Starting Your Own Food Business (Part 2) - Production

So, now you got your idea going, what to do next? It’s important to work out all the details of your business, know what you’re doing and how you’re going to do it. Yes, being adaptable is important in any business, however, a plan of action is important. Production is our next step, understanding our budgetary restrictions goes a long way. These restrictions will determine where ingredients are sourced, at what stage of the process they are sourced, where production will take place, and what packaging will look like.  Depending on what you’re decided to make, your options will vary. Some items can be made from your own home kitchen, absolutely, however, other products would certainly require a commercial kitchen. That doesn’t mean that you need to lease out an entire commercial kitchen for your business, there are plenty of other options. Keep reading while I cover some of the possible options. Decisions, Decisions! Let’s start off with the first decision, are you going to produce your products, or simply curate them? While curation has different difficulties and decisions to be made, it can be simpler as the production portion can be largely eliminated. Therefore, let us talk about production instead for the time being.  Ingredients – The Business of Sourcing The ingredients we use in our foods is likely one of the most important considerations. When a business makes claims regarding their food, their better be able to back those claims up! So, do your homework. The supply chain is vitally important, if you are to make organic items, all ingredients must meet that specification, likewise, if you make any other claims regarding your food, such as gluten free, allergen free, or vegan (keeping in mind that your facilities must also meet those requirements and no cross contamination may occur). Make sure you find the right supplier for your ingredients. Of course, I understanding as a small business, you may just go to your local grocery store to source ingredients, and of course, that’s fine too, but as your business grows, finding a supplier will become an important step in the growth of your business. It's important to research the appropriate channels and regulations, in Canada, please refer to: Functional Foods and Natural Health Products Database Always ensure that your supplier has the certification to meet your labeling requirements, and meets the health and safety requirements in Canada. Relationships with your suppliers can be paramount, especially as a small business. Make sure to have an understanding with your supplier and develop a good working relationship, thereby ensuring the best possible outcome for your business. As a small start-up however, you may wish to shop for your supplies on a smaller scale, utilizing stores such as Costco which provide a bulk discount, can be a good start to your business and allow you to reduce the cost of production, thereby allowing you to increase the profit of your fledgling business. Try and make connections, if you’re making spice blends, perhaps try and create a connection with local farmers and local suppliers. Forging connections with local suppliers not only ensures a local supplier, but also aids in boasting the local economy. Remember, you are not alone, there are likely other similar start-ups and small businesses in your area. Take advantage of that fact and create a connection with those businesses. Using the buying power of two small businesses it can allow all businesses involved to order larger quantities at a discount without creating an unnecessary strain on your small business financially.  Production The next important step in our journey is the production of our product. Depending on the product and as always, on the scale of the business you intend to launch, the facilities which you will need will inevitably differ. With options of home-based businesses, commercial kitchens, and of course manufacturing facilities, there is a lot to consider. Of course, some food items can be produced from your home kitchen, these products still need to follow your location ordnances and regulations, make sure to do your research and ensure that you are able to follow all guidelines and regulations when working from a home-based kitchen, including the possibility of registering your home-based business as a facility. The next option is a commercial kitchen. Now I know that sounds expensive and frightening, but remember, you don’t have to lease an entire commercial kitchen. Commercial kitchens can be shared and rented for limited windows, as per the time requirements for your business. Research local kitchens and find one that meets your needs and allows for as little or as much use as you require.  You do of course have the option of setting up your own commercial kitchen, however, this does come with a hefty price tag attached. Yes, you have full autonomy, but these facilities still need to meet code and regulations. Leasing or opening your own commercial kitchen can often be the next step, as your business grows and your need for space and production capacity grows with it.  The Manufacturer Option Finally, if you find yourself to be more of the brains of the operation and you’re a hands-off entrepreneur, then the manufacturing route may be the right path for you. This option allows you to run your business without as much liability. As manufacturers follow code and regulations, this burden would be removed (although it is always good practice to ensure that regulations are being met, regardless of how well established a manufacturer is). This partnership can allow you to expedite the process and start your business sooner. But, this option comes with a very important caveat: ensure that a lawyer looks over and creates all contracts between you and the manufacturer, protecting yourself, your product, and ultimately, your business. Written by: Rina Dubosarski