Subreddit: r/SmallBusiness
User: u/NeatPhilosopher5275
Original Post:
Recently began selling a local food product that people are really responding to. What are my next moves?
Hello everyone…using a throwaway account.
I recently started a small business selling a food product at local farmer’s markets and sales have been much higher than anticipated.
Basically, I am producing as much as physically possible (at my rented kitchen space) and still selling out.
Naturally, I would like to open our own shop ASAP, however, I personally lack the funds to do so.
I’d like any and all ideas/advice on moving forward from here…especially on these topics:
Would it be better to continue the small operation rather than jumping into our own shop? Even though the “iron is hot” right now and engagement with the community is high?
What is the best way to get funded for the shop? How best to approach it?
How do I properly estimate the cost of opening the shop? Obviously the equipment and everything but all of the costs beyond that? Is it appropriate to speak to a real estate broker at this early stage? Or will they consider me a waste of time?
Anyway, I’m just reaching out because I really think there is opportunity here…and I would like some opinions on how best to move forward.
How would experienced business owners handle a start-up situation like mine?
Thanks everyone!
My Answer:
Hi, food scientist here.
Congrats on getting traction. That’s always great to see early on.
When my clients are in these situations where there’s demand for a food product but they’re uncertain which steps to go next, I always recommend that they stay nimble and rent out a commercial kitchen. Many of the licenses that you need are held over by the commercial kitchen, so you wouldn’t need to do the groundwork to deal with those. The most challenging ones are those dealing with food safety.
You’re also not committing serious capital to purchasing equipment and space. You just use as much as you need for the days that you need. That way you can modulate if the demand is worth it, and usually you want to review that over a year. A few weeks or months of high growth don’t account for seasonality, so it's something to consider.
Scaling ingredients can also be more challenging than you would consider. Suppliers are not always easy to get a hold of, especially if demand winds shift or ingredient supplies are held up during distribution. So you’ll want to get a feel for how the scale-up affects your ability to produce.
Are you working on a new food or beverage product? Interested in working with me and my team to get started?
Click on the button below to get in touch and set up a meeting today!
P.S. If you're interested in developing cannabis food and beverage products or confections, head over to my good friends at Patric Food & Beverage Development.