Setting up a business is a complex procedure and not something I can fully cover in just one blog post, so today I want to give you the essential start-up check list for starting a cake business.
This is a UK specific checklist and whilst many steps may be the same in your country. Please refer to your local tax offices for more specific advice on what is applicable in your country.
- Register with HMRC as self-employed – Whilst you are registering ask them if there is a local business start-up team who can speak with you and tell you if there are any ways they can help you. For example some counties have on going grant schemes which you may be eligible for. http://www.hmrc.gov.uk/startingup/
- Do a food and hygiene certificate at level 2. Whilst level one is available most local councils will require you to do the level 2 so save yourself the money and do this one straight away. There are many online companies now providing the certificates. Check out www.saferfoodhandler.co.uk this was one site I came across when researching this blog. They seem to be the lowest priced site online.
- Register with your local council’s environmental health department. They will want to do a home visit to check your facilities and give you some advice for your business. Don’t be scared they’re there to help you as much as protect the customers. They will let you know of any changes you need to make. Home cake businesses are often seen as low risk, so don’t panic they will not require the same level of inspection as a commercial premises. Most councils are now signed up to the “scores on the doors” policy which will give you a star rating and help you show your customers where their food is coming from.
- Get yourself some product and public liability insurance. I have mine with Direct line and it only costs me around £6 per month. http://www.directlineforbusiness.co.uk/liability-insurance/public-liability-insurance.htm this will protect you if you have any customers wanting to make a complaint for any reason. Without it you could find yourself in hot water should a client have an issue with a cake you have made.
- Speak to your mortgage company and check it is ok for you to run a business from home. Many home deeds still have rules on running home businesses and having any signage on the property. It’s best to call them and go through everything to make sure before you start taking orders.
- Order a safer food better business pack from the food standards agency. Most councils will like you to fill this pack out when baking and will check your diary when they do an inspection. The pack is free and you can even get updated diary inserts for free when you run out. Call 0845 6060667 to obtain your pack. Some of the information doesn’t apply to you so give your environmental health officer a call and they will clarify what you will need.
- Start good accounting from day one. Literally every penny should be accounted for and a good way I have found is to use a tax return note book I found in Staples it was less than £10 and has columns for everything.
- Will you let customers in when they collect a cake or make and order? (wedding consultations) If so call your home insurance and advise them so they can adjust their policy to match your requirements. If you want to avoid this do your wedding consultations in a local hotel most offer a great lounge and if you call to check they don’t mind you serving your client cake testers you usually find it’s a great place to hold your consultations and it will seem more professional too.
- Are you going to offer to deliver cake orders? If so adjust your car policy so you are covered. It often costs less than you think and will ensure you and your products are covered in the event of any accident. How else will you explain to a bride her cake is squished and so is your car?
- A good book which I find really useful when I am unsure of what I can claim for on the business is the tax guide book. It has everything applicable for that tax return year in it and will guide you as to what you can put through the business. A must when you are working from home and unsure of the percentages for things like electricity. http://www.amazon.co.uk/Daily-Mail-Guide-2011-2012/dp/1846684722
Some websites you may find useful are
http://www.mumsclub.co.uk/ - Ideal for those who are mums in business.
So there you go the essential start up list. You will have thought of pretty stationery and gorgeous cakes, just make sure you do these steps too.
Until next time