I'm gonna
cover a fantastic question, I get a lot of spice business questions on how to start a profitable,
small spice business, either from home or even
in a commercial facility, getting it up and running
in a larger scale. But we're gonna go into a
handful of different tips and pointers on how to just do that. And if you're not a
subscriber, by the way, you definitely wanna hit
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you wanna be subscribed to. So now let's jump right into it. So one of the most important things when you first start out
and your spice business is you definitely wanna
have a handful of recipes. If you've got your own recipe booklet, or if you've got a handful
of collected recipes of your own spice blends, or your own take on a
certain type of spice, that is gonna be a huge plus
and a huge benefit for you, the more creative you could
be with something original or something that's got
your own spin on it, the better off you're gonna be when it comes to selling
in the marketplace, whether the marketplace is
online through e-commerce, through your own website, if you're going to be selling locally, and you're gonna be under
the Cottage Food Laws and you're gonna sell through
local farmer's markets, festivals, or fairs, all of that, we'll talk about
a little bit in a few minutes, but I definitely wanted to say that if you're going to get
into a spice business, if it's done correctly, spice businesses can be
extremely profitable. I read an article actually just yesterday doing some research for this video. And I came across a company
that did over $10 million in a about, I think, three or
four years they were into it. It doesn't happen
overnight, get it granted, but once they started
going, they really took off and it was a hugely successful business within a matter of about
three or four years, doing $10 million annually
is pretty impressive. So let me jump right into it. So the other question that's
really, really important
is gonna be, where are you going to actually be doing the business from? If you're gonna start from home, there definitely are still
ways that you could sell quite a few venues and local events. And I know that due to the situation that we're all currently in right now, a lot of social distancing
and such as is occurring, but it's little by little as it begins to lighten up a little and we have the ability to
get back into farmers' markets or fairs or festivals or different types of outings. There's definitely gonna be
a need for spice businesses in any type of food
businesses selling locally. So if you're doing it locally, some questions you need to ask yourself is of course, what does the city and county require as far as licensing permits
and being incorporated,getting yourself in the LLC or creating definitely a
business within the home itself, see what the state requires,
your city and your county
finding out how do you do that? Damian, how do I find
out if my city or county? Well, you could go to Google
and type in home-based business and then your County. So let's say you are in Los Angeles, you could type into Google how do I start a home-based
food business in Los Angeles, every county and city for the most part and I know for sure when
it comes to the states, they have their own websites set up to give you that specific
information saying, hey, you know what? You need to take a food handler's course. Maybe you just need this permit and you need to be incorporated. A lot of states, believe it or not, when you're doing a home-based business, don't require you to be incorporated.
I know that may sound odd, but they do have certain
permits and licensing granted, but not always are they
requiring you to be incorporated. I'm gonna give you some advice, you need to incorporate
yourself as a business, separate your business entity. You can go online, you can find that out on Incfile, you can even do it through Incexpress, or there are a lot of websites and I actually have a couple, by the way, down in the description below this video, there'll be a handful of other resources to help you incorporate, if you're looking to do that as well, you can do it online in
less than 10 minutes, but make sure that you've got
those guidelines followed. So then the next step would be, if you're doing it from home, find out where you can sell it to.
Now the great thing
about spice business is, when you're starting a
very small spice business and you want it to become profitable, doing it from home is a great no brainer. And here's why, because you don't have to
rent a commercial kitchen or a commercial space. You don't have to invest
so much money out initially before you begin to really make sales. So starting it at home on
a small part-time basis, even if it was to be
for additional income, spice business can be profitable that way, because you're not having
to put out so much money. You can also package them very simply. A lot of bags and containers for spices are within about a 50 to 70, 80 cents, or even less than that
per unit to package. So they're very inexpensive to produce, but the markup is tremendous. If you go to a local grocery store, I can tell you from
the years of experience I've been in the food business, even working for groceries
chains when I was in college, I could tell you that the
spices you see for three or $4, that it costs pennies, pennies to make when they're mass produced the markup and the margins are shocking. So getting started locally
and doing it from your home is a really great way to get your feet wet and kind of get a taste
for being a spice business. Now, number two, the next one up is once
you've got your recipes, you've got your formulations be able to scale it. You need to be able to make
them in larger quantities. Now you're probably thinking, well, that must be really simple, all I got to do is multiply
it times five or six times, that's true, but keep in mind, spices, when a customer buys your spices, they're going to expect
it to be consistent. You wanna make sure that consistency is on your priority list because if you start mixing spices and you've got a blend and you're short on one spice, or you're too much on another, it can throw it off and
actually cause your customers to not buy it anymore because it's not something
that's consistent. So they always look for consistency. So try to figure out the best way to accurately scale the
recipe for your spice blends or your spice in general and then from there you always have that consistent
quality for your customers. Keep that in mind as well. Now, the next step, the next thing you wanna look at is where are you physically gonna do it? Do you have the space? If you're gonna do it
from home, let's say, and you get approved and you've
get everything checked out, you've got your permits, do you have the space set aside dedicated to your spice business? You don't wanna be doing
something in your own kitchen in your home, while you're cooking, obviously meals for other people and your blending spices. Have a dedicated professional
business section in your home, an area where you've got tables, you've got sealers, you've
got bags, containers, whatever it is, as far as
the equipment's needed, but it's separated.
