Sell Homemade Foods To Make Money
Do you enjoy cooking for the others? Do you know how to make money selling food from home? In fact, homemade food is a great way to make money from home. However, there are critical points you should learn. Otherwise, you may get into trouble.
What Is Cottage Industry
In the US the homemade food business is called “cottage industry”. Cottage food includes bread, pickles, candies, jams, dried goods etc. In here, the cottage defines the food is made by an individual or family, not by a business. The operation is too small to afford any licensing. In this case, to make sure goods have prepared in clean and hygienic places some laws are set. Cottage food laws define exactly the conditions and requirements to get profit from sales of these foods. Note that, these foods are fairly safe to consume and these laws target only these kinds of low-risk foods. To produce and sell foods with higher risks, you should get licenses from legal entities. In the past, the procedure was easier. The one who wants to sell homemade food was allowed to make it. However, inspection on some products required some regulations. Due to these bad experiences, cottage food laws have been set.
What Can I Sell and Where
Do I need a license to sell homemade food? The answer depends on where you live. In fact, you are not allowed to sell homemade food everywhere. Each state has different laws. Some states put no restrictions, some allow sales only at farmers’ markets, and others may also allow sales to local restaurants. Below, what differs between states are pointed:
- Foods that are allowed to and prohibited to sale
- The usage of concepts
- Labeling requirements
- Where you can sell your homemade food
- Other requirements
The table below shows the states’ registration conditions for selling homemade foods. Y stands for requirements, permits of license; and N stands for other cases.
Permission Status For States
|State Name||Registration, Permit or License||State Name||Registration, Permit or License|
Among all, New Jersey is the only state totally bans sales of homemade foods. Connecticut allows only farmers producing canned food. North Carolina doesn’t require any license but wants a home inspection and product testing. In Alaska, you don’t need a permit for non-potentially hazardous foods but you should prove that you meet certain conditions.
Additional Requirements Of States
There are many other additional conditions and requirements of different states. Below, you can find some of them.
Some states have really tough rules. For instance, if you want to start homemade food sales in Washington, the permission procedure includes three specific requirements: water testing, food workers card for your employees and master business license. Technical details including a floor plan, production process, equipment, and utensil list, cleaning and sanitation plan, processing dates and sales plan, child and pet management plan are also asked in the application. The permit is valid only for one year.
In Oregon, “domestic kitchens” are subject to tight rules. In addition to specific requirements, you should obtain a domestic kitchen license. There is an only exemption for some baked goods and confectionary items that you don’t need licensing. Otherwise, special requirements include:
- During the operation doors should be kept closed,
- No infants and children are allowed during the cooking. Domestic activities should be finished beforehand.
- No pets are allowed even in the same building your kitchen placed.
- Ingredients should be kept in separate closed storage. Storages of medical supplies are not allowed in the domestic kitchen.
- Should be open between 8 am and 5 pm on weekdays.
Sales from the internet also depend on the state. For instance, Florida allows sales online, but Texas bans sales through internet and mail order. Accordingly, you need to know how to sell food online from home for Florida but it is not necessary for Texas.
Some states limit the maximum amount of money you can earn from homemade foods. For instance, the maximum for Alaska is $20.000, while it is $50,000 for Texas.
How Much Should I Spend?
The cost of the cottage business depends on where you live and what you produce. If you are living in a state where no legal document is necessary, then you will pay only for initial investment and costs for production. However if you are living where you require to obtain permission, you should take into account legal spending.
For instance, in Washington, the registration fee is approximately $230 including, $75 for public health reviews of the application, $125 for on-site inspection and $30 for the processing fee. In Oregon, for a license, you should pay $152 to $189 per year. In Georgia, cottage food license is $100 annually. If you apply after June 30th, you are expected to pay $50.
How Much Could I Earn?
Again, the state you are working affects the money you should expect to earn. In many states, the maximum amount you can earn through homemade food has been limited. However, there are also states like Pennsylvania where you don’t have any limitation. For instance, in Vermont, there is no limit for baked good a home baker can sell. However, for high-acid home canned foods like jams and jellies, the maximum amount one can sell determined as $10,000
Among the states where annual sales limit is determined, the maximum amount you can earn is $50,000 per year. Texas, Missouri, and Florida are among these states. In Illinois, the gross sales should not exceed $36,000 per year; where it is $35,000 for Kentucky; $25,000 for Washington; $20,000 for Oklahoma and Michigan; $15,00 for South Carolina; $5000 for South Dakota. Note that these are gross sales that any kind of taxes is not included.
There are other practices in different statesAccordingly you can use different methods to increase your demands. For instance, in states where internet sales are allowed, you can sell food from home app. Or you can differentiate the foods. For instance, in Colorado limits sales per product, such that net sales for each product must not exceed $5,000 annually.