Want To Run An Online Bakery? Here’s What To Know First
In the world of ecommerce, online bakeries are some of the most popular business options for anyone with a sweet tooth and skill in whipping up a tasty batch of baked goods.
Monetizing these factors could net you a very healthy profit as well; the bakery market is worth anywhere between $450 billion and $480 billion in 2024, and ecommerce makes up a strong portion of that revenue.
Plus, setting up an online store is easier than ever. Platforms like Shopify have streamlined the process in such a way that anyone can use their builder, and you can customize all kinds of elements like the theme and on-page SEO elements from the comfort of one single dashboard. Whether you’re selling just the one product or have a full catalogue, you can set up a storefront with total convenience.
But running an online bakery can be a real challenge. Many would-be bakers don’t quite realize this. After all, the product you’re creating depends on materials that are perishable and need to be food-safe, and with online selling, who knows how far away your customers might be?
Shipping out cakes and cookies to people living upwards of 3000 miles away takes a lot of forethought, and plenty of research into ensuring the order looks just as good once it’s reached the destination. It’s great to have this kind of global traffic, but will you be able to deliver?
Indeed, selling baked goods via ecommerce is not something to undertake lightly. However, if you’re passionate about the craft and are willing to take on the potential issues involved, we’ve got a handy list of things to know about before you get up and running. Check them out down below.
Don’t Go Overboard on Product Offerings Yet
When you’re just starting out with an online bakery, the most important thing to do is keep your product offerings to a minimum. Focus on making your first one or two products a success and then think about expanding.
Indeed, you need to know there’s demand for your baked goods before you go any further. You need to know what kind of audience you’re attracting, what they like about your products, and the price points they’re comfortable paying.
Building up this initial pool of customers will ensure you’re not wasting time and money on diversifying your product line. Wasting food is not only expensive, but it’s unsustainable and incredibly bad practice.
Your Baked Goods Need to Stand Out
We noted above that the bakery industry is incredibly lucrative. That’s good, but it also means there’s a lot of competition out there. And as a new bakery, you have a lot to prove.
So, what makes your online bakery better than anyone else’s? Why should they spend on your loaves, buns, cakes, pies, and biscuits?
You need to find your USP before you go any further. Not only will this give you a strong marketing angle, but you’ll be better able to define your target customer as well.
After all, if you’re planning on only using gluten free ingredients, it’ll be a waste of time to target anyone not 100% interested in consuming baked goods made this way. And this is especially true when you’re just starting out and need to lock down your portion of the market.
Pictures Speak Louder Than Words
With a bakery, the sight of a well made cupcake will always be more impressive than any description you come up with. The written word is the basis of online content – and you’re definitely going to need some excellent copy – but it’s your images that’ll seal the deal.
Make sure you’re taking plenty of pictures of your product, in a well lit space with a camera capable of high definition. You can also set up backdrops and use props in your images, such as placing your handmade sourdough loaves in a picnic basket, complete with red check blanket and a grassy field.
Dress your images up, make your products stand out, and think about the ways a customer would like to see your goods presented.
Your Products Will Need to Pass Safety Standards
Even online bakeries are subject to real-world food safety standards, and that’s not something you want to apply retroactively to the products you’re selling.
Your products need to be fit for human consumption from the moment you put your online store together, made in a clean and safe environment, and packaged in a way that keeps them consumable for as long as possible.
Regarding this, if you’re based in the UK, amongst other food safety inspections, you’ll need to prepare for a BRC audit. This certification comes from the British Retail Consortium, and passing one of their audits guarantees to consumers that you’re following best practices in food preparation and handling.
This is important for many reasons, but from a marketing point of view, having an accreditation like this will make potential customers feel much more confident about buying from you. And in the world of ecommerce, users like to do company reputation research.
You’ll Need a Strong Pricing Model
How much will you be selling your products for? In a bakery, products are usually sold according to the cost of the ingredients used, plus a percentage of your overhead bills, and sometimes the overall weight of the item in question is factored in too.
However, there are various ways to come up with the right price and it’s up to you to decide. All in all, it can be a complex pricing model. But it’s also OK to test out a few prices and see which are most suitable for paying your bills, keeping the customer happy, and generating a profit.
In an online bakery though, there will be a few more costs to account for, however. To start with, the cost of making sure the product can survive a long journey packaged into a small box.
Then, you’ll want to account for the cost of the website you’re selling through, which will come with subscription and hosting fees. This is an overhead a lot of people tend to forget about.
Shipping Perishables is Always Tricky
Perishables, if not prepared and packaged correctly, can very quickly become moldy and rotten when sent out to the customer. If someone opens up their box and finds such a state inside, they’re not going to leave you a very good review. Indeed, they’ll also want either a replacement or their money back, and either way, you’ll be out of pocket.
So it’s best to look into the best method for shipping out baked goods right now. You’ll need to hire a specialist delivery partner, as well as use packing materials that will retain the product’s freshness, and that’s not something you want to cobble together overnight.
The most important thing to be aware of here? The price. The cost of fragile handling and fast delivery will be high. Make sure you’re ready to pay prices like these, especially if you’re keen to grow a non-local audience.
You could also make deliveries yourself, if you’re in a position to do so, but this can be incredibly time consuming and require a lot of fuel, which comes with its own high cost. It may be more affordable on a small scale – such as delivering by hand within a 5-10 mile radius – but it’s not something you want to offer on a national basis.
Repeat Custom Will Be Your Lifeblood
Bakeris are great at capturing an audience after the first bite. If a person knows you make excellent cakes and cookies, they’re going to come back time and time again to order another batch. Because of that, you need to invest in attracting repeat custom.
Of course, someone can’t just walk in and try something, but that doesn’t mean you’re out of luck here. Online bakeries have one very great asset going for them that physical bakeries do not: they’re much more convenient. A person just has to go on the internet to find you, and placing an order is a matter of tapping a few buttons on the screen.
Complement this by offering discounts to customers who have come back, offer a loyalty card scheme, and you could also offer a referral scheme to those who recommend you to friends and family.
You can also encourage sharing on social media by offering an exclusive money-off coupon to anyone who ‘tags’ you in their story, which can get the word out about your products quickly and effectively.
If you want to run an online bakery, make sure you know what you’re getting into.
You don’t want to discover challenges like these along the way; you need to get a head start on them.
When you do, you’ll find it much easier to attract and retain custom, highlight your baked goods in a way that drives up your traffic, and you won’t be plagued by bad reviews over how terribly packaged your products are.
