Starting A Bagel Shop

Bagels are a traditional breakfast item that originated in New York City but are now eaten throughout the nation. Bagels are a handy, pleasant, and satisfying breakfast and lunch option for customers of a bagel restaurant. Most bagel restaurants provide drinks and sides in addition to bagels, allowing customers to easily complete a meal.

Follow these ten steps to open a bagel shop:

Prepare your Bagel Shop

Create a legal entity for your bagel shop.

Tax registration for your bagel shop

Create a Business Bank Account and a Credit Card

Create an accounting system for your bagel shop.

Obtain the Required Permits and Licenses for Your Bagel Shop

Purchase Bagel Shop Insurance

Establish your Bagel Shop Brand

Make a website for your bagel shop.

Configure your Business Phone System

Starting a company entails more than just registering it with the state. This straightforward guide to establishing your own bagel store has been put together by us. These stages will guarantee that your new company is well-planned, correctly registered, and legally compliant.

STEP 1: Make a business plan.

A well-thought-out strategy is vital for entrepreneur success. It will assist you in mapping out the intricacies of your organisation and uncovering some unknowns. Consider the following crucial topics:

What are the initial and continuing expenses?

Who is your intended audience?

How much money may you charge your customers?

Fortunately, we have done a lot of the legwork for you.

What are the expenses of starting a bagel shop?

A bagel shop’s launch expenditures are often in the tens of thousands of dollars. Rent, equipment fees, and staff pay are among the most expensive items (if hiring employees). Other expenditures include bagel-making materials, costs for other meals and drinks, bagels, and cups.

Business owners that wish to keep their launch expenses low might select a modest retail space with a reduced rent. Because a compact location makes it simpler to retrieve products for consumers, company owners may be able to handle all of the labour themselves and without hiring an employee. Buying secondhand equipment, which is often less expensive than buying new, may also result in big savings.

What are the continuing costs of running a bagel shop?

Rent, licence fees, staff pay, costs for bagel-making equipment and other meals, prices for drinks, and costs for serving supplies are all recurring expenditures for a bagel company.

Who is the intended audience?

Someone who eats breakfast yet doesn’t have much time is a great client for a bagel store. Bagels are a fast and filling snack. Because bagels are relatively affordable, bagel businesses can appeal to both persons with a lot of discretionary spending and those on a strict budget.

What is the business model of a bagel shop?

A bagel restaurant generates money by selling customers bagels, other food products, and drinks. Some companies may also cater events.

How much money may you charge your customers?

Serious Eats investigated the cost of a bagel at different New York bagel restaurants (as well as Dunkin’ Donuts). A plain bagel cost between $1.80 and $3.00, while a bagel with cream cheese cost between $1.65 and $4.50. Costs may be somewhat cheaper elsewhere, since New York City is recognised for both its bagels and its high prices.

Other meals and drinks provided at bagel shops, such as fresh fruit, yoghurt, coffee, and tea, are often priced similarly to a bagel or a bagel with cream cheese.

What kind of profit can a bagel business make?

The amount of money a bagel store may earn is determined by the number of clients served in a day, week, month, or year. As a result, selecting a site is critical when opening a bagel store. A store should be placed in a busy location to be successful.

How can you increase the profitability of your company?

Upselling consumers may help a bagel store enhance its profitability. Offering bagel sandwiches, which cost more than a bagel with cream cheese, and additional alternatives, such as espresso drinks and granola, may raise the average ticket price.

STEP 2: Establish a legal entity

Sole proprietorship, partnership, limited liability company (LLC), and corporation are the most frequent business structure forms.

Creating a formal company organisation, such as an LLC or corporation, shields you from personal liability if your bagel shop is sued.

STEP 3: File your taxes

Before you can begin for business, you must register for a number of state and federal taxes.

To register for taxes, you will need to get an EIN. It’s really simple and completely free!

Taxes on Small Businesses

Depending on the business form you choose, you may have multiple choices for how your company is taxed. Some LLCs, for example, may benefit from being taxed as a S company (S corp).

These guides will teach you more about small company taxes:

Taxes on LLCs

LLC vs. sole proprietorship

Corporation vs. LLC

S Corp vs. LLC

How to Form a S Corporation

S Corporation vs. C Corporation

There may be state taxes that apply to your company. In our state sales tax guides, you may learn more about state sales taxes and franchise taxes.

STEP 4: Establish a company bank account and credit card

Personal asset protection requires the use of distinct business banking and credit accounts.

