Can I Make Food and Sell it Online

Posted by Damian Roberti on December 31, 2021

Welcome to Marketing Food Online. So, can I make food and sell it online, Damian? That is a question that we got from one of our subscribers from our other Marketing Food Online channels. So, we're going to dive into that in this specific podcast. There are a handful of things that you actually need to be aware of before you take the plunge into selling any food online. As always, if this is your first video, welcome to Marketing Food Online.

My name is Damian Roberti, founder and CEO of Marketing Food Online. My wife and I have been e-commerce food entrepreneurs for almost 13 years. This coming year, in 2022, it's going to be 13 for us. We've been doing a lot of business online. We've been selling on Amazon for nearly nine years. We are on eBay, Etsy, and, of course, several other websites as well. So, I definitely want to dive into this question because there are a lot of people who are looking to create a food business.

And they want to make a food product, but they're not really sure about the laws, regulations, and other things that you have to make sure you follow to do it legitimately. And, of course, don't get yourself into trouble. So, can I make food and sell it online? Checking out my notes here really quickly? Need More resources google: "how to make money selling food from home", "do i need a licence to sell food online"

Yes, you definitely can. Now, number one, you want to find out specifically where you want to start making the product. If you're going to create and make the product itself, as you had asked in the question, if you're going to make a food product, doing it from home and selling it online is really not legal. Don't get me wrong, there are a couple of states. There are a couple of cottage food law states that actually allow this. A matter of fact, Florida just updated and changed its cottage food laws to allow you to produce a food product at home and literally sell it and ship it across state lines, which is fantastic.

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And they increased the limit to over 250,000, actually up to $250,000. So, some states will allow this to be done. You have to check what your cottage food law states. Now, to do that as well, here on Marketing Food Online we have almost every single state covered for cottage food laws to explain to you how it works for each state.

So, find your state on our channel here and check out that video. And then from there, you'll have an opportunity to get a better understanding of what you can and can't do. So, number one is, where are you going to make it from? Now that you've established that, if you can't do it from home because your state doesn't allow it, the next step is a commercial kitchen. Now, you don't have to make a commercial kitchen or create one.

You can rent a commercial kitchen. You can create your own food products, and you can sell them online. But there are a couple of logistical questions that you need to figure out first. Most states won't allow you to produce a product in a commercial kitchen, bring it home, and then sell it and ship it online. Because that's very similar to what you're doing in a cottage food setting. because you're bringing the food product to your home. So, find out from your city or your county where you're going to get your business license. And ask them, "Look, I want to produce a food product in a commercial kitchen." Can I bring that product to my home and then ship it?

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There's nothing going to be open. It's going to be packaged, sealed, and made and completed in a commercial kitchen. So, does your city or county allow you to do that? Many of them may. Many of them may not. You have to find out specifically what they'll allow you to do. And then you need to get a business license. Now, in order to do a legitimate food business, I highly recommend that you incorporate yourself, get your business license, and get your business insurance. Because you don't want to be caught up in the mix of potentially getting sued if somebody gets sick or the liability factor falls on you personally. Because that is something that can definitely happen.

Food businesses are totally different from the world of selling other things that are not edible. People can get sick, and they have allergic reactions to whatever it is. So you want to make sure that you've got the right licenses and permits that are needed to do this, okay? Once you get that down pat, you've got yourself an LLC, which by the way, you can do online. If you want to check below this video, there's a really cool website where you can actually do it online for free. And they only charge for specifically the state filing fee, so you can't really get around that. But the website itself offers this service absolutely free. So, you can create your LLC in just a matter of just a few minutes, okay? So, business license, make sure you have the right permits. Check with your city or county about bringing the product home.

Now, we can talk about the rental of the commercial kitchen. If you're looking to create your own food product and then want to ship it across state lines, you have to, of course, do that in a commercial kitchen. So, with that being said, though, what should you look for in a commercial kitchen? Number one, how do they rent out the commercial kitchen? Are you renting it by the hour? Are you going to rent it by the day? Or are you going to rent it by the block? Now, what I mean by the block is that some of these commercial kitchens will say, "Hey, Damian, we don't rent by the hour." We actually rent it out for three or four hours at a time. So you'll have to rent out that block of time. And then it's your time to do whatever it is you need to do.

