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If people are constantly telling you that they love your cookies and you should start selling them, then maybe you should.
Starting a cookie business from scratch is not difficult. However, many businesses fail in the first year due to reasons like:
- Their cookies start losing taste with time.
- They develop labor and management issues
- They use ineffective marketing strategies.
If you want to get into the wholesale cookies and chocolate industry, you should first do thorough market research. You cannot succeed in a business unless you know what you should implement and mistakes that you should avoid.
Here, we shall discuss a step-by-step guide to start a cookie business off the ground. Let’s check the information below to know how beginners can start their cookie business in easy steps:
1. Check Legal Laws
Each state has different laws and regulations to start a cookie business. These laws are usually called “Cottage Foods Business.” baked goods that do not require refrigeration like cookies fall under the cottage foods definitions. You should check your state rules about what kind of cookies you can make and sell.
2. Get Your License
A business license is required for all kinds of companies, no matter how large or small. You can get the license form easily from your local city hall or Champers of Commerce. Besides the business license, you will also need to apply for the following:
- Food Permit
- Seller’s Permit
- Home Occupation Permit (Only if you are starting your business from home).
- Federal Export License (Only if you plan to sell your cookies to another country).
3. Set Up Your Business
After getting the required licenses and permits, you need to register your cookie business. You need to determine what kind of company you want to establish. Most food businesses are registered as (Limited Liability Company) LLC because it protects your personal assets much more than a sole proprietorship.
You do not want to lose your house because someone claims they got sick because of your cookies. That is why you should get an umbrella insurance policy from the same insurance company that insures your house.
To set up your business, you also need to have the following:
- The name of your business (you can check the Secretary of State’s website to know if the name is not already taken)
- A Website (build a business website because you cannot grow a business without an online presence these days.)
- A separate business account
4. Pricing, Packaging, and Labels
Once you set up your business, you can move towards other essential business decisions like pricing, packaging, labels, delivery, and shipment. Let’s discuss these in detail below:
Setting the price of your cookies is a crucial step for your brand’s image. If you set a higher price of your cookies than the market rate, then people may avoid buying your overpriced cookies. If you set a price much lower than the market rate, then your customers may underrate your cookies. We suggest that initially, you should set your cookies prices according to the market rates.
By searching on Google, you can find various options to pack your cookies. You can get the packaging from stores like Costco and Sam’s Club.
You can design and print an attractive logo/ label on your personal computer and printer. Some office supply stores like Staples also sell different kinds of label stocks.
Delivery and Shipment
If you plan to sell your cookies in your local market, then transportation will not be an issue. However, if you need to deliver your cookies to other states and countries, then you will need the services from FedEx, USPS, or DHS. Check the shipment prices from all these services and select the one with the lowest shipping rates.
5. Choose Selling Platforms
Selecting the right selling platform for your cookies is essential for your business growth. Some states also put limitations on where you can sell your cottage food. You should check the local law to choose your selling platforms.
Normally, the state requires the companies to make direct sales, avoid cross-state lines sales or mail orders. Your first and best option to sell your cookies is the local farmer’s market.
6. Market Your Brand
Finally, you can start marketing and promoting your cookie business. Normally word of mouth is good but not enough. You should build a marketing plan for your business. You can check your competitors to learn about effective marketing strategies for your cookie business.
Starting a cookie business is not that hard. However, if you enter the market without sufficient knowledge, you may lose your customers within the first year of your company. That is why it is important to carefully make business decisions. We hope that the information mentioned above will help you start your cookies business from scratch. Good Luck!
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