As the family jelly maker recently retired from my day job, I found myself with too much time on my hands. And since I had been kicking around the idea of starting my own jelly business, I did just that.
A great reason to start a homemade canning business is to be able to offer the public a clean, green, and healthy alternative to commercial jams and jellies that are processed in bulk and filled with preservatives. Why not share with anyone interested in a product that is made in small batches from all-natural ingredients, just like I’ve been making for my own family for many years?
Since I had little experience as an entrepreneur, a good bit of research was required to find the best way to start a small business.
The process of setting up a business to sell homemade goods is not in most cases difficult, but local laws and regulations vary from state to state, and even from county to county. I found that selling locally requires the least amount of regulation.
I’m going to give you a step-by-step list of the things I did in setting up my small jelly business. Your journey will not be exactly the same as mine, but the process should be similar.
1. Decide What Product(s) You Want to Sell
After deciding that you want to start a small canning business, the first decision is to determine what product(s) you will sell. Here are a few considerations:
What home-canned foods are you good at making?
The product(s) you plan to sell should be something that many other people really like and have given you rave reviews on.
Over time, much of your business should be from repeat customers, and if your product isn’t something special, you cannot count on customers coming back for more.
Do you really enjoy canning?
It would not be wise to start a canning business if you do not really love canning, because spending that much time in the kitchen could get old really fast if it is not your thing.
Can you make your products at home?
Do you have space in your kitchen to prepare the products for your business? If not, you may have to rent kitchen space which could be inconvenient and expensive for you and could eat up a lot of your profit. You do have a few alternatives you could investigate.
Some restaurants that close relatively early in the evening might be willing to allow you to rent their kitchen at night to make your jelly.
Also, some churches, community centers, or club buildings might also allow you to use their facilities at times they are not otherwise in use.
Have you assembled the recipes you need?
Even though you have probably made so much of your jam and jelly that you don’t need a recipe, it is better to have a written copy of all recipes you will use so that all batches are the same and will not differ significantly.
This is especially important for specialty items such as pepper jelly and combinations.
Do you have all the equipment you need?
To be efficient in making your canned goods, you might need extra equipment like larger pots or an additional freezer which would add to your startup costs.
You must be able to purchase all your supplies and materials at wholesale prices in order to be competitive when pricing your products.
Check online for pricing, and in some larger areas, check whether there are restaurant and wholesale suppliers where you can purchase your supplies and materials in bulk and at wholesale prices after obtaining a business license.
Do you have access to a sufficient quantity of raw materials?
I’m talking about fruit for jelly and jam, vegetables for salsa, etc.
If you are making jelly and jam, do you have a source for fruit that would be available when you need it and at a cost that would allow you to sell your products at a reasonable price?
Maybe you have some fruit trees in your yard or your sister has a dozen Mayhaw trees on her property. These would be your basic stock items and you could add other types when you can get them at a good price. Trading a few jars of jelly for a gallon of fruit would be a wise move on your part.
If you have to pay a retail price for your fruits and vegetables, you may not be able to make a profit from your products.
Do you have sufficient storage?
For a jelly business, sufficient storage would include freezer space for extra fruit picked or purchased when the fruit is in season and cabinet or pantry space for canned fruit and juices.
Maybe you have a large pantry, a basement, or an extra room you could put into service as a storage area for business-related items.
Remember, to extend their shelf life, canned foods must be stored in a cool, dry space with no direct sunlight and no extreme temperatures.
Don’t forget labels and other “hidden” costs.
Creating and printing my own labels was much more cost-effective for me, and buying blank labels and card stock in bulk was the only way to go. This expense must also be added to the cost of your product(s).
2. Conduct Market Research to See If There Is a Market for Your Product
Market Research consists of two main sources, primary and secondary.
- Primary research collects information directly from your future customers.
- Secondary research collects information from government sources on market and population trends.
Conducting market research is not as complicated as you think. As a matter of fact, it can be accomplished very easily. You can either pay someone else to do the research for you or you can do it on your own.
Why do I need to conduct market research?
The four main reasons for conducting market research are to:
- Determine how much competition you will have.
- Find out the price of their products.
- See what products are your competition’s best sellers.
- Identify what population group or groups are attending the markets.
Here are some ways to do this research:
Primary Research
Take a few days and visit the local farmers’ markets to find out:
- If there is anyone selling jelly
- How many different jelly businesses are operating in your area
- What are their prices
- How many varieties do they offer
- Which varieties are their best sellers
- Which varieties do not sell at all
- Whether their labels look homemade or professional
- Whether they offer samples and to pick up any samples they have available
Secondary Research
Go to your local public library or chamber of commerce and locate population trends. These trends will give you an idea as to what type of inventory you should focus on.
