With the healthy snacks industry booming, a dried fruit and nut business could be a profitable venture. Armed with the right tools and know-how, you can launch a home food business with relatively little start-up money. First, it’s important to do your research and understand what you’re up against. Starting a dried fruit and nut business requires a proper business plan, a thorough understanding of food laws and regulations and the right kitchen setup.
TL;DR (Too Long; Didn't Read)
A Dried fruit and nut business needs a proper business plan, a thorough understanding of food laws and the right kitchen.
Write a Business Plan
Every business needs a business plan, and a dried fruit and nut business is no exception. Your business plan should cover everything that your business needs to be successful. Writing a business plan requires a lot of research. You should look into your local market, and who your competition will be. You must clearly define why your product is unique and how you will sell it. Further, you should lay out your operating and marketing strategies as well as your financials. How much money will you need to invest to get your business off the ground? How long will it take you to break even? How much will you charge for your product to make it competitive in the snack market? How will you handle packaging and marketing? These are just a few of the questions your business plan must answer.
Know Your Laws
All food products are heavily regulated by the FDA, not to mention state and local agencies. The good news is that cottage food laws exempt many small food businesses from these arduous regulations. But don't think you're off the hook just yet. It’s important to understand all the relevant federal, state and local regulations that apply to your business. Look up home-based food business laws in your area. These vary by state and city. For example, your state laws may allow certain foods to be prepared in a home kitchen, while others will have to be produced in a commercial kitchen.
Further, depending on whether you are selling your products online or to local vendors, different laws may apply. Make sure to read all relevant laws and regulations to stay above-board. Follow food handling laws, get the necessary licenses and permits and be sure to include any mandatory labeling on your products.
Legally Set Up Your Business
When you are starting a dried fruit and nut business, it’s important to set your business up legally. With a small home business such as a cottage food business, many people start out with a sole proprietorship. However, there are several options available including a partnership, a limited liability partnership (LLP), a corporation and a limited liability corporation (LLC), to name a few. Talk with both your lawyer and accountant to decide which is the best option for your particular business.
Find the Right Kitchen
Depending on your local cottage food laws, you may be able to use your home kitchen to start your dried fruit and nut business. However, some food regulatory laws require that you use or establish a commercial kitchen. Many cities have commercial kitchens available for rent. This is a good option for businesses that are just getting started. Read your food laws carefully and research your kitchen options. You can always start small and then scale up your kitchen space as time goes on.
Once you’ve figured out the nitty-gritty details of how you plan to make money, you can set up your business, start production of your dried fruits and nuts product, implement your marketing strategy and sell your product. Identify local businesses that would be willing to sell your snacks. Or try setting up shop at farmers and flea markets. You should also consider selling your products online. However, be aware of the different laws for online sales of food products, and make sure you’re within your federal, state and local regulations if you take this route. Also, review the rules for what can be sent through the mail, and ensure your dried fruit and nuts products qualify for mailing.
Chelsea Levinson earned her B.S. in Business from Fordham University and her J.D. from Cardozo. She is a small business owner who has created content for Bank of America, H&R Block, CNBC, AOL and many more.