The Fresh Loaf

News & Information for Amateur Bakers and Artisan Bread Enthusiasts

Selling bread from my home

ElbaLiz's picture
ElbaLiz

Selling bread from my home

I think I posted this in the wrong area, I'll try again!  I am thinking os selling bread from our home.  I have given bread away for about 15 years and might have to start charging!  I can't nor do I want to do this full-time, I have another job that pays the bills!  But, bread baking is my passion.  I am thinking of limiting my number of customers and types of bread.  I can do everything from Jim Lahey's no-knead to grinding my own grains.  I know I have to check into the legal stuff, but are there any pitfalls any of you have experienced or should I just stay with supplying the neighborhood, teachers, mechanics, postman, fuel man, pharmacist, veterinarian....you get the idea with fresh bread, just because I love baking bread?!  I don't want to ruin a good thing, by getting money in the way!


Any thoughts would be most appreciated!

flournwater's picture
flournwater

Outside of the "legal stuff", including licensing and a very well planned liability policy, I don't see why you shouldn't do it.  Frankly, if I though I could recover the overhead I'd do it myself.

breadbakingbassplayer's picture
breadbakingbass...

Be sure to check if selling baked goods baked in your kitchen is legal in your state...  I think there are only 2 states that allow this...


If you just want to keep it small and on the DL, I'd just try to have a circle of friends buy from you regularly...  Then you won't have to go through all the legal stuff...

audra36274's picture
audra36274

charge a flat amount/week. You might could fly beneath the radar that way. Your not selling bread, it's just a club! You charge to belong to the club and they are rewarded  with weekly bread, perhaps on Friday. That way it is not much different than the cake walks at Church/school fund raisers.


 

ElbaLiz's picture
ElbaLiz

Thanks for the idea, had not thought of it!
Liz

LindyD's picture
LindyD

Churches and schools are tax exempt.  Individuals are not.  Income is income, regardless of whether it is earned under the auspices of a "club."


I'm a capitalist at heart and advocate private enterprise and making money - so long as it is done honestly.


Check your zoning laws to make sure you can operate a business at home, get whatever health department permits and certifications you need, and if you make a profit, (and I hope you make a big one) report it on your federal and state tax returns, as well as your expenses.  There are some tax benefits in operating a home business, as pointed out in this article.


Go for it,  succeed, and to thine own self be true.


If I sound like an alarmist, it's because I work in the legal field and have seen the consequences of not playing by the rules. 

The Whole Grain's picture
The Whole Grain

You know those hobby-cooks who organise those dinner nights/restaurants at their own home. Some of those charge a set amount, and some let the customer decide how much the meal was worth. They then put some money into a jar after the dinner. 


Why not place a jar at your home where people can leave money voluntarily? That would be a good place to start I guess.

ElbaLiz's picture
ElbaLiz

Thanks Jar, another great idea, either way, I will bake bread!


Liz

ehanner's picture
ehanner

As soon as you have customers, you have responsibilities. The list of people you give bread to tells me you have a nice relationship with those folks. I would bet they appreciate your thoughtfulness and generosity. As soon as you approach any of your current recipients with the idea that they now would pay for your bread, I think you will have changed the relationship.


I appreciate your intentions and needs to mitigate the expenses. If your situation has changed where you can no longer afford to be as generous as you have been in the past, I suggest making the giving less frequent. The health department takes a dim view of unlicensed food operations. I think you would be taking a risk of legal trouble if you start charging with not much benefit financially. Enjoy your hobby. My 2 cents.


Eric

ElbaLiz's picture
ElbaLiz

You are very wise and what you stated is very true, I'm sure.  Perhaps after I do all of research, pondering and such, I will return to what I am currently doing, just making many loaves of bread and making many people smile...it is not about making $$$, so what is it really about, good question!


Thanks Eric!


Liz in WI

SourdoughBaker's picture
SourdoughBaker

What a great bunch of ideas. Reminded me of how I got 'started' (sourdough puns aside) in the bakery business.


A number of things said here are wise and true, from my exoerience. Once you have customers, you do have responsibilities.


A club is pretty lateral, and a great concept, provided that it's kept simple.


Anyway, here's a story directly related to this. There are two parts, so follow the links.


http://www.sourdoughbaker.com.au/stories/the-illegal-bakery.html


Hope you enjoy it, 'cos it's all true!