- For example, if the local population consists primarily of retirees, it would be a good idea to stock a variety of low-sugar and sugar-free products.
- But, if the largest population group is families with young children, a variety of jelly you can sell a little cheaper, as well as a line of products you can advertise as green and/or organic would fill the needs of this population group.
3. Learn Your State Regulations
Before you can get started, you must find out which governing body regulates the activities of a small business selling homemade canned products and find out what those regulations are.
In most states, there are cottage industry laws that cover the retail sale of home-canned foods.
In the State of Florida, for example, these laws are governed by the Department of Agriculture and allow you to sell your home-canned food products under the regulations of cottage industry laws without a license from the Department of Agriculture, without a licensed kitchen, and without inspections.
Requirements for selling your product(s) under the cottage industry laws:
- Sales must be within the State of Florida and not across state lines.
- Sales via a website are allowed, but mail delivery is prohibited.
- Delivery must be in-person to the consumer or the consumer’s event (party, dinner, etc.).
- Sales must be retail and not wholesale, and annual gross sales must not exceed $50,000 per year.
- Products must be packaged and labeled properly, and samples must be prepackaged. The label on Cottage food products must include the name and address of the business, the name of the product, an ingredients list in descending order by weight, the net weight or net volume of the product, any allergen information, any nutritional claim is made, and the statement, “Made in a cottage food operation that is not subject to Florida’s food safety regulations.”
- Products must be stored on the premises of the Cottage Food operation.
- The owner (s) must allow access to the Cottage Food operation by any employee or agent of the Department of Agriculture to perform an investigation as a result of any complaint that there has been a violation of Cottage Food Laws.
- Compliance with all Federal, state, local, and county requirements that regulate the “preparation, processing, storage, and sale of cottage food products.”
Be sure to check with your state’s Department of Agriculture for Cottage Industry Laws in your area.
4. Decide Where You Will Sell Your Products
Choosing a market for your product is one of the most important decisions you will make in this process.
If you do not market your product(s) to the right target group, you may not have enough sales to keep your business afloat.
Also, where and how you will sell your product(s) will determine the type of licenses you must have and how much product and capital you need going forward. Since I live in the State of Florida, the production and sales of homemade food products are governed by the Cottage Industry Laws.
Where you can sell your products under Cottage Industry Laws:
Cottage industry laws only allow retail sales directly to the consumer, so here are your options as to where you can sell your products:
- Local Farmers’ Markets. Most Farmers’ Markets open only one or two days a week, so find out where your local markets are and what day or days and hours are involved. You will need to find out how to register to sell at each one and what their fees and requirements are. Then, set up a schedule to try them out and see how your sales go. Some markets have space inside with tables included. For outside space, you will need to provide your own tent and table. This is an additional expense.
- Special venues such as Fairs and Craft Shows. Here, again, you will need to make contact with the individual venues for information on space costs and requirements.
- Directly from your home. This option, of course, would probably require the least investment but in many ways limits your exposure to prospective customers.
- Open your own Fruit Stand. This could be very cost-effective if you live or have property on a major highway or thoroughfare.
- Special orders from newspapers and local shopper guides. In many cases, the local newspapers and shopper guides will give you free advertising and possibly do a little story on your business. But, the ads would be a very affordable expense for you, especially if you want to keep your business relatively small.
- Online via your own website. Cottage industry laws do not allow sales outside state lines, nor do they allow your product to be mailed. Even if you sell via a website, you must deliver directly to your customers.
- Online via a local Facebook marketplace. Here again, cottage industry laws do not allow sales outside state lines, nor do they allow you to deliver your product by mail. If you do decide to advertise in a local Facebook marketplace, be sure you have a good, safe public area to meet your customers to deliver their purchases.
Related How to Mail Jars of Jam or Jelly (To Avoid Damage).
5. Name Your Business
You must give your business a name and logo. The name you choose can have a lot to do with whether it is a success. Ideally, the name and logo should, in some way, describe what your business is all about. Try to create a unique name and logo that will be easy for your customers to remember.
Important: Do a Google search to make sure someone else isn’t already using the business name that you are considering.
You must report your business name to the Department of State in your state by filing a Fictitious Name advertisement in your local newspaper for three consecutive weeks and then sending your proof of advertising to the Department of State.
Your Department of State will provide you with all the information you need to advertise and file your Fictitious Name Ad.
Be sure to include your name and logo on your business cards, stationery, and advertising.