Can I Sell Food from Home in Hawaii [ Does Hawaii have a Cottage Food Law ]

Posted by Damian Roberti on

 Can I Sell Food from Home in Hawaii [ Does Hawaii have a Cottage Food Law 


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Can I Sell Food from Home in Hawaii

Can I sell food from home in Hawaii? And does Hawaii even have a cottage food law? So in this video on cottage food laws, we are going to dive into exactly what that means. I've got my laptop open here, and I'm about to upload this to our podcast, cottage foods laws podcasts. I have links down below in the description section. So we had a great question from somebody from our other actual YouTube channel. Marketing food online in regards to Hawaii's cottage food laws So I opened my laptop. I have a friend who actually sent me some information from the state of Hawaii on how this works. I wanted to dive in and tell you what you can make, how much you can make, what is required, where you can sell it, and everything in between. So if this is your first video, definitely hit the subscribe button, guys. We have a ton of brand new videos here on cottage food laws.



Can I Sell Food from Home in Hawaii


We even have some great ones coming up to help you understand where you can actually buy ingredients online, packaging, and labeling, as well as a whole bunch of other additional business resources. So number one, back in 2017, Hawaii actually initiated a kind of "cottage food law," if you will, that allows people to create low-risk food products from home. There are cottage food states, like most, that have laws in place regarding starting businesses from home. They enable you to create "non-potentially hazardous food products." Now, these are food products that have to be on the list of approved items, but they cannot be time- or temperature-sensitive. Can I Sell Food from Home in Hawaii





For example, if you create a product or a food product from a food truck such as taco pizzas, hamburgers, and french fries, things that are cooked such as meals that must be consumed immediately, or there are temperature- and time-sensitive items, Those are not allowed. So most cottage food stays will do to make good snacks: low-risk, potentially hazardous items that can sit on a table at a farmers market all day without going bad or developing mold or bacteria. Those are the things that are considered potentially hazardous food products. So let's go down through this list really quick.




Can I Sell Food from Home in Hawaii

A couple of side notes: I'll also be covering how much you can make, if you need a permit, and all that good stuff. So residents can sell low-risk marijuana without a health department permit; however, they can only sell. You have to sell it directly to the customer at a farmers market, a local event roadside stand, or wherever it may be. But just keep in mind that your end user has to actually take the product from you or take possession of it at the time of sale. The one thing you cannot do, and I have covered all of your research on this, is sell online and ship them across state lines, such as from Hawaii to California or New York. You are not allowed to do that. From afar, some states have been on the books, and they are gradually opening up the doors and opportunities for people to sell their homemade products online.

So, for instance, believe it or not, if you are selling food products on Etsy from your home, it is actually illegal. If someone gets sick and you're making cookies or any other type of food from home and shipping it, and someone gets sick, and you don't have a business insurance policy, you could be in big trouble. You're not an LLC; you could get sued and lose everything you have. So I would highly recommend you not do that.






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So the idea is to sell products locally, at least if you have an idea for a food product and it's on the approved list. Start selling it locally to see if it's something that actually sells, and then from there, you can get your kitchen or get online to begin to sell it. Now, let's go over quickly where you can actually sell at a farmer's market in Hawaii, as they do in every state. They do have farmers markets, and they are great places to begin a food business to get your feet wet in a sense and get some practice selling your food products. So she definitely wants to start out with farmer's markets.




Can I Sell Food from Home in Hawaii

Roadside stands are allowed as well. One thing to double-check is that the city may require a business license at the very least if you're going to operate a business like this. Now, cottage food laws don't necessarily require them, but then cities and counties can write ordinances, laws, and rules and regulations locally. and they may require a business license. So just double check if you need one of those. I highly recommend that you also create an LLC. Now, if you

Can I Sell Food from Home in Hawaii

don't know how to do that, You can actually do them online. We have a ton of resources, by the way. As I previously stated, there are numerous links to be found below this video. You can actually create whatever type of business entity status you want online—an LLC, an S corporation, a C corporation—whatever you want.






Why do I recommend doing that? And even though the states have gaming, they don't require it? Because, as I stated at the beginning of the video, you could be sued, lose your home, and be personally liable if someone died. Hopefully they don't, but they got sick and went to the hospital. There's a lot of financial fallout that can happen from that. So you should have some type of legal entity, such as an LLC, and then some type of business insurance policy for your home base for business. Again, these are not required, but it is something that is going to save everything you have right now.





