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Four common wholesale bakery challenges - and how to solve them

Despite paleo diets and the demonisation of carbs, Australians still love bread. Roy Morgan research shows that around 13 million Australians are still eating bread at least once a week - not to mention other baked goods. 

These stats are heartening if you own a wholesale bakery business. Of course having an in demand product isn't the only thing that ensures your bakery is a success. Like every type business, you'll have unique challenges and we've isolated the main four below. 

1. Poor cashflow

We see this a lot with bakeries just starting out. There are so many expenses, and even with plenty of investment, loans, and donations, if you don't have proper cash flow, you won't be able to make a success of your business. 

There are many ways to keep your cash flow positive. We recommend starting with a solid foundation and developing a good cash flow forecast. This will give you visibility of all your incomings and outgoings. In practice, this means you'll know if you're going to exceed your profit predictions or you'll get advanced warning that you're going to fall short so you can turnaround a backup plan pronto. It will also help you understand if it's your customers' late payments that are making you come unstuck. 

If you need a quick guide on how to create an accurate cash flow forecast, check out this post.

2. Effective product promotion 

We know that it can be quite challenging to effectively promote your latest products. After all, you entered this trade for the love of baking - not marketing. In the past, many bakeries would host small events or send free samples to their customers - but post COVID, it's time to go digital. 

One way to do this is through a digital catalogue, such as the one you can utilise on Ordermentum. The great thing about a digital catalogue linked to your ordering system is that you can add new products that your customers will see when they go to make their order - or they can be notified.

A digital catalogue can work really well if your sales strategy is to focus on seasonal products like Christmas cookies, Easter Treats or Valentine’s day cakes. You can simply create a digital catalogue showing off all the products under your “holiday” theme and easily share it with your customers.

3. Running out of inventory

This is a big problem that can have big consequences, especially if your'e dependent on spreadsheets or other paper-based systems to keep track of your inventory. This can lead to missed order deadlines, wasted ingredients, excess spending, unhappy customers - the list goes on.

The good news is that once again its technology that can give you the easy fix. Digital inventory management systems will help you track your stock levels so you'll know if you're running low. An online inventory system alerts you as soon as you need to replenish your stock and some can then place an order directly for you. Magic.

There are loads of inventory systems on the market today. We’ve done the research for you and compiled the best ones here.

4. Collecting and managing multiple wholesale orders effectively

Many wholesale bakeries take their orders via a whole host of different methods - phone calls, texts, emails. When you get started, there won't be that many orders to keep track of. But surely your goal is bakery-world domination with hundreds of orders a day? This is when you'll need a better system. 

Once again, the answer is to invest in technology. Putting a good order management system (like Ordermentum) in place early so you can immediately manage multiple wholesale orders will mean your transition from good to great will be smooth and stress-free.

An order management system keeps all your orders in the one place so you can easily see and track them at any time. It improves your customer experience as they won’t have to call you or email you through their orders, they'll simply order online in just a few clicks. Orders then appear straight in your production system, in real-time, without any manual data entry.

The better order management systems on the market will do more than just manage your orders. You'll be able to set up your own digital catalogues, sync with your current inventory system so you can see your stock levels, and they can also help you keep your cash flow in the positive by allowing your customers to pay you immediately.

Of course, challenges are common in any food and beverage business, but it's how you manage them that will make or break you. Our biggest tips are to review your processes regularly so they work seamlessly and invest in good technology so you can put your bakery in the best position for success. Good luck! 

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Esha Thaper

Hospitality lover, food researcher, amateur chef, budding barista, and writer of content at Ordermentum.

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