Thinking of Buying a Cake Business in Australia? Here Are 3 Vital Questions to Ask

Australia’s cake industry continues to thrive through niche offerings, custom creations, and direct-to-consumer models that prioritise flavour, freshness, and dietary flexibility.

In 2025, cake manufacturing is expected to contribute approximately $698 million—27.7% of Australia’s $2.52 billion cake and pastry market.

Despite margin pressures from supermarket bakeries and rising input costs, operators that specialise in premium products or event-based orders are maintaining strong pricing power and customer loyalty.

Buyers must assess the financial mix, product relevance, and operational systems to succeed in this competitive yet creative space.

1. Is the Business Financially Sustainable and Margin-Optimised?

Why It Matters:

Custom cakes and dietary-specific offerings generate stronger margins than standard shelf cakes, especially when paired with event-driven or wholesale revenue streams.

The industry’s average profit margin sits at 6.0%, making it critical to understand the cost structure, ingredient volatility, and labour needs.

Careful pricing, seasonal forecasting, and high-margin upsells are essential for year-round profitability.

What to Check:

• Revenue breakdown: What percentage of income comes from custom cakes, online sales, wholesale, or retail foot traffic?
  
  

• Ingredient costs: Are sugar, flour, and dairy expenses managed effectively, and are price increases being passed on?
  
  

• Staff productivity: Is the business reliant on skilled decorators, and are wages aligned with revenue capacity?
  
  

• Profit consistency: How do margins vary during off-peak vs peak seasons such as holidays or wedding periods?

2. Does the Product Offering Match Market Demand and Location?

Why It Matters:

Location and product mix must align with local demand—walk-in retail stores thrive near residential or shopping hubs, while custom cake creators may benefit more from online ordering and B2B supply.

Buyers must also consider dietary trends, cultural preferences, and customer expectations around freshness and presentation.

What to Check:

• Menu diversity: Does the business cater to gluten-free, vegan, or low-sugar customers alongside traditional cakes?
  
  

• Brand appeal: Are there strong online reviews, visual branding, or a loyal client base in weddings, birthdays, or foodservice?
  
  

• Delivery channels: Is the business equipped for online ordering, third-party platforms, or catering partnerships?
  
  

• Store location and format: Does foot traffic support daily sales, or is the business better suited to a production-only model?

3. Is the Business Equipped for Growth and Operational Efficiency?

Why It Matters:

Growing a cake business depends on balancing creativity with systems—streamlined production, digital ordering, and food safety compliance all influence scale.

Skilled labour, flexible fulfilment, and the ability to customise at volume are essential for expanding into wholesale or seasonal markets.

What to Check:

• Equipment quality: Are ovens, fridges, packaging tools, and prep areas modern, clean, and capable of handling larger volumes?
  
  

• Compliance systems: Does the business meet FSANZ and HACCP standards for labelling, hygiene, and allergen control?
  
  

• Tech infrastructure: Are CRM, POS, and ordering systems in place to manage customer relationships and streamline orders?
  
  

• Growth potential: Can the business expand through cafe supply, branded retail lines, or additional decorators and packaging formats?

Ready to Invest in a Thriving Cake Business?

From custom wedding cakes to gluten-free cafe slices, the cake industry rewards businesses that blend flavour with foresight. For buyers seeking product creativity and commercial scalability, the market still has plenty of room to rise.

For Buyers:

Create an account to set up alerts here.

For Sellers:

Sell Your Business here.