In the Cake Businesses

Share on facebook
Share on google
Share on twitter
Share on linkedin

Different Cakes

Cakes come in all shapes and sizes and so do cake businesses. Upscale cake businesses include wedding cakes and custom-decorated cakes for special occasions. A retail brick-and-mortar bakery is another option. Delivering gift cakes by mail is a viable business. Providing gourmet cakes to restaurants on a wholesale basis is another alternative. Starting a small in-home bakery is possible as long as your kitchen meets certain health standards. Teaching others how to bake and decorate cakes requires less of an investment than some of the other cake businesses.

Licenses and Permits

Exactly what you need depends on the location and type of cake business. Different states and cities have varying requirements. Most have websites where the specific information is available. You most likely will be required to obtain a business license from the state and city, a food handler’s license and a sales privilege license to collect sales tax.

If you’re baking cakes, the kitchen, equipment, storage facility, oven, refrigerator and location must be inspected to meet safety and health standards. If you’re thinking of starting your small cake baking business in your home, your kitchen still will have to be approved. In many cases, a home kitchen isn’t acceptable at all. If that’s the case, you will need to find a location that is approved and do the baking there. A restaurant that only offers breakfast and lunch is one option. A church with an inspected kitchen is another option. Renting a facility is a third option.


The mixer you use to bake a few cakes over the weekend for friends and family will soon burn out when you’re faced with baking 100 dozen cupcakes a day. Industrial strength equipment is a necessity. In addition to mixers, you’ll need bowls, baking pans, measuring cups, a restaurant-quality dishwasher, freezer, ovens and refrigerator to hold the dozens of eggs, gallons of milk, quarts of cream and other ingredients. It might be possible to economize on a cooktop or stove.


Purchasing supplies from wholesale vendors will help you save considerable money and boost profitability when your small cake baking business has to buy hundreds of pounds of flour, sugar and other ingredients. You’ll also need packaging materials for the cakes including boxes, liners, lace doilies, tissue paper and food-quality bags. When deciding on vendors, review their product prices, delivery times and charges, and minimum purchase requirements. The least expensive vendor may have delivery charges that are higher or have minimum purchase requirements you can’t afford.

Pricing and Profitability

Several methods are available to price your cakes. Before you do that, scout out your competition. Customers may pay a premium for your cakes but there is a limit. Wedding cakes cost from about $2 per guest at the grocery store bakery to $15 per guest, with the average being around $4, according to 2012 data from Wedding Stats and The Knot. Price your cakes by adding up all the ingredients and adding in an hourly figure for your time, plus a profit margin. If the cakes will be sold wholesale to a restaurant, for example, keep in mind that the restaurant usually marks up food three times what it cost. That $6 slice of chocolate mousse on the menu cost the restaurant $2. Your price can’t be much more than that $2. Retail cakes are marked up double the cost. Another way to price your cakes is what the market will bear, and that’s where your competitive research comes in.


Check with your insurance agent to see what added coverage you need. You’ll need liability insurance to cover any product problems. The customers of your small cake business may be friends and family who wouldn’t think of litigation. However, you need to be prepared for the possibility that your cake is served to a guest who decides to pursue legal action. Paula Spencer, author of “Start a Cake Business Today,” says product liability insurance is critical whether you bake in your own kitchen or rent a commercial kitchen. You may also need to change the coverage on your vehicle if you now use it for commercial purposes such as delivering the cakes. Insurance is a good idea to cover the loss of inventory from fire, floods or even an insect infestation ruining your sugar and flour. Accidents happen to employees, so increased workers’ compensation insurance is an alternative.


Even a small cake business needs a marketing plan that defines its marketing niche — potential customers — and strategies to reach that market. The strategies may include brochures, a website, publicity, business cards, tastings, attending trade shows, social networking and word of mouth.

More to explorer

Types of Contract Exemption Clause

There are lots of different elements to exemption clauses and they would always need further exploration by a qualified solicitor but in the next sections we will look at how they appear in a contract and the ways in which they can be used.


at the click of a button choose your own video enabled virtual office and events space!
Video enable your own virtual office with reception, co-working spaces and happy hour lounges
host your team and sales meetings in your virtual boardroom, on a private, safe and secure platform
custom design any space you can imagine at a touch of a button


At the click of a button host your own virtual conferences, events and webinars
Host and attend with multiple presentation modes, virtual speaking panels, Q$AS, debates, group chat and direct video interaction with people sitting at your table
Host your own tradeshow, conference, or panel of speakers in an interactive video enabled experience


at the click of a button choose your own video enabled virtual office and events space!
Video enable your own virtual office with reception, co-working spaces and happy hour lounges
host your team and sales meetings in your virtual boardroom, on a private, safe and secure platform
custom design any space you can imagine at a touch of a button

Leave a Reply

Innovate The World is an all-in-one engagement platform for innovators and innovation enablers.

A virtual environment where innovators and innovation enablers come to share their content, meet, collaborate and sell their products and services


+ register + create a profile + share content + join and start groups + connect & collaborate + join meetings and events + host meetings and events + set up shop in the marketplace + build your virtual office space

Already have an account? Sign in

We are an ever-growing tribe of community networkers, media professionals, partners and friends that publish the Innovate book series in cities and industries around the world. The Innovate The World platform is the result of our digital transformation to be able to truly connect all innovators and innovation enablers around the world in an inspiring and engaging 2D and 3D virtual environment. 

Join the platform – Nominate yourself or other innovators/innovation enablers here.                                                                                         

Partner with us – We are always looking for new partners around the world to join our team in mapping out their innovation ecosystems per city or industry. Register here to talk to us.


innovation categories