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Tip 1: Choose a Niche
Theses days the food industry is SUPER competitive and people are launching new food businesses every day. If you’ve got a product idea, or just want to start a food business, make sure your product is in a niche category. This will help minimize your competition and give you an edge when pitching to new markets.
Tip 2: Choose your branding and company image as soon as possible
Put serious thought into how you want to brand and market your home food business right from the beginning to help you avoid costly image overhauls. Hiring a graphic designer is key to helping your product line stand out and look professional. Upwork is a great service for finding quality graphic designers specializing in packaging design. If you need a logo, Shopify has a free logo tool maker called Hatchful
Make sure you double, and then triple check, your artwork before sending it to the printers.
Tip 3: Consider Hiring a Co-Packer/Co-Manufacturer
These days there are many co-packers, also known as co-manufactuers, happy and willing to make your food product for you! Once you are doing enough volume (making enough sales) these co-packers will be eager to take on your business as a client. Some great things about hiring a co-packer is they:
- Have the appropriate equipment to mass produce your food product
- Have proper storage for your food product and raw materials (ingredients, boxes, labels, etc)
- Have the necessary certifications and permits to make your food product
- Have systems in place to maintaining detailed records in case you need to perform a recall on your food product
- Can easily work with large distributors to coordinate large pick ups and deliveries
Once your home food business grows, and becomes a large food product operation, you’ll need the help of a co-manufacturer. The other alternative is to invest all your money into creating your own manufacturing facility but keep in mind that it takes A LOT of time and effort to maintain a manufacturing facility. Here’s a great list of food product co-packers.
Tip 4: Choose cost effective and eco-friendly food packaging
Once you’ve decided on who will be making your product for you you’ll need to consider what type of packaging you’ll want your food product to be in. I would suggest doing your research on the following before committing to a specific package design:
- How much does your food packaging cost – each additional penny takes away from your overall profit
- How long will it take to put your food product into the packaging – each additional minute adds to your production costs
- How long will it take to seal your food product packaging – if it takes a long time this will add to your overall cost to manufacture
- How many labels will your food product packaging require – each additional label adds more cost
- How heavy is your food product packaging – each additional ounce adds more cost
- How does your food product packaging look on grocery store shelves – if it is not noticeable people won’t see it
- What do other people think of your food product packaging – if people aren’t giving you a good response, consider altering your packaging to make it more attractive
- Can your co-packer make your food product in your chosen food packaging – make sure your co-packer has the ability to package what you need
Tip 5: Keep a Spreadsheet for All Your Food Product Costs
Food product costing is KEY to running a successful home food business. You’ll want to use a detailed spreadsheet to keep track of every penny that goes into your food product to keep you updated on your profit margins.
Costs to include in your spreadsheet are:
- Cost of every ingredient that goes into your food product
- Cost of every part of your food product packaging including the outside box
- Manufacturing costs
- Shipping costs
Sell your homemade food products online in 2019 with Shopify
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