How to Start a Food Business From Home

Everybody eats, and most of us learn to cook — at least a little bit. But, some people find that they have a real passion for food. They love whipping up delicious treats or meals in the kitchen. They enjoy experimenting and exploring recipes. They absolutely delight in having others enjoy their food.

If any of that sounds familiar, then it might be time to think about monetizing something you love. In the day and age of side hustles and searching for passion in the workplace, cooking professionally could be just what you needed.

Now, breaking into the food industry can be extremely difficult. If you don’t want to go through culinary school, or if you don’t have the cash to start a brand new restaurant, you might feel like this is all out of reach. It isn’t. You can take advantage of cottage food laws and learn how to start a food business from home.

Every state has its own rules, but here’s the gist. There is an approved list of foods that can be made in a home kitchen and sold to strangers. If you pair that with online tools that help you market and sell your food, you can learn how to make money selling food from home very quickly.

There are two things you will need to really think about to get started, and we’ll cover both in detail. The first is what you should cook. You can think about easy food to sell to make money. You might also consider the best food products to sell online. When you find something that is easy and marketable, you have your business plan.

The other thing to consider is the rules at play. What are you allowed to sell, and what do you have to do to keep your business legal?

How to Start a Small Food Business at Home

When you are first learning how to start a small food business at home, you’ll have to think about licenses, permits and more. Since this is going to be a business, you’ll also need to consider incorporation, business bank accounts and taxes. That feels like a lot, but it doesn’t have to be so bad.

You can go through a starting a food business checklist. This one is short, but it has enough to get you thinking:

• Create a business name
• File for your LLC
• Create a business bank account
• Consider what food you will make
• Think about how food will be delivered to customers
• Review state and local cottage food laws
  

That’s enough to help you seriously think about online food business ideas. You’ll understand how to start a food business with no money pretty quickly. Since you’re cooking from your own kitchen, overhead is low. You really only need to consider the cost of raw food products and the prices you need to set in order to turn a profit.

When you get more into the legal aspect, you’ll find that in the vast majority of states, food labeling is one of the most closely regulated aspects. Double up on learning about food labels when you are trying to figure out how to start a takeaway business from home.

Beyond that, the most important thing is to figure out your menu. Some cottage food laws can heavily restrict what you are allowed to sell. You will still need to consider how you can bring a unique element to your food items to separate him from the crowd. That’s the other key part of learning how to start an online food business from home.

Food Business From Home Ideas

Paired with the legal aspects of your new business, you need a good business plan. These are some food business from home ideas that can help you dig a little deeper into what you really want to do.

Street food business ideas can go a long way. In most states, you can sell your home-cooked food from roadside stands. So, you want to think about foods that people would stop to purchase. Non-perishable snacks and fruit products are common here. You could make popcorn, jellies, jams or other snacks and probably do well.

You could also think about fast food ideas to sell. In almost every state, you cannot cook meat in a home kitchen and sell it, so this is not an idea to compete with McDonald’s. Instead, you can think about foods that are fast to prepare and easy to eat on the go.

You might also want some food business ideas with small capital. Most of these will inevitably fall in the realm of baked goods. Flour is cheap, so if you can make delicious foods out of it, you can lower your investment costs and be profitable from the start.

In all, your homemade food to sell ideas will stem from what you are comfortable making, legally allowed to make and able to market.

Rules on Selling Food From Home

You have some rough ideas forming. It’s time to take a deeper look at cottage food laws and how it all works. We’ll go over a few states to show how much these laws can vary and what you can expect.

Let’s start with cottage food laws in Florida. Florida cottage food law in 2021 is in the middle of the pack compared to other states. Selling food from home in Florida is allowed, but you can only sell foods on a pre-approved list that is maintained by the state. In general, these are foods that do not require refrigeration or heat to store. 

On the other hand, there is no penalty for selling food without a permit in Florida. As long as you stick to cottage foods, you don’t need any special permits or licenses, but annual sales have to be below $250,000.

Moving on to California, things are a bit different. If you are selling food from home in California in 2021, you have to stick to the approved food list. You also have to complete a training course for food processors. On top of that, you need a permit from your local county health department.

That’s where things get tricky. If you want to learn how to start a food business from home in California, most of the rules will be local, rather than run by the state. Rules in Los Angeles are different from rules in Modoc county. Focus on the local rules to make sure you are compliant.

Florida is average. California puts most things in the hands of local governments. New Jersey is restrictive. New Jersey cottage food law in 2021 was updated to allow any amount of home-cooked selling for the first time. The New Jersey food handling regulations are still strict. Food makers need a special permit, and they have to take special training courses. They have to sell from an approved list of goods, but exceptions can be requested. Additionally, home kitchens cannot sell more than $50,000.

If any of these conditions are not met, then you have to abide by New Jersey commercial kitchen requirements. These regulations are much harder to follow and out of reach for most home food operations.

What about cottage food laws in Illinois in 2021? The rules are pretty restrictive. Foods are mostly limited to jams and jellies and other non-perishables. Also, there are licensing requirements that vary by county. But, Illinois passed a new bill that takes effect in 2022. With this, there is a lot more freedom. The new rules allow cottage kitchens to sell food online, at markets and through home delivery. It also dramatically expands the range of foods that can be sold.

In Illinois, selling food from home no longer requires a home kitchen license. The amount of food that can be sold has expanded, and the rules are a lot more universal. Despite that, selling food from home in Chicago gets a completely different set of local rules that are more restrictive.

The last state we can look at today is New York. These cottage food laws were recently updated, allowing a lot more freedom. Cottage foods can be sold anywhere, as long as they remain in-state. You do have to register with the ag department, but there is no charge for it. There are no sales limits, and the eligible foods have been expanded.

Despite that, you can only make and sell foods on the approved list. New York is unique in the U.S. as the only state that allows cottage sellers to make candy while banning chocolate from the approved list.

On top of that, New York City institutes additional restrictions in addition to those of the state. The city introduces extra restrictions on where food can be sold and what kind of licensing is necessary for home kitchens to operate. Ultimately, selling food from home in NYC is still possible, but many would find it easier to produce food in the city and sell it in other parts of the state.