Bakery Business Loans

From a new oven to a delivery van, fund your bakery with confidence. Explore business funding through Fundably. Eligibility criteria apply.

Typical Range

£5k – £150k

Average Loan

£30k

for bakery

Decision Speed

24–48 hrs

for unsecured loans

Eligibility requirements

Minimum 6 months trading history (12 months preferred for better rates)
Registered UK business with a valid food hygiene rating
Monthly card takings of at least £3,000 for merchant cash advance products
Personal guarantee typically required from the business owner

Loan types available

Asset Finance

Rate: 5.4% – 13.9% APR
Term: 1 – 7 years
Security: The asset being financed
Best for: Deck ovens, proving cabinets, mixers, and delivery vans without a large upfront cash outlay

Unsecured Business Loan

Rate: 7.9% – 29.9% APR
Term: 1 – 5 years
Security: No security required
Best for: Shopfitting a new outlet, stocking up ahead of Christmas and Easter, or covering rising ingredient and energy costs

Merchant Cash Advance

Rate: Factor rate 1.15 – 1.45
Term: 3 – 18 months
Security: Repaid as a percentage of card takings
Best for: Retail bakeries with steady daily card sales needing fast, flexible top-up funding

Representative example

Borrow £30,000 over 36 months at 9.9% APR (fixed). Monthly repayment: ~£967. Rates depend on your circumstances and the type of loan.

Common challenges

Thin margins mean rising flour, dairy and energy costs are hard to absorb without raising prices
Energy-intensive equipment, particularly ovens running for long hours, adds a large and volatile utility bill
Seasonal peaks around Christmas and Easter require stock and staffing to be funded well in advance
Perishable stock means unsold product is a direct loss rather than something that can be held over

Bad credit?

Some specialist lenders consider bakery businesses with imperfect credit. You may need a personal guarantee or higher rate, but options may be available. Fundably may use a soft credit check for matching, which does not affect your credit score. A hard check may happen if you choose to proceed with a lender.

Frequently asked questions

Can I get finance for a new bakery oven?

Yes, asset finance is the most common way to fund ovens, proving cabinets and mixers, since the equipment itself acts as security. This usually means better rates than an unsecured loan and no need to find a deposit from cash reserves. Terms typically run from one to seven years depending on the equipment, and some agreements bundle installation and maintenance into the monthly cost.

How do I fund extra stock ahead of Christmas and Easter?

Many bakeries use a short-term unsecured loan or a merchant cash advance to buy in extra flour, packaging and seasonal stock several weeks ahead of peak trading. A merchant cash advance is repaid automatically as a percentage of card takings, so repayments naturally rise during the busy period and fall away once trade returns to normal, which suits the sharp seasonal swings in this sector.

Is a merchant cash advance suitable for a small bakery?

It can be, provided you take a reasonable volume of card payments through the till. Because repayments flex with daily card takings rather than being a fixed monthly amount, it avoids the pressure of a fixed repayment during quieter weeks. It is generally used for smaller, shorter-term funding needs rather than large capital projects like a new oven. Most bakeries use it alongside, rather than instead of, other forms of finance.

Can I borrow to open a second bakery outlet?

Yes, an unsecured loan or a secured loan against property can both be used to fund shopfitting, equipment and initial working capital for a second site. Lenders will usually want to see that your first site is trading profitably and has been open for at least 12 months before backing an expansion. Lendus can compare options sized to the scale of the new site.

Equipment finance for bakery businesses

Buying a specific machine or vehicle is usually cheaper than a general business loan, because the asset itself is the security. These are the items bakery businesses most often fund, with the price range we see quoted in the UK.

Equipment	Typical price range	Finance page
Commercial Oven	£3k to £50k	Commercial Oven finance
Bandsaw Butchery	£2k to £9k	Bandsaw Butchery finance
Bottling Line	£20k to £300k	Bottling Line finance
Bread Slicer	£3k to £18k	Bread Slicer finance
Brine Injector	£8k to £80k	Brine Injector finance
Canning Line	£25k to £350k	Canning Line finance
Capping Machine	£4k to £35k	Capping Machine finance
Cheese Vat	£8k to £70k	Cheese Vat finance
Chocolate Tempering Machine	£6k to £45k	Chocolate Tempering Machine finance
Conveyor Oven	£5k to £36k	Conveyor Oven finance
Depositor	£6k to £40k	Depositor finance
Dough Divider	£8k to £60k	Dough Divider finance

Browse all equipment finance pages

Guides and resources

How to Get a Business Loan Business Loan Eligibility Secured vs Unsecured Best Business Loans UK iwoca Review Funding Circle Review

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For UK limited companies with at least 3 months’ trading and monthly revenue.