The Fresh Loaf

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The Back Home Bakery - first year strategy

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mcs's picture
mcs

The Back Home Bakery - first year strategy

Last week marked our official one-year anniversary of being licensed and open to sell.  I thought those of you thinking about starting your own bakery or supplementing your income through baking might be interested in hearing about the process a little bit and how we've progressed throughout this year.  Both the production schedule and strategy has changed in the last 12 months, but these are basically the different ways that we make income without an actual storefront and while baking out of our 'bakery at home'.


1 - Selling directly to restaurants / retailers.  These customers are regular buyers or larger quantities of breads/pastries.  They buy everything at a wholesale (reduced) rate, which, although less lucrative for me, creates an outline for me to work my daily baking schedule around. Since they buy the product outright, they choose what they want and when they want it -provided I have enough notice.


2- Retailers providing a space for me.  Basically this is a typical arrangement for a bakery selling their product in someone else's store.  I bring goods to a retailer who provides shelf space for me to sell my stuff.  By viewing what's selling, I decide what to bring each day.  The products I bring are based on my regular customers above.  If it sells, they make a commision on it, if it doesn't sell, then I'm stuck with it.  Of course this isn't an ideal situation, but it's a way to get our product out there, plus it provides a location for people to pick up their special orders.  Breads that don't sell here are frozen and sold to other restaurants at a reduced rate for use in sandwiches  / panini.


3- Farmer's markets.  Just like some of you already do, here we sell directly to customers at our regular rate.  We currently sell at two farmer's markets a week.  Together with our regular business, this keeps us pretty busy for 6 months of the year.  We take advance orders via email and phone and also reserve items for people who can't make it to the farmer's market early.


4- Special cases.  Orders for special events or holidays are sold directly to customers at retail price.  If it's a small order, it needs to fit into the already existing baking schedule ('Can I get two loaves of rye on Friday?');  If it's a larger order ('Can you make appetizers for 150 people?'), then it'll require adjusting the baking schedule to work around it.  Also, it will undoubtedly require more working time in the morning or prep time in the afternoon.  Since these are guaranteed sales, however, it's usually worth it. 
In addition, as the farmer's market season ends, i'm hoping to create a system similar to a typical food/vegetable co-op subscription so I can continue to sell directily to customers.


Before this bakery began, I decided that the two most important aspects in building this business were quality and consistency - at the expense of speed (and sleep).  Most of the work I've been doing myself, with help from my wife and interns from here too.  I think we've established a very nice reputation in the area and kept all of our regular customers / wholesalers very happy in the process.  Of course this has meant turning down other accounts (especially recently) in order not to expand too quickly and risk a decline in quality.



Anyway, that's a little recap of our strategy in practice, and I hope some of you will find this helpful or at least interesting.  I'll be blogging soon about some of the more fun aspects of the last year.


-Mark


http://TheBackHomeBakery.com

cake diva's picture
cake diva

Mark,


Thank you for your update on the business.  As a frequent contributor, you're like family and I wish you much happiness and success in what must be a labor of love for you.  I also wish I lived closer to be able to sample your goods.  I am sure though that they are very good, just seeing from the videos how you treat your dough with care.  More success to you and your wife!  - cakediva

mcs's picture
mcs

Thanks for the well wishes.  From the everyday discussions about proofing and recipes to the TFL members who have come to work here as interns (or visited as customers!), I certainly value this site and am happy to return the favor when I can.  It's great to see so many people passionate about their hobby and/or profession.


-Mark

Yerffej's picture
Yerffej

Mark,


I find your valuable post to be most generous in terms of your time and information.


Thank You,


Jeff

mcs's picture
mcs

Glad you find the info helpful.


-Mark

crunchybaguette's picture
crunchybaguette


I agree with you, quality and CONSISTENCY are key. Thanks for the post.

erg720's picture
erg720

keep on the good work mark.


it seems u going the right way. best of luck !

