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Earning Delicious Profits with a Cookie Company Business

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Cookie companies are popping up all over the country as home-based businesses and brick-and-mortar bakeries. The cottage food industry, or home-based business, exists only in areas where health laws permit, but a great alternative is renting space in a local innovation center or other type of facility that has the appropriate licensing for food production. It is safe to say that most cookie companies start small and expand over time.

Before the business ever opens its doors, it is important to spend all the time needed to thoroughly test the recipes and practice the decorating styles. Though this may seem obvious, many of the companies that fail cite problems with these two issues. In fact, recipes often have to be adjusted as the business grows if the cookies are going to be shipped. Any successful cookie bakery advises that product consistency is critical, whether a customer is ordering a dozen cookies or ten dozen cookies.

Other issues to keep in mind during business planning include the following:

• Will the cookies be sold locally only or online through a website, or both? Be sure to obtain all necessary permits and licenses for selling and shipping food, in addition to the normal business licenses. The local health department can answer many specific questions.
• If selling online, how will the cookies be safely shipped to prevent damage, and has the cost of special packaging been factored into the cookie sales price?
• What is unique about the recipes and decorating designs, differentiating the product from all the other types of cookies sold today? How is the market niche defined – by cookie shape, decorations, unique ingredients like gluten free, and so on.
• What is the source of ingredients and has the baker planned for supply disruptions if unique or unusual ingredients are used? The same is true for sourcing supplies like printed labels and branded cookie boxes.
• Though some bakeries start with one person in a cottage industry bakery, it is not long before additional staff is needed as orders grow. A problem some bakeries run into is being able to hire, train, and retain skilled decorators able to meet production deadlines. This important issue should be addressed in the business plan.
• How will the cookies be marketed? Will they be sold as party favors or to cater special events, to corporate clients, to walk-in customers, or some combination? The targeted customers influences the marketing plan.

A baker needs kitchen equipment, space for producing the cookies, and large appliances like ovens and refrigerators. If starting with plans for large orders, manufacturing equipment is required. Financial planning will include determining the amount of startup capital needed to cover staff, equipment, operating expenses during the initial business stages. There should be a clear plan for generating the volume of cookies that will be sold each week. The cookie business should be approached with same diligence that would be used when starting any other type of business. Though opening a cookie company sounds like fun, it requires a lot of planning and effort to achieve success.

OGS Capital consultants have worked with many business owners in the retail food industry interested in developing a professional quality business plan. Complete the online contact form to get the process started quickly and efficiently.

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