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Location can make or break a bakery, and if you’re ready to expand to a second spot, the stakes are high: Choose wrong, and that new bakery could jeopardize your entire company. Two successful bakers tell us what to consider when you’re scouting locations.
When Tim Clegg decided to open a second Hurts Donut, he started by focusing on demographics, rather than ZIP codes. Millennials flock to the original bakery in Springfield, Missouri, for its maple bacon and “cereal killer” Fruit Loop donuts, so proximity to a college campus seemed key. “We had a short list of cities that we were interested in, and we were waiting for a campus corner space to open up,” he says. Norman, Oklahoma, was No. 3 on the list, but timing catapulted it to No. 1. When a retail space opened up on a high-traffic corner near the University of Oklahoma, Clegg sprang into action. “Within 24 hours, we were in contact with the landlord to look at the space,” he says.
You may know your current competitors inside and out, but opening in a new area means starting from scratch with assessing your threats. When Hurts Donut signed its second lease, the shop was situated five hours from the original store. But Clegg attended the University of Oklahoma and knew the bakery scene in Norman well enough to understand the market saturation. But beware: It’s easy to waste too much time fixating on the competitive landscape, says Kamal Grant, owner of Sublime Donuts in Atlanta. “We thought about the competition when we were opening our second location,” he says. “But really, we just try to do the best product that we can and hope people decide to choose us.”
Building ordinances, zoning restrictions, local legislation—oh my! It probably feels like one misstep will delay your opening for months. But Clegg, who has since opened several more Hurts Donut outposts, shares this tip for navigating the red tape: Reach out to city officials early and often. “We wanted to make sure we were in compliance from day one, so during every stage—planning, architecture, build-out—we were in constant contact,” he says. That not only helps ensure a smooth opening, but it also sets the tone for handling ongoing issues. “Remember you’ll be dealing with the health department or the permit department […] long after your doors first open,” Clegg says.
Underestimating costs is one of the most common—and killer—mistakes you can make. “Even when you think you’re right on budget, something’s bound to come up, so try to keep costs as low as possible, so you can have some wiggle room,” says Grant. Consider hiring a financial pro to help you set and stick to a launch budget.
Sure, you’ve launched a bakery before. But this time, you’ll be juggling an opening while running another business. To give both bakeries enough TLC, Clegg planned trips to the new location during the week, when the Springfield spot was slower. Finding a local repair team to handle sporadic issues also helped minimize scrambling. “Without great contingency planning, I’d be jumping in the car myself to drive five hours to put out every fire,” he says.