What it costs to open a bakery depends most on whether customers walk in. In the example budgets below, a home bakery under a cottage food law starts for about $2,800, a wholesale kitchen with no shop front for about $40,600, and a small storefront bakery for about $118,000. The biggest lines are the build-out (plumbing, electrical, a hood, finishes), the oven, refrigeration and working cash for the first few months, which is the line new bakeries most often cut and most often need. Below are the three budgets line by line, the monthly costs a storefront has to cover, how many sales a day that takes, and a budget sheet to fill in with your own quotes.
The short version
- Home bakery under a cottage food law: about $2,800 in the example.
- Wholesale kitchen, no storefront: about $40,600.
- Small storefront: about $118,000, mostly build-out, equipment and working cash.
- Used equipment can halve the equipment lines; build-out rarely gets cheaper.
- Budget at least three months of running costs as working cash.
- Work out the sales a day you need before you sign a lease.
- TaroStack runs a bakery's recipes, batches and stock from the first week. More below.
Starting at home
Many states let you bake at home and sell directly to customers under a cottage food law, usually with a sales cap and a label statement. An example start:
| Item | Example |
|---|---|
| Cottage food permit or registration | $150 |
| Stand mixer | $450 |
| Pans, racks and tools | $400 |
| Packaging and labels | $300 |
| First ingredients | $300 |
| Market tent and table | $300 |
| Insurance, first year | $400 |
| Working cash | $500 |
| Total | $2,800 |
What's allowed, the cap and the label wording vary by state. Hawaii's rules are laid out in Hawaii cottage food law, and the records worth keeping from the start are in cottage food record keeping.
A wholesale kitchen or a storefront
| Item | Wholesale kitchen | Small storefront |
|---|---|---|
| Lease deposit and first month | $3,000 | $6,000 |
| Build-out: plumbing, electrical, hood, finishes | $8,000 | $35,000 |
| Oven, used | $6,000 | $12,000 |
| Mixer, used | $2,500 | $6,000 |
| Proofer | $1,500 | $3,000 |
| Refrigeration | $3,000 | $8,000 |
| Tables, racks, sheet pans, smallwares | $2,500 | $4,000 |
| Display case and point of sale | $0 | $6,500 |
| Permits, licenses, inspections | $1,000 | $2,500 |
| Insurance, first year | $1,800 | $3,000 |
| Signs and branding | $500 | $3,000 |
| First ingredients and packaging | $1,500 | $3,000 |
| Website | $300 | $1,000 |
| Working cash, three months | $9,000 | $25,000 |
| Total to start | $40,600 | $118,000 |
These are example numbers, not quotes. Build-out swings the most: a space that was already a bakery or restaurant can cost a fraction of one that needs a grease trap, a hood and new electrical service. A wholesale kitchen skips the front of house entirely and sells to cafés and stores, covered in how to price baked goods for wholesale.
What a storefront has to cover each month
| Monthly cost | Example |
|---|---|
| Rent | $4,000 |
| Staff, three people part and full time | $14,000 |
| Utilities | $900 |
| Equipment loan | $1,200 |
| Marketing | $400 |
| Insurance | $250 |
| Software and card terminal | $150 |
| Fixed costs a month | $20,900 |
Suppose the average sale is $14 and ingredients and packaging take 35% of it, leaving $9.10 a sale toward those costs:
Sales a month to break even $20,900 ÷ $9.10 = 2,297
Open 26 days a month 2,297 ÷ 26 = 89 sales a day
Eighty-nine customers a day before any profit is the number to test against foot traffic before signing a lease. A food cost percentage near 30% is a common target, discussed in what is a good food cost percentage.
Get the budget sheet
Download the bakery startup budget. It has the wholesale kitchen and the storefront side by side with every line above; change any number and the totals follow. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The startup budget ends on opening day. After that, the money is in the daily details: what each loaf costs now that butter is up, how much dough was thrown out on Tuesday, what to bake for Saturday, whether the flour order goes in today or tomorrow. A bakery that tracks those on a whiteboard and a spreadsheet loses a few percent of its margin without anyone deciding to, and a few percent of $9.10 a sale, at 89 sales a day, is real money.
How TaroStack does it
TaroStack is built for a bakery's day: ingredients in, dough and fillings made, bakes recorded, and goods sold over the counter and to cafés.
Recipes cost themselves. Recipes contain sub-recipes, like a dough or a filling, with versions as you change them, and units convert: buy flour by the 50 lb bag, use it by the gram. Ingredients come in at the price you paid, with freight spread across the delivery, so when butter goes up, the dough, the croissant and every product that uses it move with it. Margins are reported per product on what each one actually cost.
Bakes are recorded once. Record a batch and TaroStack takes each ingredient off stock from the lot you used and notes it in the batch record. The batch is costed from what it used and divided by what came out good, against what the recipe says it should cost, and recipe truth shows whether a recipe yields what it claims. "What could I make right now" answers from what's on the shelves.
Planning knows tomorrow. Planning turns your cafés' orders and your own sales history into what to bake and what to buy, against your oven's hours, and a week's schedule per site lays it out. The reorder list shows flour and butter in days of cover, and the oldest dates go first everywhere stock is picked.
And waste becomes a number. Every write-off carries a reason (expired, spoiled, damaged, sample), so the losses report shows what's thrown out, where and what it cost. Counts run on a phone, even in the walk-in. Cafés are customers with their own orders and delivery notes, and TaroStack connects to Shopify and to Square.
| The job | Whiteboard and spreadsheet | In TaroStack |
|---|---|---|
| Cost of a croissant | Worked out at opening | From what you paid, every batch |
| What to bake Saturday | Memory | Planning from orders and history |
| Tuesday's thrown-out dough | Not recorded | Losses by reason and cost |
| Flour order | When the bin looks low | Days of cover |
Stock, counts, lots and expiry are on every plan, from $49 a month; recipes, batches, planning and more than one site, like a kitchen and a shop, are on Standard at $99. The first 30 days are free, with no credit card, and your recipes import from a spreadsheet or a photo of a recipe card. If you'd like a hand setting up, ask, and we'll do it with you.