Bakery Business Plan Template

How To Write a Bakery Business Plan

Embarking on the journey to start your own bakery business requires proper planning and a clear strategic vision. Whether you aim to open a retail bakery or a home bakery, this guide will provide you with the essential insights and practical advice needed to develop a successful business plan tailored to your aspirations.

 

Preparing to Create Your Bakery Business Plan

Creating a bakery business plan involves a structured approach to ensure all aspects are thoroughly addressed. Begin by conducting detailed market research to understand the bakery industry, your target market, and the competitive landscape. This research will inform your marketing strategies and help you define your business’s core strengths and offerings.

You can download the Bakery business plan (including a full, customizable financial model) to your computer here <–

Establish your bakery’s unique value proposition. What distinguishes your baked goods from other local businesses in this competitive market? Whether you specialize in gluten-free options, vegan baked goods, or artisanal pastries, clearly defining your bakery’s core strengths will attract your target audience. To ensure efficient operations, consider the logistics and operations plan, including inventory management, sourcing from local suppliers, and day-to-day processes.

With these foundational elements in place, you are ready to use the sample bakery business plan template provided below. From the executive summary to the financial plan, this template will help ensure that you create a well-written business plan. With this template, you will be well-prepared to secure funding (e.g., bank loans, business partners, and other potential investors), manage operational costs, and successfully grow your bakery business.

 

Sample Bakery Business Plan Template

The following sample bakery business plan gives you the key elements to include in your own bakery business plan.

 

I. Executive Summary

Business Overview

[Bakery Name], located in [insert location here], is a new, upscale bakery focusing on providing organic, healthy, premium food products. Our product line fits nicely with health trends nationwide – while people still want French pastries and baked goods, they want them to be as healthy as possible.

 

Products Served

[Bakery Name] will sell several baked goods, including bagels, croissants, cookies, cakes, danishes, muffins, scones, and strudel. All products will use 100% all-natural and organic ingredients. Several products will have regular and low-fat varieties.

In addition to baked goods, [Bakery Name] will sell breakfast and lunch sandwiches, salads, and soups and serve a variety of coffees and teas.

 

Customer Focus

[Bakery Name] will primarily serve the residents within a 5-mile radius of our store. The demographics of these target customers are as follows:

• 67,827 residents
• Average income of $74,700
• 58.9% married
• 49.6% in Management/Professional occupations
• Median age: 38 years

In addition to this prime adult demographic for an upscale bakery, there are five elementary schools, a middle school, and a high school. Students from these schools will be sure to frequent [Bakery Name].

 

Management Team

[Bakery Name] is led by [Founder’s Name], who has been in the bakery business for 20 years. While [Founder] has never run a bakery herself, she has taught baking classes at the local high school for 20 years and has worked part-time at bake shops throughout the region over the past 10 years. As such, [Founder] has in-depth knowledge of the bakery’s business operations (e.g., running daily operations) and the business management side (e.g., staffing, marketing, etc.).

 

Success Factors

[Bakery Name] is uniquely qualified to succeed due to the following reasons:

• There is currently no upscale bakery in the community we are entering. In addition, we have surveyed the local population and received extremely positive feedback saying that they explicitly want to frequent our business when launched.
• Our location is in a high-volume area with high foot traffic and will thus be highly visible to significant numbers of passersby each day.

• The management team has a track record of success in the bakery business.
• The upscale baker business is a proven business and has succeeded in communities throughout the United States.
• Market trends such as healthy and organic living support our business opportunity.

