Cake prices depend on a lot of variables. When you are just starting your business, one of the challenges you face is how to price you products so that you will make a profit. After all, if you aren’t going to make money, just bake for a hobby and enjoy the compliments of your admirers. I don’t mean to sound harsh, but in business, you have to pay attention to the bottom line. Those numbers tell you if you are profitable.

Most of us wish that pricing our baked goods was as simple as multiplying the cost of goods by a set number. There has been a “rule of thumb” that recommends multiplying your supply cost by 2 or 3 and calling it a day. Sounds good, until you realize you won’t make much money. Unfortunately, many bakers don’t charge the right amount for their products. It is really easy to omit the actual cost of some of the expenses, especially if you are working from a home kitchen.

Accurately Price all the Ingredients

It might seem obvious that you have to charge for your ingredients. From what I have observed, many bakers really don’t have accurate numbers for some of those things. Do you know what a cup of flour or sugar actually costs you? How about a teaspoon of salt, vanilla, baking powder, yeast etc? Did you pay tax on the goods you use? How much should you charge for the gas in your car that it took to go and purchase your baking stuff? What about the electricity or gas expenses needed to run your equipment to get the job done? If you are doing any type of promotion, are those expenses figured in? Last but certainly not least, have you been compensated for your labor. I don’t mean just the baking time. What about the time to do the running around to gather the the ingredients? If you are delivering the product, you have time and gas expenses there as well.

To put it in perspective, I was working with a woman who wanted to make some extra money. She was well known in her private circle for her baking expertise, and often people asked her to bake for them. She was confiding in me that she loved to bake, but for some reason although she often was baking for others, it did not actually seem to make their financial situation any better.  I asked her how she set her prices for her baked goods. [Read more…]

Yeah, another state is moving closer to passage of Cottage Food laws that will allow home bakers to start baking for profit.The home bakes in Georgia need as much support as possible as they go down the path of encouraging their lawmakers to make it legal for them to sell their non hazardous baked goods that they make in their home kitchens. If you live in Georgia and can help with their efforts, please visit their FaceBook Fan page

If your state is lagging behind the rest of the country, visit that page too and see how the people are working to add the laws to enable them to start small businesses at home. It benefits not only the people who now will have another way to produce much needed income, it benefits the community to be able to have ready access to quality home made food that is not currently available. That type of commerce also benefits the local economy. It is just a win, win, win situation. [Read more…]

If you have been encouraged by the rise in the number of states enacting Cottage Food Laws, but discouraged by the fact that your state is not included in the list, you should know some things that may help you get a movement going. First of all, I am encouraging you to take a look at how the other states are getting the laws passed. There really is a lot of information out there. Looking at the actual laws added to the books is one approach. The problem with that is you may have to be able to understand the legal jargon. I have been spending a lot of time researching because I am trying to present a brief recap for you here. I want to tell you that in now way  am I an attorney, so I was thrilled to find some of the things that have been presented to lawmakers.

I discovered and interesting tidbit that may help you a lot. The FDA Food code 2009 is being referred to often. In one study done by the Harvard Law School, they found that

According to the FDA Code, home kitchens used for household food preparation cannot be certified kitchens, so anyone wishing to prepare food for sale must have access to a separate certified kitchen outside the home.7
One of the few exceptions to the rule is the exemption for charity bake sales and religious events. Mississippi law permits individuals to produce food at home so long as (a) the food will be sold at functions “such as a religious or charitable organization’s bake sale” and (b) the food is not “potentially hazardous.”8 This exemption allows individuals to prepare for sale foods identified as non-potentiaThe U.S. Food and Drug Administration Food Code (“FDA Code”) is a model code and reference document for state and local governments on food safety laws. The FDA does not require states to adopt the code, but many states have chosen to do so because the code reflects the expertise and attention of dozens of food safety experts. Importantly, the FDA Code itself is not law; it only becomes binding when states adopt it by statute or regulation, and states typically add their own modifications by statute or regulation.

