Canning Business

webmistress007December 6, 2012

I'm searching for feedback on a business idea about canning and preserving for other people. This last season I did some local advertising for picking and preserving farmers and hobbyists excess fruits and veggies. I not only wanted to stock my own pantry but thought it was a great way to get free food.
The structure was set up to be divided into quarters with 25% of finished product going to the farmer and 75% being distributed between me and my partners. When harvest time arrived, we would book time to pick as much as we could from the farmer's trees or garden then take the harvest back home to be preserved. The farmer would have a set choice as to what they wanted done with their share. In our smallish community I was overwhelmed by the orders and had to turn people away. Now for the coming season I would like to open a business based on this structure but instead of doing the picking (which was really hard and time consuming) the farmer would bring in their picked harvest and pay me to do the preserving. It would be sort of based on a U-Brew business structure but instead of making wine and beer, I would be making jams and pickles.
Has anyone done this sort of venture before or know of anyone who did? How did it work out and what were some of the major challenges they encountered? Thanks for any feedback!!

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digdirt2(6b-7a No.Cent. AR HZ8 Sun-35)

What are the state and local restrictions that you have to deal with? I'd assume, even tho it is barter based, you'd have to meet the same restrictions and health codes those of us who sell such products to the public do - license, certified kitchen, approved recipes, liability insurance, etc.

Dave

    Bookmark   December 6, 2012 at 10:18PM
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nancedar(z7NC)

The FDA governs businesses that are home-based so as to follow the food trail in the case of illnesses. You must be registered as a manufacturing facility with the FDA, and follow all the state and local rules as if you were operating a commercial kitchen.

Also, note that it is not legal to sell food that has been home canned with a pressure canner, nor can it be bartered (still considered "selling"). The PC cannot be regulated by any of the government agencies to ensure that the canner meets the PSI and time needed for safe processing so they do not allow it across the board, US wide. If you have a commercial retort, then that is inspected and regulated by the FDA before approval for canned vegetables can be sold. If you have a retort then you are regulated fully as a commercial facility (not likely for a cottage industry like you are describing).

Pickles and acidified foods are heavily regulated by the FDA and require each product to be tested by a commercial food lab, then you send their analysis to the FDA for approval before it can be sold. The product cannot be altered without another analysis and resubmittal and approval. Pretty impossible if you have one kind of cuke from one farmer and another kind from someone else and one wants hot peppers added and the other wants caraway, for example. Each product would have to be tested, there is no across the board approval. When I had my last pickle product tested by the NC State food lab it cost $150 and I heard it went up to $500 PER PRODUCT. I'd have to sell a heck of a lot of pickles to make up for $500 start cost.

Canning vegetables in a boiling water bath is never approved because of the high pH risk and the perfect environment for c.botulinum.

Jellies and jams are exempt because of the low pH naturally and the addition of sugar which inhibits c.botulinum. I would imagine that is true also for canned fruits. Using artificial sugars or ingredients would mean they'd have to be tested by a food lab to ensure the pH and Aw is safe and correct before they can be offered for sale. Freezing food is not governed as readily but product must be kept at below 0F - can you ensure that it won't thaw before the buyer gets it home?

I understand what you are trying to do, and I applaud your entrepreneurial spirit, but do check out what all is required before you jump in with both feet. It worked some last year, but if the Feds or State get wind of you it could be quite costly besides you being sued if they want to get nasty. Another thing, if your state has sales tax then you have to collect it and send it in for every sale. If you don't they come after you with big laws on their side. Think of 'revenuers" coming after moonshiners. It wasn't the sale of it, it was that they didn't collect tax.

A million dollar personal liability insurance policy is just the start when you want to feed someone.

Nancy

Here is a link that might be useful: FDA rules

    Bookmark   December 7, 2012 at 5:37PM
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digdirt2(6b-7a No.Cent. AR HZ8 Sun-35)

A great summary Nancy! Unfortunately this is one of those endeavors that sounds wonderful in theory but often fails in practice.

Still I wish you luck with developing your plans.

Dave

    Bookmark   December 7, 2012 at 7:00PM
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albert_135(Sunset 2 or 3)

When I was a kid neighbors got together, sometimes, it was not a very gregarious community, and did harvesting and preserving projects.

If you provide some supplies and the neighbor provides the produce and you both do the hands-on work together how is the government going to .... never-mind. But you see the direction in my thinking?

    Bookmark   December 10, 2012 at 1:36PM
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nancedar(z7NC)

The government will know when he/she starts advertising, albert_135. My friend grew plants/trees that were exotic and rarely offered for sale locally (not invasive nor regulated as drugs like marijuana, just unusual). The State came to her house the day after she advertised (small, local) and demanded her state growers license number and sales tax records for the last 5 years. Otherwise she was going to be fined huge dollars for operating illegally. I do know that disgruntled neighbors, "do-gooders", and competitors can submit anonymous alerts to the regulating government agencies. I sell jams and baked goods at the local farmers market and the State came and asked to see my inspection reports and filings with the FDA. I had them but another vendor was shaking in her boots because she didn't have them and packed up like a "thief in the night". She has not been offering her stuff since (4 years ago). You really don't want to mess with any government agency. Do it right and legal, follow the sometimes silly rules, and you are safe.

Nancy

    Bookmark   December 11, 2012 at 6:37PM
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digdirt2(6b-7a No.Cent. AR HZ8 Sun-35)

In addition to Nancy's good points there is also the possibility of someone getting ill - or claiming they did - from something you canned for them. Proof is difficult. Disproving it is impossible. And unfortunately proof isn't needed to cause you severe problems and bring you to the attention of the authorities.

A disgruntled friend, neighbor, or family member, just one, can put all you own at risk. So do it right and do it legal for your own protection.

Dave

    Bookmark   December 11, 2012 at 7:01PM
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grlsixx

Hi, If you are in California you may be in luck. As of Jan 1, the "Homemade Food Law" or AB 1616 went into effect allowing the small food business operator to prepare foods in a home kitchen. There are a few exceptions, mainly regarding meat and dairy. You can learn more about the bill at the link below. Best of luck to you!
Heather

Here is a link that might be useful: AB 1616 Homemade Food Law

    Bookmark   January 2, 2013 at 10:55PM
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grlsixx

I noticed part of it specifically allows some canned goods:
'(c) 'Cottage food products' means foods that are prepared for sale in the home kitchen of a person�s primary private home andare not potentially hazardous food, as defined in Section 113871. Cottage food products include, but are not limited to, nonpotentially hazardous baked goods, jams, jellies, fruit butters, preserves, pickles with a pH level of 4.6 or below when measured at 75 degrees Fahrenheit, candy, granola, dry cereals, popcorns, nut mixes, dried fruit, chocolate covered nonperishable nuts and dried fruit, dry baking mixes, roasted coffees, dry teas, honey, and similar products specified in rules adopted by the department.'

Here is a link that might be useful: State of CA website

    Bookmark   January 2, 2013 at 11:03PM
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GingerGarden

I was going to mention AB1616, but Heather beat me to it. I am working on establishing a business under this very law. It is going to take time for the State to catch up on paperwork and to get everything set up, but there is a list of allowed "cottage sale" items that include most of what I make. They will offer two licenses: direct-to-consumers and third-party sales. The first requires no inspections and costs less. This is for selling at Farmer's Markets and the like. It also covers online sales direct to consumers. The second is for larger operations wishing to sell goods to boutiques and restaurants. It costs quite a bit more for the license and requires annual inspections of the home kitchen. There are rules we all have to abide by, and there will be a special course required for home canners and cooks.

    Bookmark   January 3, 2013 at 4:12PM
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