The donut business idea is characterized by a simple start, low initial capital and little competition.
In the confectionery industry, baking cakes, buns and pies is more popular. A novice entrepreneur can still easily enter a relatively free niche by choosing one of the methods for selling airy, flavorful donuts. This could be selling at a kiosk on the street or in a shopping center, organizing a food court, mini-cafe and supplying baked goods to stores.
Independent trading does not require large investments: it is possible to develop a business almost from scratch. Opening a cafe and store is more expensive: you will need to save up start-up capital.
Where to begin
A properly drawn up business plan is half the success. It needs to be thought through to the smallest detail: your own production or supplier, location, necessary equipment, personnel, assortment of donuts, documents, means of promoting the product, expenses.
If you expect to attract investors, then your business plan needs to be concise, clear, and logical. Some moments need to be embellished, but getting carried away is very dangerous. Start your business plan with an assessment of the current situation and resources. It should consist of approximately the following sections:
- Summary;
- Description of the product or service;
- Production plan;
- Organizational plan;
- Budget;
- Expected results from the implementation of the business plan.
Before you sit down to write a business plan, gather as much information as you can about the donut business.
Advertising campaign for the establishment
Like any establishment from scratch, a donut shop must first be advertised to attract more customers. The most effective advertising for such an establishment is, first of all, the transparency of the procedure for producing a fast food product. To do this, it is recommended to make the walls in the product preparation area as transparent as possible, so that customers have the opportunity to observe with their own eyes the production of fresh donuts.
Pyshechnaya staff
The number of employees required for such an institution depends on its format.
- If you create a large cafeteria, more workers will be needed. A standard donut shop, which will accommodate no more than 10 consumer tables, requires 4 service personnel (2 per shift: cook, waiter) and one manager.
- If you plan to sell a by-product, for example, you can sell soft drinks, natural juices in a bar, offer coffee, tea, then you will also need a bartender.
Some tips on how to run a successful donut business
It is recommended to strictly control the quality of product preparation; the scale of the regular customer base will depend on this.- The assortment should be quite extensive: you can use a variety of fillings and come up with several types of toppings.
- The cost of finished products should be affordable to a wide range of consumers; it should not be inflated.
- In such an establishment, it is recommended to create a comfortable atmosphere from Soviet times; there is no need to spoil the interior with modern design solutions. To create a more believable picture of Soviet public catering, you can consult with friends and relatives.
By adhering to these rules, success is guaranteed!
Selecting a location
The key to the success of any retail outlet is the correct location. Ideal locations: near office buildings, universities, schools, shopping centers, hospitals, and on their territory.
A good option is bus stops, metro stations, and the basement floors of high-rise buildings, where regular customers may appear.
It is possible to locate the counter inside shopping centers and large stores. You can open your own small donut cafe or make do with a pavilion.
Future plans
The current economic situation raises many questions for me. Now it’s difficult to plan something specific; I want to look at the future - what will happen in 2020 -2018.
Since our city has been chosen as a participant in the 2018 FIFA World Cup, we are actively involved in this event and are developing desserts with the logo of this event. We also intend to open summer sales points to start selling ice cream. We have already entered into an agreement with a shopping center, on the territory of which we will have a large area. There we will produce ice cream and carry out sales. But we intend this project to be seasonal. We want to develop it every summer.
It’s still difficult to say about the expansion of points. Perhaps we will grow as we see prospects. And it is quite possible that points will appear not only in our city. We are carefully looking at nearby cities: Penza, Ulyanovsk.
We decided to postpone the issue of franchising until next year. We have received several applications to open a franchise business, but, unfortunately, we cannot offer anything yet. Some people simply ask to sell the recipe.
I would advise young entrepreneurs and even those who do not consider themselves as entrepreneurs to try. I was convinced by my own example that anything is possible. And everything is not as complicated as they write in smart books about business or business magazines. Everything is learned in practice. Practice is more important than theory, although if I had some knowledge at the initial stage, I might not have made some mistakes.
Small cafe
The law sets the size of the donut shop - 40 square meters. m. Those who want to satisfy their hunger “without leaving the cash register” need to install a bar counter, chairs, and several small tables.
