How To Start An Online Cake Business From Home

how to start an online cake business from home

I started selling online in 2011 as a way to reach the DIY brides who had popped up all over the place after the economy tanked. 

As my online business evolved, I ended up selling more to other cake decorators and hobby decorators and less to the brides (who have now gone back to buying their wedding cakes after realizing it’s not easy to make one themselves.)

I even sold fake cakes to people who used them as photo shoot props!

Anyway, after 12 years of it, I’ve learned a lot, and I know that it isn’t as easy as it looks. 

People will open up an Etsy shop, list a few things, then sit back and wait. 

After a week they post on the Etsy forums that they’re giving up and closing their shop.

There’s no reason to give up that quickly, but not everyone is meant to sell online, either. 

This article includes affiliate links that will pay a commission if they’re used to purchase something. As an Amazon associate, I earn from qualifying purchases.

What should you sell?

First of all, you have to be selling something that people want to buy. 

That might sound overly simplistic, but people don’t seem to understand it. 

They’ll post a question asking for shop critiques, and the first thing I want to say when I look at their shop is “I don’t think people are going to buy the shrunken fish-head jewelry that you’re selling.”

So first of all, you need to decide what you want to sell. 

If you intend to list anything that’s considered food and ship it outside the area you’re licensed to sell food, you’ll need to check with your country’s national health and food authority to see if you can legally do that. 

In the U.S. the FDA would be involved, and you’ll need to follow their guidelines for what type of licensed kitchen you’ll need to use to be able to sell various types of edibles legally across state lines.  

And the argument “but everyone does it” won’t fly. If you want to run a business, run it legally. 

You also can’t sell anything that’s copyrighted or trademarked without a license to do that. 

So no cartoon characters, team logos or retail logos unless you pay for permission to sell them.

Selling gumpaste cake toppers and fondant cupcake toppers is something that a lot of people want to do, but again, you have to follow the rules about what types of materials you need to use and what type of language you need to use in advertising them. 

If you indicate in the item description that something is edible, it will then fall under the “selling edibles online” guidelines, so you’re back to dealing with FDA rules.

When deciding what to sell, you’ll need to take ease of shipping into account. 

If you can’t deliver something in good condition you shouldn’t sell it. 

For example, fragile royal icing snowflakes probably aren’t the best choice to sell in an online store. 

If you’re not sure how well your products will travel, send some test packages to people you know who live a good distance away to see how they arrive. 

You’re responsible for making sure your products get where they’re going in good condition, so don’t take chances.

If you’re not interested in getting into the business of shipping physical items, you can choose to sell tutorials and other digital downloads. 

However, there are a LOT of tutorials online now, so you’ll need to spend time marketing yours. 

You can easily see this in action if you look on the Facebook pages and groups run by decorators who rely on classes and tutorials for their incomes. 

I see constant mentions of tutorials on social media, and the decorators who are selling them are active in promoting them. It’s definitely not a “list it and walk away and they’ll sell themselves” situation. 

Want to open a new Etsy shop? Use this link to get 40 free listings: 40 free listings for new shops (#ad)

how to start an online cake business from home

Where to sell online.

Once you decide on the “what” of selling, you’ll need to decide on the “how.”

Existing sites like Etsy and eBay allow you to set up a store pretty easily, and might drive traffic to it for you.

If you set up your own website on sites like Shopify, Wix, Squarespace, or WordPress you’ll be the one who needs to create your own traffic through good SEO (Search Engine Optimization) and advertising.

It might seem better to have a stand-alone website for your shop because you won’t have listing and processing fees.

However, the cost of a shop on a site like Etsy might be worth it for the traffic they bring you, which can translate into more sales with less effort on your part.

For selling physical items, you’ll need a secure site that allows you to set up shipping costs and clear customer service policies, including how you handle returns.

You can set up a WordPress site with a shopping cart if you plan on selling a lot of things, but for one or two I’d add PayPal buttons to your existing website if that’s an option.

If you decide to sell tutorials exclusively through automatic downloads, you’ll need to find a sales platform that supports that.

