Bakery Business Plan: A Description Example and Numbers

A bakery business plan sets out what you'll bake, who will buy it and at what price, how and where you'll make it, and what the first year looks like in money, month by month, including how much cash you need before the bakery pays for itself. The business description at the top says all of that in a paragraph. The numbers underneath are what lenders and you should read most carefully. In the example below, a small wholesale bakery reaches $18,900 of sales a month by month 11 and makes its first monthly profit in month 8, but its cash is at its lowest, about $20,200 below where it started, in month 7: more than twice the $9,000 of working cash in its budget. Below is a description example, each part of the plan, the 12-month projection, and a free template that works it out from your own numbers.

The short version

• Start with a one-paragraph business description: what, for whom, where, how, and the first year's goals.
• Cost each product by what one more unit costs, then price it for each channel.
• Name your first customers, and how many you need.
• Describe the kitchen, equipment, people, suppliers and the records you'll keep.
• Project 12 months with sales ramping up, not starting at full speed.
• Find the lowest point of your cash, and make sure the working cash covers it.
• TaroStack turns the plan's guesses into real costs and real sales once you open. More below.

Part 1: the business description

The business description is the paragraph everyone reads. Say what you make, who buys it, where you are, how you make and deliver it, what makes you different, and what the first year should achieve, in plain sentences. Windward Roots, the made-up taro business I use in these examples, opens a wholesale bakery, and its description reads:

Windward Roots Bakery is a wholesale bakery on the windward side of Oʻahu, making taro sweet bread, taro sourdough, cookies and cinnamon rolls for independent cafés and small grocers within 20 miles. We bake overnight in a licensed 900-square-foot kitchen with a used deck oven, and deliver every morning except Sunday from one van. Our customers want local bread with a flavor their customers can't find elsewhere, delivered fresh, without baking it themselves. Our taro breads use taro from island farms, and every order arrives by 7 a.m. In the first year we plan to supply 25 cafés and grocers, reach $18,900 of sales a month by month 11, and make a monthly profit from month 8.

Keep it to one paragraph. Everything in it is backed up by a later part of the plan, so a reader who doubts a number knows where to look.

Part 2: products and what each costs

For the plan, cost each product by what one more unit costs, its ingredients and packaging; wages and rent go in fixed costs. The costs here come from earlier articles in this series:

At full speed that's $18,900 of sales and $12,710 of contribution a month. How the loaf's cost and wholesale price are built is in how to price baked goods for wholesale.

Part 3: customers and prices

Name the customers you're aiming for, and how many you need. At an average café order of about $750 a month, $18,900 is about 25 accounts. Say how you'll find them (samples, a delivery-day tasting, a price list that fits their margins) and what you'll do about standing orders, returns of unsold bread, and minimum orders per delivery.

Part 4: operations

The inventory and records line is the one most plans leave thin, and the one that decides whether the costs in Part 2 stay true after opening. How to plan the bake itself is in bakery production planning.

Part 5: the first year, month by month

Sales don't start at full speed. The plan assumes 35% of full speed in month 1, rising to 100% by month 11, against $10,000 of fixed costs a month: rent, a baker and part-time help, utilities, the van, marketing, software and supplies.

The year loses $10,567 before the owner's pay, and the cash is lowest in month 7, at about $20,200 below the start. The budget's working cash of $9,000 runs out in month 2. The plan's job is to show that before the lease is signed: either raise about $21,000 of working cash, or find a way to ramp faster, like signing ten accounts before opening. How to work out the monthly sales that cover fixed costs is in break-even point for a food business.

Part 6: the startup budget

Every line is worked through in how much does it cost to open a bakery.

Get the template

Download the bakery business plan template. Type your products with their price, variable cost and units at full speed, your fixed costs and your startup budget; set how fast sales ramp up; and it works out each month's sales, contribution, profit and cash, the first month with a profit, the lowest cash point, and whether your working cash covers it. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

A business plan is a forecast, and the first month replaces it with real numbers. Butter costs more than the plan said, the sourdough yields 22 loaves a batch instead of 24, three cafés want Sunday deliveries, and the cookies outsell the cinnamon rolls two to one. If the costs and sales stay in the plan's spreadsheet, nobody notices the contribution slipping until the bank balance does.

How TaroStack does it

TaroStack takes over where the plan stops: it measures what each product really costs and what each customer really buys, from the first week.

The plan's costs, made real. Each product is a recipe, with sub-recipes for doughs and fillings, and units converted: buy flour by the 50 lb bag, use it by the gram. Ingredients come in at what you paid, and each batch is costed from the lots it used, divided by what came out good, so you see whether the loaf's $2.60 is still $2.60, and recipe truth shows whether a recipe yields what it claims.

The plan's sales, made real. Each café is a customer with its sales orders, delivered with a picking list and a delivery note. Margins are reported by product and by customer, on what each one actually cost, so the contribution in Part 2 becomes a number you can check every month. Stock value by site and month shows the cash sitting on your shelves.

And the week, planned. Planning works out what to bake and what to buy from your standing orders and your own sales history, against your oven's hours, so the order for flour goes in before it runs short.

Stock, counts, lots, recipes, batches and margins are on every plan, from $49 a month; planning is on Standard at $99. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

How do I write a bakery business description?

In one paragraph: what you bake, who buys it, where you are, how you make and deliver it, what makes you different, and what the first year should achieve. Back every claim with a later part of the plan.

What should a bakery business plan include?

A business description, products and what each costs, customers and prices, operations (kitchen, equipment, people, suppliers, records), a 12-month projection, and a startup budget with enough working cash.

How much working cash does a new bakery need?

Enough to cover the lowest point of a month-by-month projection. In the example, $9,000 runs out in month 2, and the projection says about $21,000.

When does a bakery become profitable?

It depends on how fast sales ramp up against fixed costs. In the example, the first monthly profit comes in month 8, and the first year as a whole still loses about $10,600 before the owner's pay.