How to start a bakery

When starting a business, all entrepreneurs must choose a company name and legal structure, and register their company with KVK. This article explains what else you need to arrange when you start as a baker.

Opportunities for bakers

The number of bakers increased by nearly 20%  over the past 5 years.  On 1 December 2023, there were 4,779 bakers registered with KVK (SBI codes 1071 and 47241).
 

Bakers are having a hard time due to the high price of raw materials and difficulty recruiting staff. Nevertheless, there are opportunities in this sector. Bread is and remains a popular product. As many as 90% of Dutch people think that eating bread every day is part of a normal diet according to a 2023 report on trends in the Dutch bakery sector (in Dutch). The same survey shows that in recent years there has been a growing demand for bread and pastries.

Rules and regulations

You don't need a diploma to start a bakery. You do need to comply with various laws and rules. Some of the important ones are:

Environment plan

Check the environment plan for your municipality. This will tell you whether you can start a bakery in the place you want to rent or buy. Check with your municipality to see what other laws and regulations you must comply with. For example, fire safety regulations and environmental regulations. 

Trading hours 

The Winkeltijdenwet (Trading Hours Act) states that your bakery may be open Monday to Saturday from 06.00 to 22.00 and on shopping Sundays (koopzondagen). Your municipality decides if Sunday openings are allowed and the number of Sunday openings. Do you want to open outside these times? Ask permission from your municipality.  

HACCP – hygiene code

You must have an HACCP plan and work according to those rules. Hazard Analysis Critical Control Points (HACCP) rules cover food safety and hygiene. For example, rules about the temperature of refrigerators and how you record when appliances have been cleaned. If you work with an HACCP plan, there is less chance that food safety will be compromised in your business. You may write the plan yourself, but you can also use the Dutch-language plan from the Nederlands Bakkerij Centrum (NBC). 

Registration NVWA

You must register with the Netherlands Food and Consumer Product Safety Authority (NVWA, in Dutch). The NVWA checks whether companies comply with the Netherlands Commodities Act (Warenwet). The Commodities Act applies to all businesses that make, prepare, or sell food. An inspector from the NVWA may visit you to check if you are working according to the rules. If you are not doing so you will receive a warning or a fine. This is laid down in European legislation.

Allergy information

You must have allergy information available at your shop for any non-prepackaged food products. Inform your customers about the allergens present in your product. You can display this information online or on paper. There are requirements for the information on prepackaged food products.

Industry-wide pension scheme

Everyone who works in a bakery must take part in the industry-wide bakers’ pension scheme (in Dutch). You must organise this for your personnel. You as owner do not have to take part. 

Low VAT rate

You must charge VAT on the products you sell.  Food products fall under the low VAT rate of 9%.

Sustainable entrepreneurship 

There are various laws and regulations on business sustainability and new ones are being added all the time. From 2025, for example, the rules for environmental zones will become stricter. Your delivery van must have at least emission class 4 or 5 to enter zero-emission zones. These are areas where only vans and trucks that drive without exhaust emissions are allowed. The Energy Saving Obligation may also apply to your bakery. By becoming more sustainable, you reduce your company's CO2 emissions and save on energy costs. So before you open your bakery, delve into sustainable business practices. This will save you time and maybe even money later.

What does owning your own bakery cost? 

The cost of starting your own bakery can vary greatly. It depends, for example, on the location. You will pay more rent for a shop in the centre of a large city than for a location in a shopping street in a suburb or village. You should also think about the costs of:

• Inventory such as machines, refrigerators, ovens, and display cases
• Rebuilding the premises, think new flooring, storage, lighting, and making sustainable
• Raw materials such as flour, sugar, and yeast
• Packaging materials
• Promotional costs for an opening event, newspaper, or social media ads
• Personnel costs
• Costs for insurance, permits, and a bookkeeping software package

Financing your business

Make a financial plan for your bakery. This will show you how much money you need to get started. Perhaps you have savings of your own or you can borrow money from someone. A family member or business partner for example. Most of the time, you will need financing. You can receive funding via a bank or the microfinance loan company Qredits. For bakeries, there is also the Dutch credit union Kredietunie Bakkerij Ondernemers (KBO, in Dutch). A credit union is a member-owned financial cooperative – created and operated by entrepreneurs – that offers financing and coaching for amounts between €50,000 and €250,000. The KBO not only provides credit but also offers coaching by a former entrepreneur from the baking industry.

Taking over a bakery

In the next 10 years, approximately 500 bakers will retire. The Stichting Bedrijfsopvolging Bakkerij (Foundation for Bakery Business Succession) has started a campaign (in Dutch) to encourage people to take over their businesses. Taking over a bakery gives you advantages, such as name recognition and an established customer base. It is also often much easier to get financing for an existing business.

Starting as a franchise entrepreneur

Another option is franchising. As a franchise entrepreneur, you start your business under the name of an existing concept, but you remain independent. There are various franchise concepts for the baking industry. You can find most franchise concepts in the Netherlands National Franchise Guide. Franchising has both advantages and disadvantages. One advantage is that you profit from the name recognition of the concept. On the other hand, you will have less say in the choice of suppliers and the range of products.

Sector organisations

There are several sector organisations or associations,  2 well-known baking industry organisations are:

• Nederlandse Banket en Broodbak Ondernemersvereniging (NBOV, Netherlands Bakery and Patisserie Entrepreneurs Association )
  The NBOV (in Dutch) supports entrepreneurs in the artisanal patisserie and bakery sector with a focus on entrepreneurship, employership, and professionalism. They organise meetings for starting entrepreneurs.
• Nederlands Bakkerij Centrum (NBC, Netherlands Bakery Centre). 
  The NBC (in Dutch) is a knowledge and advice centre for entrepreneurs in the baking industry.

Industry organisations will charge a membership fee. You are not obliged to become a member of an industry organisation.

General information for starters

As well as dealing with all the issues above, starting entrepreneurs  also have to deal with the following:

• Choosing a legal structure
• Taxes 
• Registering with KVK
• Business administration and bookkeeping
• Choosing a name
• Renting commercial space
• Hiring staff