So you think you want to start a food business? Here are 8 tips straight from the entrepreneurs at Hot Bread Kitchen.
TEST THE MARKET.
So you’ve created a delicious product that your friends and family love. But, will people pay for it? To find out, conduct a focus group of strangers, set up a stand in front of your house, or put a few items online and see if anyone buys them. This is the key question to answer before you go any further, so spend a little time proving your concept!
GET DOWN WITH THE NUMBERS.
Food businesses have notoriously challenging margins. Work to know your costs (including packaging, labels, ingredients, transportation, and labor—including your own!) and price appropriately. Will your customer pay enough for your product? Unless you work in finance by day, hire a bookkeeper or seek out low-cost resources to help get you started on financial management.
HBK Incubates graduate business, Unna Bakery
Food businesses are regulated by city and state agencies working hard to keep us all safe! Do your research on permits, label claims, and food safety certification requirements for your area. Where and what you sell will determine which permits you need. Before you can get those permits, you will also likely need to go through formal business formation and get insurance.
At Hot Bread, we say “Sales solve all problems.” If you want to be a successful food entrepreneur, get out there and sell what you’ve got! If that doesn’t appeal to you, then you might want to bring on a serious salesperson as a partner who can make that happen.
Too many flavors, varieties, and SKUs can be costly and hard to scale. Stick with a few signature items to start.
HBK Incubates business owner Keisha Smith-Jeremie of Sania Applesauce
Get out of your comfort zone. While it’s tempting to spend a lot of time on what you know you are good at, building a business requires learning and conquering the scarier tasks, too—including accounting and, likely, washing dishes!
HIRE A SQUAD.
You’re a multi-talented entrepreneur, but you can’t do it all alone. Know when to ask for help (like hiring your designer friend to help you with that website) or bring on new team members. Cultivate a community of strong female mentors.
Culinary incubators can offer more than just business development support and a space to produce. HBK Incubates is a vibrant culinary community of 80% female entrepreneurs who learn together and support one another.
HBK Incubates is a shared commercial kitchen space and business support program for high-growth food enterprises, run by Hot Bread Kitchen.