If your cookies get rave reviews and you enjoy coming up with new recipes, a cookie company could be a lucrative business for you.There is more to running a business than just making cookies.Customer service, book keeping, marketing, and food safety are some of the things you'll have to do.Make a plan for how you will operate your cookie business before you start.
Step 1: A business plan should be written.
A business plan is the first step in starting a business.You need to have a good idea of who will work for you, what your expenses will be, how much you will charge for your product, and who the competition is.It's important to have employees that are trustworthy and responsible.Think about how you can make your product stand out.Tailoring your products to a specific audience helps.If you cater towards an audience that wants a more adventurous cookie, you will have a better chance of winning.If you want to cater to an audience with certain restrictions, you could offer cookies that are vegan.The time is right to figure out financing.You should have an idea of how much it will cost on a monthly basis once you know how you plan to operate your business.If you want to get a loan from a lending institution, make sure your business plan is thorough.You should come up with a name for your business, as well as a logo or sample promotional materials.If you've never written a business plan before, you may want to consider hiring a professional.
Step 2: It's a good idea to include your business.
Depending on how many people are involved, how you want to be taxed, and how much personal liability you are prepared to assume, you have several options for incorporating your business.Discuss your option with a qualified attorney and/or CPA.Small business owners like to use limited liability corporations because they help them avoid double taxation and protect them from being personally liable for money owed to them.Sole proprietors and corporations are other options.
Step 3: Have a plan for taxes
You will have to pay estimated taxes on a quarterly basis and file an annual tax return if you are a self-employed individual.If you don't pay the correct amount, you will end up owing a large tax balance, which will grow with penalties and interest if you do not pay it right away.If you don't know anything about accounting for businesses, you should consider hiring an accountant.If you want to sell in a state that has a sales tax, you need to register your business with the state's Revenue Agency.
Step 4: If you want an EIN number, you need to apply.
A Federal Tax Identification Number is also known as an Employer Identification number.This number is used for tax purposes, and is the business equivalent of an individual's Social Security Number.If you answer a few simple questions about your business, you can apply for an EIN on the IRS website.If you don't plan to open a bank account for your business or hire employees, you may not need an EIN.Check with your local government to find out more.
Step 5: Insurance coverage is a must.
In the case of an accident, insurance can protect you from liability as well as protect your personal assets.Talk to your local insurance provider to find out what you need.
Step 6: There is an approved facility.
The requirements for commercial kitchens vary from state to state.It is against the law to sell food that was produced in a residential kitchen.You may be able to make changes to your existing kitchen or create a new kitchen in a different part of your home that meets the requirements in other areas.You will most likely be required to have your kitchen inspected on a regular basis.For information specific to your area, contact your county's health department.You will need to get approval from your local board if you want to operate your business from home.If you are not allowed to use your home kitchen for your cookie business, you may be able to find a local business that will allow you to rent out their kitchen during off hours.If you're in a cottage food industry, you might not need a licensed kitchen in some states.There are restrictions regarding how much money you can make and where to sell your products.Check with your state's Department of Agriculture and Rural Development to learn more about local laws.
Step 7: You must apply for a license.
Obtaining a general business license from your local city or county government is required in order to legally operate a business.Depending on the state you live in, you may be required to apply for licenses specific to the food industry.When applying for a general business license, make sure you ask about the requirements.
Step 8: Good food safety practices must be followed.
You will still have to comply with local health codes for safe handling of food even if you are allowed to operate your business from your home kitchen.If you aren't familiar with safe food handling, you may want to take a class.It's important to keep accurate records of where your ingredients come from and where they end up.The government wants to be able to track foodborne pathogens in the event of an outbreak.
Step 9: Correctly label your products.
In order to be compliant with federal laws, you must make sure to label all of your products with a complete list of ingredients and allergens.The USDA provides guidelines for calculating the nutrition of your products, but if you don't feel comfortable doing it yourself, you can hire a specialized company.Make sure you understand the legal definitions of special phrases.You may not be allowed to use the term if you can't prove that your products meet the requirements.Whenever you make a change to your recipe, your labels will have to change.
Step 10: The right equipment should be obtained.
Depending on local laws and the amount of product that you intend to produce, you may need new equipment.Ensure that you have everything you need to produce and distribute your product in order to get your business off to a good start.Important items like ovens and mixers, as well as smaller items, like mixing bowls, sheet trays, and packing materials, should be considered when packing cookies.Think about what equipment is necessary for the production of your product and what is optional.When your business becomes more established, you may want to save money by only buying essential items.
Step 11: Take the time to figure out who you'll sell to.
There are many ways you can sell your cookies.You can open a store, sell gift baskets on the internet, or sell your product at farmers markets.The amount of money you have to invest in the business upfront, the regulations imposed on you by federal and local laws, and the buying habits of your target market are some of the factors that will determine the right choice for you.Specific food safety procedures that are not required by law may be demanded by certain wholesale customers.
Step 12: Outstanding products can be created.
This should be the best part of your new job if you love baking cookies.You may feel overwhelmed by all the other aspects of running your own business, but try not to lose track of your passion for creating amazing cookies.New and exciting products will keep your brand relevant.Make sure to keep up with the latest industry trends and products from your competitors.You might want to get some feedback on different recipes with friends and family, or even from a random sampling of potential customers, before deciding which to produce.
Step 13: Go and market yourself.
If you can't sell your brand, you'll never sell cookies.Make sure that your brand looks professional and that you have a plan for how you will communicate with your customers about your latest offerings.Don't stop doing market research!It's important to make sure you're meeting your customers' most relevant needs.As you grow, you might want to consider hiring a dedicated employee to help with marketing.It's easy to get overwhelmed with marketing when you have a professional website, active social media presence, and print materials.When you sell a customer on the idea of your product, you need to provide great quality and a great customer experience.