The term that gets the most attention in that code is the “potentially hazardous” foods. The focus [Read more…]

Baking cupcakes could be a great niche market if baking cakes is your thing. Remember in my last post I wrote about specializing to zero in on a target market. How do I know that? I did a bit of research, and I want to encourage all of you to approach your business plan in the same way. Start by doing your homework when you are choosing your niche.  So using the cupcake example, I did some keyword research and found out that there were 9,140,000 searches globally last month, and 5,000,000 local monthly searches. I would have to draw the conclusion there is a lot of interest in cupcakes.

If I were thinking about starting a cupcake business, I would be really excited about now. I want to encourage you to realize that yes, there is a lot of interest, but how can you get your share of that “pie ” or cupcake as the case may be. You realize that they are readily available, every grocery store has them, and they are priced extremely competitively. Let me say this loud and clear, if you have been reading my blog on a regular basis this will not be news. You can not compete on price! [Read more…]

Selling your baked goods or any product for that matter is a huge hurtle for a lot of people. I know for myself, when I started the catering company I was planning on having a partner to do all the sales. I imagined myself happily baking away in the kitchen while she was out pounding the pavement getting new customers. My dream business was to spend the day in the kitchen with the mixers and ovens running, and maybe answering the phone when the orders were pouring in. Boy oh boy was I delusional.

First off, having a business partner is a terrible idea. I know, it is so tempting to take a look at other peoples strengths and wanting to partner up with them because what they bring to the table is something you don’t feel you are good at. I won’t even get into all the reasons partnerships are a bad idea, but trust me, all the experts advise against it. There are more potential problems than benefits to that situation.

I know you might not want to hear this, I know I didn’t. You are best suited to sell your products. If you are just starting out, you get to wear all the hats, remember? I know it seems scary, but think about it. You know your product better than anyone else on the planet. You understand all the benefits of using the quality products teamed with the expertise you have to produce those treasured family recipes everyone loves. You can just see and smell the aroma of [Read more…]

Cottage Food Laws are part of the sustainable living, eat local movement. It is past time that food artisans are allowed to start a business producing non hazardous baked goods, jams, dry mixes, coffees and more. The laws prohibiting small business startups in this economy is part of the problem in our country today. People need a way to generate income, and the substantial investment needed to build a commercial kitchen is out of reach of many people today.

In thirty one states, small business enterprises are starting up providing homemade food to the local community. Hooray for those states. If you are lucky enough to live in one of those states, what are you waiting for? If you don’t know where to start, you might want to take a look at the business start up class I teach on helping non profits with fundraising. If you would just like to do some brainstorming, I would like to invite you to enroll in the free mini webinars. I am going to answer questions, brainstorm ideas you may have, and teach lessons I have learned along the way. What do you have to lose? It may be just what you need to launch your business that you know you have been dreaming of. You can register for those free group coaching sessions by clicking on that link.

Want Cottage Food Laws in Your State?

Step up and start a petition, yes, I mean you. I know it will take awhile, but the fact that so many other states have paved the way and set the precedent makes it much easier. Because other states have the laws in place, [Read more…]

Alright, I said it, bookkeeping. It is a part of running a business that many solopreneurs want to shy away from. I get that, I have to raise my hand as guilty of sharing that same feeling. You have heard me say it, when you start your business, you get the honor of wearing all the hats, and one of the key hats you wear is keeping the books for your business. Otherwise you will never know if the decisions you are making are taking you in the right direction.

I am not an expert on this subject, but I would like to start introducing you to people who have expertise in areas that I lack concerning running your business. That is why I am hosting a guest blog today. I would like to introduce you to Molly Mitchell. She is a freelance business writer who also owns the site https://www.economicsdegree.net. When she isn’t writing, she enjoys reading and being outdoors. Molly is going to give you some great suggestions about types of software that is available to make your book keeping chores easier.

