How to Make Money Selling Food From Home

Posted by Damian Roberti on June 8, 2022

How to Make Money Selling Food From Home

I'm going to give you tips on selling food from home. I'm actually going to give you 11 tips to make sure and ensure that your food business is successful and profitable because these 11 things are super important. If you're going to start a home-based food business, So we started this video because we've had a lot of comments about people looking to start home-based food businesses. We've had questions about everything from licensing to permitting to what I can make and how much I can make and where can I sell. So this video is going to give you 11 tips. We're going to get into that right now. All right, so welcome back. It is Damian from marketing food online. So as I mentioned before, in the introduction, we're going to give you some tips on selling food from home and how to make money selling food from home, because it's all about, of course, making a living and a profit and even adding additional revenue to your monthly income. So if this is your first video, always make sure you hit that subscribe button, because we have nearly a thousand videos for food entrepreneurs. If you've never been to my channel, welcome to my channel. I have been a food entrepreneur for over 12 years.

How to Make Money Selling Food From Home

My wife and I have been online for a little bit about 13, almost 13 years now. And we operate food e-commerce businesses. So I help people get food businesses started. I have experienced for over 30 years being in the food industry, since I was in high school all the way through college and then up to today. So let's dive into these 11 things, as I always don't want to waste your time. I want to jump right into it. So, number one, know what you can sell. Every single state has a variety of "cottage food" laws, as they're known, and they allow you to sell certain food products, but every single state is a little bit different. They don't necessarily allow you to sell everything exactly the same. So, number one, know what you can sell. And then from there, you can go move forward and find out what it is specifically that you want to sell. because a lot of states offer anywhere from 20 to 30 or even 40 different types of food items. And you may only want to make one of them. So, you want to make sure that you find out exactly what you can sell.

How to Make Money Selling Food From Home

Now there's a second one that was really interesting, and that's the amount of actual funds that you can sell. The amount of money that you can actually make is also dictated by the state as well. So number two is to know the amount of money that you're allowed to make each year. And you don't want to go above that or beyond that. If you do, then you're considered a commercialized food business, and you're going to get yourself into a commercial kitchen and get out of your home. Now that's a good thing, but potentially a bad thing because you don't want to overdo it with the sales. Some states are actually limited to anywhere from 15 to $20,000 a year. Some states actually have no limit at all, and you could sell as much as you want, but you definitely want to keep track of it because that is considered a business and you don't want to go above and beyond that. So, number three, know your cost of your product and how to price it. So, knowing exactly what your ingredients are, how much is your packaging, your labeling, everything that goes into creating a finalized product, is it considered a cost? So that way, each individual unit, when you begin to sell it locally, you'll have a good idea of how to sell it at a certain retail price and make sure your price point is profitable. Because if you're obviously selling a product that's breaking even, you're not going to be in business very long.

How to Make Money Selling Food From Home

But if you're also selling it just above what it costs to make, you're also not going to be in business very long. So you want to make sure you have that sweet spot. You find a good retail price point for your product. So you must know your costs and price them accurately. Number four, understand where you can sell. cottage food laws, when you start to create a home-based food business and you're selling food from home, you want to make sure you know where you can actually sell it because many states do not allow you to sell it online. There are many misconceptions about people making food products at home and shipping them across state lines. That is technically not legal. So if you do that in somehow, someone gets sick or ill and it gets to the health department, the state finds out, and the local city or county funds out, that's going to cause a big problem. So there are many states that offer any state that does offer the opportunity to sell online, but requires you to deliver it in person. Which, to be honest, doesn't make much sense because if you have a product on the other side of the state, say you live in Northern Florida and someone in Miami buys a product on your website because you're selling it online, you're not going to drive 10 or 11 hours to drop a product off. selling a product locally, you can create a website, and you should actually create a website. That's another one of my points I'm going to get to shortly, but you don't want to necessarily get caught up in selling products online, where you have to drive it hours and hours because you're obviously not making any money doing that.

How to Make Money Selling Food From Home

So, know where you can sell locally and tap into those local markets first. And then you can expand and develop your product, hopefully getting into a commercial facility and going online because selling food is a lucrative business. Number five, LLC, and insurance. Now you're probably going to say, "Well Damian, I know my state doesn't require this." A lot of states actually don't even require a business license, believe it or not, but for the purposes of protecting your own home and all of your other assets, consider this type of business, not as a hobby, but as a business. And you want to be legitimate. I highly recommend that you look into creating an LLC and getting yourself a food business insurance policy for your food business. There are a lot of misunderstandings too, and misconceptions about homeowners' insurance policies don't necessarily cover food businesses that you start from home, or actually any business for that matter. So the liability will fall on you personally, and if it does, trust me, that's something that you don't want to have to deal with. So make sure you get into an LLC or some type of insurance policy as well to cover yourself and separate your business from your home and your personal life. Sixth, keep up with local events. Now, the reason why it's so important to be aware seasonally, let's say the fall Christmas holiday, spring, summer, whatever it may be, those local events in your area are going to be a gold mine for you to expand your reach with your food products. So once you have all of the other legalities set, you create the product, you know what you can make and all of that good stuff, you need to be aware of what's happening in your community. Could it be church-related? Could it be something that is a local music event festival? Is it a winery festival or a wine festival? Is it a food festival? Is it potentially a farmer's market that just opened up or something to that effect? You want to be aware of what's going on around you and in your community, because those are the events you want to be at. So, you want to make sure you meet people. Find out who is the one in charge and contact them. That way, you begin to network with people.