The area of technical premises where the equipment necessary for baking donuts, sinks, refrigeration equipment, cabinets for storing equipment and donuts will be installed cannot be less than 6 square meters. m.
It is advisable to make the preparation of donuts open so that visitors can watch their order being prepared. The pavilion is a separate room, making open cooking easier here. Cafes are usually located on the lower or basement floors of multi-story buildings. Here it is more difficult to equip an “open” kitchen, but it is also possible.
Business equipment
There are three common options: manual donut makers, semi-automatic and automatic. For the first and second types of devices, preparation requires more time and human resources. Therefore, small industries prefer the third option of devices.
Donut making machines are produced in Russia and the West. Foreign ones are better, but they are expensive. Russian analogues are not bad and are cheaper. Fryers that make donut rings produce from 200 to 600 donuts per hour. The machines work both with regular yeast dough and with mixtures for cooking.
For work you will also need:
- Dough mixer;
- Proofing cabinet;
- Boiler;
- Ventilation equipment;
- Washing;
- Cabinets.
Options for starting a donut business
There are two main ways to produce and sell these baked goods: on the street, in a shopping and entertainment center or food court, and in a specialized cafe. In addition, you can organize the production of donuts on stream. The first option does not require much equipment and is the most accessible for beginning businessmen. The other two methods, as a rule, are chosen by large entrepreneurs who have serious initial capital.
Staff
Initially, when there are still few clients, you can handle it alone. But with an increase in the volume, assortment, and area of the donut shop, significantly more personnel will be required.
Cooks, technical staff, administrators, waiters. The number of personnel depends on the type of establishment and production volumes.
The donut machine itself is quite easy to operate; it just takes a little practice. Instead of dough, use a ready-made mixture, it will be cheaper in terms of financial, time and human resources. The main thing is that all employees have a health certificate.
Disadvantages and advantages of this business
Like any business, donut production has its pros and cons. The list of advantages includes the following:
- Simplicity of production technology;
- Affordability in terms of investment (300 – 400,000 rubles are enough);
- Lack of mandatory product certification;
- Availability of a wide range of equipment;
- Profitability of production (on average ranges from 13.8 - 20%);
- There is no need to hire highly qualified specialists.
The disadvantages of such production are:
- High degree of risk (donuts are a perishable product);
- Big competition;
- High quality requirements.
Assortment of donuts
You need at least 3-4 different types. As your business progresses, increase the types of donuts: add new fillings, sprinkles, make unusual shapes and colors.
Try to come up with your own recipe with a twist so that your donuts are recognizable. Remember the range of drinks: coffee, tea, juices, fruit drinks, cocktail drinks. Even if it is planned that donuts will only be sold to take away.
Over time, it is necessary to increase the assortment by introducing other bakery products; sooner or later people will be full of donuts.
Feasibility study of a donut making workshop
- Type of activity: donut production
- Location: Business opened in a city with a population of 500 thousand people,
- Workshop area: 50 sq.m.
- Preparation technology: Products are made from their own ingredients.
- Sales: Products are sold through grocery supermarkets, as well as through small shops. For sales of products through chain supermarkets, a retro bonus is paid, 7% of the volume of products sold.
- Delivery: Products are delivered daily using hired transport.
3.1. Capital expenditures
| Capital expenditures | Price, rub. |
| Production line | 2 490 000 |
| Line delivery costs | 100 000 |
| Refrigeration equipment | 165 000 |
| Creation of inventory | 500 000 |
| Total | 3 255 000 |
3.2. Revenue
Revenue (assuming daily line operation of 10 hours and 30 work shifts per month) is 1,170,000 rubles per month.
| Name of product | Output per shift, pcs. | Cost, for 1 piece | Output per shift, rub. | Monthly output/30 shifts |
| sales of products | 7 800,00 | 5 | 39 000 | 1 170 000 |
| TOTAL | 39 000 | 1 170 000 |
3.3. Cost price
The cost of producing a donut includes the costs of raw materials, electricity and packaging.
