I am renting out my kitchen to local baker as a way to help with overhead. It's also a really good opportunity for us to work together because I can offer a high quality wedding/event cake baker right out of my shop. She will also be baking cupcakes for me to sell on a limited basis.
Right now my shop offers muffins, cookies and brownies along with all of our chocolates but I don't really want to get more involved in baking at this point. I have a ton of people who come in looking for cakes, so I think its a good opportunity for both of us. We will also be able to cross promote our offerings for weddings and bar/bat mitzvahs.
I would like to offer her a standard rental price, but we have also been discussing doing something more percentage based. Thoughts?
Anyways, I am putting together a rental agreement and would love to see what other people have done in similar situations. If you are willing to either post or e-mail your kitchen rental agreement that would be great. I have something pretty standard drafted now but would be interested in seeing what others include or don't include.
Kitchen rentals are generally priced by the shift, with the prices based on time of day (overnight is cheaper) and sometimes based on the equipment that's available.
When I look at and evaluate rental kitchens it's not just about the space and equipment, it's about value-added services. For example, in an 8-hour shift, how much time is spent loading in, cleaning up, and loading out? Often, an 8-hour shift might end up closer to 6 hours (or less) active production time. So, anything you can do to make it easier for the person to be more productive drives up the price. Does the price include dry/refrigerated storage? Can you co-op purchase some ingredients to drive down costs for both of you?
A new rental kitchen opened up here in NYC and prices are $120/$150/$180 per shift depending on the shift time (graveyard is cheapest). Extras include dishwashers to clean up for you and laundry services. There is also limited storage at extra cost.
What I might propose is a hybrid arrangement for pricing: lowball the shift rate slightly and also take a percentage. As sales increase (as your take from the percentage increases) you can reduce the hourly rate. There's incentive there for both of you to improve sales - which is better for all involved.