Isn’t it every person’s dream to turn their hobby into a source of income? Last year, it was my dream to bake my way to a part time income- and I took a leap of faith tried my hand at running a home-based bakery while juggling a full-time job.
What all those people who have done it successfully don’t tell you is that you’ll probably be working more than 70 hours a week and you will more than likely lose money instead of making it for the first little bit if you don’t plan, plan, plan! You may also be babbling incoherently for lack of sleep. At least…that’s what happened to me. I learned the hard way that being your own boss isn’t all it’s cracked up to be: that being said, I made a few big mistakes, ones that I hope this post will help you avoid if you’re thinking of starting a culinary home based business. 12 months later, I realized that it was a full-time gig that unfortunately wasn’t feasible under my lifestyle. I’ll always remember both the good and bad, I’ll also fondly remember the extra 25 pounds I gained!
1. Spend time figuring out Pricing
This tip is probably the most important thing I can pass on to my fellow entrepreneurs. Whether it’s a baking business, catering, or any other food related business, settle on an hourly rate for yourself. Don’t set arbitrary prices based only on cost of ingredients and equipment usage. Make sure that you are able to pay yourself just as you would an employee. Or, like me, you’ll find yourself wondering whether the four hours you spent on that birthday cake was worth the $20.00 profit that you made. Your time has value! Do some research on how competitors and other home based entrepreneurs have historically priced in your area.
That being said, set realistic prices. What I mean by this is; if you’re just starting out and building your clientele, stay competitive and price your products based on your level of expertise. Be honest with yourself about the quality of your product. An established bakery with industrial equipment and high quality ingredients may price a couture cupcake at $5.00. You, a one person operation, should be realistic about what your cupcake is worth. I will have a more detailed post on pricing baked goods coming soon!
2. Learn how to say no
It’s great getting new clients, yay! More business is awesome, but the worst thing you can do is overload yourself. I remember one weekend in August 2015, I had orders for a 100 guest wedding, a 20 guest birthday party, and a small baby shower. The dollar signs may look good to you on an invoice, but actually doing the work is a whole different ball game. Sometimes, you have to say no because you don’t have the resources or the labour power that bigger operations have. The quality of your product will suffer, which is much worse than losing a little business. Say no if you already have a big order, there will be others.
3. Toughen up, don’t take everything so personally
When you’re working with all kinds of people, accept the fact that not everyone will be happy 100% of the time. Clients will have expectations, and sometimes, a small operation will have limitations which mean that your product may fall short of those expectations. Set clients up for realistic expectations: this is an important step in keeping your business in positive ratings. But for now, remember, when there is a disgruntled client, don’t take it personally. I’ve had moments where I’ve been close to tears when a client is rude and devalues my hard work: you listen, you keep your cool, apologize that they are not happy, and you move on. And then, you learn how to better manage expectations next time.
4. Set Regular Business Hours
With an aching back and eyes that were shifting in and out of focus, I spent multiple nights perfecting a cake, or cupcakes at 3 AM, exhausted after 8 hours of baking and decorating (after a full day at work, mind you!). In hindsight, I realize that I should have managed my time much more effectively. Set regular business hours. Just because you’re a home operation, doesn’t mean that you work 24/7. Once you’ve set your hours, do not deviate under any circumstances: this includes answering emails and calls (you’d be surprised at how many people will expect you to answer the phone at 1AM to discuss cupcake details). Schedule and manage your time within the parameters that you’ve set. This will save you a lot of grief.