| Naming of expenditures | Daily consumption | Cost, per unit | Consumption per shift, rub. | Monthly output/30 shifts |
| Raw materials (flour, yeast, other jams), g | 585,00 | 22 | 12 870 | 386 100 |
| Electricity consumption, kW/h (production) | 190 | 4,5 | 855 | 25 650 |
| Package | 1 300 | 1 | 1 300 | 39 000 |
| Total cost | 13 725 | 450 750 |
3.4. General expenses
| Expenses | 528 400 |
| Salary | 256 500 |
| UST | 30 000 |
| Fare | 75 000 |
| Administrative expenses | 20 000 |
| Rent | 50 000 |
| Accounting (outsourcing) | 5 000 |
| Retro bonuses (retail chains) | 81 900 |
| other | 10 000 |
3.5. Calculation of profitability and profitability
| Revenue | 1 170 000 |
| Cost price | 450 750 |
| Gross profit | 719 250 |
| Expenses | 528 400 |
| Profit before tax | 190 850 |
| Tax simplified tax system (15%) | 28 628 |
| Net profit | 162 223 |
| Profitability | 13,87% |
3.6. Payback calculation
| Net profit, rub. | 162 223 |
| Capital investments, rub. | 3 255 000 |
| Payback, months | 20,07 |
The payback period for a confectionery shop for the production of sweet donuts equipped with an automatic line is 20 months.
Purchase of raw materials
The dough is created on the basis of flour, sugar, eggs, milk, yeast. You will also need products for a variety of fillings, confectionery toppings, and chocolate icing. It is more profitable to buy raw materials from wholesale suppliers, but there are other options.
Eggs can be purchased from farmers by agreeing on regular supplies. Flour and sugar should be ordered from the nearest manufacturing plants.
This will reduce the cost of raw materials and allow you to be confident in their freshness. At least 60,000 rubles are set aside monthly for raw material costs. All products must have quality certificates.
Project implementation format
A business idea for selling donuts can be implemented in several ways. Each method has its own advantages and disadvantages, and also differs in the amount of capital investment. Let's look at each of them superficially.
- Vending. Now there are special automated machines on sale through which you can sell ready-made donuts. Automatic machines are in great demand. The load is 96 units. The device itself occupies 1 square. m area. The principle of operation is very simple: load the machine with donuts and regularly monitor its filling. Before dispensing the donuts purchased by the client, the machine will warm up the product. It takes only 45 seconds. Small investments - high profitability. The big advantage of the machines is that they can be installed almost anywhere: from gas stations to shopping centers.
- Food courts. The ideal location for a donut shop is food courts located in large shopping centers. There are always a lot of people there, it is possible to cook on site, due to which the aroma of fresh baked goods will attract more customers.
- Mobile trading. Another option is sales through sales vans or trailers. An interesting option that allows you to come to the consumer yourself. But there is one “but” here - there are not many regulations in the legislation that would regulate trade “on wheels”. Therefore, the registration process can be lengthy and hassle-free.
- Takeaway trade. Organization of a stationary retail outlet in which products will be simultaneously prepared and sold. Its principle is similar to a food court, but this option does not imply the availability of places for visitors to have a snack. Beverages can be used as accompanying “to-go” products – from tea and coffee to milkshakes and soda.
Making donuts
The standard recipe is no different in complexity. To make 10–12 donuts, you will need:
- Two glasses of flour;
- The same amount of milk
- Two eggs;
- 15 g dry baker's yeast;
- Five large spoons of sugar;
- 150 ml vegetable oil;
- A pinch of salt.
Donuts are decorated with chocolate glaze, powdered sugar and confectionery powder. Custard, chocolate and butter cream, and various jams are used as fillings.
The dough rings are formed by hand and dropped into boiling oil. Mass production requires special equipment: a dough mixer and a production apparatus that allows you to make 250 donuts at a time.
The baking technology is as follows:
- The dough is kneaded using a dough mixer and placed in a special chamber of the device.
- The dough is formed into donuts and placed on a heated baking sheet.
- The products are fried in oil and placed on a separate baking sheet to remove excess fat.
Ready-made donuts are filled with filling and covered with glaze or sprinkles.
