Thinking of starting a home-based food business, but don’t know where to begin?
Starting a food business in your own home may sound like an exciting venture, but it can also be scary – how can you tell if it's a good idea? What if you choose a business and can’t make any sales? Or you go all in on something you think you’ll love, only to find out that you don’t enjoy the work?
This guide is here to help! We’ll walk you through ten major areas to consider, questions to ask yourself and others before you jump in, and the research you’ll need to do to help make a decision on which home food business is right for you.
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1. Consider your interests and skills.
First things first: feelings matter. What kind of food business would you like to run? Do you love to bake? Do you have a talent for decorating elaborate sugar cookies? Did you train in a culinary school, and now want to create food experiences for others?
Maybe you’ve always known exactly what you want to do: have a home bakery, specializing in dog treats.
Or maybe you’re curious – did you see a new food trend online that you’re sure is the next big thing, and want to jump on it before it’s gone mainstream?
If you feel drawn toward a certain type of food business, start there!
Not sure? That’s okay, too: take some time to explore different businesses that you could start from a home kitchen. You may find something new that you hadn’t considered before, or you might even realize that the business idea you loved is a lot more complicated and requires more work than you’d thought.
Looking for ideas?
Have you considered:
- Making custom cakes
- Becoming a private chef
- Offering a food delivery service of your home-cooked meals
- Selling home-baked goods at vendor events and festivals
- Preparing charcuterie or deli trays for home parties
Or maybe you’re more interested in a food-related business that doesn’t involve spending quite as much time in the kitchen:
- Creating meal plans for busy customers, with the added option of doing their grocery shopping
- Becoming a food photographer or food blogger
Once you have a few ideas, it’s time to take a closer look at what it would take to turn them into a reality.
2. Research local regulations for a food business
Would the business be allowed, where you live?
Research local regulations and any licensing requirements. In order to start a food business from home, you’ll have to comply with any “cottage food laws” in your state, which we'll dive into in other posts. Most states have some form of these in place, to help individuals build a food business from home.
Even in states without cottage food laws you may be able to start your business, by making any necessary changes to conform to your state's guidelines. This will take some research on your part, but it’s worth it to pursue your goals.
Will you need a certified kitchen if you are selling food?
This is another question that can be answered by researching the cottage food law in your state, which regulates food businesses that are run out of home kitchens.
If you find that the answer is no, you cannot run your food business from home, there may be alternatives, so don’t give up on the idea!
Your state may require you to operate out of a “commercial kitchen”, or an “approved” or “certified” kitchen – find out exactly what this means in your state. A certified kitchen could mean that you can operate out of a community or church kitchen, or that you can have a separate kitchen in your home that is not used for cooking your family’s meals.
You may also be able to find a shared kitchen space to rent – these have become more common, but you may have to do some searching to find them.
Check your state’s website for kitchen requirements. Food businesses may fall under your local health department’s oversight. Or, if you own a farm or grow many of your own ingredients, you may operate under guidelines from your state’s agricultural department. Produce from a farm can fall under regulations that are very different from rules that apply to decorated cakes.
If you are hoping to have your products in retail stores, or sell foods that are not shelf-stable, you’ll probably need to produce them in a commercial kitchen.
Each state's rules will be different, and the requirements will depend on the type of food business you are operating. It’s worth your time to do some research before you make a decision – you might even find unique opportunities in your state, especially if they have programs promoting locally made or locally grown products.
If the business will be food-related, but not involve cooking, you'll possibly be looking at a different type of business model, falling under different regulations.
3. Consider the time investment
How much time are you looking to invest?
Short-term – will this be something fun to do on the weekends? Are you looking for a side hustle? Hoping to make a full-time career out of this?
Consider your other commitments, and be realistic. If you work a full-time job and have kids in scheduled activities, how much time (and energy) can you dedicate to working on a business? This can affect the type of business you choose to start, and how to make the best use of your time.
Long-term – it can take quite a while before a business is considered profitable. Lot of hours and sweat and tears may go into your business. On the other hand, you may have an advantage by being able to start sooner, since you won’t have the overhead costs or work of setting up a commercial kitchen.
Speaking of costs…
4. Consider the financial investment
What about money? There are going to be expenses. You can keep them to a minimum by starting small, but this might mean a trade-off, in the form of slower growth.
Do you have a practical idea of what your ingredients will cost when you are buying them in larger quantities? Will you be able to make a profit when the price of eggs and butter are high, for example?
What about equipment? Can you start with what you already have, or will you need to invest in your production space? This is especially important if your state requires a separate or commercial kitchen. Everything from a larger oven to packaging and labeling will come with a cost.
Can the business be profitable? How soon?
What will it take to get started and keep going until the business starts to make money, or until you’ve earned back the cost of equipment?
Find out as much as you can about what it takes to run the business successfully. This isn’t just about cost – is there a growing market? Can you reach your customers and let them know you exist? Where will you sell?
5. Research your market
Where are your customers, and are they looking for you?
Is there a local market for your business idea? Do you have a unique concept that will help you stand out?
If you have a product for sale, find a places selling similar items, and research your future customers. Who are they, and what are they looking for, exactly? Do they want customized products? Are they looking for homemade treats or foods that meet dietary restrictions? If you offer a service, who are your potential customers, and where are they spending their money?
