Business Objectives for a Bakery
Bakeries sell perishable comfort food -- sweet and tempting offerings that appeal to a broad target market. Bakery products are also extremely perishable; many customers have grown to expect bakery businesses to offer product that is baked fresh daily, making it challenging to meet demand without wasting inventory. Business objectives for a bakery should include building a broad and committed customer base and developing a business model that brings in enough income to cover your expenses despite a potentially high level of waste.
A bakery can increase its revenue through advertising and promotions such as offering deals on specific items on different days of the week. You can add to sales totals by carefully monitoring and adapting to demand, paying attention customer flow as well as sales patterns. Many changes that bring in additional revenue require little or no monetary outlay, such as adjusting your hours to be open when you are likely to be busiest or creating displays that tempt customers to buy additional product. Bakeries stabilize revenue through repeat business. Promotional offerings bring new customers in the door but monthly revenue targets are more easily met by encourage return visits. Excellent customer service and rewards/referral systems are major revenue drivers.
Business income is the amount left over after subtracting deductible expenses from sales revenue. To achieve the objective of maximizing income, your bakery must minimize waste without running out of popular items. Because customer demand is rarely consistent, it is nearly impossible to avoid waste altogether. However, keeping careful records of which items sell fastest enables you to predict some sales patterns. You can achieve additional accuracy by paying attention to variables that affect sales patterns, such as holidays and weather. Discounting leftover baked goods the next day will also decrease waste. Consider donating leftover baked goods to homeless shelters and community programs. Contributing to the community in this manner has a net positive impact on your reputation and community as a whole.
Because the bakery business model of selling optimally fresh offerings creates so much potential for waste, bakeries should closely monitor profit margins, or the percentage of sales that exceeds operating expenses. Shop around for low prices on ingredients, but don't compromise quality for the sake of price if your customers hold you to a high standard. Introduce efficiencies that enable you to produce more in less time, such as consolidating processes, eliminating bottlenecks and achieving economies of scale. Maintaining margins is critical to any business model.
Building a strong reputation is essential to a bakery's objective of attracting a loyal clientele and generating a consistent sales volume. Build your reputation by producing high-quality products and maintaining excellent customer service. Although it is tempting to sell product that are less than perfect to minimize waste, these sales may cost more in the long run by compromising your bakery's reputation. Develop a specialty, and practice until you are an expert. Build your reputation through social media, community events and local promotional opportunities. Creativity and positive customer interactions/reviews will boost business in the long run.