The problem and its solution
One of the major challenges we face is seasonality. We recently found ways to solve this problem.
The biggest decline in sales occurs in the summer, because our main customers - children and students - go on vacation. And until September we have low sales. Weddings turned out to be a way out of the situation. It is thanks to weddings that we make money from candy bars - sweet tables. But seasonality does not apply to gift sets; they are ordered consistently throughout the year.
The idea of candy bars was suggested to me by a friend who was designing my store. At first I was skeptical about her proposal because it seemed very complicated to me. But now I personally deal with orders received for weddings: I communicate with clients, develop a candy bar and do a lot of other important work.
It must be said that we thought about expanding the range even before we encountered seasonality. After the boom associated with the opening of the donut shop passed, we realized that people were gradually full of donuts and they needed to be offered something new - other types of donuts, various desserts. We started working closely on this. Now you can buy cupcakes, cakes, marshmallows, bizet and much more from us.
We deliver the regular menu and cook four times a day so that we always have fresh products. We have also developed a line of gift sets, we sculpt figures from mastic, which we then put on either donuts or cupcakes, and the entire order is placed in special packaging. It takes two days to complete the order.
In addition to these sets, we have developed a line for corporate clients - we draw company logos. I can say that this is a very profitable direction. We already had experience collaborating with large companies that ordered desserts with their logos.
A good advertisement for such a product is “open kitchen”. Many buyers, only after seeing with their own eyes that the products they are purchasing are safe, are ready to buy them. The cooking process itself will brighten up the minutes of waiting for your order.
Advertising can be placed on billboards, stands, television and radio. The Internet is a modern and effective form of advertising. Create a website with photos and descriptions of donuts. Create groups on Facebook and VKontakte.
Organize the distribution of leaflets and business cards. The best advertising is a recommendation. Customers will tell their acquaintances, relatives and friends about the donut shop.
Useful tips and tricks
- It is better to look for premises on the periphery (far from the city center). An area of 30-40 m2 is the best option. It is convenient to install equipment and arrange shelves for products. If you are lucky enough to rent a room for 20-25,000 rubles per month, this is an excellent option for starting a donut business.
- To ensure the recoupment of such production, it is necessary to organize maximum and regular consumer demand. This can be done by supplying retail outlets in crowded places: near entertainment and business centers, educational institutions and market squares. You should not lose sight of the amusement park and recreation areas, although there is great demand here only on weekends and holidays; on normal days sales are minimal. To ensure financial stability, the finished donut product must be actively sold in many locations in the region.
Documentation
There is a special tax regime (simplified system), which will greatly facilitate the life of a novice entrepreneur. Then, you need to collect the necessary package of documents.
You can seek help from companies that will collect documents for you.
Required documents for business registration:
- Documents on registration of an individual entrepreneur or LLC;
- SES permission;
- Permission from the fire inspectorate;
- Certificates;
- License;
- Declaration of conformity, which can be obtained from the certification center. They are issued for a certain period, they must be renewed;
- Staff health records.
Business idea for a pizzeria in the city center
A profitable business idea selling pizza will become the basis for your earnings. Pizza has long since left the category of delicacies and has become an everyday food for the majority of the population. The cooking recipe is very diverse. The main features are a layer of rolled out yeast dough, on which the filling is laid out and cheese is sprinkled on top. The ingenuity of pizzaioles
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Public catering (cafes and more)
Costs of setting up a business
The amount of initial capital depends on the scale of the business: whether it will be selling donuts in a kiosk, a small cafe or a production workshop.