 

Financial Highlights

[Bakery Name] is currently seeking $370,000 to launch. Specifically, these funds will be used as follows:

• Store design/build: $250,000
• Working capital: $120,000 to pay for Marketing, salaries, supplies, and lease costs

Top-line projections over the next five years are as follows:

Financial Summary	FY 1	FY 2	FY 3	FY 4	FY 5
Revenue	$560,401	$782,152	$1,069,331	$1,379,434	$1,699,644
Total Expenses	$328,233	$391,429	$552,149	$696,577	$776,687
EBITDA	$232,168	$390,722	$517,182	$682,858	$922,956
Depreciation	$7,000	$7,000	$7,000	$7,000	$7,000
EBIT	$225,168	$383,722	$510,182	$675,858	$915,956
Interest	$6,016	$5,264	$4,512	$3,760	$3,008
Pre Tax Income	$219,152	$378,458	$505,670	$672,098	$912,948
Income Tax Expense	$76,703	$132,460	$176,985	$235,234	$319,532
Net Income	$142,449	$245,998	$328,686	$436,864	$593,416
Net Profit Margin	25%	31%	31%	32%	35%

II. Company Overview

You can download the Bakery business plan (including a full, customizable financial model) to your computer here <–

Who is [Bakery Name]?

[Bakery Name], located at [insert location here], is a new, upscale bakery focusing on providing organic, healthy, and/or premium baked goods. We also sell breakfast and lunch sandwiches, salads, soups, and coffees and teas.

[Bakery Name] was founded by [Founder’s Name]. While [Founder’s Name] has been in the bakery business for some time, it was on [month, date] that he decided to launch [Bakery Name]. Specifically, during this time, [Founder] took a trip to Fort Lauderdale, FL. During his trip, [Founder’s Name] frequented a bakery that enjoyed tremendous success. After several discussions with the owner of the bakery, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.

Specifically, the customer demographics and competitive situations in the Fort Lauderdale location and his hometown were so similar that he knew it would work. Furthermore, after surveying the local population, this theory was proven.

 

[Bakery Name]’s History

Upon returning from Fort Lauderdale, surveying the local customer base and finding a potential retail location, [Founder’s Name] incorporated [Bakery Name] as an S-Corporation on [date of incorporation].

The business is currently running out of [Founder Name]’s home office, but once the lease on [Bakery Name]’s retail location is finalized, all operations will be run from there.

Since its incorporation, the bakery has achieved the following milestones:

• Found office space and signed a Letter of Intent to lease it
• Developed the bakery’s name, logo, and website located at www…
• Created the menu
• Determined equipment and inventory requirements
• Began recruiting key employees with experience in the bakery industry

 

[Bakery Name]’s Product Offerings

Below is [Bakery Name]’s initial menu. All items will be 100% natural and organic. As you can see, all items are classified under the following eight main categories:

1. Soups
2. Breakfast Sandwiches
3. Croissants and Danish
4. Muffins and Scones
5. Sandwiches and Wraps
6. Salads
7. Bagels
8. Cookies and Desserts

 

III. Industry Analysis

[Bakery Name] directly or indirectly competes with all food service providers near our store that offer similar products, mainly breakfast foods, bread, desserts, sandwiches, and salads. Competition will come from supermarkets, restaurants, coffee shops, bakeries, and other retail establishments. Direct competition will come from other bakeries offering 100% natural, organic products like [Bakery Name].

 

Industry Statistics & Trends

The following industry statistics bode well for [Bakery Name].

According to the recent report titled “Retail Bakeries Industry in the U.S.” by Supplier Relations US, LLC, the retail bakery industry’s annual revenue is approximately $3.6 billion, with an estimated gross profit of 25.52%.

According to a recent report by Modern Baking, the median annual sales of retail bakery stores surveyed were $333,000, while the median store size was 2,120 sq. ft, and the average bakery sale per customer was $12.51.