Wingboy's picture
Wingboy

Mark,


Thanks for sharing the process of establishing a bakery.  I have found your journey to be intensely interesting. 


-Tom

poppyfields's picture
poppyfields

Its so good to hear of your success.  You deserve it Mark.


I have learned a lot from viewing your videos.  Thank you for sharing your expertise and successes.  I wish you continuing success.

mcs's picture
mcs

Thanks everybody, I appreciate your kind words.  Tomorrow I'll get some pictures up of some of the people who made this last year possible. 


-Mark

tananaBrian's picture
tananaBrian

Allow me to congratulate you on sticking to the right principles ...quality (1st) and consistency (1st as well!).  We need more of the same in this country!


And thank you for sharing your business adventures and methods with us!  Your professional attitude will always boost your business.


Brian


 

flourgirl51's picture
flourgirl51

Congratulations on your success. I have a question. If you don't have a store front then I assume you are baking from a certified kitchen. Did you have to build a separate building for this or is it attached to your home?

mcs's picture
mcs

In order to have a certified kitchen in a home, it needs to be completely separated from the living residence and everyday traffic in the home.  That means it could be on a separate level/floor than the rest of the house or separated by a wall.  I converted our open basement into a bakery by putting in a dividing wall in a few places to close off the bakery from the rest of the area.  It could've also been done as a separate building as you described.


-Mark

Paddyscake's picture
Paddyscake

  You were so generous to offer your bread baking techniques with video instructions and your recipes. AND again, be so generous with your business
strategies. Very happy for your success!


You are da MAN!!


Betty

mcs's picture
mcs

Thanks for all of the congrats, I'm happy to share the success with fellow bakers.  Actually I'd be happy to share the failures with you too, but I don't get too many pictures of those.


-Mark

dmsnyder's picture
dmsnyder

And congratulations!


Your account of your first year really lays out the importance of having both values and talent for success. A willingness to work hard is important, but so is knowing your limits.


Ever thought of volunteering to be a business school case study? In your spare time, of course. 


I can see how busy you are, but it's always nice to see you back on TFL, Mark.


Good luck for many more successful years!


David

mcs's picture
mcs

I appreciate your compliments.  I'm not exactly sure what you mean by 'business school case study', or if you're just joking anyway, but I'm still definitely more versed as a baker than as a bakery owner - if you know what I mean. 
I've erred on the side of longer hours and working harder in order to be in control of the product, distribution, packaging, and all of that stuff.  Since I don't have any employees, when I do something as simple as change the mix time from 2 to 3 minutes or the DDT from 78 to 76 degrees, I don't have to explain my reasoning or demonstrate a new technique to someone - and I know it'll be done right (most of the time anyway). 
As a home baker, you make adaptations ALL the time, mostly without even writing them down.  In the commercial setting of course, adaptations by the boss man would have to trickle down to the worker bees and some would adapt more easily than others.
I think once things get more solid as far as the process and products go, then the business model will change accordingly.  Anyway, that's where I'm at now.


Thanks again everybody.


-Mark

LindyD's picture
LindyD

I'm so glad your perserverance, dedication, and hard work has paid off, Mark, especially in this tough economy.


I've been away for most of August and now just playing catch-up, but wanted to wish you sincere (if belated) good wishes, and many more anniversary celebrations in the years to come.

bakrwomyn's picture
bakrwomyn

on how one can avoid burn-out? I work as a baker for a cafe and am considering going into business for myself also selling to retailers and restaurants. I work long hours as it is and my biggest fears are working around the clock and taking on too many orders.


Any suggestions?


Btw, kudos to you for pursuing your dream!

mcs's picture
mcs

Hi bakrwomyn,
If you actually enjoy what you're doing, then doing it for 16 hours a day is a good thing, not a bad thing. 


So how do you continue to actually enjoy baking?  You have to keep yourself involved in the enjoyable parts of the baking process.  I think if you were to ask people here what they enjoy about baking bread, one of the top answers would be 'sharing my bread with others'.  Some of the engineers on here might say 'I like the challenge of always trying to create the best bread that I can' or something like that. 


