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What Are Some Tips On Buying An Existing Bakery Small Business?


Tips For Selling A Bakery

It's no secret that Americans have a major sweet tooth, and neighborhood bakeries have been servicing that craving for as long as we can remember. According to FirstReseach.com there are about 6,500 retail bakeries with annual revenue of about $4 billion in the United States.

Bakeries service all occasions from weddings, birthdays, retirement, and a whole host of other special occasions. Many bakeries do a brisk retail business, but really make their money in catering.


Here are my top tips for selling a small business bakery:

1. Survey the area and determine your competition.

A buyer should drive around the area to see who they will be competing with. Are there other bakeries within a 3-5-mile radius? Is there a supermarket near by that has an extensive bakery selection? If you are specializing in 5-6-dollar cupcakes, does the area that you are selling support that? By examining the area, a buyer will be able to determine if they will want to specialize in a certain product (cupcakes) or be an all-purpose bakery. A buyer should determine the need for bakery products in their area.

2. Ask how long the bakery has been established and why the owner is selling?

Buyer should investigate if this location has been a community staple and how long the current owner has been there. Many customers develop a relationship with their local baker and a buyer should ask why they are choosing to sell. I have seen locations where the rent had become to high to operate and ones where the seller simply wanted to retire and hang up their apron.

3. Determine an adequate amount of training and inquire if the current staff will stay.

Being a baker requires skill and so a buyer who plans on being an owner/operator should have a level of expertise in bakery and make sure they have adequate staff. A new owner should also be aware that bakeries operate at irregular hours, and their day may start at 2-3am. Since many in the community have a relationship with their local baker, make sure to put an agreement not to compete in the sales contract, so they don’t sell and later open up shop near by and compete with you.

4. Make sure that equipment is in working order.

This is very important because bakery equipment can be expensive and so before the close of escrow, a buyer should have the equipment inspected, and if repairs are needed, then either have the seller fix them or be credited money from escrow, so repairs can be made.

5. Specify that recipes are included in the sale, and a list of customer database.

Nothing could be more frustrating than finding out a seller does not want to sell their recipes, which can hurt the goodwill of the business, and also since many people come back to the same bakery for their special occasions, it's important for a buyer to receive a list of customers, so they can market to them of build a catering business.

Joe RanieriAbout The Author: Joe Ranieri is a Business Broker in the LA & Orange County Areas of Southern California. Having owned retail businesses for over 22 years, my interest turned to listing and selling businesses rather than owning them. In business opportunities, I specialize in high volume restaurants, fast food independents and chains, bars and liquor stores, small manufacturing, service business sales. Joe can be reached direct at 714-292-5448 (cell/text).


Categories: BizBen Blog Contributor, Buying A Business, How To Buy A Business



  Helpful Resources To Assist In Selling And Buying California Businesses
Ryan Clark, Business Broker, Southern California

The Veld Group provides a refreshing approach to Business Brokerage, Mergers & Acquisitions and Business Consulting and Valuations. From Your Street to Wall Street, we cater to Main Street Businesses as well as more complex Strategic Firms and Start-Ups. Phone Ryan at 310-652-8353.

Joe Ranieri, Business Broker, Orange & LA County Areas

Having owned retail/restaurant businesses for over 20 years, my interest turned to listing and selling businesses rather than owning them. I specialize tend to specialize in Orange County high volume restaurants, fast food independents and chains, bars and liquor stores. Call 714-292-5448.

Michael Davidson, Business Broker - Southern California

Los Angeles Business Broker providing M&A quality services for Small Business Owners. We leverage our technology and expertise to Simplify & Expedite the Business Sales Process. Matching the right buyer with the right business is how we define success.

George Lanza, Business Broker, At Plethora Business Sales

Plethora Businesses, a division of A Premier In Services, Inc., is a Business Intermediary Consulting Firm headquartered in Orange, California. Plethora specializes in the listing and sale of small and medium sized private businesses.

William Park, Business Broker - Southern California

Highest Volume Broker in California, Simply Check our HUNDREDS of Listings! Over 25 Associates, Speaking Dozen Languages, Helping Buyers and Sellers of Small Business since 1982, Centrally Located between Los Angeles and Orange Counties, while Riverside & San Bernardino Counties are Very Accessible.

Peter Siegel, MBA - SBA Loans, Non SBA Financing Assistance

For over 25 years I have provided niche business purchase financial advisory and loan placement services with SBA and Non-SBA Loans, Retirement Plan Conversions, Private Investors, etc. Financing amounts available: $20K to $7MM. Call today to get pre-qualified or receive financing: 866-270-6278.

Steve Zimmerman: Restaurant Broker Specialist

Steve founded Restaurant Realty in 1996. He has personally sold/leased over 900 restaurants, bars & clubs, & completed over 3000 valuations. The author of "Restaurant Dealmaker - An Insider's Trade Secrets For Buying a Restaurant, Bar or Club" available on Amazon. Reach Steve direct at 415-945-9701.

Jack Oh, Business Broker - LA, Orange Counties

Business broker and real estate services in the Los Angeles and Orange County areas. 10 years experience with great negotiating skills. To sell a business or buy a business in the LA or Orange County Areas phone Jack and his team at 562-787-4989.


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What Are Some Of The Best Tips On Buying An Existing Bakery Small Business?

Bakeries service all occasions from weddings, birthdays, retirement, and a whole host of other special occasions. Many bakeries do a brisk retail business, but really make their money in catering. Joe Ranieri a Southern California Business Broker looks at the top tips when trying to sell a bakery.

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