diff --git a/packages/cli/src/commands/build-cache/index.ts b/packages/cli/src/commands/build-cache/index.ts
index 70033097e5..a8a1a27e9d 100644
--- a/packages/cli/src/commands/build-cache/index.ts
+++ b/packages/cli/src/commands/build-cache/index.ts
@@ -14,27 +14,26 @@
  * limitations under the License.
  */
 
+import fs from 'fs-extra';
 import { Command } from 'commander';
 import { run } from 'helpers/run';
 import { Cache } from './cache';
-import { parseOptions } from './options';
+import { parseOptions, Options } from './options';
 
 function print(msg: string) {
   process.stdout.write(`[build-cache] ${msg}\n`);
 }
 
-/*
- * The build-cache command is used to make builds a no-op if there are no changes to the package.
- * It supports both local development where the output directory remains intact, as well as CI
- * where the output directory is stored in a separate cache dir.
- */
-export default async (cmd: Command, args: string[]) => {
-  const options = await parseOptions(cmd);
-
+// Wrap a build function with a cache, which won't call the build function on cache hit
+export async function withCache(
+  options: Options,
+  buildFunc: () => Promise<void>,
+): Promise<void> {
   const key = await Cache.readInputKey(options.inputs);
   if (!key) {
     print('input directory is dirty, skipping cache');
-    await run(args[0], args.slice(1));
+    await fs.remove(options.output);
+    await buildFunc();
     return;
   }
 
@@ -52,9 +51,23 @@ export default async (cmd: Command, args: string[]) => {
   }
 
   print('cache miss, need to build');
+  await fs.remove(options.output);
+  await buildFunc();
 
-  await run(args[0], args.slice(1));
-
-  print('caching build output');
   await cacheResult.archive(options.output, options.maxCacheEntries);
+}
+
+/*
+ * The build-cache command is used to make builds a no-op if there are no changes to the package.
+ * It supports both local development where the output directory remains intact, as well as CI
+ * where the output directory is stored in a separate cache dir.
+ */
+export default async (cmd: Command, args: string[]) => {
+  const options = await parseOptions(cmd);
+
+  await withCache(options, async () => {
+    await run(args[0], args.slice(1));
+  });
 };
+
+export * from './options';
diff --git a/packages/cli/src/commands/build-cache/options.ts b/packages/cli/src/commands/build-cache/options.ts
index 523d5fc7e6..6903c01ddf 100644
--- a/packages/cli/src/commands/build-cache/options.ts
+++ b/packages/cli/src/commands/build-cache/options.ts
@@ -18,6 +18,7 @@ import { resolve as resolvePath } from 'path';
 import { Command } from 'commander';
 import { paths } from 'helpers/paths';
 
+const DEFAULT_CACHE_DIR = '<repoRoot>/node_modules/.cache/backstage-builds';
 const DEFAULT_MAX_ENTRIES = 10;
 
 export type Options = {
@@ -27,19 +28,34 @@ export type Options = {
   maxCacheEntries: number;
 };
 
-export async function parseOptions(cmd: Command): Promise<Options> {
-  const argTransformer = (arg: string) =>
-    resolvePath(arg.replace(/<repoRoot>/g, paths.targetRoot).replace(/'/g, ''));
+function transformPath(path: string): string {
+  return resolvePath(
+    path.replace(/<repoRoot>/g, paths.targetRoot).replace(/'/g, ''),
+  );
+}
 