If they have any other types of events, like a jazz festival or a music festival, check and see again within the city or county if you have to have any type of additional permit to be at those events. But to operate your home-based business, they're not required. Okay. Now, as part of the allowed services, you can also have people pick you up from your home. If you're comfortable with that, if you're making cookies, cakes, pies, bagels, or whatever it might be, we're going to go over that list in a minute. If you can and you are okay with that, I could come to your home and pick up the product, and if you're not comfortable with that, you can deliver it.




Can I Sell Food from Home in Hawaii

Now, if you deliver it, that means you've got to keep in mind the cost. So if you're selling \$20 worth of products, but driving around town costs you \$30 in gas, obviously your business will not be profitable. So, if you want, you can now create minimums. By the way, what's another really cool thing? Check out the other free resources we have down below. Take a look at them. There is an app that saves a Play app projection for other apps that came to mind. Saver Plate is a great app that you can actually download on your phone. And you can begin to actually take orders and such, deliver them, and do all that cottage food home base work for business operations from there. So I definitely want to check them out too. To download the app itself, it's actually free. But check it out and take a

Can I Sell Food from Home in Hawaii

look into that as well. So these are the ways that you could actually deliver a product, kind of similar to UberEATS and everything else that you are delivering. You can't necessarily tap into Uber Eats or DoorDash just yet. There are some states that do allow you to do that. But in Hawaii, you cannot do that. So you can't sell to a retail store, which is one of the prohibited ways of distributing your food.


Like I mentioned before, you can't sell online; retail stores would be considered a third-party seller, for instance. So they would take possession of your food product, and Rob did sell it to their customers.



That's not allowed because, again, you have to have direct sales. Indirect sales, as they're known, are actually when you sell it to a retailer or a restaurant. Let's say you've got a spice business and you want to sell your spice blends to a whole bunch of restaurants and they're interested.



That is because you cannot do so and it must be done directly to the end user. Okay. Another question we had was whether you could cater from your home and why that wasn't allowed right now. So catering from home doesn't really fall under cottage food laws. So that is also prohibited, and if you want to wholesale your product, which many companies obviously do, you must wholesale to retailers like Walmart or grocery stores or grocery chains in Hawaii under their cottage food laws. You can't necessarily do wholesale just yet. Okay. Let's move on. Next up. Now, Damian, you talked about the allowed foods and things that you can make. These are not non-potentially hazardous products.




Can I Sell Food from Home in Hawaii

These are items that are relatively shelf-stable; they don't require a certain temperature. They don't have to be consumed at a certain time. That is what distinguishes cottage foods from others. So muffins, scones, cakes, bagels, breads, and cookies; rolls and tortillas; candied griddles like we do on the griddle live riddle; what a great opener. You could also make chocolates and fudge candy. I was also told that you can make candy. Now remember, these are the types of products from which you can create a multitude of variations. So if you're into making cookies, there are literally limitless types of cookies that you can create.



You can make hundreds of variations or sell them as chocolates, truffles, or peanut kernels. There are literally endless types of different girdles that you can make. If you're into making fudge, Punch can be made with an almost limitless variety of flavors. So keep that in mind. Other things you can do are dry vegetables; cereals if you want granola mixes; coffee, beans, spices, and even herbs. If you're into creating herbs and coffee and roasting coffee beans, you can start a small coffee business from your home.




Can I Sell Food from Home in Hawaii

One thing you obviously cannot do is serve brewed coffee; that is food service, which is prohibited. cottage food, but the beans themselves—either ground whole beans or whatever you want to do with espresso blends—you can resell the beans themselves. Dried fruits and teas—you started your tea business from home. You do pastries and pies, scones, cones, and danishes. With that, again, if you're doing pastries, keep in mind that if it's topped with the cheese or if it's on top of the meat, if it has anything that is exposed, that has to be refrigerated or time- or temperature-sensitive. That's a new Okay, that's a no.


For snacks, you can get granola, veggie trip chips, kettle corn, popcorn, crackers, pretzels, and so on. So the list is quite extensive. If you want to talk a little bit about what you can't make, There's also a reason why you can't make things like breads, sauces, pickles, fermented foods, or even meat jerkies like beef or turkey, or even chicken jerky. Those are not allowed because, again, they have certain processes where bacteria could form. It is not done properly. We obviously want to resell salsas and canned goods because they have pH levels that must be maintained at a certain level or bacteria and other microorganisms can grow in them.