When you combine your personal and business accounts, your personal assets (your house, vehicle, and other possessions) are at danger if your company is sued. This is known as penetrating your company veil in business law.

Furthermore, understanding how to develop corporate credit may help you get credit cards and other financing in your company’s name (rather than your own), lower interest rates, larger lines of credit, and other benefits.

Establish a business bank account.

Opening a business bank account is not only required when asking for business financing, but it also:

Separates your personal assets from the assets of your firm, which is required for personal asset protection.

It simplifies bookkeeping and tax reporting.

Create a net 30 account.

Net 30 accounts are used to develop and grow company credit while also increasing cash flow. Businesses use a net 30 account to purchase items and refund the whole debt within a 30-day period.

Many net 30 credit suppliers submit information to the main business credit agencies (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how firms establish business credit in order to get approved for credit cards and other lines of credit.

Apply for a business credit card.

Obtaining a business credit card benefits you in the following ways:

Put all of your company’s costs in one location to separate personal and business spending.

Build your company’s credit history, which will be important for raising funds in the future.

STEP 5: Establish business accounting

Recording your numerous costs and sources of revenue is crucial to assessing your company’s financial status. Keeping precise and thorough accounting also makes yearly tax filing much easier.

STEP 6: Obtain all required permissions and licences

Failure to get appropriate permissions and licences may result in significant penalties or possibly the closure of your firm.

Requirements for State and Local Business Licensing

To run a bagel business, certain state permissions and licences may be required. Visit the SBA’s reference to state licences and permits to learn more about licencing requirements in your state.

Most states, in particular, require retail companies such as bagel shops to get a seller’s permit. A seller’s permit allows states to record and collect taxes on sales of products (and occasionally services).

Furthermore, various local licencing or regulatory criteria must be met. A bagel store, for example, will need licence from the local health authority. Once a licence is secured, bagel businesses will be randomly inspected on a regular basis by the local health authority. These inspections will verify for compliance with local health rules, which are generally connected to food contamination prevention.

For additional information on local licences and permissions, please visit:

Check with the clerk’s office in your town, city, or county.

Contact one of the local organisations mentioned in the US Small Business Associations database of local business resources for help.

STEP 7: Obtain commercial insurance.

Insurance, like licences and permits, is required for your company to operate safely and legally. In the case of a covered loss, business insurance protects your company’s financial well-being.

There are several sorts of insurance plans designed for various types of companies with varying risks. If you are unaware about the hazards that your company may encounter, start with General Liability Insurance. This is the most popular coverage required by small companies, so it’s a good place to start for yours.

Workers’ Compensation Insurance is another important insurance product that many companies need. If your company will have workers, your state may require you to purchase Workers’ Compensation insurance.

STEP 8: Establish your brand

Your company’s brand is what it stands for, as well as how the public perceives it. A strong brand will help your company stand out from the crowd.

How to Market and Promote a Bagel Shop

All marketing efforts should be directed towards residents, employees, and commuters in the region served by a bagel store, which may be rather small. Signs assist to bring attention to a company.

To entice visitors in the door, company owners might visit surrounding establishments and hand out vouchers for free bagels or coffee. Giving out free products will attract people to come, and if people enjoy what they have, news will travel rapidly.

How to Keep Customers Returning

A bagel store may distinguish itself by selling real bagels. Bagels are available in a variety of locations, including coffee shops, grocery stores, and eateries. However, they are often frozen items that have been thawed. A freshly cooked bagel will taste considerably better, and many people will go out of their way to get outstanding bagels. As a result, company owners should attend a bagel-making class.

STEP 9: Create your company’s website.

After you’ve defined your brand and designed your logo, the next step is to build a website for your company.

While developing a website is an important step, some may be concerned that it is out of their grasp due to a lack of website-building skills. While this was a fair concern in 2015, online technology has made significant advances in recent years, making the lives of small company owners considerably easier.

The following are the primary reasons why you should not put off developing your website:

Every genuine company has a website, period. When it comes to bringing your company online, it doesn’t matter what size or sector it is.

Social media accounts, such as Facebook pages or LinkedIn company profiles, are not a substitute for your own business website.

STEP 10: Install your company phone system.

Getting a phone for your company is one of the finest methods to keep your personal and professional lives distinct and private. That isn’t the only advantage; it also helps you automate your company, provides it legitimacy, and makes it simpler for prospective clients to identify and contact you.