I recently posted my money mistakes when I started my home bakery on Instagram (you can follow me here if you are interested). It was one of my most popular posts, so I decided to expand into a blog post.
It makes sense; we all like reading about mistakes to see how you compare. Many of the people who follow me are still learning about running a home bakery and looking for information. I hope this post is useful.
1. I paid way too much for ingredients.
It took me a while to dig around for lower prices. Eventually, I created an excel doc where I keep track of how much things cost. Knowing how much you pay for ingredients to such a foundational aspect of your business. It comes into play big time for #5 below too.
I also used to run down the street to my local store for quick trips for butter and the like. We all know how expensive butter is, so you can see how that can add up. I was fortunate that my mom loves a good deal, watched the weekly sales for me, and alerted me.
I suggest looking at Costco, BJ’s, Walmart, or a place like Restaurant Depot, if you are eligible. I created a blog post with a list of where to buy ingredients, decorations, and packaging.
2. I had too many items on my menu.
In the beginning, I tried to be everything to everyone. I have a wide range of items and flavors available, which meant more ingredients and more supplies.
It can be challenging to know what should be on your menu, especially when starting. It’s helpful to see how actual customers react and what they order and narrow it down from there. But, running to the store for, say, blueberries, here and there cost me money and, more importantly, time.
3. I bought all the baking and decorating tools and gadgets.
I thought to myself; now I have a business, I was entitled to all the fun tools out there in the baking world. And, as we all know, the tools are many.
There is nothing wrong with investing in your business with the equipment and tools you need. One of the best things I ever did was purchase a second mixing bowl for my Kitchen Aid. It was game-changing. On the flip side, I also wasted money on too many non-essentials. I have a blog post that lists my 20 essential home bakery tools. Let me know if you agree with what I classify as essential.
4. I didn’t keep track of all my expenses.
Not tracking my expenses was a huge mistake. I should have set up systems from the beginning where I know where every dime was going and how much overall I was spending. I made a lot of assumptions. Not a smart move at all.
As a business owner, you have to know what money is coming in and what money is going out. If you are interested, I recently wrote a blog post about keeping track of your bakery finances.
5. I didn’t charge enough.
I didn’t have a lot of confidence when it came time to charging strangers for products. It’s such a wild experience to bake for years and years for family and friends and then bake for strangers and get paid. The pricing struggle is real!
You have to value what you produce before others will. Remember, not everyone likes or wants to bake, which is good for us. We need those people as customers.
I look at pricing as a skill you develop over time. Don’t let determining your price stop you from moving ahead. You can always change it. But it is essential to know how much it costs you to bake and package your items.
Time is also a key factor when figuring out how much to charge. Track your time! It is so easy to underestimate how long something will take you. Pay attention. Write it down.
In the beginning, you might charge less as you build your baking skills and become more efficient. That’s okay. Just don’t lose money.
It’s so easy to undercharge. If you are stuck, sign up for my email and get my free pdf pricing guide. This powerful cheat sheet will help solve this confusing aspect of your home-bakery business.
Wrapping It Up
I shared these money mistakes hoping that you, as home bakers, can avoid some of them. The truth is there is no one perfect path free of mistakes when you are starting as a business owner. You screw up, you learn and you keep it moving.
Don’t let the fear of making mistakes stop you from taking action forward. Maybe my sharing these with you will save you some time and money. I hope so. One last reminder, sign up for my email to snag my free pricing guide.