A clear comparison of costs can be shown in the table:
| Capital investments (in rubles) | Stall | Mini cafe | Manufacturing facility |
| Official registration of the enterprise | 10000 | 20000 | 40000 |
| Renting premises and repairs | 30000 | 50000 | 200000 |
| Purchasing specialized equipment | Dough mixer – 30,000, donut making machine – 100,000, cash register – 20,000 . Total: 150,000 | Dough mixer – 30,000, apparatus – 100,000, cash register – 20,000, professional coffee maker – 80,000, refrigerator – 20,000, thermal display case – 20,000, dishes – 10,000. Total: 280,000 | Automatic production line - 3,500,000, installation costs - 100,000, refrigeration equipment - 40,000. Total: 3,640,000 |
| Employee uniform | 5000 | 10000 | 15000 |
| Advertising expenses (website creation, promotions, leaflets) | 10000 | 50000 | 20000 |
| Transport and other expenses | 10000 | 10000 | 20000 |
| Total amount | 215000 | 420000 | 3935000 |
It is advisable to add expenses for the first month of work to this amount so as not to end up completely at zero. If you open a kiosk or mini-donut shop, excluding taxes they will be at least 115,000 rubles. This includes:
- Utility bills – from 15,000;
- Salary to employees – from 30,000;
- Purchase of raw materials – from 60,000;
- Unforeseen expenses - 10,000.
On the shop floor, monthly expenses are increasing. You need to budget from 600,000 for raw materials, from 50,000 for utilities, from 270,000 for wages, and 20,000 for unexpected expenses. The minimum total amount is 940,000 rubles. All investments will pay off in about four months.
Determining profitability
As an example, we will take a project that produces donuts in a separate workshop and sells them at 200 kilos per month at a standard kiosk in a large regional city, as well as supplying them to other organizations.
| Expense line | Amount of costs, thousand rubles. | |
| 1 | Kiosk rental | 30 |
| 2 | Rent of premises for a workshop | 50 |
| 3 | Purchase of equipment and furniture | 1 500 |
| 4 | Public utilities | 10 |
| 5 | Paperwork | 15 |
| 6 | Salary of staff at the kiosk | 50 |
| 7 | Salaries of staff in the workshop | 100 |
| 8 | Marketing campaign | 20 |
| 9 | Purchase of raw materials for the preparation of donuts and drinks | 60 |
| 10 | Unexpected expenses | 15 |
| Total: | 1 850 |
On average, a monthly sale of 200 kilos generates an income of 200 thousand rubles. Additional sales of drinks and supplies to stores or cafes will bring in a total of another 200 thousand. The net profit is approximately 150-170 thousand, which will allow the project to pay off in about a year.
Additional Tips
After opening, do a little price dumping, organize various drawings and promotions. Sell special holiday donut sets for various occasions: birthdays, weddings, corporate events.
Make donuts to order for corporate clients. With the symbols of their enterprise. In a cafe, it is important to have a pleasant interior and friendly customer service. You need to gain a reputation. In no case should service issues be given last place.
Find out about existing regional programs to support small businesses and individual entrepreneurs. Financial assistance from federal and regional authorities will be very helpful.
Please contact Rospotrebnadzor for legal advice. It’s better to learn all the details before opening your business than to pay fines after.
First difficulties and search for the ideal recipe
We immediately developed branded packaging and created a logo. A little later we bought a coffee machine and began offering coffee to go. We initially rented a small room and did not intend to install any tables or counters. Visitors were expected to take everything with them.
About two months before the opening of Crazy Donuts, we created a group on the social network. We didn’t really work on it, we just posted photos to show how we do repairs and what we buy. The confectionery is located in the center of Saransk. To attract attention, we pasted it with the words “Opening Soon!”
We haven’t opened yet, and unexpected difficulties have already begun to arise. For example, two days before the opening, the transport company simply forgot to send us a machine for making donuts. We had to order additional delivery by courier, literally the day before we started trying to bake on it, and, of course, nothing worked. We had to find out the reasons why we were doing things wrong and look for information on the Internet.
In general, we learned how to bake donuts, but we didn’t like their taste. We realized that it was necessary to develop a new recipe and hired technologists who helped us solve the problem.
It took us two months to find the right recipe. We had to experiment a lot. And we are still improving. Now the recipe is a secret of our company, many have already tried to find it out. I can only say that in donuts the dough and the chocolate with which they are coated are very important, it must melt in your mouth and at the same time be inexpensive in cost so that the price of the product is low.
Our donuts cost from 28 to 40 rubles. In principle, this is an affordable price for residents of Saransk, because the average price of a donut in the city is 45-50 rubles.