-  const inputs = cmd.input.map(argTransformer) as string[];
+export async function parseOptions(cmd: Command): Promise<Options> {
+  const inputs = cmd.input.map(transformPath) as string[];
   if (inputs.length === 0) {
-    inputs.push(argTransformer('.'));
+    inputs.push(transformPath('.'));
   }
-  const output = argTransformer(cmd.output);
-  const cacheDir = argTransformer(
+  const output = transformPath(cmd.output);
+  const cacheDir = transformPath(
     process.env.BACKSTAGE_CACHE_DIR || cmd.cacheDir,
   );
   const maxCacheEntries =
     Number(process.env.BACKSTAGE_CACHE_MAX_ENTRIES) || DEFAULT_MAX_ENTRIES;
   return { inputs, output, cacheDir, maxCacheEntries };
 }
+
+export function getDefaultCacheOptions(): Options {
+  return {
+    inputs: [transformPath('.')],
+    output: transformPath('dist'),
+    cacheDir: transformPath(
+      process.env.BACKSTAGE_CACHE_DIR || DEFAULT_CACHE_DIR,
+    ),
+    maxCacheEntries:
+      Number(process.env.BACKSTAGE_CACHE_MAX_ENTRIES) || DEFAULT_MAX_ENTRIES,
+  };
+}
diff --git a/packages/cli/src/commands/plugin/build.ts b/packages/cli/src/commands/plugin/build.ts
index cb28d4cf5f..aa9c68c494 100644
--- a/packages/cli/src/commands/plugin/build.ts
+++ b/packages/cli/src/commands/plugin/build.ts
@@ -17,6 +17,7 @@
 import { rollup, watch, OutputOptions } from 'rollup';
 import conf from './rollup.config';
 import { Command } from 'commander';
+import { withCache, getDefaultCacheOptions } from 'commands/build-cache';
 
 export default async (cmd: Command) => {
   if (cmd.watch) {
@@ -40,10 +41,12 @@ export default async (cmd: Command) => {
     });
   }
 
-  const bundle = await rollup({
-    input: conf.input,
-    plugins: conf.plugins,
+  await withCache(getDefaultCacheOptions(), async () => {
+    const bundle = await rollup({
+      input: conf.input,
+      plugins: conf.plugins,
+    });
+    await bundle.generate(conf.output as OutputOptions);
+    await bundle.write(conf.output as OutputOptions);
   });
-  await bundle.generate(conf.output as OutputOptions);
-  await bundle.write(conf.output as OutputOptions);
 };
diff --git a/packages/cli/templates/default-plugin/package.json.hbs b/packages/cli/templates/default-plugin/package.json.hbs
index dc1500944a..3fb02a992e 100644
--- a/packages/cli/templates/default-plugin/package.json.hbs
+++ b/packages/cli/templates/default-plugin/package.json.hbs
@@ -6,8 +6,7 @@
   "license": "Apache-2.0",
   "private": true,
   "scripts": {
-    "build:watch": "backstage-cli plugin:build --watch",
-    "build": "backstage-cli build-cache -- backstage-cli plugin:build",
+    "build": "backstage-cli plugin:build",
     "lint": "backstage-cli lint",
     "test": "backstage-cli test"
   },
diff --git a/packages/core/package.json b/packages/core/package.json
index 93c2e2fdf7..fcba46b1f1 100644
--- a/packages/core/package.json
+++ b/packages/core/package.json
@@ -19,8 +19,7 @@
   "main": "dist/index.cjs.js",
   "types": "dist/index.d.ts",
   "scripts": {
-    "build:watch": "backstage-cli plugin:build --watch",
-    "build": "backstage-cli build-cache -- backstage-cli plugin:build",
+    "build": "backstage-cli plugin:build",
     "lint": "backstage-cli lint",
     "test": "backstage-cli test"
   },
diff --git a/plugins/home-page/package.json b/plugins/home-page/package.json
index 88afe98bd4..548ed25a8d 100644
--- a/plugins/home-page/package.json
+++ b/plugins/home-page/package.json
@@ -6,8 +6,7 @@
   "license": "Apache-2.0",
   "private": true,
   "scripts": {
-    "build:watch": "backstage-cli plugin:build --watch",
-    "build": "backstage-cli build-cache -- backstage-cli plugin:build",
+    "build": "backstage-cli plugin:build",
     "lint": "backstage-cli lint",
     "test": "backstage-cli test"
   },
diff --git a/plugins/welcome/package.json b/plugins/welcome/package.json
index 8eb9f45f7f..f9f39f5c4e 100644
--- a/plugins/welcome/package.json
+++ b/plugins/welcome/package.json
@@ -6,8 +6,7 @@
   "private": true,
   "license": "Apache-2.0",
   "scripts": {
-    "build:watch": "backstage-cli plugin:build --watch",
-    "build": "backstage-cli build-cache -- backstage-cli plugin:build",
+    "build": "backstage-cli plugin:build",
     "lint": "backstage-cli lint",
     "test": "backstage-cli test"
   },