According to a recent study by the IDDBA (International Dairy·Deli·Bakery Association):

• Health is strengthening as a food purchase mega factor, ranking third after taste and price, and above convenience.
• Frequent bakery shoppers tend to be less health-conscious than the rest of the population, but they are still health-conscious.
• Shoppers say they are buying more reduced-fat milk (+30%), whole-grain bakery products (+29%), and yogurt (+19%).
• More than half of shoppers are trying to avoid trans fat, total fat, and saturated fat. Frequent dairy, deli, and bakery shoppers are more concerned about trans fat than the average shopper, but less concerned about a reduced-fat claim on products.
• More than a third of shoppers say that the calorie content of foods is very important to them when they shop in the dairy, deli, and bakery departments. Frequent deli shoppers are the most concerned, with about 40% of full-service and a similar portion of self-service customers indicating they place great importance on calories.
• Frequent shoppers in the self-service deli and self-service fresh bakery are more likely to buy organic and natural foods.
• Seven in ten consumers tried to increase their consumption of whole grains last year.
• About half of frequent deli and bakery shoppers say it’s important for products in these departments to contain added nutrients, such as vitamins or fiber. Added nutrition is ranked even more important by frequent shoppers in the dairy and full-service deli departments.

A recent study by Modern Baking found the following:

• In-store bakery (e.g., bakeries in supermarkets) annual sales increased to $20 billion.
• Cake and bread are the top two products contributing to sales.
• Sales of freshly baked bread have been positively affected by the demise of the low-carb trend, the growth of whole grains, and an increased interest in crusty bread products.
• There has been growth in the cookie sales. Declines were reported for bagels, pies, and donuts.

 

IV. Customer Analysis

[Bakery Name] will serve the residents of [location] and the immediately surrounding areas, as well as those who work in [location].

The area we serve is affluent and has an affinity to healthy and organic foods and beverages like those we will be offering.

We will primarily target the following four customer segments:

1. Soccer/stay-at-home moms: The town has a large population of stay-at-home moms who are active in the school and community. These moms often meet for lunch or coffee, and [Bakery Name] will provide a perfect place to congregate. (We also expect mothers to take their children to [Bakery Name] for after-school and weekend snacks and meals.)
2. Morning commuters: Many local residents drive to neighboring towns or take the nearby train to work. [Bakery Name] is conveniently located for these individuals to pick up coffee or a breakfast sandwich in the morning or pick up a sandwich in the evening.
3. Local office workers: Approximately 5,000 individuals work in offices within a quarter mile of our location, and we expect a fair portion of these individuals to frequent us during the morning and lunch hours.
4. Students: There is a middle school and a high school in the town, and the high school is within one-half mile. Students from these schools will be targeted to frequent [Bakery Name].

 

You can download the Bakery business plan (including a full, customizable financial model) to your computer here <–

 

V. Competitive Analysis

Direct and Indirect Competitors

There are other bakeries located within a 2-mile radius of [Bakery Name], thus providing either direct or indirect competition for customers:

Joe’s Supermarket

Joe’s Supermarket is the town’s leading grocery store and has been in business for 32 years. Joe’s offers a wide array of all the products that you typically find in a grocery store.

Joe’s also has an in-house bakery. However, less than 10% of the products served in their bakery are made with organic ingredients. In addition, Joe’s offers little variety in their items. For example, they only offer 2 types of soups, 3 types of cookies, etc. [Bakery Name], on the other hand, offers numerous options for each product type.

Old Time Bakery

Old Time Bakery has been in business for 14 years. It offers a variety of baked goods, primarily cookies and desserts.

However, [Bakery Name] has several advantages over Old Time Bakery, including:

• Old Time Bakery offers a few products baked with organic ingredients
• Old Time Bakery does not offer sandwiches, soups, or salads
• Old Time Bakery does not offer customer seating
• Old Time Bakery has little parking
• Old Time Bakery is located over one-quarter of a mile from us, and, as such, is less convenient for the office workers who work next to our store.

Freddy’s Deli

Freddy’s Deli is located four stores to the East of us. It has been in business for the past 21 years and enjoys great success, primarily due to its prime location (which we will also have).

Freddy’s primarily offers breakfast and lunch sandwiches and soups, some cookies and cakes, as well as a variety of packaged goods.

