Bakery Business Advantages and Disadvantages

Bakery business is a very interesting field to venture into and comes with a great set of opportunities for growth and expansion. It’s also a great pick for people who have a background in the food industry like chefs, bakers, or even food entrepreneurs. It can be a both fun and profitable venture if you plan and set it right.

Starting a bakery business seems a good aspect but setting a business isn’t just about opening the shop and letting it run. There are various sides to running a bakery business, both good and bad. It is ideal that as a business owner, you are aware of all the challenges and the advantages and disadvantages of running such a business.

We here take a look at both sides of the aspect of running a bakery business and discuss in length the advantages and disadvantages of the lot. Let’s find out.

Bakery Business

Advantages of Running a Bakery Business

1. Control over your work

  • Setting up a bakery business as someone who already is from a similar background is a great start and can help you control the aspects of the business much better. You can utilize your inputs from the very first into the out of the business and make it functional and revenue-generating at the same time. It also gives you an entrepreneurial venture where you are the absolute owner of the work and the work you put in relates to your growth and not your employers.

2. Bakery business is a mix of art and entrepreneurship

  • Other aspects of white-collar or even blue-collar jobs are more of a person pursuing the field with an academic background from a similar field or taking up work as they need. There are only a few works that have an artistic charm like that of art, painting, bakery, handicrafts, and more. A baker isn’t just someone who puts the dough in the oven and produces the bread. He’s an artistic fellow who specializes in making perfected breads, pastries, and a host of other delicacies that machines can never do. Running a bakery business helps you to monetize your art and become an entrepreneur at the same time.

3. Connection with the Community

  • Bakery business is wholly stepped into the community as they often find their major customer share from the local area. Bakery businesses that have good community relations often have a larger customer base and tend to generate better revenue. The connection with the local community also helps to make the work wholesome rather than a corporate structure where you’re not just producing goods for consumption but also essentially connecting with your customer base regularly and getting feedback and everything right away. We’ve seen lots of bakery business owners becoming an irresistible part of the local community for ages.

4. Low economic cost of setup

  • Bakery business doesn’t require thousands of dollars to start with. It can be started in a small area with minimal capital and can be expanded further over the years with the revenue generated from the business itself. Bakery business can be even started from your own house and compound with just the use of basic equipment if you want to start it as a side hustle. The business also tends to deliver good profits as the staff wages and setup capital are quite low. This allows for greater control over expenses and less overheads helping deliver a higher share of profits when compared to other business initiatives.

5. Easier to market and evergreen

  • We as human beings have been consuming bread for millennia in different forms. It’s just that the type of bread has changed but it has always been a staple part of our food habits and we are engrained with it. Consumption of bread is never likely to go out of fashion and it ever accommodating with lots of varieties and even multiple different types to cater to a wide variety of audiences. We talked about how likely they are a community-based business idea and this allows the bakery business to be marketed at a very economical cost allowing them to focus on working on delivering the products more than focusing on marketing.

Disadvantages of Running a Bakery Business

1. Long working hours

  • Bakery business takes a lot of toll on the owner as they tend to have long hours. It’s not as if you can just mix the dough and bake it to get bread. It takes hours to prep it and get the things set up before letting it to proof. After which the baking is done. This often means that owners have to put in long hours from early in the morning to late nights to finish and prep for the next day. Couple that with other activities of the business like getting inventory and stock ready, cleaning and delivering, and more, and it becomes a tedious task.

2. Bakery business can be stressful

  • Bakery business and many other forms of business, in general, are often stressful for people. Running a successful business requires a lot more work that is unseen to the normal eyes. The management aspect, expansion, operational, and other financial aspects of the business are far more clutched and aren’t all shiny and glittery. This is why people who are passionate about the bakery business find it stressful as they can’t handle all the aspects of the business as perfectly as they want.

3. Perishable goods

  • Bakery items are perishable and come with a shelf life for the goods. The breads may last long but pastries can go bad in just 1-2 days. This is why the stocks need to be sold out within their shelf-life period else they go to waste. We often see that many bakeries offer huge discounts after 7 p.m. just to clear the stocks and not have to throw them away. This makes the managing and selling part hectic at times. And if you can’t sell them off they tend to become your loss as it needs to be thrown away.

4. Highly regulated by FDA laws

  • Since the bakery business is part of the food industry it is regulated under the various FDA laws and is strictly monitored. There are stringent laws in this industry to protect against any health hazard related to food production. This makes running a bakery business quite hard as it is constantly meddled in by the laws and oftentimes needs to change its course of product, cancel certain batches, or even discontinue certain product lines in the law requires.

Final Words

Bakery business is always regarded as one of the hobbyist or passion fields where people venture into this path to generate income via their skills. It is a great field and has great scope and a lot of growth and hence many people going on this entrepreneurial path. We hope you understand the aspects of running this business wholeheartedly before starting it.

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Sumit Kumar Yadav has experience analyzing business and finance of big to small companies. Loan, Insurance, Investment data analysis are his key areas.