Cottage food laws are taking the nation by storm. They are long overdue, and could help many people get the small business of their dreams get started. Recently South Carolina has joined the ranks of the states with Cottage food laws on the books. Watch this video to hear from one excited baker who is seeing the beginning of a life long dream come true.
I just want to tell you, if you start out right in the beginning, it will make your life so much easier. You have to realize that you have to know at least a little about keeping your books, if you don’t know that, you will never actually know if you are making money. You can’t just cover your cost and call it good, otherwise you will just be paying for your hobby.
I recently talked with a woman planning on opening up a bakery.. She gave me an example of how excited she was to make money baking. She said she had made and sold 48 cupcakes for $20 and it only cost her $.88 each for two cake mixes. She figured her profit was $18.24 for only two and a half hours of work. She so desperately wanted to think she had made a tidy profit, that she neglected to even include all the ingredient costs. By the time she paid for the cupcake cups, the frosting, and whatever packaging she used, her actual product costs were probably more than double her original figure, plus the fact that she paid sales tax. I did not even address the cost of the gas or electricity it took to run the oven or the gas it took to run to the store and shop. By the time you add in all the real costs, she did not even make minimum wage.
These expenses don’t even come close to the expense involved in running a retail location. Overhead is extremely expensive. That is one on the reasons I am really excited about cottage laws, you can start small, but I can’t stress enough that you need to have a business mindset right from the very beginning.
As you watch this video, this woman says she has already been baking for friends and neighbors, but she has had to operate in secrecy, baking as a favor. Now she can market her baking skills after she readies her kitchen to meet the requirements for the South Carolina laws. Once her kitchen is ready, she will have to fill out paperwork, make her labels, and then start figuring out her sales channel.
Cottage Food Laws are Great, but You Still Have to Sell Your Product
Selling you product is where many people get stuck. Baking and selling are two entirely different skills, and you need both to be able to succeed in this business. You need to understand that you are the best salesman for your product. I know if you hate to sell you hate to hear that. I heard those very words many years ago from one of the first business advisers I talked to. I did everything I could to prove him wrong because I was terrified to “sell”. I just wanted to bake happily ever after and leave the sales to someone else. It just did not work that way.
Word of mouth advertising is great, and it does work, but there is nothing instant about it. People are constantly given choices other than purchasing from you every time they go to the grocery store. Unless you make the effort to stay at the top of their list of choices, and make it super easy to purchase from you, it will be really hard to grow your business. Don’t be fooled and think that simply giving folks your phone number is enough, because today that simply is not the communication tool of choice. You are going to HAVE to have an online presence.
For all you non techie people, which is the case for many of us, I can just imagine the thoughts going through your heads about now. No worries, it is not as bad as you might imagine. You are right, I am talking about having a website. Many of you are seeing $$ signs flash before your eyes but it is not nearly as bad as you think. This website is a WordPress site, and when I started I knew zero about websites, I could barely send an email. I am going to start a series about starting your website, it is really pretty fun.
This is getting pretty long, so for today, I will sign off. Consider this an invite to check back very soon for information on how to get started using WordPress. If you have any questions or comments, please leave them and we will have a conversation.