[Bakery Name] has several advantages over Freddy’s Deli, including the following:

• Freddy’s Deli does not offer products, including pastries, sandwiches, soups, and more, made with organic ingredients
• In our product categories, Freddy’s does not offer a wide variety of items.

While we expect that Freddy’s Deli will continue to thrive based on its location and customer relationships, we expect that more and more customers will frequent [Bakery Name] based on the high-quality and organic ingredients we use and our product selection.

Supermarket is the town’s leading grocery store and has been in business for 32 years. Joe’s offers a wide array of all the products that you typically find in a grocery store.

 

Competitive Pricing

Here is the pricing of our key competitors:

Type of food	Joe’s	Old Time	Freddy’s
Coffee / Tea	$2.75 - $5.75	$2.95 - $4.50	$2 – $5.50
Breakfast	$5 - $12	$6.95 - $12.95	$8.95 - $16.95
Lunch	$9 - $18	$7.95 - $12.95	$12.95 - $15.95
Pastries	$2 - $4	$1.75 - $2.50	N/A
Cakes / Bakery	$2.75 - $7 / slice/piece	N/A	N/A

Competitive Advantage

[Bakery Name] enjoys several advantages over its competitors. These advantages include:

• Location: [Bakery Name]’s location is near the center of town, giving us access to commuters going to and leaving the train station, local office workers, and passersby going to local shops. We also offer adequate parking, making it easy for customers to patronize us.
• High-Quality Baked Goods: In the local market, finding 100% natural and organic baked goods, including gluten-free and vegan baked goods, soups, and sandwiches, is challenging, if not impossible. No other retailer offers direct substitutes or competition for most of our products.
• Management: Our management team has years of business and marketing experience that allows us to market and serve customers in a much more sophisticated manner than our competitors.
• Relationships: Having lived in the community for 25 years, [Founder’s Name] knows all the local leaders, newspapers, and other influencers. As such, it will be relatively easy for us to build branding and awareness of our bakery.

 

VI. Marketing Plan

The [Bakery Name] Brand

The [Bakery Name] brand will focus on the bakery’s unique value proposition:

• We offer organic, high-quality food items, including baked goods, sandwiches, soups, salads, and more.
• We offer a convenient location that offers both eat-in and take-out options.
• We provide excellent customer service.

 

Promotions Strategy

[Bakery Name] expects its target market to be individuals working and/or living within a 5-mile radius of its location. The bakery’s promotions strategy to reach these individuals includes:

Direct Mail

[Bakery Name] will blanket neighborhoods surrounding its locations with direct mail pieces. These pieces will provide general information on [Bakery Name], offer discounts and/or provide other inducements for people to frequent the store.

Public Relations

We will contact all local and area newspapers and television stations to tell them about the opening and unique value proposition of [Bakery Name].

Advertising

[Bakery Name] will initially advertise in local newspapers and sponsor community events to gain awareness.

Sampling

[Bakery Name] employees will initially give free food samples to passersby to enable them to taste the quality of our products and learn about us.

Ongoing Customer Communications

[Bakery Name] will maintain a website and publish a monthly email newsletter to tell customers about new events, products, and more.

Pre-Opening Events

Before opening the store, [Bakery Name] will organize pre-opening events designed for prospective customers, local merchants, and press contacts. These events will create buzz and awareness for [Bakery Name] in the area.

Digital Marketing Campaigns

Digital marketing campaigns are crucial for bakery owners to boost traffic and sales. Utilizing social media platforms like Instagram and Facebook allows for showcasing baked goods and engaging with local customers. Targeted ads can reach ideal customers nearby. Email marketing is effective for promoting special offers, new products, and events. Collaborating with local influencers can enhance visibility and draw more customers to the bakery.

 

Pricing Strategy

[Bakery Name]’s pricing will be moderate, so customers will feel they receive great value when patronizing the stores.

