selling pastries for resale

[pgr555]

I have been offered an unusual opportunity. I generally do catering, but am known for my baked goods. There is a new bakery here that rather than baking themselves uses local bakers to bake for them. It is almost like a consignment shop for pastriues and chocolates. In other words, she provides the storefront, does the selling and promotes the product. Everything in the store looks and tastes INCREDIBLE!!! It has been open less than a month and is extremely busy. People are really talking about it too. She wants to taste a number of my items. If we agree that I will be one of her bakers, she will give me tasting day to drum up business. She also does special order, so i can do that as well.

Does anyone here sell pieces like that to stores or restaurants? How much volume does it take to make it worth while? I can answer more questions about size, price, items, etc if it will help people answer.

Thanks in advance.
pgr

[Breton Beats]

That would kind of depend on what you mean by pastries. Croissants and Danish? Muffins and Tea cakes? or Pies and Tarts? You have to look around and ask yourself if you have the storage and equipment to produce these things on a wholesale basis. To make wholesale pastries worth it you often need to make bulk batches, most which require refridgeration or freezer space it will eat up room for your other business. Or will require special equipment. For example a Sheeter if you are rolling out a lot of dough, or a 60 or 120 qt mixer if you are mixing lots of icing or batter.

Are these pastries something that are needed fresh each day. If so at what time? If they need to be delivered by 6am (when customers require their morning pastries) that means you/or employee will have to work overnight, or VERY early in the A.M, are you in charge of delivery or will they pick up?

Do they have exclusive rights to your goods, or can you offer them to other businesses?

Personally I have a problem with businesses who call themselves bakeries and don't bake stuff there, it is kind of insulting to us bakers who do. However some things for you to keep in mind, the bakery will get the credit for your work. Even with your signage, (I assume she is going to let you post some sort of sign or labels) Customers will remember the establishment. It will be "Oh my goodness that cake from XYZ Bakery is so awesome!" Not, " Oh My, that tart from pgr is the bomb!"

As far as setting prices goes I would establish her price point first! Have her tell you what she well sell the goods for then set a wholesale price. (For small bakery production 25-75 pieces or 2-3 whole cakes/tarts a mark -up of 75-100% is normal.)

Answering all of these questions will help you determine if it is worth it to you. If she has provided you with numbers as in how many she wants and what she is willing to pay it is easy to do the math and figure out in numbers if it will pay the bills. On the other hand full time baking is a different world than full time food with some pastries.

Good luck, p.s. where is this new bakery do they have a website?

[foodpump]

Those are good questions, but here are some of mine:

Terms of credit. C.O.D.? Weekly? Monthly?
Shelf life? Do you have to "eat" the goods after x days?

[pgr555]

I knew I should have given more info

She is very clear with customers that she uses outside bakers. I did not ask the questions about payment, but i did ask what she charges. Everything she sells is huge sized. She sells cupcakes for $3. Large cookies for 2-2.5.Can't remember how much her brownies, tartlets, etc are. Thank you for the percentages, that was part of what I was looking for.

I am talking with her about doing baklava, coffee cakes, rugalach and a few other more candy type things. Some will be special order; others she wants 1-2x/week. We talked about small batches of things that don't have a good shelf life.

I make all of these things for catering, so i won't need any special equipment.

She will not have exclusive rights. I actually saw a cookie she had me taste in a deli later the same day.

Any other info or advice will be appreciated.
thanks,
pgr

[tommybza]

New guy here,
I just left a Bakery /Pastry shop I / we did everything from scratch .
my boss would use a 300% markup ,and people would say why are you so cheep ,this is in Chicago mind you we were selling 10 inch real and fresh chocolate mousse .with ganach coating for $34.oo 27bucks to wholesale accounts,
Great point on the terms too . 14 day max ,we would not deal with hotels just fore the simple fact 30 turns into 45 ect. as long as you can keep a thumb on the payments ontime .

[pgr555]

I delivered my 1st batch of cookies to her today. She was thrilled, loved the look and taste of my stuff. I think this will be a sucessful venture. Just wanted to share my excitement!
pgr

[SugarCookie]

Congrats on your first delivery, pgr. I'm thinking about wholesaling my product too and was wondering if you could tell me what percentage she's paying you. One location told me that they would split the profit 50/50 after my hard expenses. I'm thinking it might not be such a bad idea since I wouldn't have the expense of a store front.

Kelli

[ShoeMaker]

Originally Posted by pgr555

I delivered my 1st batch of cookies to her today. She was thrilled, loved the look and taste of my stuff. I think this will be a sucessful venture. Just wanted to share my excitement!
pgr

Congrats ... hope it goes very well for you

[pgr555]

Hi All! Sorry I didn't respond for so long, I was away for 5 days. I didn't mention in my last post 2 very important things: 1)She paid me on delivery; 2)She asked me what i wanted, then told me it wasn't enough and upped it by $2/lb! She said it was important to her that our relationship worked, and it wouldn't if we weren't both happy, so she would help me learn what I need to know to do this. I am delivering again after the holidays becasues I didn't have the time, not because she didn't want me sooner. She wants me as soon as possible and I am doing gluten free cookies, GF, vegan caramel corn, rugalach and mexican wedding cookies for starters.

Sugar cookie, 50/50 after expenses sounds good to me, but it really depends how much that works out to! What are your expenses? What can the goods be sold for? What does that mean you make?

[panini]

Just a thought from an old timer. I think your cart is almost running up upon your horse.
Take the time to set this arrangement up properly and get things in writing. 50/50 after expenses doesn't sound to good to me. That's just me. I think you need to sit and get your exact costs, cogs, labor, energy, delivery etc.
It is very difficult to go back after starting to make changes. You need to build your box and be very disiplined in staying within it.
Just a for instance. Nothing to do with your current business.You decide on two deliveries a week. One day she calles for a couple dozen brownies. You've already had to go there 4 times this week and you really don't have time to do this. You say, I'll drop them off on my way home. You're now way outside your box and this delivery now becomes part of the inferred contract if you don't have one. Going outside or not building your box will come back to haunt you in the future and is a large reason for failure in this bus.
Sorry, boring, I know. Just want to see you succeed. Hey, made just about every mistake you can make over the decades PM if you like.

[pgr555]

Panini,
I was not doing 50/50, Sugar cookie was.. but ty for the benefit of your experience! I did cost things out, but don't have the contract... still thinking this all through. Will take your advice into consideration