I currently have a home-based specialty bakery based off my grandmother's bread recipe. I use a liquid starter and the result is a soft sweet bread with a thin crust on the top but the bottom is fairly soft. I'm working on a business plan to start a wholesale bakery (not in my home).

I had my bread tested and it has a water activity level between .92 and .94.  I understand that bread with water activity above .85 has to be sold refrigerated or with preservatives. Everything I've read says the standard water activity level for bread is .95. If this is so, how do bakeries or anyone sell fresh preservative-free, non-refrigerated bread? I am going to try to bake my bread at a lower temp for longer time to see if this lowers the water activity level. I don't want to use preservatives or refrigerate it because refrigeration causes staling. Can anyone PLEASE help??? 

I've been looking into expanding my very small bakery business.  Right now I'm just selling to co-workers and friends, but have been looking into California regulations for operating a commercial kitchen.  Basically there is no way to convert any home operation to something that would pass the California Retail Food Code.  Has anyone out there been selling at farmer's markets without going through the Dept. of Environmental Health?  I saw some mention of bread being a non-hazardous food product but can't find any exceptions in the CA Retail Food Code. 

Another question:  by using an online service like Etsy, I would assume you are still required to be selling a legal product, which may mean operating from a licensed commercial kitchen.  But since you are potentially selling out of state, under which jurisdiction do you operate? 

I'd love to be able to sell more bread but it seems the regulatory hurdles are just too immense, even if I want to sell a little bread at the local farmer's market.

Thanks for any advice!

-Peter