Not knowing what the future will bring is one of the most stressful parts of starting a new business. And while there’s no way to predict everything that will happen during the life of your business, one way to reduce the number of unknowns is to write a business plan.
A business plan is essentially the roadmap for your business. At the very least, all business owners should write a business plan for their own use. However, if you’re planning to apply for funding or seek out partners, you’ll be required to have a comprehensive business plan to prove why your business is worth investing in.
While the elements of a business plan are typically the same, you’ll want to customize yours to fit your unique business. If you’re starting a bakery, for instance, you’ll want to detail your menu, what will set your bakery apart from the competition, and more. Ready to get started? Read on for a complete guide on how to create a bakery business plan.
Writing a business plan for your bakery will help you take your ideas and turn them into a profitable business. Here are the steps to follow to write the perfect bakery business plan. If you find you’re still unsure how best to structure your thoughts, a business plan template can help make the process easier.
The first section you’ll write for your business plan is the company overview. A company overview is just what it sounds like, an overview of your company.
When writing this section, it can help to take a step back and think about your company from a bird’s eye view. Your company overview should specifically cover your business structure and what you do. Here’s a breakdown of what you should include in your company overview.
You might think it’s self-explanatory, but think about what purpose your bakery will serve. Are you bringing a unique menu to your neighborhood, want to provide people with a cozy spot to grab a snack and spend some time, or do you plan on catering larger events or specializing in custom creations?
You’ll go into more detail on this in your market analysis, but it’s worth adding a few lines about how your bakery fits into the market—namely, how your business is unique and will fill a need that’s not currently being met.
Lastly, you want to provide some information about the legal and ownership structure of your bakery business. The ownership structure is simply who owns the business, so if you’re the sole owner, that part is easy enough.
The legal structure of your business is the business entity that you’ve chosen for your bakery. For example, you might have started a sole proprietorship, an LLC, or an S-corp or C-corp.
As one of the first sections in your bakery business plan, your company overview isn’t the place to get into the details. Keep the descriptions of your company and ownership simple and to the point. You can explain any important details in later sections of your bakery business plan.
The next section in your bakery business plan is the market analysis. It can be helpful to think of this section as a process. You’ll need to do market research on competitors, pull together all of the information you’ve gathered, and then refine that information into key takeaways and define what they mean for your business.
A market analysis is an in-depth description and explanation of how your business fits into the industry, market, and competitor landscape. This is where you can really start to dig into the details of your business and what needs your bakery will fill.
This is one of the most important sections of your business plan, as it proves to yourself—and potentially outside investors—that there is a need for your business. The number one reason why businesses fail is a lack of demand. If you open the doors of your bakery without taking the time to complete this step, you may enter a market saturated with bakeries and quickly find you can’t attract customers.
Learning as much about your market as possible will help you determine your role in the market, who your target demographic is, and how you can set yourself apart from your competitors.
Your market analysis will include a number of sections.
The market analysis is all about data and research, so this section of your bakery business plan might take the longest time to write. Resist the temptation to rush through this section and instead really dig into the data and take the time you need to find all of the information you can.
The next step in writing your business plan for a bakery is to describe your organizational and management structure. While you covered who owns your bakery in the company overview, this is the place to get into the specific details about who is part of your business and what roles they’ll play.
Not only will this section describe who has what role, but it should also give some background on each person and what they’ll bring to the team. It can be helpful to include a visual of your business organizational chart in this section.
The subsections that should be included in your bakery business plan about your organizational structure include:
If you’re a one-person operation, this section may feel unnecessary, but you should still take the time to think through the future of your bakery and what you want that to look like. Will you need bakers, waitstaff, marketers, or designers? Include these in your hiring plan.
You should also think about where you want your business to go in the next three years and how your team will change accordingly.
So much of your bakery business plan focuses on the nitty-gritty details of operating a business, but here you can really focus on what makes your bakery unique—your menu.
It’s important that your product offering is more than a menu without any context. You’ll also want to spend some time here to detail how your products will be different from the other bakeries in your area—do you use unique ingredients, offer one-of-a-kind creations, keep up with trends, or offer the classics? While not every aspect of your bakery can be completely unique, you’ll want to lay out all of the ways in which you’ll stand out—and be specific.
