How to Navigate Cottage Food Laws

By Lisa Kivirist, MOSES Rural Women’s Project
Home-produced bounty from Scotch Hill Farm

Home-produced bounty from Scotch Hill Farm

If you regularly have an abundance of tomatoes you’d love to turn into salsa to sell at your local farmers’ market, or you make an amazing strawberry pie your neighbors and friends clamor for, now could be the time to launch a business producing these items in your home kitchen. New attention to state legislation that supports small-scale food businesses based in home kitchens is making it easier to be a “cottage” entrepreneur.

These state-specific laws, often referred to as “cottage food legislation,” focus on regulations that enable the production of various nonhazardous, food items processed in home kitchens for public sale. Typically, the businesses developed are small-scale, independent and family-run, and use their own equipment. Producers operating under cottage food legislation gain cost savings and the ease of working from home rather than renting or building a commercial kitchen, as required in commercial food processing regulations.

“While everyone from the media to Capitol Hill keeps spinning wheels trying to find the perfect panacea for job creation, especially in rural areas, they really need to look no further than our nation’s kitchens,” explains Patty Cantrell, founder of Regional Food Solutions LLC, a Missouri-based consultancy that supports cottage food legislation. “Our American history [has] roots in this idea of cottage businesses, from the butcher to the baker and other food artisans who create things at home that service their local community.”

More than 30 states currently have some form of cottage food legislation in place, with many of those becoming laws within the last two years or so.

“It is inspiring to see an entrepreneurial movement gaining momentum nationally that has such a potentially positive economic [impact] on small-scale farmers,” says Wes King, Executive Director of the Illinois Stewardship Alliance, a grassroots nonprofit organization that championed cottage food legislation in Illinois. “These new cottage food laws, like we now have in Illinois, remove barriers that historically have impeded farmers’ [abilities] to launch small-scale, value-added businesses. It is now much easier for aspiring entrepreneurs to start new local-food enterprises and tap into selling at one of Illinois’ over 300 farmers’ markets.”

Know Your State’s Cottage Food Laws
Cottage food regulations vary tremendously among states, covering from what you can and can’t produce to how much gross income you can bring in. There is a patchwork of rules and regulations, and not all states have laws in place.

“Individuals need to research, understand and operate under their specific state regulations,” advises Judith McGeary, executive director of the Farm and Ranch Freedom Alliance, which worked on the legislation in Texas. “Start by reading the specific law, and then connect with like-minded organizations familiar with your state’s situation, such as local foods groups or farmers’ market associations, for advice. Ask people already producing under your state’s laws about their experiences and advice.”

Potential food-safety issues generate the loudest complaints against cottage food legislation, stemming from concern that most of these laws do not require home kitchens to be inspected or regulated. However, food safety problems have not been documented to date.

“I have not heard of any significant problems or increases in food-borne illnesses within the states that have cottage food laws in place,” McGeary notes.

Launch Your Home-based Food Business
If you think you’re ready to go public with your food business, here are six key steps to launch your home-based start-up:

1. Identify your food business’ purpose.
“As a first step, put some time into thinking about and defining what it is that you want to make and who you want to sell to,” advises Quincella C. Geiger, author of Bringing Home the Baking: How to Start a Licensed Home-based Baking Business (self-published, 2007) and a national expert on home-based baking start-ups. “This may determine if your state’s cottage food laws even cover what it is you envision and are passionate about doing.”

For example, a wedding- or birthday-cake business may be allowed in states with laws for home-based baked-goods, as these products are sold directly to one person. On the other hand, if you envision selling your jams to a local food co-op for distribution, you’ll discover that most legislation does not allow wholesale sales.

“My motivation to start doing home-based processing of jams and breads came from seeing other folks at the farmers’ market I sell at,” explains Regina Dlugokencky, an organic and sustainable farmer who runs Seedsower Farm in Centerport, N.Y. “I noticed their jams were flying out of their booths, and in talking to my farmer friends about their experiences, the process to start such a business didn’t seem that hard.”

Bounty also motivates: Dlugokencky harvested an abundance of raspberries and realized she could diversify her off-season income sources by selling jam at winter markets.

2. Understand your state’s cottage food laws.
While each state’s laws will vary on specifics, they generally include some form of the following:
Labeling requirement: Most states require labels notifying the consumer that the product was processed in a home kitchen. For example, according to Wisconsin’s current cottage food law, the label must include the sentence: “This product was made in a private home not subject to state licensing or inspection.” Additionally, the label must include the name and address of the person who prepared and canned the product, the date it was processed, and a list of ingredients.

Market specification: Cottage food legislation generally supports sales venues where the producer has direct contact with the customer, such as farmers’ markets, community events and on-farm stands. Wholesale or online sales are typically not included.

Registration: Registration may be as simple as filling out some paperwork (as is the case in Michigan) or as intense as an on-site kitchen inspection (like Dlugokencky needed in New York).

Submitting your recipes might be required as part of the registration process. For example, your state might require the use of specific university Extension-approved recipes. Don’t assume you can sell a product made using Grandma’s 50-year-old pickle recipe under cottage food legislation. Ask questions and adhere to all recipe requirements.

