A gluten-free bakery sells to people who can't take a chance, which is why the kitchen matters more than the recipes. A dedicated gluten-free kitchen, with no wheat flour ever in the building, is what customers with celiac disease look for, and it's how the bakery can stand behind FDA's gluten-free definition: under 20 parts per million of gluten. Gluten-free flours, rice, sorghum, tapioca, almond, cost two to four times wheat flour, so ingredient cost runs higher than a regular bakery's. The plan turns on that cost, a test program to check the products, and sales at full price to customers who travel for them. In the example, a Boise gluten-free bakery starts with $138,600, ends its first year about $16,500 behind before the owner's pay while sales build, and makes about $2,700 a month at full speed. Below is each part of the plan, the first year month by month, the startup budget, and a free template.
The short version
- Describe the bakery in a paragraph: who it's for, the dedicated kitchen, the goals.
- Cost each item with gluten-free flours; they cost two to four times wheat.
- Plan sales by product: loaves, muffins and cookies, cakes to order, wholesale and online.
- Keep the kitchen dedicated: no wheat flour ever comes in.
- Test products for gluten on a schedule; keep the results.
- Budget working cash for the slow first months, and check it against the lowest cash point.
- TaroStack makes each loaf a recipe, so its true cost follows the price of what's in it. More below.
Part 1: the business description
Clearwater Gluten-Free Bakehouse, a made-up dedicated gluten-free bakery in Boise, Idaho, writes:
Clearwater Gluten-Free Bakehouse is a dedicated gluten-free bakery with a retail counter, baking sandwich loaves, muffins, cookies and cinnamon rolls, cakes to order, wholesale loaves for two grocers, and shipped cookie boxes. No wheat flour enters the building. In its first year it aims to reach $29,000 of sales a month.
Part 2: what a gluten-free loaf costs
| Item | Gluten-free flours | Other ingredients | Bag or box | Card fee | Cost | Price | Cost share |
|---|---|---|---|---|---|---|---|
| Sandwich loaf | $2.10 | $0.95 | $0.25 | $0.33 | $3.63 | $11.00 | 33.0% |
| Blueberry muffin | $0.38 | $0.42 | $0.08 | $0.12 | $1.00 | $4.00 | 25.0% |
A blend of brown rice, sorghum and tapioca flour with psyllium costs about $2.20 a pound against 60 cents for wheat. What the label needs to say "gluten-free" is in gluten free labeling requirements.
Part 3: customers and testing
Customers drive 40 minutes for it, so Saturdays are the biggest day. Every new product, and every new flour supplier, gets a gluten test before it's sold, and a few finished items are tested each month; the results go in a binder by lot.
Part 4: what each product earns
| Product | Price | Variable cost | Contribution | Margin | Units a month at full speed |
|---|---|---|---|---|---|
| Sandwich loaf | $11.00 | $3.63 | $7.37 | 67% | 900 |
| Muffins, cookies and rolls | $4.00 | $1.00 | $3.00 | 75% | 2,400 |
| Cake to order | $55.00 | $16.00 | $39.00 | 70.9% | 40 |
| Wholesale loaf | $7.50 | $3.30 | $4.20 | 56% | 600 |
| Shipped cookie box | $32.00 | $11.00 | $21.00 | 65.6% | 90 |
At full speed the business sells $29,080 a month and keeps $19,803, 68.1%; muffins, cookies and rolls bring $7,200 of it.
Part 5: the first year, month by month
Fixed costs are $17,100 every month: rent ($3,200), wages ($11,500), utilities ($900), insurance ($300), gluten testing ($250), register and software ($150), ads ($400), and other costs ($400). Sales start at half of full speed:
| Month | Sales | Profit | Cash, year to date |
|---|---|---|---|
| 1 | $14,540 | −$7,198 | −$7,198 |
| 2 | $16,250 | −$6,034 | −$13,233 |
| 3 | $18,047 | −$4,810 | −$18,043 |
| 4 | $19,757 | −$3,646 | −$21,689 |
| 5 | $21,554 | −$2,422 | −$24,111 |
| 6 | $23,264 | −$1,258 | −$25,368 |
| 7 | $24,734 | −$257 | −$25,625 |
| 8 | $25,900 | $538 | −$25,087 |
| 9 | $27,043 | $1,315 | −$23,772 |
| 10 | $27,882 | $1,887 | −$21,885 |
| 11 | $29,080 | $2,703 | −$19,182 |
| 12 | $29,080 | $2,703 | −$16,479 |
The year's sales are $277,131, and the business ends it $16,479 behind, before the owner's pay. It breaks even at about $25,110 of sales a month, in the eighth month. The lowest cash point, −$25,625 in month 7, is covered by the $35,000 of working cash with about $9,400 to spare. Gluten testing is a small fixed cost that protects the whole business; the wholesale loaves to two grocers carry the weekdays.
Part 6: the startup budget
| Item | Example |
|---|---|
| Build-out and signs | $45,000 |
| Ovens and mixers | $28,000 |
| Refrigeration | $9,000 |
| Display case | $6,000 |
| Lease deposit and first month | $6,400 |
| Smallwares | $3,000 |
| Opening inventory | $3,500 |
| Register | $1,500 |
| Licenses and permits | $1,200 |
| Working cash | $35,000 |
| Total to start | $138,600 |
The $103,600 before working cash is earned back in about three years at full speed. Pricing gluten-free baked goods is in how to price gluten free baked goods, and keeping allergens apart in allergen control plan template.
Get the template
Download the gluten-free bakery business plan workbook. Four sheets: your products, each with its price, variable cost and units a month at full speed; the first year, month by month, with sales ramping up, profit, cash, the first profitable month, the lowest cash point and whether the working cash covers it; your fixed costs; and the startup budget. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The plan uses one flour cost. The kitchen buys flours from three suppliers at moving prices, and a test result has to be tied to the lot it came from, which a binder of papers does slowly.
How TaroStack does it
TaroStack keeps each flour by supplier and lot, so a test result points to the batches it covers.
Flours by lot. Each flour delivery is received with its supplier and lot, and you can record its gluten test on the receipt.
Batches by lot. Each batch records which flour lots it used.
Recalls. If a flour lot tests positive, one report shows every batch and customer it reached.
| The job | Notebook | In TaroStack |
|---|---|---|
| Which flour lot a loaf used | Not recorded | Batches by lot |
| A lot's test result | A binder | Recorded on the receipt |
| Who got a doubtful lot | Invoices | One recall report |
Lots, batches and recalls are on every plan, from $49 a month. 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.