None of the amateurs on this forum complain about how long it takes or having to prepare a ton of bread/rolls for a family get-together.  Why?  Probably because they enjoy doing it and they get to partake in the sharing of their product.


Sometimes when people go into a business like baking, the further along they get, the further they get from the rewarding aspects of bread baking.  Maybe they still sell the bread, or market it, but they aren't making it because they're too busy doing the accounting or managing personnel.  That's not fun and that has nothing to do with baking bread.


I'm deliberately keeping the business small so I can stay involved in (control) every part of the process.  I've turned down wholesale accounts because I knew that accepting them would mean I'd need to hire someone else.  Ask any of the interns who worked with me and they'll tell you.  It's a great (albeit tired) feeling to be the one who scaled, mixed, shaped, baked, delivered, and sold a loaf a bread to a happy customer who drove into town JUST to buy that loaf of bread (again).


Of course it's possible to hire help and keep a great and consistent product, but that's not the goal of my business.  As I get more efficient, I automatically create more space in my baking schedule which results in more time to create better products, more time to get new customers (if that's what I desire) or more time to relax.


I've gone two years now without a single complaint about my products (I won't count that guy who complained that my baguettes had holes in them).  That's a good feeling and I assure you that wouldn't have happened if I'd taken another approach. 


Anyway, there you go.


-Mark


 

bakrwomyn's picture
bakrwomyn

Mark,


Thank you much for putting things in perspective for me. Why did I go into this business in the first place? Because of my obsession, my passion for creating and the instant gratification I get when I see someone rolling their eyes with delight!


My aim in the future is indeed to keep it small but I think my problem is to decide how many customers to take on to break even, how many to make a profit, how many is too much to handle for two people (it'll just be myself and my bf). My operation will strictly be pastry goods (i.e. sticky buns, cakes, cupcakes, scones) with some savory goods such as meat pies and quiches, as well as some breads such as hoagie rolls, buns, small baguettes, batards, etc.


Warmest Regards,


Cara

dolcebaker's picture
dolcebaker

You are lucky you have those outlets, if the law has not changed, I see this is from 2009.  Here in Florida they just allowed baking at home to be a legal business, but we can not sell to retail for resale or online, and no employees.  Only direct or at farmers markets, but then we don't have any home inspections. 

mcs's picture
mcs

Although we're 'The Back Home Bakery' we don't function under the cottage laws.  I went through the same process any retail operation would go through (plus the wholesale inspection that most bakeries and restaurants don't have to go through) to open our doors.  In fact, before I opened I researched the building and health codes of the most strict states in our country, then built the bakery accordingly.  Since I did all of the work and research involved I knew we'd pass inspection before they even arrived.

It just so happens that we live upstairs, but the bakery is a completely independent unit- much like the bakeries, restaurants, businesses in cities that have apartments upstairs. 

-Mark
http://TheBackHomeBakery.com

bertie26's picture
bertie26

Hi Mark

Thank you for your post. I am about to start baking for a living in about a month from now.I have learnt so much from your writing, videos and the best thing I learnt and use is the strech and folding of dough no matter how much,i admit never more than 6 kg at a time.

Good luck for your second year and it is a pity I am in the UK and not able to sample yor fare

Albert

mcs's picture
mcs

I'm glad you've enjoyed the videos.   Make sure you keep us all posted as to your baking adventures.  BTW, this past July marked our 3 year anniversary and things are going well.

-Mark
http://TheBackHomeBakery.com

Oldcampcook's picture
Oldcampcook

I am truly happy to see that you are being successful.  I still bake the sour rye at least weekly.  It has long been my favorite bread.

Bob

The old camp cook

mcs's picture
mcs

Glad to hear that you're still enjoying the rye so much.  I hope everything is going well with you.

-Mark