Food safety: “To sell my products direct from my kitchen to my customers is really the ultimate form of trust,” Erin Schneider says. She and her husband run Hilltop Community Farm in LaValle, Wis., and have been selling a variety of high-acid foods approved under the state’s cottage food legislation, including sweet pickle relish, salsa and jam. “I make sure to adhere to all the needed safe food-handling procedures, like good hygiene and proper canning procedures; keep all required records and use approved recipes.”

States may designate certain ingredients as “potentially hazardous” and not allow them. For example, pies, such as banana cream, lemon meringue or custard, that require refrigeration to assure safety are generally not included.

“Think about how to frame your questions and get in the right frame of mind before calling your state agencies for information on legislation and requirements in your state,” Geiger advises. “Remember you are calling an overtaxed governmental agency. Patience and kindness on your part can go a long way in getting the information you need.”

3. Get down to business.
Those who’ve always loved making jam or baking cakes and sharing tasty results with neighbors or donating them to local bake sales must treat the venture accordingly in the move from “hobby” to “business.”

“Farmers can grow beautiful produce, but they do tend to underprice the value of what they are selling,” Cantrell says. “Remember to price [your] products accurately, taking into account everything from your labor in the field to the cost of the jars and containers.”

With that in mind, a cottage food business can add a healthy boost to your farm’s bottom line. Schneider grosses approximately $1,500 to $2,000 in annual sales from her processed products, and finds her canned goods a particularly strong seller at winter farmers’ markets, when folks are looking for holiday gifts.

4. Brand your product.
After you comply with your state’s regulations, there is room to add creative, personal touches to your products. A colorful label with a photo of the farm or a ribbon tied around a jar or package are inexpensive yet distinct and memorable ways to brand your product.

To increase potential future sales, share ways to use your product, including your favorite recipes. Offer unexpected uses for your product, such as a layer-cake filling or a sweet fruit dip made with your jam. Give your customers a recipe for homemade croutons, and they may go home with an extra loaf of your bread.

“We are able to sell approved canned goods during local holiday fairs and community events,” Schneider says. “Producing and selling these canned goods is a win-win for us: We have an added income source that keeps us diversified, but it also helps support our bigger mission of helping our members and community eat seasonally year-round.”

5. Grow, if you want to.
At its core, cottage food legislation intends to help micro food businesses launch without the cost of a commercial kitchen. You’re the one managing and directing your business and shaping its future. If you have a consistent, quality product and loyal customer base, it’s possible that your volume might outgrow what your state’s regulations will let you produce in your home kitchen.

Dorothy Stainbrook of Forest Lake, Minn., ran into that problem after she started HeathGlen Farm in 1998. “I wanted HeathGlen to be more than a hobby; I wanted to make a living on the farm,” Stainbrook explains. “I got into fruit preserves because I wanted to develop a part of the farm business that would take me through the whole year financially, especially the winter months.”

Taking advantage of her garden abundance and Minnesota’s cottage food laws, Stainbrook started making fruit preserves to sell at the St. Paul Farmers’ Market.

“I did a ton of sampling at the market to get feedback from customers on what they liked and developed a unique distinction by keeping the sugar as low as I can, which really accents the fresh-fruit flavor,” she says.

Stainbrook also tapped into her former bartending expertise and blended liqueurs into the preserves to further enhance the fruit flavor. Volume and sales snowballed to the point that Stainbrook eventually needed to build her own on-farm commercial kitchen.

“My preserve business succeeded because I could start out processing at home,” Stainbrook adds. “As a farmer, I didn’t have the money or the time resources to go into the city and rent a commercial kitchen when I got started. I found Minnesota’s laws very straightforward and easy to understand.” Even when Stainbrook eventually needed to build her own commercial kitchen, she remained committed to building it on-farm and continued to work at home, avoiding the fuel costs and the need to lug equipment and product to an off-farm setup.

6. Raise your voice.
The motivation behind every state’s cottage food legislation comes from individual citizens and grassroots organizations passionate about supporting home-based food businesses. If your state does not have such laws currently on the books, consider taking a leadership role to make it happen. Even if your state does have legislation in place, be aware those laws can change at anytime—whether expanding cottage food opportunities or scaling them back. Ask questions and get involved.

“I’m curious why my New York regulations do not allow me to include fruits or vegetables in my breads,” Dlugokencky says. “During the winter when I have more time, I want to investigate this further and perhaps see what it would take to change that. I would love to do something like zucchini bread and showcase more of what I grow on the farm in my baking.”

Remember, legislators need your eyes and ears on the farm to help inform their decision-making.

The cottage food movement represents more than just a diversified farm-income stream. By growing the ingredients and processing these items on your farm, you’re directly contributing to growing the local-food movement and increasing the opportunities for your neighbors to support community agriculture, one jam jar or bread loaf at a time.

Lisa Kivirist is the co-author of Farmstead Chef (New Society Publishing, 2011), along with the award-winning ECOpreneuring (New Society Publishing, 2008) and Rural Renaissance (New Society Publishing, 2009). She and her family run Inn Serendipity bed-and-breakfast on their Wisconsin farm, completely powered by the wind and sun. Kivirist also leads the
MOSES Rural Women’s Project.

Reprinted with permission from the March/April 2012 issue of Hobby Farm Home. Adapted from the original.

November/December 2013

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