Make sure that that happens, okay? Because you want to make sure that you're not overlapping
your food production for your home, like cooking
and such and making lunches with your actual business products. You don't want to do that. So next up, finding a supplier. You wanna make sure that your
suppliers have your product. I recommend always have
three, rely on two of them, but have three. Why would you need three Damian? Well, I can tell you when I first started my food
business over 12 years ago, we had some situations where I
didn't know this at the time, but one of our suppliers for some of the products that we need was out of a certain item
and I desperately needed it. So then I realized I needed
to find somebody else, but I didn't know the quality. I didn't know the company,
I didn't know nothing. So I was in this panic
mode trying to figure out who can I get to supply
the same ingredient, but, you know, taste the same, obviously, and in the same quantity that I needed. Make sure you have reliable suppliers and have three of them. Rely on two, so if something
goes wrong with those two, you have a third one as a backup, okay? And you wanna make sure that the quality of the product is there. Can they deliver on time? Is the shipping costs, the
pricing of the product? Is it actually reasonable
or is it inflated? You need to do a little research for all four of those parameters, the pricing of the shipping, the timeframe, the quality of the product
and the cost of the product.
Some websites actually will have like a minimum order quantity. They're gonna say, look, you have to order a thousand dollars worth of product. Try to find one that has a lower minimum. So that way, when you invest by starting this business that you don't know for
sure if it's gonna work, when you start your spice business, you want it to be profitable
right off the bat, obviously, but you don't want to accumulate
7,000 pounds of spices because you're meeting minimums
that are outrageous, okay? Try to find a smaller price point and a smaller minimum that's needed in order for you to buy from them, so you're not investing
such a large amount, okay? So next up, what kind of marketplace? So where are you gonna sell it? You need to do some research locally. What type of farmer's
markets are available? What type of maybe some food events, maybe there's some music festivals. There's a lot of different
places that offer food that may not actually be
associated with food itself. What does that mean?
There are some art expos,
there's music expos. There's also book events, there could be something
at a local school. There could be something that universities that are get togethers for
certain types of interests. Always try to look outside the box and think outside the box, when you're trying to start
a profitable spice business, you wanna make sure that
you find those places where you could sell and sell a lot of it. So do a little bit of
investigation, look into it, do some research and find out which one, of course, is
gonna be the best for you and then don't go to just one, sign yourself up for a bunch of them. Always have multiple
venues that you can go and sell these spices to. So next up you want to make sure that once you're there at these events, that you've got some type of advertising, you wanna catch people's attention. So it's not just a table that
you put some tablecloth on and drop some spices. You need to have maybe some brochures, maybe put together some business cards with your website address, okay. And then also make sure
that if you've got a tent, you've got some large signage that has really bright colors, it gets people's attention and gets them over to your booth or where you are that you're selling. All of those parts are part
of marketing and advertising, even though you're at these events, that doesn't necessarily mean that you're gonna get the
attention of everybody. So make sure you've got materials, maybe even informative
or educational materials. Maybe there are some health benefits to some of the spices
and herbs that you have. And you can mention some of
them even in your website, not necessarily giving doctor's advice or anything like that, but helping people understand
what the spices are that you've got and why is it that they wanna buy them?
So the next one up is I wanted to cover is if you are renting a commercial kitchen that opens the doors to being online. That can open the doors to a
lot of other possibilities. So you can actually go into, for instance, get your own website on
Shopify, you can go to Weebly. You can get yourself a domain name, sign up, create a website, get yourself a hosting company that will host your website for you, and then start selling
your product online, which can open up the doors
to millions of customers, not just a few hundred locally or a few thousand locally but millions. I highly recommend that direction. Not necessarily for the sake of spending the money for
the commercial kitchen, but looking at the bigger picture and having the opportunity to be online with your spice
business is huge, okay. Even if you put yourself
on an eBay or even Etsy before you even go to Amazon
or something to that effect, you can get your product
in front of the eyes of a lot of people. And that is a huge plus, trust me, because if you're looking at
this as a long run business long-term business, being
online is a no brainer, especially with food nowadays.
40% increase in the second quarter, Amazon had over 40% increase
in their sales for food alone, just in the second quarter for a three month timeframe. That is gigantic. That's like hundreds of
millions of dollars in increase just for food. So being online with a spice business, definitely do it, okay. Renting a commercial
kitchen is easy to do. It may be hard to find one, but once you get the kitchen you're there just packing your spices, and producing your product. You wanna do it the most effective and efficient manner because
you're renting that space. Think about that as well, is that if you're putting
money out for a two hour, three hour, four hour period, try to produce as much
as you possibly can. That's a huge plus as well. So if you've got any questions about how to create a extremely
profitable food business, such as spice blends or spice and herbs, let me know down below
and we'll help you out. Take a look at the rest of our channel. Of course, remember to subscribe and I'll see you on our next video. Thanks for watching Marketing Food Online. 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, remember to subscribe and check out these
videos for more resources. Take care.