If your site doesn’t allow customers to download their files right away you’ll need to email the file they purchased to them.

This results in a delay between the purchase time and when the customer receives the file, which isn’t optimal.

Most people like an automatic download a lot more than having to wait for their file to arrive.

You’ll also need to look into the fees that go with automatic downloads.

Many services that support automatic downloads charge a variety of fees, so shop around before you decide where to list your products.

There are some platforms that don’t charge, but they may have some limitations on what you can list, so check around.

Once your shop is set up, you’ll need to market it.

This is the part of selling online that most people don’t count on.

You’ll need to use your social media to promote your listings and get the word out that you’re open for business.

If you hate social media, selling online might not be for you… As I’ve said before, this isn’t a “set it up and walk away” scenario.

Tips for selling online.

Listing items in an online shop isn’t the only thing that you have to work on.

Pricing is important, since you’ll need to make a profit, so that’s the first thing to get in place.

After that, the main thing that will make a shop succeed or fail is SEO, or Search Engine Optimization.

You’ll have to learn enough about this scintillating topic to make your shop be “findable” in search results.

I’m a bit of a marketing geek, so I actually enjoy this part of the process, but if you don’t you’ll have to rely on direct referrals from your social media, and that takes more work on a daily basis.

There are definitely people whose SEO stinks, and who still sell a decent amount of items.

But as I mentioned, they’re the ones who have a large social media following to begin with, and they’re sending that following directly to their shop by posting on social media.

Direct traffic doesn’t require any SEO at all, but it’s not the way to reach the most people.

On top of that, Etsy has its own search engine, which works differently than Google’s does.

To sell successfully on Etsy, you need to understand how their SEO works since it’s not the same as Google’s SEO. It adds an extra layer to the puzzle.

I once offered to help someone who had a huge social media following with their Etsy shop because I looked at her SEO and it wasn’t the best.

One of my suggestions in her case was to put her items on her website, as opposed to having them on Etsy.

Her following was large enough that she should have been able to support her own sales without having to rely on Etsy’s platform.

That’s an unusual situation, though, and most people would benefit from being on a platform that has its own built-in traffic.

Other considerations include whether you have time to deal with a second business, because selling online requires a different type of customer service than in-person sales do.

People are used to Amazon’s quick deliveries and liberal return policies, and they expect that their online shopping experience will mimic that.

As small businesses we obviously don’t have the capacity to imitate Amazon, but you’ll have to deal with people who expect you to. 

And don’t forget the tax man… You’ll need to collect and remit sales tax on items that are sold within your state if the items that you sell are taxable, and if the platform you sell on doesn’t do it for you.

This will involve registering with your state tax authority and filing returns on a regular basis.

Your local government’s business department can give you more information about the requirements for this, including whether postage and handling are taxable or not.

Selling online is a matter of figuring out the right combination of products, the right SEO, and how to effectively market your shop.

I can’t emphasize this enough…marketing an online shop is FAR more time-consuming than marketing custom cakes.

I’m not kidding.

Plus, it involves a different type of selling and strategies that you might have to learn from the ground up. It’s not for everyone, but if you’re willing to put in the effort it can be a good source of income.

Set your prices first.

You shouldn’t use other people’s pricing to set your prices, but you do need to check to see if your prices are realistic.

Figure out how much you would need to charge to make the profit that you want to make BEFORE you start investigating how much other people are charging for similar things.

That way you won’t be tempted to drop your own prices to match undercutters, and you’ll be able to see if you can make enough to make it worthwhile selling that thing.

There have been many times when I decided not to sell something because I saw how little other people were charging and I didn’t think it would be worth my time.

That’s not a bad thing, it’s just reality. You need to make a profit if you’re running a business!

Before selling anything: Check the legalities of selling online from where you are. In the US, check with your local Health Department or Department of Agriculture to check on whether you can sell edibles online. If you don’t own your home, check to see if you’re allowed to run a business from your apartment. Check to see whether you need a business license or to collect sales tax (you probably do.) If you work under the cottage food laws, make sure that you’re allowed to sell online at all.

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