Cheers!

rossnroller's picture
rossnroller

I'm with Eric on this. You write: "I don't want to ruin a good thing by getting money in the way" - so don't!


If you really can't afford to keep supplying your friends with bread, why not just tell them that and let them know that you'll have to cut your baking down to stay within your budget. Those who want your bread enough will surely offer to pay for it; those who don't won't. Simple.


If, on the other hand, you have decided you want to make money out of your bread, rather than merely reducing costs, why not explore ways to enter the commercial baking world on a scale that suits you, while paying heed to the appropriate regulations.


I suspect this notion of turning our baking skills to profit is common enough amongst home bakers, but I think it's important not to turn friends into paying customers. In my experience, it is vastly preferable to keep friends and business very distinctly separated. Further, many a great hobby was turned into a labour by commercialising it.


OTOH, perhaps it really is something you would love to do professionally. Only one way to find out. I'd keep risk to a minimum to begin with, and try getting a job in a local artisan bakery. OR, hire a small stall at a local market, and try selling your bread on market day.


Cheers
Ross

sewcial's picture
sewcial

I don't know how laws have changed in the past 30 years, but, in the mid to late 1970s, I baked and sold decorated cakes in Maryland...birthdays, weddings, all sorts of small and large event cakes. I started by sending free cakes to work with my DH.  All my advertising was by word of mouth. I had heard stories of how one was required to have a separate kitchen and comply with all sorts of laws in order to sell any edibles. As a precaution, I called the health department about licensing. I was told that, as long as I sold only on orders, did not have a "shop" or sales room where people stopped in and browsed the products for sale, I did not need a license or any special kitchen equipment. My business did very well and there was never a problem. We delivered huge wedding cakes to banquet halls and hotels. Smaller cakes were picked up by the customer at my home. 


If you are in doubt, you could phone your local health department to ask, but I bet you are safe if you are simply selling by word of mouth and do not have a showroom, etc. Different states could be different and times have changed a bit, but it doesn't hurt to check. Also, if you are selling to people you know, I don't think there is much risk.


Catherine

ElbaLiz's picture
ElbaLiz

Thanks Catherine, sounds promising!   I have a similar mind-set as you did/do.  I shall check the laws in WI. This is a wonderful bread site, so much info, recipes, so little time!


Thanks again,


Liz

flourgirl51's picture
flourgirl51

This topic has always intrigued me. Most of the food borne illnesses in this country seem to come from vegetables, meat and the like. People can sell eggs( with the off chance of carrying Salmonella), sell veggies( E. coli) and fruits ( ditto the E. coli) from their homes legally and butchered chickens also-  but the baker, who bakes their wares at temps that would kill off any food borne nasties is supposed to get licensed, have special buildings and equipment, etc. I have seen people pull fresh veggies right out of the garden with their chickens running all around being good, free range chickens but who are pooping on said veggies, and then the veggies that aren't even washed are handed off (sold) to the consumer for them to take home and wash. To me there is much more danger of someone getting sick on food that is treated in this manner than there ever would be in most home kitchens.

rossnroller's picture
rossnroller

I'm with Eric on this, ElbaLiz. You write: "I don't want to ruin a good thing by getting money in the way" - so don't!

If you really can't afford to keep supplying your friends with bread, why not just tell them that and let them know that you'll have to cut your baking down to stay within your budget. Those who want your bread enough will surely offer to cover your costs; those who don't won't. Simple.

If, on the other hand, you have decided you want to make money out of your bread, rather than merely reducing costs, why not explore ways to actually enter the commercial baking world on a scale that suits you, while paying heed to the appropriate regulations.

I suspect this notion of turning our baking skills to profit is common enough amongst home bakers, but I think it's important not to turn friends into paying customers. In my experience, it is vastly preferable to keep friends and business very distinctly separated. Further, many a great hobby was turned into a labour by commercialising it.

OTOH, perhaps it really is something you would love to do professionally. Only one way to find out. I'd keep risk to a minimum to begin with, and try getting a job in a local artisan bakery to see how you like it all day, day after day. OR, if that's more full on than you would like, hire a small stall at a local weekend market, and try selling your bread that way for a while...that is, until you've had your toe in the water sufficiently to determine whether you like the temperature enough to dive in.

Cheers
Ross

Bertel's picture
Bertel

Just ask them for a contribution. No one can expect to get good bread for free. By asking for a contribution you turn the relationship around, you'll see who values you and your product, if they have money that is.


