Do I need a license to sell coffee online?
How to start an online coffee business. So these are two great questions. If you are just getting into the e-commerce space, start by selling coffee. Now there are a few questions you need to kind of ask yourself before we dive into what type of license and permits you might need. And we are going to do that right now.
All right. So, welcome back to marketing food online. Damien Roberta from Casablanca here.I hope you're having a great day. If you are brand new to marketing food, this online channel is dedicated to food, entrepreneurship, and everything about it. If you're looking to start a food truck business, get an e-commerce food business up and running, or even sell your own packaged food products, This is the channel for you. We have over a thousand videos and nearly a hundred thousand subscribers, and 50 countries are watching us. So we definitely have the information you need to get started successfully. Now, this is a great question. I actually had this email sent to me by one of our subscribers, who sent it to our email. And he had asked about this because he was looking to get into it because he has a brick and mortar coffee shop. So he was looking to transition that brick and mortar coffee shop to an e-commerce business, but he wasn't sure if he needed a license to sell coffee online.
Do I need a license to sell coffee online?
So he was basically asking, "How do I get started selling coffee online?" And I have all of them.Hey, you know what? I'm going to put together a video for you, because I have a lot of subscribers that are actually in the coffee space through e-commerce through Amazon and so on. So there are a few questions you should ask yourself specifically about your coffee business, because this will truly dictate the type of licensing and what you would require in terms of permits and other extraneous items.Now keep in mind, any food business. This has nothing to do with licenses or permits for any food business that you're starting. Make sure you have a food business insurance policy, even if you are reselling, for instance, and we'll dive into this in a minute. If you're reselling coffee online, that's fine. But just remember that if you are distributing any type of food product, you need to make sure that you have a food business insurance policy for your food business.
Do I need a license to sell coffee online?
It doesn't mean you have to be the one roasting the coffee or even importing it, breaking it down, and all of that. You don't need to be doing all that. If you're just reselling coffee, brand name coffees that you can get anywhere else that you're going to curate. You need to have food business insurance. By the way, below all of our videos here on marketing foot online, we have tons of great resources, links to resources, to our websites, our podcasts, and everything else in between. All right. So the first question What type of coffee business online are you starting? Believe it or not, there are numerous types and I'm going to give you an example of five of them. Okay, Number one, whole bean reselling, but you're going to buy it in bulk. Now, that does not mean you're going to be porting it. We'll get into importing in a second.
Do I need a license to sell coffee online?
If you're just going to buy whole beans, break them down and private label them with your own label, your own product, and your own packaging. That's fine, but make sure you figure out how you're going to do the whole bean reselling of your product. Okay, Make sure you've got your own supplier. Make sure that you've got the proper bags. Make sure you are labeling your product properly. There are FDA guidelines for food product labeling. Make sure it falls in line with that. So if you're going to simply re-resell whole beans that have already been roasted and have maybe been infused with the flavor or something to that effect, that's fine. But ask yourself the question. Are you going to get into whole beans? The next one is roasting your own beans. Now there are a lot of companies that create coffee businesses where they buy the beans pre-roasted and do the work themselves.
So they're unhosted beans that they basically buy in gigantic Burla bags. You can get 'em 50 pounds, 70 pounds, or even a hundred pounds or more, and you're going to roast them yourself, then resell them on Amazon. Start with, you know, a Shopify store online. Sell 'em on eBay, sell 'em on Etsy, sell 'em on Walmart.com. And that's perfectly fine. But again, ask yourself: what type of coffee business are you doing? Are you going to roast the beans whole and then potentially grind them up and sell ground coffee, or are you just going to sell them just roasted whole? Okay, next up is importing coffee to resell. Now, believe it or not, There are a lot of companies that are actually online platforms, even like eBay. I've actually even seen this where there's a lot of companies outside the US and South America predominantly, but in South America, where they have a tremendous number of stores set up on eBay, where they will send you and ship you directly from being imported into their warehouses.
Do I need a license to sell coffee online?
Many of them actually come through Miami, so you can buy the imported beans directly from them as opposed to importing your own beans. Of course, you can do that, of course, but the biggest challenge to most of that is the additional permits or licensing or other insurance or fees or costs or even tariffs or taxes when it comes to importing large quantities of coffee. You're talking about, on a large scale, that's a big business investment financially. Okay, of course there's risk involved with that as well, like with any other business, but if you're going to be importing something, keep in mind the additional fees that will be tacked on. And the biggest problem with that is when you begin to break them down by bag, making a profit on individual units in the food industry or the packaged food industry, individual unit profits are very low.
So the idea of selling anything has to be in bulk or large quantities. Okay, Massive amounts because the pallet size or purchasing hundreds or even thousands of orders is where you start to really make money.So if you're going to import it, you can do that. But again, again, this is the third, third type of coffee business to sell online. To sell these products online, you have to ask yourself, do you want to import them, or do you just want to buy them from somebody who is already importing them? And basically, they still have them in the large burla bags, large boxes, large pallets, whatever it may be, because it might make your business a little bit easier and a lot less financial investment to try to go through all of that. Okay, Next up is the fourth type of business model. The fourth type of way that you could sell coffee online successfully is by curating existing brands on a website that you resell.
Do I need a license to sell coffee online?
Now, of course, this happens all over the place, and you're probably thinking, well, Damien isn't the online marketplace for coffee saturated. If you think that it is, then don't even start a coffee business. I never looked at that 12 years ago when I started selling chocolate pretzels, chocolate covered Oreo cookies, and baked goods. When I launched my food business online 12 years ago, I never thought for one second about that. Nope, I didn't, because I was focused on building my store, promoting and marketing my store, my brand and getting my product into the customer's hands and moving on to the next customer. Okay, And that's what I've done. And most businesses don't even last two years, and we've been doing it for 12. So the reason I'm telling you this is that you need to convince yourself that you'll be able to make it work and succeed right away.