The first few sections of your bakery business plan will focus on describing your business. The next couple of sections will focus on planning for the future of your business. While there may have been a few unknowns in previous sections, the next two can feel very amorphous and unknown—that’s okay!
The next section of your bakery business plan is all about how you will market your business and your product. There are a lot of moving pieces to a marketing plan, so your first step might be to learn how to write a marketing plan.
The marketing section of your bakery business plan should include:
If you’re still early in the process of starting your bakery business, it’s likely that you don’t know exactly how you’ll market your business. Keep in mind that nothing is set in stone just because it’s in your business plan; you can always make adjustments later.
If you’re struggling with how to start this section, you may also want to look at how your competitors market their businesses and see what they do well and what you could do better. Additionally, you should consider speaking with your target market to see what platforms they frequent, where they consume ads, and how they want to be reached.
One of the final sections of your bakery business plan will cover your business finances. This section is especially important when you’re looking for outside financing and will be presenting this to potential investors. A business plan for funding will look slightly different than if it’s just for yourself. That being said, even if this bakery business plan is for your eyes only, you shouldn’t skip the finances section.
If you’re already in business, you should show your past financial performance by including these documents with your bakery business plan:
If you’re not yet in business, this section should be filled out with financial projections. Your financial projections should be based on similar competitors and any past data you have. Your financial projections should include your expectations for the next 12 months and then a bigger-picture view of the next three to five years.
You should include how much capital you are putting into your business, as well as how much you plan to add in the future, what your business expenses are (cost of supplies, rent, marketing, etc.), and whether you’ll seek outside funding in the future (and a ballpark of how much).
There are a number of different options when it comes to outside funding. If you are seeking outside funding, you’ll want to include these details:
When you’re looking for outside funding, be sure to evaluate what type of small business loan or startup business loan is right for your business. It will also be important for potential investors (including banks or individuals) to see projections for how your profits will increase with this influx of capital.
The final section of your bakery business plan will be your appendix. The appendix will include any supporting documentation that will help the reader to understand anything presented within your business plan but that would have overwhelmed the individual section where it was relevant.
This can include charts and graphs for your marker analysis, additional information on any key employees, marketing collateral if you already have a business logo or ad in the works, and more.
What could possibly be left after the appendix? It’s actually the first section of your bakery business plan. The executive summary is the first section of your business plan, but it’s actually best to write this piece last.
The executive summary is, just as the name implies, the shortened version of the most important parts of your entire business plan. This means that the executive summary includes an overview of everything that will be covered in the business plan. Once everything else is written, the executive summary becomes a lot easier to write.
This section should only be one to two pages in length but should be able to stand alone and serve as an elevator pitch of sorts for your business and why it’s a good idea. Once you’ve hooked your audience with the executive summary, they can dive into the details of the rest of your business plan. Make sure you keep this concise but attention-grabbing.
Once you’ve written and put together all of the pieces of your bakery business plan, it’s time to edit and revise. You want to go back and reread your own business plan to make sure everything is clear and as concise as possible.
Once you’ve done that, you’ll want to have it reviewed by some trusted advisors. These advisors can provide feedback on where you’re lacking data or if some aspect of your plan can be stated more clearly. With this completed, you should be in a great place to continue onto the next phase of starting your business. Keep in mind, though, your business plan isn’t a one-and-done activity. You should continue to update and revise your plan as your business grows and changes so that you always have a current look at your business and where you want it to go in the future.
Sally Lauckner is the editor-in-chief of the Fundera Ledger and the editorial director at Fundera.
Sally has over a decade of experience in print and online journalism. Previously she was the senior editor at SmartAsset—a Y Combinator-backed fintech startup that provides personal finance advice. There she edited articles and data reports on topics including taxes, mortgages, banking, credit cards, investing, insurance, and retirement planning. She has also held various editorial roles at AOL.com, Huffington Post, and Glamour magazine. Her work has also appeared in Marie Claire, Teen Vogue, and Cosmopolitan magazines.