A little backstory about myself, I own a baking studio (mainly customized cakes for both birthday cakes and wedding cakes, baking masterclass and cake decorating lessons on weekends) and having bootstrapped to open my own baking studio. My first outlet is in PoMo, and after 2 years in a 450 sq feet location, the mall management decide to pull a sudden attack on all the retail stores that they want to do a full renovation of the mall. This equates to opening a 2nd outlet with lesser machine startup-cost.
Hence the inspiration for this new post to help you bakers out there who are thinking to open your own studio. If you are looking at opening your own baking studio or business, I would recommend you to take a look at these rough figures.
Rental of a studio Space – min $20,000
To rent your dream space would mean you require to put a 3-month deposit to your landlord and a average space decent space (400 - 600 sq feet) at a decent place would be $4,000 - $6,000 in Singapore, the first month advance rental plus the 3 months deposit would mean at least – This is an amount which you can never expect to see again.
This does not include the component called “GTO” (usually 1-3%) this simply means the landlord is going to take a cut from your hard earn money on top of the rent. Consider this as you “performance bonus” to them. The more you make, the more they make too. If you make too little GTO for them, just be abit careful as when the lease is up, your time might be up too.
The unseen cost – min $5,000
This is probably going to be the cost which you did not budget in as a first time business/studio owner. Here are some items you need to pay for
Website, website template, website hosting, email account ($1,000 for 3 year)
NEA kitchen license (approx. $200) , change of use license (approx. $500), request for current use (approx. $50), Pest control contract (approx. $70 a few hundreds a month depending on size and service covered)
Designer for create artwork for logo, printing logo signages, branding measures (depending on who you look for will cost up to $1,000 - $3,000)
Machines, equipment, fixtures - min $30,000
Depending on your work scope, and the volume you are aiming, I would suggest at least 1 chiller, 1 freezer, 1 upright chiller and 1 display chiller, 1 Industrial Mixer , 1 good industrial oven – this will cost you approximately $ 20,000 – $30,000
For fixtures and tables/work surface, I would recommend going to u-save, taobao or ikea to buy items which suits you best. Try to budget around $5,000 - $10,000 for this item
Renovation - min $25,000
I would usually budget for a small studio space. This figure means you will probably get 1 carpentry item, getting your wires and electricity lines, water pipes laid and sorted out, a new paint job and probably just the cheapest screed with vinyl tiling. After I started by business I realized that in malls only allow night works, hence increasing your work budget to of its original price.
As a word of advice, you have to get contractors who have done NEA kitchen before, bigger scale guys with in-house LEW and plumbers would be perfect.
My experience with working for the smaller players or inexperienced players, they would screw up you “safety” aspects of your new studio. If you would like a grander scale – feature walls etc, it would mean a lot more. Bear in mind that this figure does not include lighting and fixtures.
Staffing Cost – Variable
As a start, you will probably hire interns, and 1 full timer to take over most of the jobs from your hand so you can focus in growing the business. If you are considering about interns, they cost from $400 - $800 a month (but sometimes they will screw up and spoil batches of items if they are less experienced, and they will usually need more time to teach). A full time chef cost from $1,300 - $4,000 depending on their experience and skill level. If you are considering to hire Malaysians or Non-Singaporeans remember to factor in a $500 – 1000 for levy.
Marketing Cost – Variable
To get your name out there to the potential customers, you will probably need to buy some dummy cakes to make some cake samples to start some sort of portfolio.
For a start I will recommend using facebook or Instagram and using $5-$10 daily to get more followers and customer base and running some giveaways.
Starting Ingredients cost and Tools – Variable
If you have been baking at home it would be a lot cheaper as you can bring your older tools to your new studio, however if you are planning to hire people or conduct classes, you will need to purchase items which are not part of the list. This would highly depend on your current menu, cleaning tools, trolley, ladders are all part of this list which you should include. I would suggest buying as you need. When I first started, I bought my trusty kitchen aid from my home to my new studio. I bought my 2nd kitchen aid 2 months into the studio opening, had a free (2nd-hand) large mixer given to me on the 3rd month and finally managed to buy the 4th mixer on the 6th month into the business. My final mixer is a 2nd hand item from ToTTs studio when they close their site. If you feel that you need more, then buy because I understand how scary it is to buy all the equipment right from the start.
If you have an approximately $80,000 - $100,000 in your bank account and would like to live life dangerously, this would be a good ballpark to start a mini baking studio. However, you have to bear in mind that you cannot expect a pay for the next 6 months to 1 year depending on how well your business is doing.
A word of advice from someone who owns a baking studio. The trend is always changing and people are always upgrading, learning new skills and techniques to make their cake more special. The client’s taste area always getting more and more sophisticated. If you don’t want to be in the main market pool competing about prices, you have to make your bakes more special and interesting for your clients, for more of our classes you can find out here.
If you have any questions with regards to my studio opening journey, please let me know I would love to share more about the softer aspects of opening a baking studio, design, planning and other related items in my future posts.