What does it REALLY involve? (long) - Page 2

<highfive> Cool.

But you gotta get enough steady work that produces income to pay your sister. Payroll sucks (paying it that is). Quickbooks is not hard--once it's set up & you know how to use it.

Pay your husband, not so much. He keeps his day job & keeps the roof over your head right?

If 30% of her deal is walk-in you don't really wanna mess with that do yah? You could make it up with doing more cakes but you gotta weigh that out.

Doing all decorated work and parties is a different line to follow. Geez 30% walk-ins is a lot --that sounds pretty good but you gotta make the stuff and work the counter too.

I'm betting her figures are not gonna fly. It's the part where she says it was her intention to sell the bz after a few years? Really? Why? Who goes into business to sell out in a few years?

From what you've said, it sounds like another employee is needed to reduce the effects of potential burn out (owner's go it huh) So the bz has to be brisk enough to support another employee so then you'd have two.

If you can make up 30% of the receipts some other way.

This sounds like a cute retail place. If you are doing strictly decorated cake you don't need a cute retail place. By cute retail place I mean with location location location to draw in the impulse crowd. I mean sure you want a cute place but you're paying for the location--if you don't need it and it's by appointment why pay the higher rent?

How much is the rent? Well rather I should say how much is it compared to someplace else that doesn't have the foot traffic aspect since you don't want that.

Of course it's an option--people do it successfully--but you have to have enough money to keep your head above water until the custom biz gets off the ground. Even then, you're still not working a 9-5 job (especially if you're the only one doing all of the baking and decorating). I did my internship at Pink Cake Box (by appointment only custom cakes). Besides herself, Anne has a paid full time staff of 6-8 people, plus 3-4 interns in on various rotating schedules. The production manager (baker) would usually come in at 5am or so and leave by 2-3pm. ALL she did was bake and make buttercreams and fillings. The rest were all decorators. I believe the earliest started around 8 and we were the last ones out of there, usually by 6:30, but that was when it was a good week. Thursdays and Fridays were almost always late nights because most of the cakes were due for the weekend.

In some ways appointment only is easier than retail because, other than tastings, you don't have to deal with customers. But it's still long hours and a lot of work.

I just realized that both of my responses sound like I am trying to discourage you, which I am SO not trying to do. I think I just want you to realize that in no way, shape or form is running a bakery or custom cake shop a 9-5 gig, and that no matter how much help you have, when you are the boss, long hours are inevitable.

As I said earlier, I really think you should trail this woman for a solid week to get a better sense of things. be there when she unlocks and turns on the lights, right until she is ready to go home. Keep us posted!

<thud>

<smelling salts>

Three thousand seven hundred dollars a month?

Ok. So $3700/month ok.

Just super rough figures---So you have to bank about $8,000 a month in kiss good bye fly out the window expenses give or take. So you gotta do about $16,000 every month in receipts of cakes cookies & cuppies give or take to break even in a perfect world. I'm not good at factoring in payroll so there's that too. You better keep the 30% walk-ins, Cake Buddy and forget sleeping.

No fricken wonder she's burnt out.

lol, funny I didn't even bat an eye @ $3700... this is New Jersey... that's actually quite reasonable for a turnkey operation, depending on the size.

That was not my point though, PinkZ. My point is that that's a ton of cake to shovel to keep up the expenses. $3700 is not turnkey it's one month's rent. That's like $45,000 a year in rent alone. You're talking hundreds of thousands of dollars of cakes to be able to maintain a place like that.

And our op chickie is allergic to balancing her own check book--deliver me!!!

Ok two things to consider--you don't have to reveal on the internet here--but how much do you charge and how did you do last year? Multiply that out to get $45,000 in rent and then double that and you're getting warmer.

There are killer places here to rent for those prices but one decorator is not going to carry the load and sell some cookies and cuppies on the side. You will be a full blown business woman like Snarkbuddy.

Oh believe me I know... there's a reason I haven't opened my own place since my partner and I split. I'm just not doing the volume to maintain a commercial storefront right now and I'm not sure what direction to take my career.

It's doable, but again you need to have someone look at her books (and don't assume that everything you see on the books is 100% accurate... let's face it, people aren't always 100% honest even with themselves! lol and you need to examine the biz VERY hard.

Again a lot falls back to, if you are going to be the sole decorator/baker, can you alone do all the work that's needed to produce the volume you'll need to keep the biz going? If not, will you be able to afford payroll for additional employees. Other than the purchase price for the business, do you have enough cash to sink into it that you can keep the business running for a few months-to-a-year if things are slow and the cash flow isn't there. Even if it is an established biz, a change of hands is sometimes a detriment, especially if you plan to change things up. A lot of people like "their" bakery.

Just more to think about.

k8, you've been giving incredibly good advice. saberger, please listen to everything being said.

As I read this thread, I hear someone who is in love with the idea of being in business, of being able to say she owns a business, but in reality wants nothing to do with "the business" side of it. Are you looking to buy a business, or find a place where you can "play" with your cakes? And I don't mean that harsh ... I'm trying to jolt you into reality here. I see someone who wants to hand the business side off to someone else, the management decisions to someone else, wants to work 8-5 .... that's the mindset of an employee, not a business owner.

your sister is not going to do your books for free forever. At some point, you'll need to hire a CPA or accounting firm for tax reasons (unless your sis IS a cpa, then I stand corrected).

You said you can do some marketing. Sales and marketing is almost a full time job. I've been working in some type of sales/marketing position in the corporate world for over 25 years, so I can confidently say, yes, I AM good at it .... and I don't have time to devote to it like I should. If you are going to be the only decorator doing all of those cakes to pay that $3700, you're going to have zero time to get out and do the sales you need to do.

I also got a big "thud" in my chest when I saw the monthly rent. Regardless of whether that is the norm in your area or not, that's a lot of moola to have to be accountable for every month. How many cookies before you PROFIT $3700? Business plan. Write. A. Business. Plan. It will be a big eye opener for you.

Payroll is no joke. You're pretty much paying someone "on spec" ... they are in there making the cookies, cupcakes, etc., and you HOPE someone comes in and buys them. If they don't, you STILL have to make payroll. $8/hour x 40 hours a week = $320 x 4 week = $1280 + $3700 in rent = $4980 a month right off the bat.

We're not trying to kill your dream. We want to give you lots of things that you have to consider NOW before you're financially committed. We want it to work for you. But you have to go in with eyes wide open. And even then, you're going to miss stuff. We all did.

I read this thread. It was insane. But I also searched the bakery and it looks like it has closed it's doors.