Funding a new shop

Any and all of the above.

You will probably have to get pretty creative!  The bank wasn't willing to loan much and only for physical equipment and that was WITH perfect credit history and having already been in business 4 years.  For me, the bank loaned $45k, I owner-financed the pizza shop I was purchasing for $100k immediately and over the next 2 years put about $25k on credit cards.  I have been open for 5 years and will be completely paid off in the next 4 months or so.

I had saved 50 thou USD and borrowed 50 USD thou from the bank. I paid off my loan after two years (had a five year loan). I've been open at my currant premises for seven years.

Our long-term plan was to start with an appointment-only bakery run out of a rented commercial kitchen (very low startup costs, around $5K) and use the profits generated by the business to fund opening a retail storefront. At its peak we were looking at about 5 years of running the appt only bakery to generate enough profit for the storefront, but we ended up scaling back and selling the business after our daughter was born and we moved out of the area.

We had enough in savings to open the retail storefront right away, but we had a unique business targeting a niche market and it was too risky without testing the waters first. Before we scaled back I was also in talks with a national manufacturer in the same niche to co-brand the retail storefront and eventually franchise it.

Just curious Jason, why would a similar, larger business want to "co" anything with a smaller competitor when you're in a small niche catagory? I don't understand.........

The other business is a manufacturer of niche packaged goods that sells wholesale, mostly to grocery stores, so they are more complementary than competition. A network of small bakeries that serve customers in the same niche (which was the eventual goal with franchising) would be an outlet to sell their packaged goods directly to their target consumers at higher margins.

I saved money, and hoarded equipment. I had every single piece of equipment I needed to open, before I even bought my house. We saved $10,000 simutaneously, and put it down on an owner financed house, then started saving to redo the garage as a bakery, doing a little at a time, as we could afford it. From start to finish, it took 7 years, and I don't anyone a penny for my business, though we still owe on the house it is in, but it's or home, and we pay just $25 more for our mortgage than we did for rent in our last place. 

We saved money from full-time jobs, took out a small business loan, used personal credit cards, and took advantage of every skill that we have (painting, drywall, web design, etc).  We've been in our store front for about a year now and just opened our online shopping cart as well.

 

http://www.bakemeacakesupply.com/

 

My best advice -- be smart.  Don't spend on what you don't need.  Do whatever you can yourself (time permitting, of course).  Start small, if possible.  We started in our local swapsmart and we there for about a year...  This gave us time to save the cash for a real store front and helped build a loyal customer base.  

I hadnt saved any money but got a small business loan for $17000 which was enough to buy everything I needed down to the dish soap for my storefront bakery. we were able to remodel the shop I rented too and it turned out super cute

I began as a home-based business and cultivated several strong wholesale accounts. After two years I was able to save money because of those accounts. When a small neighborhood pizza shop went out of business I rented the storefront, bought some of their equipment, and only did minimal code work before opening. Retail business was slow at first but my wholesale accounts remained steady. Growing slowly was the key for my being able to grow my business without borrowing.   

I'm still in the beginning stages of mine, also. I started 2 years ago with a $400 gift. I'm in a smaller town that's really resistant to new stores and new things. I actually started at our local artisan market. I sell a variety of baked goods and candies... my chocolate truffles and caramels being the local favorite, but was taking cake orders at the market. I then started at the Farmer's market, also. Year 1 I had maybe... 4 cake orders total... from June to December. I did a few shows... a bridal show, a business expo show and returned the markets the next spring... and by June was booked solid every weekend through the end of October. It was amazing... I'm already now booked through March and plan to do the shows again and the market again, in my 3rd year. I went from a $400 gift to being completely self-reliant and not having to take a loan or charge credit for ANY portion of my business. Every now and then I get small amounts that come as extras, like when I was the caretaker for my mom... I just put that right into signage, cards, brochures, and other forms of advertising.
I take advantage of the internet and social media however I can. Facebook REALLY helps. I've been trying to get around their new facebook for business nonsense and so far have been successful. Scheduled postings, constant streams of pictures and other media and I run contests for $35 worth of free cake for every 100 fans. It keeps the insights on the rise and in just a few months I went from having less than 100 fans to nearly 300 now. I don't pay for advertising on there or anything like that, because it's just not worth it. At the bridal show I'm doing in a few weeks I'm giving away a 75 serving wedding cake with a retail value limit on it (so they don't go haywire with extra decor). So far this ALL is working. I keep my overhead down. I'm growing my presence in the town and slowly converting everyone one by one. I also joined a Bridal Association for my county. We're the only one and we all work hard to refer business back and forth to each other. It also really helps. It's been great and I've been blessed.
I plan to start working with the Michigan Small Business Association in the coming months in order to use as many of their resources as possible. They teach a number of free classes, help with hiring, help with business plans, bank applications, etc. I am making it in my 3 to 5 year goal to have a storefront.