So, by curating existing brands, bringing together name-brand products, different packaging, maybe a different type of bundle pack. Maybe you're into cafes. Bustillo, maybe you're into Folgers. Maybe you're into dunking donuts, or maybe you're into Starbucks, and whatever it may be, if you want to bring those together by creating bundle packs value packs, this is where you can separate yourself from the competition and allow yourself an opportunity to get a slice of that pie because it's so big online and it's not going away. Anytime soon, food that's being ordered online through e-commerce will be skyrocketing. And it's only going to continue to grow no matter what inflation is. I'm sorry, but I don't believe any of that. No matter what inflation is, the cost of food prices, all that's nonsense because at the end of the day, everybody's still got to eat, and everybody's still going to come.
Companies need to make a profit and have money. And you can do that. As long as you do your research, as long as you bundle the products, as long as you price them, right? As long as you find out how much the shipping is for your products, your rating, and existing brands, It's a genius idea because you're not roasting. You're not bagging. You're not having to label your own, et cetera, et cetera, you can just bring together a variety of, okay. So the fourth type of business is that of curating existing brands, which is a much simpler business model when you start to sell coffee online. So next up is the last one. This one is genius. And yes, there are a few people doing it, but the truth is, there are not as many as I thought, because I actually researched before I did this video to find out a little bit more about it.
Do I need a license to sell coffee online?
I knew some of this, but not the coffee of the month subscription businesses. Yes. If you have a micro-coffee roasting business that you can get access to, What I mean by "micro" is the small mom-and-pop roasting businesses. They love to get their products out there. There's a lot of unique packaging, a lot of unique branding, a lot of roasting that's going on. This is a small micro company, and by scooping up a variety of those and bringing together a coffee of the month subscription business by selling uniquely curated boxes every month is another type of business model for selling coffee online. And if you wanted to, I mean, there's nothing limiting you to just one of these. If you want to incorporate all five of these, then so be it. You can do that. There's nothing limiting. There's no law saying you can only have one coffee company.
If you can incorporate all of these business models into one business and offer this variety, then do that. If you want to roast your own, then do that. If you want to import it yourself, and you've got a great supplier outside of the US, and you want to bring it in and create a uniquely roasted coffee bean that you want a private label on, create your own custom label and own packaging to do that, as well as curate boxes. But Cookie of the Month is great for multiple reasons. But here's the main one: it creates a constant, consistent revenue stream every month. So you've got somebody who's ordering it either monthly and they're signed up for three months or six months or they prepay for three months or they prepay for six months, but creating a subscription service for coffee, which is something that's consumed on a regular basis, is genius.
I mean, everybody does it. You go to Amazon now, amazon.com, and you can sell on their eCommerce platform, offering subscribe and save. I believe it's called Walmart's now getting into the subscribe and save concept. Everybody's starting to do this online. So now, once you've asked yourself all of these, the question is, okay, Damian, the video's about licensing. Number one, you need, of course, a business license to sell coffee online. If you think this is a hobby or something you want to do from your house, and you're going to put coffee in your kitchen cabinet and sell it on eBay every now and then without a business license, because selling food from your home over state lines is illegal and you could get into trouble. You'll need a business license from the city or county that you're working in, or actually, a state license as well.
Do I need a license to sell coffee online?
Next up is a sales tax certificate. Okay, in order for you to remit sales tax that you're collecting on transactions online through e-commerce platforms. I know Amazon does it on behalf of a lot of their sellers, and there are a few other platforms that do the same, but if you're on Shopify, you need to collect sales tax. You need a sales tax certificate. Next up, you need an LLC and a C corporate S Corp. You need to create an entity status. As it's known, I would recommend an LLC. And again, you do your own research and due diligence. LLCS are very simple to form. We even have down below in the description, we've got resources for websites. You can even check that out for yourself. LLCS are simple to form and easy. And you can have an app up and running in literally a matter of a few minutes.
Okay, As I mentioned before, you also need food business insurance. The cost of a basic food business policy is between $5 and $600 a year. And that's something you definitely need to look at. Next up is zoning permits. Make sure that you're obviously in a commercially zoned area doing this type of business or conducting this type of business. And you may need to make sure that there are no permits or additional zoning permits. That's what it's required to open and initiate your business. Next up, the U.S.D. has an annual license. You're going to have an inspection by the department of agriculture. If you are a food sales establishment, not a food service establishment, that's different. A food sales establishment needs to get through the U.S.D. and they will come and inspect your facility. Now, one other thing that you need to be aware of is any facility that handles food, prepares food, ships, stores, or warehouses it.
It, or any of that, needs to be registered with the FDA. Okay? That's, that's a must. You have to register your facility. It's cheap. It's free to do. You can just simply go to the FDA website, but you need to register with the FDA. Okay? Every single facility in the country has to have that. If you're distributing food products or warehousing manufacturers, those are all registered with the FDA. So these are the types of licenses you'll need. When you start asking yourself, "Do I need a license to sell copy online?" As a matter of fact, you do. Okay, And depending on the type of food business model that you're going to do, as far as your coffee business model, make sure that you have the right license and permits. So if you have any questions about how to start an online coffee business, let us know down below in the comments, and we'd love to answer your questions or help you out. If there is anything we can do to assist, please let us know.Thank you for watching, and I'll see you in our next video.And if you are looking to create your own food truck, start a home-based food business under the cottage food law franchise, a food operation, start a packaged food business, private label, your own food product, sell on Amazon. Get your own online store or sell food online. Take care. Remember to sub, subscribe, and check out these videos for more resources.