How to Make Money from Your Micro Bakery at Home

Four years ago my sister and I started our Micro bakery called The Flour Barn. We turned a barn on our family farm into a commercial kitchen and started with one product, Cinnamon Rolls. As we got more and more orders we added more and more products. As we sold more products, we could afford better equipment, then employees, slowly creating the bakery we always dreamed of. Still, open only one day a week, we make products varying from fresh croissants, sourdough bread, brownies, cookies, and, of course, cinnamon rolls, all while devoting time to our growing families. The growing trend of micro bakeries is not only one that allows bakers to pursue their passions, but a trend that is bringing quality baked goods back to communities. So How do you Make Money from Your Micro Bakery at Home?

What is a Micro Bakery?

A micro bakery is simply a small bakery. This trend is one we see a lot for part-time bakers, moms who want a side hustle, retirees who need a creative outlet, and even passionate home bakers who have another full-time job. Micro bakeries are amazing for two reasons. One, they allow talented bakers a place to sell their products without opening a full-scale bakery. The second reason is that they allow customers to receive baked goods that are high quality.

Why are bakeries becoming harder to find?

Every time I go on vacation, I try to take a tour of all the local bakeries. One because I love to get new ideas, and two because I love to eat. I found some amazing places in Chicago, Portland, and even Cleveland. But what I have learned is that very few mid-sized and small towns can sustain a high-quality bakery. This is not to say that lots of places have bad bakeries, it is to say that very few even have bakeries. This means that very few communities have access to quality sourdough bread, freshly baked pastries, or decadent brownies. Many places may have a coffee shop, but they don’t generally have a large bakery case. I think there are several reasons for this.

“A bakery is where dreams rise and delicious memories are made.”

In most cases, when you run a brick-and-mortar bakery you have to pay rent. When you have rent to pay you feel as though you must be open every day. Not only to pay the bills but to stay consistent for your community. It is these long, unprofitable hours that can drive a bakery out of business. During these hours products are wasted, employees are paid, and utilities are running up the bills. In a large city you can rely on steady traffic through the week and very good business on the weekends resulting in a profitable business. In a location with a mid-size population, you have very little reliability. Some weeks may be busy, and others may not make much money. Unfortunately, when rent is involved, not being able to rely on a consistent income can be crippling. So how do we bring high-quality baked goods back to our communities?

Calling all Bakers

Bakeries unable to stay in business is not just hard for the bakers who lose their dreams; it is also a hit to their community. I know so many moms who are looking for places to get their weekly bread and exciting treats that don’t come from the big-name grocery stores. It is no longer about just wanting to shop local; it is so much more than that. It is about wanting your items to be fresh, made from quality ingredients, or simply not full of so many preservatives. Starting a micro bakery is not just about someone following a dream or trying to make money, it is one way to give to your community. Now all that being said, like starting any small business it may not be easy. You have to find your people and optimize your product.

Find your People

The best way to find a product that will sell is to check with the customers. It may seem strange to start with a client base before your product; however, many times it can help you find the very product that will create your business. This is basically what many people refer to as finding your niche. When you find the people who are willing to consistently buy certain items you are selling you find both your client base as well as your product.

What does this mean?

When I was in college, I started my own baking business out of my apartment. I would post on the apartment Facebook group what I was baking that day and would see who wanted to purchase my bake. The first thing I started making was a combination of cupcakes and muffins. Very few people were messaging me. Then one day I posted my brioche bread. Immediately people wanted my loaves and asked how to get more. I was able to find my people and in doing so find my product. I also remember while in college I went to school with a girl who had a home bakery and sold Hot Cocoa Bombs. She was able to sell a huge amount on campus, all items made in her own home. A completely different set of people for completely different items.

Farmers Markets

I have always used social media because I have a location that I want people to come to. However, as a home bakery, going out to sell your product can move a large amount of product at one time. Remember that if you live in a small town, you can join neighboring towns’ markets. This can be worth it for a large pool of potential customers.

How do I find my people (potential customers)?

When I was in college I focused on location. I searched for Facebook groups in my area and simply targeted those people. I only wanted to sell a few loaves a week to a loyal group of customers. This was making me about $200 a week, which was good money, and really made a difference for me. Your goal could be just to have extra money to cover your grocery bills for the week. However, when my sister and I started our bakery in our hometown, we wanted to be able to sell to a larger audience. Local Facebook groups were very helpful. We joined our town’s Facebook group, local housing development Facebook groups, and even neighboring town groups. We offered cookie kits, small custom cakes, and eventually cinnamon rolls. It was when we started getting a larger amount of interest in the Cinnamon rolls that we knew we had found our product. Not only were we getting steady orders for them, but we also were getting a good number of comments and a high number of shares.on our posts that had pictures of our rolls.

Quick tip: You can create a business Facebook page through your page. You are unable to join groups as a business page, but can through your account. To get your posts visible in Facebook groups, post through your business account and then share on your personal page.

What if I am having trouble finding my people?

Try mixing up your approach. This does not mean trying a baked good you have never baked before, but maybe making it more user-friendly. So maybe instead of your grandma’s key lime pies, you turn them into key lime pie bars, get amazing pictures of them, and post them. Or instead of your simple sugar cookies, you fill your cookies with strawberry buttercream and call them Strawberry and Cream Cookie Sandwiches. Pictures are important in a business that the customer has to seek out so do your best to focus on getting quality shots for advertising.

