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Business proposition to mull over!

post #1 of 6
Thread Starter 
I took some samples to a shop owner in our town today. She is very interested in my cookies and some candy. We talked a bit about me doing the work there, no problem according to her as long as I do it after the lunch rush. Fine with me because I don't want to have to pay a babysitter. DH is home by 4. I guess the question is if I become her employee, how much do I expect to be paid? We live in a small town but I am definitely not interested in making what most employers pay around here, minimum wage or a bit more. I know I am worth more than that. What do you guys think I should be making an hour if we go that route? What about an hourly rate and a percentage of the cookies sales? I opened this pandoras box and now I don't know what to do.

The other possibility is to rent the kitchen from her. We touched on that but with neither of us knowing the requirements, we could not pursue that too far. She seemed open to this depending upon the requirements.

We even talked about who would buy the ingredients. I think it is obvious if I am her employee, she should buy them. If I rent then I will buy them.

She seemed very confident that the cookies would sell. I just don't want her making all the money.

Ok people, let's hear the advice. Anybody out there in a similar situation?

Thank you in advance, I don't know what I do without you guys.
Mary
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Mary
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post #2 of 6
Don't be the employee. If you sell a lot, you'll get the set wage and she'll get the profit. (On the other hand, if you don't sell a lot, you'll still get the wage, but she probably won't keep you on too long, anyway.) As an employee, the harder you work - the same pay you'll get!! As your own boss, you can reap the benefits of your hard work.

I'd be tempted to remain independent - you buy the supplies (buy in bulk and only what you need for, say, a week at a time - once you get established you could probably afford to buy way more at better prices).

Establish what the cut of your profit the shop owner will get.

Establish use of ovens, storage and refrigerators, and hours of use.

Keep a firm hand on the pricing - don't underprice.

Discuss expectations reicon_surprised.gifrders that don't come through the shop. What if someone orders cookies on a day when you're not in the shop, and you make them out of your house? Do you share the profit or is it all yours? I say it's yours, as long as you keep your home prices same as your shop prices ( don't discount, it would be a conflict).Of course, I'd encourage people to buy from the shop when possible, fair is fair, but it doesn't always work out that way.

If you're an employee, she's your boss and you have to do what she wants - you'll have more creative license to try different things if you are your own boss. Also, you can set your own budget, find better(cheaper) suppliers, etc. without having to get her approval for funding, etc.

My gut instinct is to stay independent , otherwise, you're like an artist/sculptor, etc. working for a set wage, which is strange - you'll have no say on much. What if she hires someone to help you, and you don't approve? Lots to think about, for sure. Best of luck.
post #3 of 6
i would say to rent the space from her. under no circumstances would i let her hire me as an employee. you buy the ingredients, do all the work, and get all the profit. in return, she gets her rent. .......goood luck
post #4 of 6
I agree with the others. I would NOT be an employee...
post #5 of 6
I agree with everyone. Your best bet is to rent the space from her, and then sell her your product cheaper than you would a customer that calls. That way you both win. She gets the product and rental fees and you get the cost of the supplies plus some for your time.
post #6 of 6
As someone with my own business (not food related), I say you need to really research all that is involved and make a decision about what is best for you at this point in time. I have been an employee, am an occasional independent contractor, and currently own a private practice. There are pros and cons to all of the situations.

There are certainly benefits to remaining independent and not being an employee of the bakery. (I LOVE being my own boss, and am fortunate tha tI can be!) But, there are a lot of things that you have to do when you own your own busines -which you wuold be doing, if you just rent the space from her- that you don't have to worry about if you are an employee - such as tax-realted, liablility-related, and state/local requirements just to name a few.

Whatever route you decide, I encourage you to really think about future possiblilites that may arise and think of a plan of action for them. For example, a clear statement in your contract with her - regardless of if you are an employee or you rent space and sell cokies through her store - about competition (especially if you intend to sell any of your baked goods anywhere else) would be essential, in my opinion. If it were me, I would also want a specific time frame for renegotiation, so that you can both see how it's really going after a little while with whatever arrangement you choose.


Congratulations on your new endeavor! How exciting!!

Bonnie
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