Home cake business

AHewlett

Hi everyone,

I'm nearly ready to start my cake business but I would just like to check with everyone that I have done everything right.

START UP
- Kitchen Inspection (done with 5 rating.)
- Public liability insurance (Not yet done but quote for £6 a month. Needed for markets/fairs)
- Register with HMRC (28 days before trading)
- Find out about council tax and housing benefit

AFTER START UP
- Send in tax reports
- Set up business bank account
- Buy business cards
- Buy large amount of stock
- Find funding/grants/loans

If anyone could point out anything that I may have missed or forgot or any advice.

Thanks,
Anne-Marie

nickj_2

accounts ?

AHewlett

Thank you, accounts! It's on my list and I forgot to add it on here.

earthstorm

not just Public liability insurance you also need Product liability insurance and Employers Liability Insurance..

dont know where you are paying £6 a month, but this will not be enough. If you are doing fairs/markets then go with a specialist insurer like http://www.gmimberltd.com/ (http://www.gmimberltd.com/MarketInsure.html) which will cover includes Public and Products Liability at £5,000,000 and Employers’ Liability at £10,000,000 (or statutory limit in respect of terrorism). Plus stock, theft, Business Interruption, Legal Helplines and Vat/Inland Revenue Investigation.

tattycath

Advertising?

paddyrg

Employers liability insurance only needed if you're employing BTW

Assume you can't get grants or loans and plan stock levels accordingly. Likely you won't get either and even if you do it's good to be disciplined with stock levels.

Loyalty cards/initial sales incentives
Enough cash on hand to tide you over 6 months living expenses

AHewlett

£6 is from Axa.

But I won't need employers liability insurance since it will just be me doing the business.

Advertising will be flyers and word by mouth, hopefully!

earthstorm

It is always advisable to have Employers liability insurance especially if the OP wants to trade at markets/fairs as you never know when you may need assistance.
I do some that i have no problem being on my own, but i also do some where i cannot cope single handed, so need assistance. using gmimberltd.com/ everything is covered including upto £2,500 stock for an annual fee of £129

closed

buying large amount of stock is often the first mistake, along with loans.

may also impact house insurance

PasturesNew

Depends how your business will be run, but also:
- vehicle insurance changed for business use
- check if you need any planning permission from the Council
- draw up contracts for anybody that's asking you to bake to order

Also need to think about costs/methods of:
- advertising, marketing, PR
- branding, logo stuff

Did you write a business plan?

hayley11

Direct Line public liability insurance at £5 ish a month is enough for a home cake business, I have it myself and know a ton of other home based businesses that have it.

Two points you mentioned...

Opening business bank account, personally I wouldn't unless the amount you're making is worth the cost.

Buying lots of stock - again I wouldn't invest a lot of money until you know how well you're going to do, at first I would buy in small amounts as and when you need it. The only things i'd buy in bigger packs is flours, sugars etc from say somewhere like Costco but I wouldn't go mad. Booker is good for ingredients too and you don't need to pay to be a member like you do at Costco.

A simple spreadsheet for your accounts would suffice, I wouldn't pay for an accountant unless you're really struggling and don't know how to submit a tax return. HMRC do courses for new business teaching things like this. Keep all your receipts.

Use social media, facebook, twitter, linkedin, to build up your business, it's free. Word of mouth is the best way to get business IMO. Register on directory websites that are free, yell for example.

MASSIVE POINT (just thought of it) - take deposits from the word go. At least 25% of the total price, if it's a large order say for a wedding, get the full payment at least 7-14 days in advance, otherwise I just get payment when they collect. Don't undercharge, work out the costs, including costs for your time and profit. If you're good at what you're doing, then people will pay for it.

I set up my business three years ago and it's great, hard work but very rewarding.

Best of luck.