Starting a home food business

It's a great time to start a home food business with friends or family. Locally produced, hand-made and artisan foods have grown immensely in popularity and the demand continues to rise. The Trends Research Institute predicts local micro-brands to be a wave of the future.

And you don't necessarily need a lot of start-up dollars to begin a home-based food business. Margaret Brown, one of our affiliate authors who's been in the small food business for years, shows how she and others can start your own food business for less than $100. There are many outlets for small food item producers to sell, such as local restaurants, farmers' markets, and even flea markets.

Jill Beebout of Iowa started a canned food business because of an overly productive apricot tree and then learning to can foods the proper way. Check with your cooperative extension about becoming a Master Canner, and you may also be interested in our affiliate Home Canning How-tos.

Perhaps you want to work with a local u-pick to harvest, can and sell old-fashioned heirloom tomatoes at their peak of freshness, bake organic oatmeal and raisin cookies with healthy virgin coconut oil for overnight delivery across the country, or supply local restaurants with your famous secret recipe apple pie.

Whatever your vision for a home based food business, this article assumes you know how to make the food product or products, and it will take you from step one of starting a food business at home to the point of receiving that very first paycheck. Amy Rose and I have both operated home food businesses. First, here are a few other resources you may find of use, then Amy Rose offers tips and a template for succeeding below. home bakery business

Other resources of interest:

Backyard to small acreage farmers: Barbara grew and delivered salads and gourmet veggies to local restaurants while raising her kids. “It was so fun to eat at those restaurants and see my own creations served to customers.” If you grow any of your own products for your home food business, there’s tons of free information for you here: Center for the Micro Eco-Farming Movement.

The cupcake trend: Want to get in on this fun trend in the home bakery business? Our affiliate Turn Cupcakes into Cash provides tons of recipes, the legalities, getting lots of customers for free, display ideas and so forth.

Want a home bakery business focused on cookies? You might love our inexpensive affiliate Mook & Pop's Culinary Delights written by a woman long famous for her cookies, who sells them in various ways including farmers' markets.

Don't forget to check out Margaret Brown's book on starting your own food business for less than $100, and click on the "Menu" (her word for "table of contents"). You'll get a bunch of free ideas just from reading this page.

_________From Amy:

Steer your home food business towards the right trends

Unless you already have a target niche (for example, a local ethnic restaurant or organization wants you to produce your ethnic recipe for them), tweak the foods you want to make towards the following trends: Locavore, organic, locally grown, artisan foods, hand-crafted, local farms, heirloom, eco-friendly, and regionally produced.

Before you start a home based food business, practice.

I don’t mean practice making the foods, I mean your group of friends who are starting this business should practice the business end. This may sound too simple, but it's a time honored first step for developing a successful home food business. It allows your group to work out the kinks you don't yet know you have without the tense pressure once you've become a business and your reputation is on the line.

To do this, set yourself goals with your food product beyond just making it when you feel like it and serving it to whom ever happens to show up. Create pretend “tension” so the food product must be made and delivered on time.

Perhaps offer to donate a certain amount to a charity bake sale by a specific date, or, if your home food business will be about shipping foods, send some home to every family member by a specific date. Notice people's responses, and if you have more than one food product, which ones do they like the best? Tweak your products from their response.
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Develop a "working" business name, logo and slogan

A “working” business name means it’s what you think you might call your home food business, but it’s still in the works and can change. Then make mock business cards either by hand or on the computer for everyone involved in the home based food business. For example: SBC, Sherri's Best Cookies: Where Desserts are Delicious and Healthy.

By creating these three upfront, an energy will begin to form around your home food business. Carry the pretend business cards around with you in your wallets, take it out now and then, and allow your intuition to work on it for a week or so. After a week, have a meeting and tweak it if you want. It may still change after today, but now it's time to go on to the next step.

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Write a quick overview

When you write a business plan for your home based food business, you discover its strong points as well as the blank spots that need to be filled in. But it's nice to start with a quick overview first to keep yourself motivated and better prepare for the actual business plan. Go to SCORE.org for their Quick Start Business Plan and fill it out.

Unlike traditional business plans, this one is very short and gives your group a clear, focused snapshot of your future at-home food business. You'll also sharpen your ideas, and the act of writing it down will access areas of your brain that can help you succeed. It can help you decide or make sure, for example, your idea of selling to retail stores at a discount will pay off. If not, you can re-adjust now instead of after it's too late, and maybe find ways to sell direct to customers for full retail. At this point, don’t get discouraged if profits don’t seem to add up…

Make sure you’ve considered all possible markets: How about local personal chefs? Local B&Bs? Even a roadside stand? Maybe schools, caterers, farmers’ markets, or flea markets.

Finalize your business name and get legal

Contact your county health department to see what rules apply to start a home food business. If they say your food product must be prepared in a certified kitchen, find out what the rules are for such a kitchen. If it's something simple one of you can do to your own kitchen, complete this step. If not, find a local church, university or school that allows you to use their certified kitchen on Saturdays for free or for a low price. Also contact your county extension service, as they're sometimes aware of certified kitchens for farmers who want to make food products from their crops for sale.

It’s now time to decide permanently what your home food business name will be. Then contact your Chamber of Commerce to see what other local, state or federal business permits or licenses are required. Complete their requirements using your now permanent business name.

Get financing if necessary – but it might not be necessary.

Some people prefer not to finance with loans. They either find grants or just start from the bootstraps (They save change and a little grocery money to make and sell their first food product. With that money they buy what they need to make and sell three more. With money from three more they upgrade their marketing and inventory, etc. etc.).

But if you need either grants or financing, go to SCORE.org's how-to page and look under financing your business and you'll find how to get loans and other ways to finance when opening a small business. If you want formal financing, on this same website, you'll find tutorials for writing a longer, more detailed business plan which will help you make sure the cost of financing will eventually bring in a profitable cash flow.
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(Like all Great Group Activities articles, this one is copyright protected, but you can easily and legally share this article with the tools at the bottom of the page)
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Get a personal business coach (for free).

By now, you may have noticed that SCORE.org allows you to ask custom questions, and find and choose an experienced volunteer business coach that will help you with customized concerns every step of the way when opening a small business. Find one that has experience in your type, or a similar type of business. They are in every geographical location in the country, but you can also correspond online. Along with any customized questions you have, find out if you should get extra liability insurance and operate as a sole proprietorship, an LLC, a small corporation, or another form of business entity that will protect you and your assets.

Complete your final business print materials and web presence.

With the help of your business coach, finalize the look of any print (such as business cards) promotional materials you'll hand out, and set up a web presence. If you won't be selling or marketing online, you may simply want a one page low-cost description and contact information for a web presence.

Market your business and begin.

To start a home food business, unless you plan to sell only online, make sure you get your marketing materials to all the possible outlets that apply to your food product or products: Local restaurants, local B&Bs, personal chefs, caterers, gift basket businesses, event planners, etc. Then consider getting yourself known by offering your food item as a prize for a drawing where many people will see it. For example, work with a non-competing food-related merchant (such as a kitchen shop) where you can make up a beautiful gift basket full of your food items and allow people to enter their name in the drawing for free, or buy a raffle ticket with the money going to a local charity. Send a press release to the media about this project.

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