 

VII. Operations Plan

Functional Roles

To execute [Bakery Name]’s business model, the bakery needs to perform many functions, including the following:

Administrative Functions

• General & Administrative functions including legal, marketing, bookkeeping, etc.
• Sourcing and storing ingredients
• Hiring and training staff

Kitchen Functions

• Food preparation
• Ongoing menu creation and modification

Store/Retail Functions

• Order taking and fulfillment (for take-out and dine-in)
• Customer service
• Janitor/maintenance personnel to keep the store clean

 

Milestones

[Bakery Name] expects to achieve the following milestones in the following [X] months:

Milestone	Priority Level	Time to Implementation
Strategic Planning & Business Plan Development	Urgent	0–2 Months
Secure Capital Partners	Urgent	0–2 Months
Develop Website, Branding & Marketing Content	Urgent	0–2 Months
Grand Opening	Urgent	8–12 Months
Raise Capital & Funding Required to Launch	High	3–4 Months
Acquire Bakery	High	3–4 Months
Purchase Initiate Hiring Plan	High	3–4 Months
Neighborhood Interest Party	Moderate	5-6 Months
Sales and Marketing Plan Execution (Focused on Community Branding)	Moderate	5-6 Months
Launch Official Naming / Ribbon Cutting	Low	8–12 Months

VIII. Management Team

Management Team Members

[Bakery Name] is led by [Founder’s Name], who has been in the bakery business for 20 years.

While [Founder] has never run a bakery herself, she has taught baking classes at the local high school for 20 years. Two courses that he taught included:

1. How To Bake Wedding Cakes: This course was designed to give students an overall understanding of baking wedding cakes. The students were taught to bake and decorate traditional and contemporary wedding cakes, and cakes for special occasions.
2. How To Bake Bread: This course was designed to give students an overall understanding of baking breads and included four units teaching students to bake the following types of breads: Levain, baguettes, pain bordelaise; baguettes, bagels, flatbread; brioche, croissants, and challah; pizza, focaccia, ciabatta.

[Founder] has also worked part-time at bake shops throughout the region over the past 10 years. Specifically, he has worked for Giana’s Bakery, where he has prepared all wedding cakes. He has also trained several others in the art of creating commercial cakes and pastries.

[Founder] graduated from the University of ABC, where he majored in Communications.

 

Hiring Plan

[Founder] will serve as the store manager. To launch our store, we need to hire the following personnel:

• Customer Service Staff (2 full-time equivalents to start)
• Skilled Bakers (1 to start)
• Assistant Store Manager (will manage cash register and other administrative functions)

 

IX. Financial Plan

You can download the Bakery business plan (including a full, customizable financial model) to your computer here <–

Revenue and Cost Drivers

[Bakery Name]’s revenues will come from the sale of natural and organic food products to its customers.

The bakery will have dine-in, takeout, and possibly delivery systems to cater to a broad spectrum of customers in its target market.

The major costs for the bakery will be operational costs and the salaries of the staff. In the initial years, the bakery’s marketing spend will be high as it establishes itself in the market.

 

Capital Requirements and Use of Funds

[Bakery Name] is seeking a total funding of $370,000 to launch its store. The capital will be used for funding capital expenditures, manpower costs, marketing expenses, and working capital.

Specifically, these funds will be used as follows:

• Store design/build: $250,000
• Working capital: $120,000 to pay for Marketing, salaries, and lease costs until [Bakery Name] reaches break-even

 

Key Assumptions

Number of customers per day	Per location		Number of locations started
FY 1	100		FY 1	1
FY 2	105		FY 2	0
FY 3	110		FY 3	0
FY 4	116		FY 4	0
FY 5	122		FY 5	0
Average order price	$14.00		Cost of goods sold
			FY 1	23.00%
Annual increase in order price	5.00%		FY 2	22.00%
			FY 3	20.00%
Annual Lease (per location)	$60,000		FY 4	19.00%
Yearly Lease Increase %	2.50%		FY 5	18.00%

 

