How to Open a Bakery With No Money 

Opening a new business has many different challenges, but getting enough money to start yours doesn’t have to be stressful. Even if you don’t have any funding available, with the right planning and enough drive to get there, you can open your bakery. But what do you have to do to get that funding? 

You can open a bakery without money by working through the Small Business Administration and learning more about their loan opportunities, apply for grant funding, get a loan from a bank or from family and friends, or sell your assets for quick cash. You can also cut down on your budget items to make do with the amount of money you do have. 

When it comes to starting your bakery, you could be looking at an opening cost of $10,000 to $50,000, depending on your business decisions. How can you get that funding to open your business without breaking your own bank? Read on to find out more. 

What’s in Your Budget?

There are so many things to consider when starting your own small bakery, but what do you need to consider when you’re putting together a budget? The following items are what you’ll need to start your bakery:

How to Open a Bakery With No Money
  • Inventory and baking supplies. No matter what you’re looking to create, make sure you know exactly what kind of supplies you’re going to buy to make your baked goods.
  • Location, equipment, and furniture. This cost can greatly vary, but make sure you have a location sorted out and have picked out all your appliances and equipment. If you’re going to let people sit in your bakery and eat their purchased goods, you’ll also need furniture. 
  • Licenses and business permits. You’ll need several different permits and licenses, including food handling and location-based permits. 
  • Point-of-sale system. You’ll need a way to collect money for your items. 
  • Employees and salary. Don’t forget to pay yourself!
  • Marketing. You can do much of this for free, but you’ll need to pay to create a website. 

Small Bakery Funding Options

What can you do to get funding to start your bakery? Read through the following steps. 

  1. Look into possible resources through the Small Business Administration. 

Even if you’re just starting out and haven’t made many business decisions, you can get assistance through the Small Business Administration. They exist in order to help any small business—your bakery included—with anything they need to start their business. Funding is not actually provided by the Small Business Administration, but they provide information and even assistance in applying for those funds. 

They publicize several options for your business, including loans and grants. When it comes to a loan, it’s exactly like what you would get if you went to a bank, but typically with better support, education, and interest rates. The 504 loans, 7(a) loans, and microloans are the most popular that the Small Business Administration discusses, specifically the microloan, which allows for you to request less than $50,000 for your small business. 

Other benefits include loan counseling and education, along with competitive terms. All of these options are not available if you go through a bank and can help you make better business decisions down the line. These loans also do not mean you have to provide collateral, like in other potential loans. Find out more about the funding opportunities at

  1. Apply for grants of any type. 

If a loan scares you because you have to pay it back, consider looking at a grant. The main benefit of grant funding is that you do not have to pay it back—but you typically do have to follow certain rules or guidelines and report back to the entity granting you the funding about what you’ve done with it. This can be a small price to pay when you’re looking for money to start up your new business. 

Grants are typically specific towards a certain demographic or a goal. If you are a member of a minority group, are a senior citizen, or are a woman, you may have expanded grant opportunities. Make sure you consider all the possibilities—even look into grants that may help you create a safe space in your community or have an impact on your community. 

How to Open a Bakery With No Money

There are thousands of grant opportunities out there, but make sure you’re applying for ones that are reputable. You can find opportunities through the Small Business Administration, or if you’re looking for more local opportunities, you can typically find more information through a local development agency or chamber of commerce. 

  1. Get a loan from the bank or through family and friends. 

With each step on how to gain money, it will start to get harder with more risk. While applying for loans and grants through organizations or the Small Business Administration are easy, at this point in the road, it will start to get to be harder or more stressful. 

That being said, one of the most common ways to get funding for your business is by getting a loan from the bank. Grants are competitive and take a very long time to receive those funds, so if you’re under a time crunch, a bank loan is one of your business options. It is also one of the most stable, even though you’re looking at a potential for a high interest rate. 

When you consider getting a bank loan, make sure your entire business plan is prepared and you have a budget to consider. No bank will allow you to get a loan without that preplanning. When it comes to friends and family, though, make sure you have the same sort of information—treat them like you’re going to a financial institution. While their interest rates should be less than a bank, you should still treat them like a bank, because they’re expressing interest in funding your project with their own money. Make sure in both situations that you get the loan information in writing so there are no questions about the parameters of the loan. 

How to Open a Bakery With No Money
  1. Sell your personal items and assets to get quick cash. 

This step is definitely one of the last options that you should consider, but if you’re having a hard time securing funds and still want to start your bakery, consider selling your personal items like jewelry or cars. 

This step is an option, but should be avoided at all costs. Consider what issues you have faced before getting to this point. Have you been refused for a grant or a business loan because of your business plan or budget? Consider revising your plan. Have your friends and family refused to give you a loan? Talk to them about why and see if you can’t make edits to your plan based on their suggestions. Try to avoid this step at all costs, and you could come out with a better business plan because of it. 

  1. Edit your budget to fit the amount of funding you do have. 

Another “last resort” item, you can also take some scissors to your operating budget. Is your funding request too high, or can you reduce what you’re asking for? Consider what you’re overspending on. Whether it’s spending too much on initial inventory, or your marketing costs are too high. If you’re worried about spending too much on a storefront, consider starting your bakery out of your home. There are choices that you can make to keep your costs down and keep your success up. 

How to Open a Bakery With No Money

Regardless of what you decide on how to fund your business, make sure you do everything with enough research and planning. The worst thing you can do in this process is run headlong into something you haven’t fully researched or even planned for. Create your business plan, create your budget, and research your potential funding opportunities to find out which one is the best for you. Only then can you start your business with no money to begin with, and you can find your success through your bakery!

Frequently Asked Questions

Is it possible to sell baked goods out of my home?

Yes, in many states you can sell baked goods out of your home without too much oversight. There is a law called the “Cottage Food Law” that allows for the sale and manufacture of homemade food objects that are considered low risk, or those that are less susceptible to bacterial growth and can stay fresh without refrigeration. While you should always check state laws to see where this can affect you, it’s an option for your bakery business. 

Is it hard to work in a bakery?

Any small business has its challenges, and working in a bakery has many. It’s a very physical job, shifts start early, people want the products that they know, it’s hard to advance in the career, and holidays can be stressful. But there are many benefits, too—while shifts start early, they also end early; you can be creative, it’s not too hard to find success with your small business, and you get to work with customers and put a smile on their faces. 

To learn more on how to start your own bakery business check out my startup documents here

This blog post is provided for informational purposes only. The information contained is not intended to constitute legal advice or to substitute for obtaining legal advice from a qualified attorney.