Now, in order to make this effective and profitable, you need to make sure that you can produce as much of that product that you're producing as possible in the timeframe that you're actually renting the commercial kitchen. If you get the commercial kitchen for three to four hours, that's great. Make sure you max it out. And you can make 1,000 units or 10,000, whatever it may be that you're producing. Because you're going to factor that into your costs, okay? When it comes to creating a price point for your product, which we're going to talk about shortly, you want to make sure that you understand the cost of renting the commercial kitchen, plus your packaging, your labeling, your labor, and everything else that goes along with it.

Because that's going to cost you a bit of money. Some places it may be 30, 40 bucks an hour, which is inexpensive, very cheap. Some places that are in more urban areas and cities may charge 100, 200, or even 300 an hour. I've actually heard of some that even go more than that, which is absolutely insane. But, anyway, you want to make sure that you utilize the time that you're in the commercial kitchen to make the most of what you're doing, okay? Now, next up is packaging. Let's talk about packaging. You want to make sure that you've got eye-catching, eye-appealing packaging for your food product, however it is that you're packaging it. What I mean by that is, if you're not really good at creating really cool labels, if you want to design a really good one, check out Fiverr.

Fiverr is actually a website where you can hire someone for anywhere from $10 to $15 to even $25 just to make a great simple logo for your food product. When you first start your food business, you don't have to go all-out. It's the most expensive part of the endeavor when you're first getting started. So, don't spend a tremendous amount of money upfront designing a bag and pulling your hair out trying to make something that looks amazingly perfect, even retail-ready when you first start. When I do my consulting, I tell my clients to just put in the amount of money they need to get the ball rolling. And then later on, your product can evolve, and so can your business.

If you don't have a lot of funds to dive into this, but you really are passionate about it, and you want to get started, don't knock yourself over the head trying to figure out, "Oh, how can I figure it?" I want to make a package that looks just like something I saw at the grocery store. Those types of packaging on your scale, on your level, will cost you anywhere from about $1.75 to $2.25 a bag or container. I can tell you right off the bat. How do I know? Because I've been there, I've done that. When I first started, I looked into it. And I thought, "Hey, I wanted to have this amazing bag that has pretty print and that has all the nutritional information." And it has a barcode. I ended up actually just doing my own label, creating my own label, putting together my own packaging, even making my own nutritional analysis label for my product, putting in my barcode, and creating all of this myself. And it worked out fantastic. It worked out for what I did. And little by little, we evolved, and we put more money into our packaging. So, next up was the packaging.

Make sure you have a really good-looking professional package for your product. And, of course, you don't have to do it all yourself. You can definitely go to fiverr.com. And, again, I'll have it linked down below for that as well, and direct you to some of the designers. You can even take a look at it, set your price point, and figure out what's good for you. So, next up is, if you're going to start selling the product online, do you sell it on an existing platform like Amazon, Etsy, or eBay?

Do you create a store on Shopify, or even Weebly, or even GoDaddy? So, for an online business like this, I highly recommend you be in as many places as you can at once. Don't rely solely on one singular website or one singular platform. That's why we have stores. We've been on Etsy since 2011. We've been on eBay since even before that. And we've been on Amazon for about nine years now. And we have our own website, thebrittlebox.com, and then a couple of other shops on our Shopify stores as well. Why do we do that? because you want to be in as many places as you can.

There are a lot of shoppers, a lot of customers who enjoy shopping at Amazon who don't go to eBay. There are some customers who go to eBay who will never go back to Amazon. Or even some people who shop at, believe it or not, Walmart.com. You can even sell your food products on Walmart.com as well. So, all of those customers that are on these specific platforms, you want to make sure you kind of encompass and capture as many of them as you possibly can. Don't rely solely on your own website. Now, how do you market a food product online, Damian?