Learn from others:
What have similar businesses done that led to success?
Talk with other people doing the thing, whether they make the same products you are considering selling, or they have any kind of home business. Do they have any tips to share? If they are locals, and have already dealt with the same regulations that you will, their advice can be invaluable. Ask them how they got started – this will often result in a story that lets you know if they love their business. Don’t be afraid to ask people if they enjoy what they’re doing!
Go online and join related groups. Pay attention to the gripes – everyone complains occasionally, but if there is a consistent thread of something that seems to be a problem for everyone, it’s probably something to keep in mind for your own business.
Is there someone out there already nailing what you want to accomplish? Let them be your inspiration, and look at them as a mentor. If it’s someone you know and can learn from directly, that’s great! If not, study their business and learn their ways. This is one case where stalking isn’t creepy – it’s admiration!
~Now, we’re not talking about swiping ideas in order to steal business from your “competitor”. That’s not cool. Learn what you can from those ahead of you, and share with the folks coming up behind you.~
6. Consider your production space
If you’re planning to run your business from your home kitchen, do you have enough space to work?
Think about your workflow – do you have enough counter space? Storage for ingredients? Space for extra pots and pans?
How often does your family use the space? Will you need to create a work schedule that fits around family meal times?
It’s possible you’ll need to have your kitchen inspected, or your state may require that you have a separate kitchen or workspace.
If you’re considering a food-related business that doesn’t involve cooking or baking, like food photography, you'll still have a workflow and will want to maximize your productivity – can you set up a dedicated space for your business?
7. Where and how will you sell?
What kind of business model do you picture when you think of running your business? Will you sell directly to your customers? Probably, at least when you’re first getting started. So how will you get your product to those customers?
Will you sell at vendor events? On Facebook marketplace? Will you deliver to their homes (if your state or neighborhood rules don’t allow customers to pick up at your home)?
Places to Sell
There are a wealth of places to sell, now, and depending on your state, you may be able to sell online or even ship to customers within your state.
Look for every option and opportunity available to you, and make a list (down the road, you may want to try them all):
- Vendor events like flea markets and craft fairs
- Festivals, school or church events
- Farmers markets, depending on the market’s rules and any state laws
- County and state fairs
If your state does not require face-to-face sales, consider:
- Rented vendor space
- Selling on consignment in small shops or restaurants
Can you ship to customers?
- Some states are direct-to-consumer only, with no shipping allowed. If your state does allow you to ship to customers as a cottage food producer, find out if that includes out-of-state customers (it usually doesn’t, but there are exceptions!).
- If you can ship across state lines, then you can take full advantage of online sales and marketing in places like Etsy.
If your state allows it for home-based food businesses, you might also consider becoming a wholesaler to retail stores or food establishments.
Side note: if you want to sell food on Amazon, you will need to be set up as a commercial facility.
8. How will you promote your business?
No matter which home food business you choose to start, you’ll want to think about how you’ll promote your brand – will you advertise locally? Set up at small business events? Give out business cards or free samples to potential clients? Rely on word of mouth?
Be thinking of ways to get the word out. Once you’re in business, you'll want to take advantage of the free tools available online!
Use social media to promote your brand: set up a Facebook business page, create TikTok videos of you in your kitchen, creating your products. Heck, show them how to make it themselves – they’ll still buy it from you once they realize how much effort it takes.
9. Test your ideas
Once you have an idea that’s fledged out, get some feedback from friends and family. Describe your plans. Try out your sales pitch on them. Show them what you would be making – and, of course, impress them with some free samples (just make sure they know you won’t be working for free in the future – they’re lucky to be getting a sneak peek at your future success)!
Test your workflow
Set up your production space and try out your potential workflow. Do a run through of a work day, as though your business were already started. See how you feel about doing this for the long-term, after a day spent working on it.
Are you even more energized and excited? Or feeling a bit overwhelmed? Both? Take a closer look at where things went well or went wrong, and think about changes you could make to make the work go more smoothly.
Does the idea itself need some tweaking? Do some brainstorming – there might be a different way to approach this thing that you love, that won’t leave you hating it from being overworked.
10. What are your goals?
Is this something you have dreamed about, hoping to turn it into a full-time endeavor?
Do you see this as a way to reach a specific financial goal?
Put it in writing, then back up and create a plan that will get you to that ultimate goal.
What is your plan for growth? Because you know you’re going to be successful, right? And growth is going to happen, especially if you expect it and look forward to it. Be open to opportunities that come along at any point in your business’s development. You never know where things will lead. One person who tries your products at a festival may turn out to be a shop owner who wants to carry your brand in their store.
Go into this with the mindset of an entrepreneur, because that’s what you are: an entrepreneur.
Consider your personal goals, too: What do you hope to accomplish with your own food business? What will your life look like while you’re working toward your goals, and how will that change once you've reached them? It may take a lot of time, sweat, and tears to reach what you envision. But along the way, you will also be helping people to enjoy food, to be connected to it, and you will be sharing beautiful creations from your home kitchen.
Once you have an idea that “checks all of the boxes” for you, it’s time to take the next steps.
Time to work on a business plan, contact your local or state officials about starting a business, get any licensing or permits that you need, and start setting up your production space. We’ll cover all of this, and yes, even naming your food business, in our other posts.
This is where things start getting serious, and exciting!