You also can reach out to local coffee shops, local grocery stores, and any other local businesses or local restaurants to see if they are looking to carry any specific local baked goods. A lot of local grocery stores are looking to carry local freshly baked sourdough bread along with other bread basics like hamburger buns and bagels. In addition, local coffee shops are often looking for specialty items like scones, muffins, and cookies.

Key Take Aways:

Don’t get stuck on a product. If everyone in your area is not biting at your muffins, switch it up and try your favorite pie recipe or bread recipe.
Check Facebook groups to find local customers. Try, “Your Towns People in the Know”, “Local Schools Parents”, and “Local Subdivisions People in the Know”.
Check with Local coffee shops and Local Grocery Stores to see if they are looking to partner with a local bakery for specific items

Optimize Your Product to Make Money from Your Micro Bakery at Home

The best part about finding a specialty is that you can focus your supplies around that item. We used to dabble in cake decorating and bread baking. These two items use such different equipment that our kitchen became very hectic. Once we decided to stop doing cakes, our kitchen became much more efficient. We ditched the cake pans, and we bought cookie sheets in bulk and special containers for our icing and cinnamon sugar. A long island that was perfect for our rollouts was added and eventually we even bought a sheeter that was able to roll out the dough for us. We could put all of our money towards the production of our most popular product and in turn sell more of the product in a shorter amount of time and with more efficiency. Here are a few tips on how to optimize your Micro bakery.

Set Your Goals

In the beginning, I wanted to make enough to add to my retirement, this totaled about $700 a month. To be able to meet that I added up just how many cinnamon rolls I needed to sell. Once I knew the amount of product I needed to sell I was able to have a better understanding of what equipment I needed. This doesn’t just include mixers and ovens, but also containers, spatulas, and scoops. I needed to know what ingredients I needed and how I was going to store them. If you can have this all situated it will make your baking process so much less hectic. Here is a post on our favorite tools.

Know your limits

If you are a home baker, keep that in mind. You have one oven and a set amount of baking time. Some things that are large and bake for a long time, but don’t make very much may not be as helpful as smaller items that don’t take as long but can sell for more. An example may be bread loaves vs macarons. Again this is all based on your clientele.

Also, remember your profit margin. If you advertise that you use all organic ingredients, but then sell your loaves too cheap then you will not be able to make enough of a profit.

Be creative.

At our bakery, we did start to expand our menu once we had a client base. We often use our brioche dough recipe in several products to optimize production. Instead of several batters and dough being made, we have a lot of one dough that then gets shaped and filled into different items. Also, remember the impacts of marketing. Good photography and descriptions can bring a product to life and reignite interest. We sold iced brownies for years with little excitement over them. However as soon as we topped them with sprinkles and called them Cosmic Jumbo Brownies, everyone wanted them.

Other Lessons I’ve Learned

Paying to Rank on Google

I have been approached by companies that can boost your ranking on Google. This means that when people search, “local bakeries near me” that company can make you appear first. As a Micro bakery, I have found that I have little to gain from this. Most people searching for a local bakery usually fall into two categories. They are looking to visit a bakery where they can head there now and sit down. Our bakery has very limited hours and only outdoor seating. The other group is people looking for cake decorators for events. If you are a cake baker, this may be worth it for you. I think this is also worth it for bakeries that have consistent hours.

Word-of-mouth referrals

These are the most flattering referrals you can get, but if you want to make money you have to work for it. References from happy customers are the result of excellence. Make a great product, and people will talk about it!

Paying for Mail Ads

I have done this for a couple of months and have had mediocre outcomes. The downside is that the people who show up based on mail ads often don’t fully understand your business. Microbakers are often very specific in what they sell and when they sell, which can be confusing through a mail ad.

Facebook Ads

The best digital marketing path I would take would be through Facebook ads. This does require you to make a business account through your Facebook account. You then want to make a post that contains a few good pictures of your product and a description of how to purchase your product and support your business. Once you post this you can pay to have Facebook push your post to people who are in your typical customer demographic. This can be location-based, age-based, and even interest-based. Very worth it.

Facebook Groups for Support

Some great Micro bakery Facebook groups are full of ideas and inspirations. They are filled with bakers who own a home-based bakery. I highly suggest checking them out. One of my favorite groups that I am a part of is Sourdough Micro-Bakery Community. Even if you are not a Sourdough specific baker there are so many interesting ideas in this group. From packaging to holiday bundles there are so many creative bakers in this group.

Square

We use the Square POS systems. We can get online sales through this and have our online store. I have never used another brand so I can’t speak too much on this. I will say there is a feature that allows people to join a mailing list that is great for turning customers into repeat customers.

Videos

People love watching videos of bakers. If you are creative, making content is a great way to advertise your business and even make money through social media platforms. Being a content creator is no small task and does require time and thought.

Local Health Departments

Check out my other posts on micro bakeries to learn more about how to get your micro bakery started. It includes a section on cottage food laws, local laws, and all things bakery business.

Check us out on the Farmhouse on Boone Podcast