Cottage Food Operator Self-assessment
Do you have what it takes to be a CFO, a cottage food operator? More than an idea, recipe or home kitchen filled with appliances, becoming a small food business owner will require a level of knowledge, skill and talent, each addressed below.
1. Food Knowledge
What’s your culinary know-how? Having a degree in food science, years working at a bakery or a stint at a delicatessen would help you achieve the goals you’ve set for your business from the perspective of what you can accomplish in the kitchen. But don’t underestimate the “on-the-job” experience of raising a family of four if you prepared most of the meals at home. Perhaps you’re the legendary birthday cake maker of the family. Perhaps you already can enough food products to keep your family, friends and a few neighbors stocked up each winter. Every product you make reflects your cumulative knowledge of cooking skills, techniques, recipes and ingredient selection. When deciding what products you want to make for sale, go with what you love and feel there’s a market for. Eventually, you’ll want to complete a feasibility study.
Do you love baking, making pickles or mixing spices together? Is kneading dough a passion, or something you procrastinate doing? Would a call for a large-batch production of fifteen dozen muffins for a corporate retreat be stressful or a fun challenge? Be realistic and honest in your self-assessment, but don’t sell yourself short when it comes to your cumulative knowledge. Experience is the best teacher of all. When your recipes turn out the same every time you make them, that’s a good sign.
If you like the idea of being a home baker but struggle because your recipes don’t turn out as tasty or look as attractive as they appear to be on the Food Network, recognize that you might want to learn some new skills (which can be fun, too) or cultivate your existing talents further. Practice really does make perfect. Many food entrepreneurs have spent months, if not an entire year, tweaking, modifying and perfecting their customized, decorated sugar cookies that they now sell for two to five dollars each.
Beyond the accredited and non-accredited programs, workshops and short courses you might take, you may also pick up some quick experience in your area of interest by working at a bakery, restaurant or catering business. If you love baking but want to see how another company does it, consider working part-time for a while at a bakery or one of those fancy cupcake-making places; you wouldn’t be able to use their secret, proprietary recipes, but you could walk away with practical knowledge about the industry you want to break into.
Another way to get in some experience might be as a volunteer at your church for events that involve food preparation; maybe you could handle the dessert or bread baking and test out your recipes. A non-profit organization that regularly offers some food at their events could be another route to go. For example, our Monroe Arts Center in Wisconsin sets out various nibbles during all their gallery openings; this could be a place for us to try out recipes and garner feedback without spending a cent of our money.
Exercising your “mind muscle,” repeating over and over again the techniques needed for kneading dough or twisting croissants, translates to a more consistent, higher-quality product. The more practice you put in, the better the results. According to Malcolm Gladwell’s book Outliers and based on a study by Anders Ericsson, consider adopting the “10,000-hour rule,” which states that it takes approximately this amount of focused practice time to perfect a skill. That’s twenty years, practicing an hour and a half a day. For many of you home cooks, you’re already there!
2. Business Knowledge
What other talents or attributes do you possess that can help drive your enterprise? Can you write well? Are you a people person or someone with a knack for selling? Do you never grow tired of social media, always chattering on Facebook or tweeting? Are you comfortable enough with software on your computer to make brochures, flyers, invoices and receipts?
While you may bake a blue-ribbon-winning torte for the state fair, how much of the business skills do you have to help propel your business along? Even on a small scale, any skills with planning, marketing and managing the financial aspects of your business can go a long way in helping you achieve your goals. The more you can do yourself, the less you will need to contract out for a graphic design service for your labels, a freelance editor to help write the copy describing your product, a designer for your website or a bookkeeper to manage the money. The great news on website design is you’ll never need to be a programmer or learn HTML5. Thanks to Wix.com (and other sites), it’s just a matter of adding text and photos after choosing one of their attractive – and free – templates. In fact, the website for HOMEMADE FOR SALE (www.homemadeforsale.com) was created with Wix to illustrate this point.
3. General Knowledge or Talents
How strong are your community networks? Would it be easy to share what you’re doing, word of mouth, and then sit back and start filling orders, or are your community connections more limited to church, school or place of employment? Are you an organized or tidy person? Both organizational skills and cleanliness are extremely valuable to any food enterprise. Can you manage multiple projects at the same time, or do you find you like to do things one at a time? While balancing your work and life, having the ability to multi-task may make operating a home-based business less overwhelming.
Completing an informal CFO self-assessment will help provide a better understanding of what you might be in for. Remember, in starting a cottage food enterprise, it’s almost impossible to fail in the traditional sense of going bankrupt. The worst-case scenario is usually one that involves having a few more cookies in the cookie jar or strawberry-rhubarb jam you can give as gifts during the holidays.
Where would I start to find out how to become CFO registered in my state?
You can learn about your state’s law here: http://forrager.com/laws
Hello, I have a question regarding advertisement for home bakery. Is there any guidelines for as the Do’s and the Dont’s on how we can advertise our business?
Usually you can advertise your business in any way. The only state I know of that restricts advertising (by preventing online advertising) is Mississippi. However, many states disallow online selling.
I just learned that Mississippi updated their FAQs and no longer prohibits online advertising.