Also wouldn't worry to much about the legal/health mumbo jumbo, crossing the street is also very dangerous! There are always problems of any type looming in any situation.


Just bake what you want ask a contribution and see how it goes. you can always go back to giving it away.

Mary Fisher's picture
Mary Fisher

Perhaps your friends might like to give you a bag of flour when they see you - not in exchange for bread which is barter, just as a gift. Or a packet of butter or a box of eggs ... 

ladychef41's picture
ladychef41

Google "what are the laws for selling food out of your home in Wisconsin". The first link that should pop up will be "Wisconsin Food Safety Laws Relating to Small Processors and Farmers"


You might want to check out Slide #18 specifically in the link.... And as previously stated by someone; most states do not allow "cottage industry" businesses..


 


Wendy



gildee's picture
gildee

I was thinking of why not go wholesale sales; alot of grocery chains purchase wholesale cause I never smell bread or pastries baking. LOL!  this may cut out some  of legalize also but I have no idea of what legal stuff u may run into if you sell directlyh to the public besides sellin whole sale will take a lot of steps off of you. 

alabubba's picture
alabubba

I remember reading a post where the writer talked about setting up a "Flour Fund". A quick search and I found the thread here


http://www.thefreshloaf.com/node/13203/does-accepting-money-wreck-it-you

PeterPiper's picture
PeterPiper

I used to make a lot of bread and give it out for free to friends and co-workers.  Once I decided to start selling my bread, they were actually happy and willing to pay.  Rather than putting a strain on the relationship, it put them at ease because getting the free bread made them feel beholden to me, and by being able to order what they wanted when they wanted, and paying for it, I think it made the relationships easier!  In fact, I still have customers who say I should charge more.  You'll find that people that want your bread would probably rather pay for it.  If people didn't want it, they would be relieved.


Regarding running a cottage business, if you live in California, there is no such thing.  You either have a full-sized commercial bakery or nothing at all--this state allows no middle ground.


 


-Peter


http://psoutowood.vox.com

SourdoughBaker's picture
SourdoughBaker

I just got inspired to add some more of my own story as grist for the mill in this conversation!


It's in three parts, one of which I've already posted. There will be more, I promise!


So, the first part (where it had to happen):


http://www.sourdoughbaker.com.au/stories/the-saga-of-the-illegal-bakery-1.html


The second part (where it did happen):


http://www.sourdoughbaker.com.au/stories/the-saga-of-the-illegal-bakery-2.html


The third part (where it turned legit):


http://www.sourdoughbaker.com.au/stories/the-saga-of-the-illegal-bakery-3.html


I have to say I really can identify with everything said here so far!


Cheers

JoeV's picture
JoeV

This issue reminds me of when I learned how to tie fishing flies. I was having good success with my hand tied flies catching steelhead trout in the tributatries feeding Lake Erie in Ohio. I had made friends with fellow fishermen and we would often stop for coffee after a day of fishing and critique our day's catch. A couple of the fellows remarked that my success rate exceeded theirs, and would I mind making and selling to them some of my flies. I was puffed with pride as I left the restaurant with orders for 4 dozen flies at the going rate from the tackle shop of $1.25 ea. (The tackle shop did not make the pattern that I made). After work the following day I sat down at my bench and tied half the flies, then did the same the following day, at which time I met my friends at the restaurant after their evening of fishing, and exchanged money for flies. They told me how the fishing was the two evenings I was busy tying flies (it was very good, btw), and gave me orders for 4 more dozen flies. While tying the second batch of flies, I realized that tying flies for my friends for profit,was eliminating my time for fishing, which was my passion at the time. When I delivered the second batch of flies I told my friends that was the last batch I was tying, and if they wanted more of those flies I would teach them how to make them... the next time it rained and we could not fish!


I give away much more bread that we consume, but refuse to bake for people on a regular basis. I have a small business that keeps me busy during the day, and bread baking is my hobby that takes my mind off of work. I realized that if I took orders for bread that I would be right back where I was when tying flies for profit. I enjoy giving away bread, but I do it on my terms, and when I have the time to bake. It is almost always a surprise to someone because it is done when I have the time to do it. If I could not afford to be quite so generous, I would just scale back on my baking.


This is just my perspective...your mileage may vary.

SourdoughBaker's picture
SourdoughBaker

Hi all, just thought I'd let those of you who were following the story I posted a link to last time that the latest instalment is up on the site.