Computer-Based Bookkeeping for Beginners

If you are interested in starting your own business, there is one thing you must learn to do to ensure financial success; bookkeeping. Although this process may raise feelings of dread and confusion, it’s best to remember that bookkeeping simply means keeping track and recording every business transaction. [Read more…]

Seriously, a cake pan is an absolute must if you want to bake a cake. Are you thinking I have lost my marbles? It is Friday, so please bear with me, but that made me think of something funny. A psychologist I know got a t-shirt that said”I can help you find your marbles”. I know, that was really random, but some days are just like that.

Anyway, back to business here. Last week my husband and I were invited to a dear friends house for a dinner party. She asked me to bring a Red Velvet Cake. Oh boy, now you will begin to know the truth about me. I love to work with yeast. I have done quite a bit of cake decorating back in the day, but really, cake isn’t my specialty. And Red Velvet Cake was all new to me. You see, my family is not big on cake.

My kids have always been able to pick their birthday dessert, and it seldom is cake, unless it is German Chocolate. They usually choose things like cherry pie, cheesecake, apple crisp, grasshopper torte, strawberry shortcake, tapioca pudding etc. So you see, the request for a cake that I did not have experience with made me nervous. When that happens, I always pull out a cookbook that my sister-in-law wrote for family. She is a gourmet cook, so I always count on her book when I have to make something new, because I know that if it is in her book, it is a great recipe. I flipped through her book to the cake section, but there was no recipe for Red Velvet cake. That put me over the edge.

Start With a Good Recipe

I am always afraid to trust a recipe from the internet for a special occasion. Problem was, I [Read more…]

If you just wanted to be able to sell your favorite cookies, it may not have occurred to you that you have a lot in common with the people who are passionate about sustainable living issues. I have to admit that I had not put two and two together until recently either. The more I research how to help others be able to start a business baking from home, the clearer the picture becomes for me.

One of the goals of the sustainable living movement is to make it possible for people to have access for local food. I had thought that they were talking about fruits and vegetables. That is not the case, as a matter of fact, a lot of the local organic gardeners are helped by the cottage food laws as well. The truth of the matter is that we are partners in trying to create businesses that produce food, baked or grown, that is local. It puts the consumer face to face with the producer. You get to actually get to know who makes or grows your food, and you can actually ask questions about how they do it.

Meet the people who are baking for you

If you are looking for organically grown, not GMO,  chemical free, you can go to the farm and see for yourself. If you want food baked sans preservatives, ask the baker who made it for you. Cottage food laws require a list of ingredients on non hazardous foods. I bet you will be able to pronounce all the words listed on that label. It is taking us back to the basics, and in most cases, access to home grown or home prepared food. We need to combine our efforts as part of a growing movement to localize food systems and stimulate small-scale food production.

I recently heard of a great book It is about a family that decided to live only on locally grown food available in season. It is a good read, I would have to say inspiring. It does tie into the Cottage Food Law mindset.It too suggests the benefits of reverting back to the way things once were. The before all the chemicals and preservatives that are present in many things we eat everyday.  You should check it out. I think you will see the connections I am talking about. Animal, Vegetable, Miracle: A Year of Food Life (P.S.)

Cottage food laws are made and passed by each individual state. Because of that, you have to check with each state to see what foods they include in their laws. Here is a list of some of the common foods that are approved of as non hazardous foods:

• baked goods (but with no cream or meat fillings)
• jams and jellies
• candy
• granola and other dry cereal
• popcorn,
• waffle cones
•  pizzelles
•  nut mixes
• chocolate covered non-perishables (such as nuts and dried fruit)
• roasted coffee
• dry baking mixes
• herb blends
•  dried tea.

Depending on the state, that list will vary. If one of those is a specialty that you make, and your state has Cottage Food Laws in place, you may be a few steps away from starting your own business.

Your Health Department Can Tell You the Rules

You will have to check with your local health department. You may have to do things like get a [Read more…]