If you’re thinking of opening a bakery business, like any company that sells food to the public, you must be licensed by your state, county, or city.
In fact, in most jurisdictions, bakeries are treated as food establishments and must obtain a permit from the health department.
Licensing requirements to open a bakery vary by state, county, and city. Other considerations include the scale of your operations and whether you operate a storefront bakery or a home-based bakery business.
If you’re asking, “what licenses do I need to open a bakery?”, read on.
License requirements for traditional brick-and-mortar bakery businesses
Brick-and-mortar bakery businesses are subject to several licensing, permit, and tax registration requirements. Below is a list of the most common licensing requirements for a bakery business with a storefront:
1. Food licenses, permits, and certifications
These are generally issued by your local health department. You may need more than one license depending on the business activity you conduct. For example, New York City issues permits for food service establishments and a separate one for food processing and/or food preparation.
Some jurisdictions also require all employees involved in the preparation, storage, or service of baked goods in a food facility to obtain a food handler permit.
The application process for food service licenses and permits can be lengthy and must include building plans and inspections. Check with your city’s small business department to find out licensing and application requirements to open a bakery.
2. General business-related licenses, permits, and registrations
In addition to a food service license or permit, you may need the following:
• Business operating license: This license is issued by your county or city and grants you legal permission to operate a bakery in your city or state. If you plan to open several locations, you might need a license in each city where you operate. However, some states do offer state-wide licensing, such as Washington, which cover state and local licensing needs. Check your state government website for application guidelines and remember to renew your license annually.
- Federal tax ID (EIN) number: Issued by the IRS, an EIN (also called a tax identification number or employer identification number) is required for almost all types of businesses.
- State tax ID number: Issued by your state’s department of revenue or taxation, the state tax ID number is also called a tax registration number.
- DBA/fictitious business name registration: The doing business as (DBA) or fictitious business name registration happens with the appropriate state or local jurisdiction.
- Zoning and land use permits: Local governments’ zoning laws may prohibit certain business activity in designated areas.
- Building permit: If you plan on remodeling or building a commercial space, you'll need to get a building permit.
- Sign permit: Before you put up a sign outside your business, you’ll need a sign permit from your city.
- Building health permit: This is overseen by your state or county health department and ensures that your premises meets safety regulations.
- Dumpster license: This allows your bakery to place a state dumpster near your business for the proper disposal of food waste. Check with your city to see if you need one.
- Sales tax license/sellers permit/resellers permit: This license/permit has many names, and those names vary by state, but it is required for the selling of almost all products and services. You may also need to obtain a Certificate of Occupancy or amend the existing one.
- Workers’ comp insurance: In most states, workers' compensation coverage is mandatory if you have at least one employee.