Financial Statements

5 Year Annual Profit and Loss Statement

		Year 1	Year 2	Year 3	Year 4	Year 5
Revenues
	Product/Service A	$151,200	$333,396	$367,569	$405,245	$446,783
	Product/Service B	$100,800	$222,264	$245,046	$270,163	$297,855
	Total Revenues	$252,000	$555,660	$612,615	$675,408	$744,638
Expenses & Costs
	Cost of goods sold	$57,960	$122,245	$122,523	$128,328	$134,035
	Lease	$60,000	$61,500	$63,038	$64,613	$66,229
	Marketing	$20,000	$25,000	$25,000	$25,000	$25,000
	Salaries	$133,890	$204,030	$224,943	$236,190	$248,000
	Other Expenses	$3,500	$4,000	$4,500	$5,000	$5,500
	Total Expenses & Costs	$271,850	$412,775	$435,504	$454,131	$473,263
EBITDA		($19,850)	$142,885	$177,112	$221,277	$271,374
	Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
EBIT		($56,810)	$105,925	$140,152	$184,317	$234,414
	Interest	$23,621	$20,668	$17,716	$14,763	$11,810
PRE-TAX INCOME		($80,431)	$85,257	$122,436	$169,554	$222,604
	Net Operating Loss	($80,431)	($80,431)	$0	$0	$0
	Income Tax Expense	$0	$1,689	$42,853	$59,344	$77,911
NET INCOME		($80,431)	$83,568	$79,583	$110,210	$144,693
Net Profit Margin (%)		-	15.00%	13.00%	16.30%	19.40%

 

5 Year Annual Balance Sheet

		Year 1	Year 2	Year 3	Year 4	Year 5
ASSETS
	Cash	$16,710	$90,188	$158,957	$258,570	$392,389
	Accounts receivable	$0	$0	$0	$0	$0
	Inventory	$21,000	$23,153	$25,526	$28,142	$31,027
	Total Current Assets	$37,710	$113,340	$184,482	$286,712	$423,416
	Fixed assets	$246,450	$246,450	$246,450	$246,450	$246,450
	Depreciation	$36,960	$73,920	$110,880	$147,840	$184,800
	Net fixed assets	$209,490	$172,530	$135,570	$98,610	$61,650
TOTAL ASSETS		$247,200	$285,870	$320,052	$385,322	$485,066
LIABILITIES & EQUITY
	Debt	$317,971	$272,546	$227,122	$181,698	$136,273
	Accounts payable	$9,660	$10,187	$10,210	$10,694	$11,170
	Total Liabilities	$327,631	$282,733	$237,332	$192,391	$147,443
	Share Capital	$0	$0	$0	$0	$0
	Retained earnings	($80,431)	$3,137	$82,720	$192,930	$337,623
	Total Equity	($80,431)	$3,137	$82,720	$192,930	$337,623
TOTAL LIABILITIES & EQUITY		$247,200	$285,870	$320,052	$385,322	$485,066

 

5 Year Annual Cash Flow Statement

	Year 1	Year 2	Year 3	Year 4	Year 5
CASH FLOW FROM OPERATIONS
Net Income (Loss)	($80,431)	$83,568	$79,583	$110,210	$144,693
Change in working capital	($11,340)	($1,625)	($2,350)	($2,133)	($2,409)
Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
Net Cash Flow from Operations	($54,811)	$118,902	$114,193	$145,037	$179,244
CASH FLOW FROM INVESTMENTS
Investment	($246,450)	$0	$0	$0	$0
Net Cash Flow from Investments	($246,450)	$0	$0	$0	$0
CASH FLOW FROM FINANCING
Cash from equity	$0	$0	$0	$0	$0
Cash from debt	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
Net Cash Flow from Financing	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
SUMMARY
Net Cash Flow	$16,710	$73,478	$68,769	$99,613	$133,819
Cash at Beginning of Period	$0	$16,710	$90,188	$158,957	$258,570
Cash at End of Period	$16,710	$90,188	$158,957	$258,570	$392,389