So all of these things are considered a no. Okay, but if you wanted to get into a commercial kitchen and you wanted to rent something like that and create these products, go for it. Okay, that's different. So Jamie, how much can you sell from your home in Hawaii under the cottage food laws? Guess what? There is no limit. If you want to sell a million dollars' worth of stuff from home and you can sell a million or half a million dollars' worth of stuff, then go ahead and do it. They don't have a limit. But with that in mind, you want to make sure that you're obviously filing your taxes and handling this business. If you're profiting and you put out \$200,000 worth of product, if you make a million dollars, you're going to want to file taxes because you're going to have to claim that.





Okay, I wouldn't try to avoid this. That would not be good in the long run, especially if the IRS found out or somehow got a hold of those bank accounts and saw that you made a lot of money that you didn't claim. I highly recommend it. Again, I'm not an accountant. But I don't recommend you get around that; just simply do your taxes and do them the right way, and always follow the rules. Now, if you are producing, there's a question I actually got from one of my clients in my consulting business: "Hey, I want to produce a product in the commercial kitchen, then bring it home, and then I want to sell it as a cottage food that is not allowed in almost every state, not just Hawaii." But when you're dealing with a commercial kitchen and producing a product from a commercial kitchen, you have to have a commercial license. You have to have some type of commercial distribution for that.





Can I Sell Food from Home in Hawaii

Or you're taking it directly to a restaurant or something to that effect. You can't bring the food product in from a commercial kitchen and then try to pass it off as a cottage food business. You must keep this in mind as well. There are also many other agriculture or health inspectors who visit farmers markets. And in many cases, if they see a product that is supposed to be made at home under the category of "cottage food," they will make it in a kitchen. If they find out, you could be fined or shut down. So definitely don't play games with them. Just follow the rules. If you want to get into commercial kitchens or operate as a commercial food business, don't do it. It's a direct sale, but remember to keep that in mind as well. Now you also have to use your specific home address. If you have a friend down the road and Susie says, "Hey Damien, come on over," you can use my kitchen bucket, and then we just start using different kitchens. That's not allowed. You must be specifically present at your "primary residence." You have to stay there, and you have to be there producing your product. Now, before you sell your home for a project, you do have to complete a food safety training course in the state of Hawaii. They do have that available; you must first attend a free food safety education workshop and then complete an accredited food handlers class online.




Those classes are usually $15 to $20, maybe $25, somewhere in that range. So these are the things you do have to do even though you don't have all the permits and other things required for a food business. Now let's talk a little bit about the label. So you produce your product, you've got it ready to go, and by the way, they do establish specific guidelines for labeling your food product. Now, this is not something the FDA steps into; this is regulated by the cottage food law within the state. So the FDA doesn't really necessarily regulate, nor do they come in and inspect and do all that; they have nothing to do with cottage food. They delegate that responsibility to the state.





And that's up to the state, if the state does create guidelines. So, for example, if you have to have your business address, so on the actual label itself, your food product, whatever it is, whether it's chocolate chip cookies or trail mixes, you need to make sure you've got the business address, that's going to be your specific residence, that's going to be your home address, okay, you can't use a peel box. You cannot use anything outside of where you're actually making the product. Next up is going to be your business name. So if it's Damien's granola company, the name of that specific business needs to be awfully okay: Damien's granola business, whatever it is, and then the product name. So if it's cranberries, low fat, or whatever the name of that granola mix is, it needs to be on there.





Then there's a statement saying it was made in an inspected cottage food facility. This is kind of a disclaimer just to let the customers know that if you're at a farmers market, we're producing and selling a product at home. So I know that if I look at the label, it says it's not been inspected by any government agency. It's likely that they did an entire kitchen that was not inspected by the Department of Health. In some ways, that has to be labeled very simply. I know of quite a few cottage food laws throughout the states over the years that I've worked in this industry, but I can tell you that many of the states are very detailed; they have an extensive amount of information. So that sums up what you can and can't do under Hawaii's cottage food laws. If you have any questions about this, let us know. Can I Sell Food from Home in Hawaii



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