Ever considered a bread bakery business in Zimbabwe or any African country? You’re about to learn several reasons why you should.
Everyone eats bread. Bread competes against rice and cassava as the most popular food and a staple in Africa. It has remained a widely-accepted food item because of its convenient and ready-to-eat nature.
Bread is a common food item in many African households and up to 70 per cent of breakfast diets on the continent contain bread. In urban areas of Zimbabwe, bread has become a major part of the breakfast diet. With the current economic crunch, bread prices fetch between RTGS $45 to $80 depending on the quality and size of the loaf.
The size of the Zimbabwean bread market is worth millions of dollars every year and all the bread we eat is produced locally. A bread bakery business is easy to start up and can be run from a home kitchen or a bread factory. Easy….
Let’s take a dive into this interesting idea and explore the business opportunities for Zimbabwean entrepreneurs in the bread bakery business…
Why is the demand and market for bread growing very fast in Zimbabwe?
The key drivers of this demand are Zimbabwe’s rapidly growing population, an expanding middle class which has more money to spend, an enlarging labour force, and increasing rates of migration to Zimbabwean cities and towns.
Many of the Zimbabwean population now lives in towns with Harare, Bulawayo, Gweru, Mutare and Masvingo being the major towns.
Statistics reveal that urban dwellers and city people eat more bread than people in rural areas. Given the rapid growth of Zimbabwean city populations, bread is sure to remain a highly sought-after food item by African households.
More than 80 percent of all imported and locally produced wheat flour in Zimbabwe is used by bakeries to produce bread. The rest is used by food processors to make biscuits, cakes, and pasta.
Over the last decade, more bread has been consumed in Africa than maize and rice. Why? It’s simply because bread is more affordable (costs much less than rice, yam, and maize).
Bread also appeals to the convenience and lifestyle of most people – it’s an instant meal that requires no further preparation and makes a great fast snack (besides its popularity as a breakfast item).
Many of us may not know this: bread provides more nutrients than any other single food source and is particularly important as a rich source of carbohydrates, proteins, and vitamins B and E!
Market opportunities for entrepreneurs who want to start a bread bakery business in Zimbabwe…
There are different categories of bread that attract different kinds of consumers in Zimbabwe. It’s very important that entrepreneurs understand these categories to help them decide on the type of bread they will produce, the likely competition, and the needs of the market.
Plain White Bread
The bread bakery business at the bottom of the ladder is the basic, plain and cheap white bread. This variety is very common with low-income earners or people who just want to fill their belly and don’t care about nutritional content.
This type of bread usually comes without any labeling, branding, or packaging and very little attention is paid to product taste, quality or hygiene. It’s best described as ‘bread for bread’s sake.’
More than 50 percent of bread sold on the Zimbabwean market are of this type and most consumers are drawn to it because of its very low price. As a result, most independent and small-scale bakeries producing this bread make money by selling cheap at high volumes.
This is usually for those who are health conscious and most of them live in medium to low-density housing projects.
There are usually no leading producers in this segment of the bread market and it’s commonly dominated by many small-scale and family-run bakeries. This bread appeals to, and is targeted at, Zimbabwean middle-class households and customers who are conscious about high food standards, nutritional content, quality and taste. These customers are also willing and very happy to pay extra for this higher quality.
Most families also prefer brown bread for their growing children. As a result, brown bread costs much higher than the plain version on the market. Consumers who prefer these kinds of bread do so for lifestyle, health, taste, or cultural reasons.
This type of bread usually contains ingredients like eggs, milk, fruits, etc. and generally do not contain unhealthy supplements or additives.
A lot of attention is usually paid to the product’s taste, branding, packaging and overall quality.
Special bread is usually sold in specialty stores and supermarkets. They cost much more than the plain white and brown versions and require specialized skills and experience to produce. The specialized may include but not limited to scones, muffins, doughnuts and more…
Bakeries that produce this bread target niche markets like upper-class residential areas and parts of town with a large population of foreigners.
How to start a bread bakery business – An important checklist
1. Prepare a business plan
Bread bakery business requires business plan is not as scary as it sounds. Even if you don’t intend to source any capital from banks or investors, it is important that you organize your thoughts on paper.
A business plan doesn’t have to be complex or too elaborate, just something to keep your eyes on the big picture. The business plan will allow you to easily identify the obstacles and anything you may not have considered.
Your business plan should consider the prevailing market price for the type of bread you want to produce and how much competition there is. You also need to estimate the profit you’re likely to make in the first, second and third years.
Is it sustainable? Is it worth the time, effort, and capital?
It’s usually wise to keep 8-12 months of working capital to adequately support a bread bakery business.
If you’re looking for a sample bakery business plan template, I have found a good one you can adapt and use for your own bread bakery idea.
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2. You should know enough about bread
Nobody says you must be a master baker to succeed in this business; you really don’t need to. However, you need to know the basics and tricks of the trade if you want to survive in this business.
3. Choose a location that’s close to your target market
Bread bakery business 7The types of bread in the African market appeal to different segments of consumers. You must ensure that the type of bread you intend to produce will find a sizeable market in your area.
What kind of people lives around you?
Are they high, middle, or low-income earners?
Are they students, single people, or households with families?
Are they predominantly young or old people?
If you live in a closely-knit community like a residential estate or a university campus, it may be a great opportunity to run this business from your home kitchen.
Look for newly established or developing suburbs and high-traffic locations that have little competition. It’s also important to focus on areas that may not be well serviced, like industrial estates or high-density office blocks where you can draw eager customers.
4. Would you need a permit or license to operate?
Depending on your country and location, you may require a permit or license from a government establishment or the City Council or Environmental Management Agency office to operate a bakery.
What are the requirements and standards for approval?
Would you need to have specific equipment like fire safety tools?
Is there a standard qualification you must obtain to be eligible for a permit?
You must know these requirements in advance and take the necessary steps to ensure you get the approval you need to open your doors to the public.
You need to use the right equipment
The size and quality of your equipment will depend on how much bread you intend to produce for the market and the amount of startup capital you have.
It’s very important that you don’t spend too much on equipment at the beginning of this business. Look out for any good quality, pre-owned (second-hand) bakery equipment you can find at a bargain price.
The basic equipment you need to start a bakery business includes an oven, mixer, dough molds, dough divider, fermentation chamber (proofer), and maybe a bread slicer.
The bread bakery business is an interesting opportunity in Zimbabwe…
Because most people WILL eat bread most of the time, the bread business can be a very rewarding venture if entrepreneurs can find a large market with few competitors.
With some creativity and higher quality, a new bakery can easily win consumers over from an established bakery. When properly planned and operated, bakeries can become a rich source of lasting income.
If you believe this type of business will work for you, start working on a business plan and take action as soon as possible.
You could also choose from many more amazing business ideas in the Business ideas we have. Of much importance, you must register your business as you grow so that you comply with the Companies and Other Business Entities Act of Zimbabwe and also to take part in competitive bidding for bread supplies. We assist in company registrations as well.
We would love to hear from you about your successes, challenges, advice, and questions. Do not forget to leave a comment in the section below and share this opportunity with your friends.
To your success!
And by the way, if you enjoyed reading this article and you’re thinking of raising capital to start or grow your business contact us for Company registrations & Business Plans.