How to buy a bakery?
A bakery business is not much different from cafe, restaurants, and coffee shops. However, it will take more than just serving some tasty treats for your bakery to be successful.
There are a wide variety of bakeries trending in the UK and it can get difficult to choose from them. This guide will take you through the bakery sector in the UK and provide the information you need to buy a bakery.
Essential skills you will need
Running a successful bakery will require you to have a set of skills. It is okay if you are lacking in one aspect or another; you can also hire people to fill those spots.
Passion for baking is highly advisable. Having culinary experience will help you in coming up with new ideas which set you apart from the competition. It will help greatly if you acquire knowledge of bakery business by working at one.
You will have to be business minded. While you may enjoy baking for yourself or your family and friends, you will be running on tight profit margins, especially in the start. So you need to pay close attention to details, keep an inventory and stay on top of it to ensure your business’s success.
You will have to be prepared for early morning and pressure. Your customers will want your baked items to be fresh, so you have limited time to sell before the items go stale.
Types of retail bakeries
You will find that there is a massive variety of retail bakeries. Here are some of the most trending:
- Counter service – They sell baked items and do not offer sitting space.
- Bakery cafe – Apart from offering the freshly baked items that a bakery normally, would you will have to offer further items such as coffee, tea, alcohol, sandwiches.
- Food truck – You can take your baked items and go where the customers are.
- Flour based bakery – such bakeries offer flour based items only.
Should you buy an independent bakery or franchise?
An independent bakery business will give you the space to do what you want to it. However, if you buy a franchise, you will get the support offered by the franchisor which includes training your employees. As a franchisee, you will have to be flexible with your expanding and business development goals.
Choosing a bakery to buy
Location is the most important factor when it comes to choosing a bakery to buy. You should take a look around the neighbourhood to see what kind of footfall the area gets and whether any of is directed to the bakery.
If the business has delivery capability it will be an excellent way to increase your sales.
The process of due diligence is one that provides a thorough investigation into a proposed investment transaction. It means you check the investment worthiness, and assess the full claims made by the owner. This check is usually performed by a solicitor and accountant who act on behalf of the buyer. A large portion of due diligence will involve checking financial statements and accounts.
If you buy wisely and do thorough research of the background and potential of the business which attracts your interest, you will get immediate access to the existing base of customers and suppliers. This make ensure that you know what you are getting into.
Click here to find more about due diligence.
You need a solid contract
You, as the buyer, will have to produce the sale document. This agreement will have to cover the mechanics of the deal – what is being sold, where it is, how it is to be transferred, and so on. This is where warranties come in. Click here to download a business sale agreement if you are purchasing a bakery.
You also need to be aware of warranties which are legally binding promise as facts about the business, which provide information relating to the business. Click here to know about how warranties work and why they are important.
Other documents you need
Additionally, you may need assignment and novation agreements to transfer contracts the seller is a party to.
If company shares are being sold, then you will need directors service agreements, board minutes to document approvals to changes, and possibly, a new shareholders agreement and new articles of association.
We can help you find exactly what you need for your circumstances if you contact us and ask.
Please note that the information provided on this page:
- Does not provide a complete or authoritative statement of the law;
- Does not constitute legal advice by Net Lawman;
- Does not create a contractual relationship;
- Does not form part of any other advice, whether paid or free.
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