So, I've got my websites, maybe I'm on some of these platforms, but I'm not getting a lot of sales and traffic. You need to market it, you need to promote it. If you want to run basic, simple Facebook ads, I recommend you do that. Start off with a very low budget. We even have some videos right here on our Marketing Food Online YouTube channel. And I'll show you how I spent 20, I think it was 20, or $30, and got $800 in sales from one of our food products, okay? So, using basic Facebook ads, you can even stay active on platforms like LinkedIn and Twitter. Etsy also has some fantastic additional things that you can be part of with groups within Etsy. Even on eBay, they've got groups that you could be part of as well. But places like LinkedIn, Twitter, Facebook, and even Instagram are places that offer free platforms for you to get attention for your product. Right now, the two that we work best with are Facebook and Twitter. The reason being is that I can post a link on Twitter and have it clickable and have people go directly from that tweet all the way over to my product, put it in their cart, and buy it. That's pretty cool. One of the other great ones is Pinterest. Believe it or not, Pinterest is great! We average about 400 to 500,000 views a month on our Pinterest page. because we promote a lot of food products and food-related items on our boards. We've got about 40,000 pins. So, we've been doing that for a few years. That gains a lot of traction and momentum. So that's one way to market your food product absolutely free without spending a lot of money on Facebook ads, okay? Now, the logistics. How are you going to ship the product? Once you make your food item and once you know that you can make a food item and sell it online, how are you going to ship it? Do you have any experience with shipping? Understand what is best for your product? because every single product is packaged differently.

Some, during spring and summer, may actually need ice packs. Some of them may not. It depends. If you're selling something that's a fermented item that's been sealed, it doesn't really matter how hot it is outside. You don't need ice packs. Are you using glass jars or glass packaging? Be very, very careful with those types of packaging. Because that's going to even increase the weight of the product and the amount of bubble wrap and additional things you're going to need. So, keep in mind what type of packaging you have, and then also how to package it and how to ship it. When I do my consulting with them, I always let them know that if they've never shipped a food product, they should ship it to experiment with it. Ship it to some friends or family across the country. Find out how it arrived. What did you do right? What did you do wrong? Find out what the best packaging and buffer are that you need to use. Should you use styrofoam peanuts, bubble wrap, or envelopes?

Double-check the way that you're actually packaging it. because the logistics can cost you a ton of money. If it arrives damaged and broken, you have to resend it and send more product, okay? The next step is to find a payment processor. So, you've created your website online. Let's say you're using Weebly, you're using Shopify, or you're using GoDaddy. Now you have to actually have a payment processor as well. Keep this in mind as you sign up for whatever it is that you need to attach, like PayPal. A payment processor is something that processes your payments for you for your website. So you need to attach your website to something like Stripe, or PayPal, or one of those payment processors to make sure that your transactions go through safely and securely.

Now, if you're on a platform like Amazon, Etsy, or eBay, there's nothing wrong with that. because they already have their own payment processors built-in. And they're going to process those payments for you. If you're going to be doing this, make sure that your payments are around two to three, maybe 3.5% at the most. Anything above that, you definitely want to take a look at a different type of processor to make sure your payments are taken care of as well. Customer service. Next up is that. Now, how are you going to handle a product that is potentially damaged?

How to Sell Food online

Do you know how to handle either refund? Or if you're going to rescind it, you need to be on top of your customer service and any questions or emails that you get from your customers on a daily basis. So, if you're overwhelmed with trying to grow the business, you can actually have someone else do that for you. I actually would hire somebody and recommend hiring someone part-time to make sure that they stay on top of those emails. So, any of these questions that you have for your customers, you can be there when they need it. These are the basics and the outline of getting ready to start selling. And can I make a food product? Can I make food and sell it online? I definitely want to look into it. And these are some of the most important key factors if you're looking to just get started. So, if you have any more questions about how to sell your food products online, definitely let us know in the comment section. We'll get to it as soon as we can. And we'll create a video and answer your questions. And I'll see you guys in our next video.

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