Here it is:


http://www.sourdoughbaker.com.au/stories/headed-for-the-hills.html


Just goes to show where such a journey can take a person.


Cheers

008cats's picture
008cats

Small businesses out of the home are promoted, given write-offs and several years grace for running at a loss (talent takes time to become a success) here in Ontario. That's how I supported my now grown son (and how I came by this computer, now that I think of it!)


There's a fellow in town who built his own outside brick oven; people pay him $35 and once a week for 7 weeks, they pull up in his driveway and pick up a bag of fresh "bread du jour" from a table in his garage. All very respectable.


Probably paid for his materials by now!

Urchina's picture
Urchina

Call your health department first. Don't mess around with it, or you'll be getting a cease and desist order from someone like me (a county health inspector in a former life....). That's a good way to ruin your day. It usually makes no difference if you have a showroom/shop or not. If you're selling or bartering to the public (or even distributing free of charge, aka a soup kitchen, to all comers), you're considered a retail food facility in most states and are governed by retail food facility laws. 


 


Second, call your local land-use and zoning folks.  Can't have a commercial business in many residential areas around here. 


 


If you do want to sell your bread, but you don't want to sink the cash into a commercial facility, you might see if you can rent a permitted kitchen and use it. Most big churches here have permitted food facilities (kitchens) that are used intermittently; it's possible that you could find one to rent and have a locked cabinet and fridge there that you could use. Worth asking around, and then there would be no conditions on who you sold your product to, since you'd be producing it out of a legal kitchen. 


 


Good luck!

ralph127's picture
ralph127

Forty years ago my grandmother made in her home and sold large pepperoni rolls to a local eatery to be used as hoagie rolls. For years after she passed on the locals were still telling me how much they loved her pepperoni rolls. She supplied the eatery with pepperoni rolls for decades. It was always on a cash and carry bases, the black market if you will. If any of us tried that today we'd end up in the hooscow. Yet her baking was a not insignificant part of her family's income.


About 20 years ago my county opened farmer's markets for locals to sell their produce. In the beginning many were selling home baked goods. A few years ago I notice less and less baked goods on offer. I asked around and was told that the county had passed regulations requiring home inspection by the health department and liability insurance. In my county parents are not permitted to bring baked goods to school events.


If you wonder why our economy is tanking do not forget the dead hand of the regulatory Nanny State.


On a happier note: if you have never heard of pepperoni rolls here is a great site with a recipe.


http://www.bobheffner.com/pepperoniroll/


I'm amazed that pepperoni rolls have never spread beyond the Appellation coalfields where they were born.


 

SteveB's picture
SteveB

Are you perhaps referring to the Appalachian coalfields?


 


SteveB


www.breadcetera.com

008cats's picture
008cats

of many varieties in Ontario. I always thought it was from Italian and/or Ukrainian populations we have. Come try! 


I wonder if the 'nanny state' in this situation isn't more of a case of a culture of litigation? I just had to bulldoze my grandfather's heritage 1850 ranch house in So. California because we were liable for actions of squatters (gangs) who kept breaking in and setting up shop.

Allyta's picture
Allyta

I'm surprised that after 15 years of doing this, no one has given you any gift certificates for bulk stores etc, where you can buy the things you need to make the bread you are giving them.  From the list of people you mention (postman, teacher, etc, etc), it must be getting mighty expensive.  If you start charging them, then you are a business and you have all the legal stuff that I would not want to get into if I were you.  Seriously tho, if you are just dropping bread off for these people without their asking for it, it would seem inappopriate to charge them for it anyway.  If they are asking YOU, however, then you are in a position to request something in return.  I wonder if bartering might work for you, or if by simply mentioning your dilemma might inspire them to gift you some certificates or even drop off some flour.  I don't know, it's a tricky one.  Maybe we should build a public awareness campaign about it...one rule I try to have is telling people I do need the tea towel back that I wrapped the bread in when I gave it to them.  

Baked Goods's picture
Baked Goods

If your State is able to grant an inspection for a home-based kitchen, you should have no problems with moving into the 'commercial' side of things. From what I recall, there is a focus on storage (both ingredients and utensils) as well as recommended labeling procedures. Of course, each State is different, and yours may have different priorities.

Another thing that will be important to know is what your recipes will cost to make.

A handy recipe cost calculator for baking that helps make pricing your recipes a good bit easier can be found here:
http://www.pricingbakedgoods.com