How to Make Money Selling Food From Home

And that's definitely something that you want to do. Now, for Number Seven, work on a professional looking package. Yes. If you're going to make the same chocolate chip cookies, you don't want to just throw them in a box and then put a label on it and drop it on a table. It's not very eye-catching. Think of this business again, not as a hobby, but as a legitimate professional business. So you want the packaging to be eye-catching. You want to get people's attention. even if you're at a farmer's market. It's even more challenging because you may have a row, an entire row of tents, full of food. How are you going to stand out? You want to make sure that your packaging grabs people's attention. So number seven is to make sure you have a professional looking package. Now, if you don't have a logo, you don't have a package. Don't worry about it. Check down below this video. I have a whole list of links to help you get food, packaging, food logos, anything you need help with, even branding, you can get it done on Fiverr. It's actually a website that I use. If you've never happened to hear of it, I've used the website Fiverr now probably 25 or 26 times for different logos, for different things for our website, even marketing strategy. So there are a lot of really good affiliates that you can be a part of that you can actually check out on Fiverr and have them freelance your product for you. So, number eight, website and social media, yes. Believe it or not, even though you are a home-based food business, you need to have a website. You need to be online because there are a lot of people who have purchased your product from a farmer's market or a local event, gone home, and want to look up more information about who you are.

How to Make Money Selling Food From Home

What motivated you to start your business? Can I buy the product online? Anything else that you can put in to help you grow, grow and build your brand? You want to make sure that your website and social media have that online. Number nine, you need to, this is super important, check to make sure you know your state's cottage food labeling requirements. So when you start to build and start selling food from home and you have a whole base food business, you want to make sure that you're labeling properly. Some states require certain bits of information. Some states require an Allergan listing. Some states require ingredient lists, and some actually don't. So, you want to make sure that you have the right information on your label. I would highly recommend it, even if your state doesn't require it. Go above and beyond that and start to label your products with everything. Ingredient listing You can actually check out the link down below this video. You can even get a nutritional label. You can make your own nutritional label and make it look totally professional. You can also get an allergen label listing created. I highly recommend you do that even though, in some cases, they may not require it. Why would I do that, Damian? Because customers have a tendency to already expect that information on their food products. Especially today, a lot of people are label-conscious and when they go into a grocery store, they start reading labels. They want to know everything about what's in the food because they may have an allergy to it. They may have a kid or a child or a family member who has allergies to, but creating all of that information and putting it on your label right out of the gate makes a professional looking package. Okay, Number 10, maintain really good record-keeping. Yes. For tax purposes, this is really important because it has some really big tax ramifications.

How to Make Money Selling Food From Home

You want to make sure you maintain a good sales history, know how much you're selling and also how much you're spending when you begin to buy ingredients, and whether you're getting products locally or beginning to get packaging. You go online, you go online, maybe you buy some labels. Everything you have is an expense that you're using for your business. Then, how much do you sell? The difference between the two is obviously your profit, and that's what you're going to be taxed on. Okay? So, as a legitimate business or legitimate food business, make sure you do that and keep really good records so that when you bring them to your accountant, they can assist you. Now, the next one, the last one, number 11, is super amazing. Whether you believe it or not, if you know this or not, you can actually get huge. Number 11 has two huge tax benefits for operating this type of business from home. And I'm going to explain just a couple, because I actually have a few videos here on my channel that go into much more detail, but if you operate a business from home, part of your mortgage, your rent, your electricity, your water, the space you use for your business, and even the equipment that you have, whether it's baking pans, sheets, or bowls, or a brand new oven that you bought specifically for your business, these are things you need to make note of and bring them to your accountant. Now I'm not an accountant. Of course, I'm not giving you tax advice. I just know, though, for sure, I've been through this experience myself. There are a lot of benefits to operating that food business from home. So make sure that you keep track of all of those expenses and anything related. Even if you have a website and you have a hosting website such as Weebly, or you have Shopify, or you have GoDaddy, and you have a website, it costs you $30 or $40 every month just to have that website up and running.

How to Make Money Selling Food From Home

All of those are expenses for your business. Okay? And of course, the list can go on and on, but I won't get too deep into that just now. but keep it in mind. Number 11: tax ramifications. There are big benefits to operating that food business from home as a small business. So keep in mind all of these. These are 11 things that are super, super important, but if you know them, make a note of them, check them out, and then take action on them, your home-based food business will be much more successful. And you'll definitely answer the question of how to make money selling food from home. These 11 ways will definitely get you going in the right direction. So I'll see you guys on the next video. If this video was helpful as always, please give us a big thumbs up and if you're not subscribed again, be sure to hit that subscribe button and check out our huge amount of resources, absolutely free. And I'll see you guys in our next video.

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