business by contacting Starters’ CFO.

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