Building a New Bakery
Line of Credit Building a New Bakery
Author: Stephanie Clarke
Date posted: 12.28.24

After receiving glowing feedback for the gluten-free baked goods they sold at the nearby farmer's markets, two close friends decided to look for an alternative location to bake beside their home kitchens. They successfully found an established bakery that was interested in selling. After signing the lease papers for the new location, they established their reputation in the industry.

Allergy-Friendly Equipment

 

Because they were committed to providing gluten-free options for their patrons, they were aware that upgrading their facilities would be required. They were mindful of the potential risks cross-contamination posed to those with severe allergies. As a result, they decided to sell the old ovens and tables to fund the purchase of new machinery.

They were aware they would not have enough money to purchase an entirely new kitchen for the bakery, so they decided to take out a loan to assist them in acquiring the necessary items.

Building a New Bakery

How Much Money Was Needed?

Brand new ovens had an approximate cost of $6,000 each, while butcher block tables had a price tag of $3,000 each. When they examined their various financial options, they actively made the decision that $50,000 would serve as a suitable starting point. They desired this amount to ensure they had some wiggle room for possible future costs.

Their goal was to actively find a solution that permitted them leeway in actively managing the timing and allocation of their expenses. At the same time, they aimed to have some breathing room before they had to repay the entire amount.

 

The Best Option for Their Needs

 

Despite the option for a short-term loan, they deliberately avoided rushing into simultaneous purchases. Instead, their initial plan involved starting with two brand new ovens and a butcher block table. As their company expanded over time, they would wisely invest in different ovens. They would also invest in several additional tables.

Thanks to the availability of a line of credit, they could proactively make purchases on an as-needed basis and carefully manage payments based on their capacity. Furthermore, as their company grew, they actively accessed funds from the line of credit and promptly repaid the money as soon as they were able to.

In The End?

Following the signing of the lease, these close friends swiftly got their bakery up and running within six weeks. With necessary precautions, they made their establishment a safe haven for people with celiac disease and gluten intolerance.

Now popular in the neighborhood, their bakery offers a diverse selection of freshly baked loaves of bread. It also offers specialty coffees and chocolates. They have paid down a significant portion of the initial sum they borrowed. They are actively planning to purchase additional equipment for expanding their offerings.

Building a New Bakery
About The Author | Stephanie Clarke

Stephanie has a bachelor's degree in psychology and has been a professional writer for over 15 years. Her client list includes New York Times bestselling authors, publishing houses, prominent public figures and successful business owners. She resides with her family in Florida.

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