Like most business on earth, these are some of the risks involved which youd do well to be aware of. Being aware of these risks will help you plan properly on how to completely avoid or minimize them. It will also help you to properly plan your income and expenditure. Below are some of the popular risks in the business.
1. Your Bread Could Get Burnt
Moment of carelessness by your workers could get you bread burnt easily which may result to high loss of money.
Install a smoke detector at all location of your bakery, because in our case all our night shift workers once fell asleep making about 5 flour bags of baked bread burnt to ashes. We were lucky the building didnt burn down. So dont over look little mistakes from workers, otherwise it will come back to hunt you.
This is one of the major risks every baker must be aware of because of the potential danger it carries. But its a risk that could be avoided if you take proper precaution.
2. Spoilage
Because of the competition in the business and effort to attract more retailers, most bakers offers to accept back bread if it developed mold. Some retailers are so careless and ineffective in sales that they keep those bread unsold for long time only to return it when it develops mold.
When this happens, you are the final person to bear the cost and if it happens in large number, you may be out of business.
3. Price Fluctuations
Prices of baking raw materials is the most unpredictable as baking flour can change within days unannounced. When this happens, you buy flour at higher cost and still sell your bread the same price you used to sell because bread is a very sensitive commodity, you cant increase the price arbitrary.
4. Police Harassment
Because bread is a ready made fast food, Police may stop your supply vehicle on the road even when you didnt do a thing and demand that you give them some breads. Though you are not under obligation to give but if you dont, they may try to victimize you in other ways.
By the time you do that to and fro, imagine how many loaves of bread you would have lost? Road safety, LASTMA, and other agencies are equally there.
5. Theft
Internal and external theft by your staffs, people who may come into the premises, touts on the roads, and others may reduce your profit in the business.
How To Setup Your Bread Bakery
Having mentioned some of the major risks involved in the bread bakery business that you need to be aware of, lets proceed to discussing how to get your bread bakery setup and the materials you need.
1. Get Training
To become a professional baker, you need training in bakery and food processing. Some people get their training by getting attached to a bakery to learn all the skills of baking from first hands experience. If you are fortunate to have worked in Bread Bakery, that will make things lot more easier as you must have learned the skill while working.
Look for a professional trainee who will train you in the art of bread making. Your success in this business depends on how much you know; do not trade knowledge for anything.
2. Prepare Your Business Plan
As they say: He who fails to plan, is already planning to fail. You need to have business plan that will guide you along the way. You can prepare it yourself or hire a professional to do it for you. Dont just assume you have everything in your head, lack of proper clearly written out business plan can make a business crumble within a short time.
3. Source For Finance
Bread Bakery business is a capital intensive business especially if you are starting it big which is my recommendation. You have to start big or medium if you hope to be producing quality bread that will attract good patronage. And starting big requires some good amount of money. Once you have the required capital to invest in this business, you are halfway done. Make sure you budget 7-12 months working expenses; time that will be required to break-even. At this point youve started following your business plan.
4. Choose Location
This is important but not critical. While location in the city and busy towns allows retailers to come in and buy without having to travel distance, you can make up to this with good marketing and supply mechanism. If your product is good, well branded, and marketed effectively, people will find you no matter where you are.
So, weigh the situation carefully and look for suitable location that you think will be good for your business. Property cost higher in the major cities but well worth your business.
Note: People sometimes buy products based on the address. I personally have rejected some products because of where the factory is located. It may not be obvious but believe me it happens.
5. Build Your Factory
Here you need to engage the services of expert too. Your factory have to be properly planned and executed in order to meet NAFDAC approval requirement.
Bakery Equipment You Need To Acquire
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