Turning Your Family Recipe into a Food Business

I meet many people who have a dream of taking that cherished family recipe for a baked dessert or food item and creating business out of it. Often, they have no idea of how to go about doing that – sometimes even after they've already started the business and find themselves floundering.

Earlier this Spring, Joe Connolly, business writer for the Wall Street Journal and creator of the Small Business Report on WCBS880 radio, asked me what advice I would give to people who dream of starting a business, since "so very few people seem to ever make a real business out of a personal interest."

I’ve done it twice. Here’s what happened with the more successful venture, a specialty baked goods company called The Well-Bred Loaf:

• We had tested the market by (A) initially selling at an outdoor market and (B) by developing some wholesale accounts (E.A.T., Balducci's) before having to invest in a commercial space & equipment. So by the time we made the financial investment, we knew we had a business.
• The timing of all this – catching the upswing of what I call the "gourmet food boom" – enabled us to accelerate the growth of the business.
• But what differentiated Well-Bred Loaf from other home bakers of that era was that:
  
  • We were well-organized in the business details as well as the sales, production and delivery of the products.
  • We quickly developed low-cost but effective "guerilla marketing" methods and provided good service to the store owners – as well as consistently-excellent products to the ultimate consumers.
  • We identified and targeted those types of stores that offered strong "point-of-purchase" opportunities for our products.
  • We made "no-compromise," delicious versions of all-American classics (choc. chip cookies, brownies), and invented "Blondies", which fit in nicely with the other products we made.

The problem I often see is that while someone may have a dream, and even a good product, they haven't looked for evidence to indicate whether there is a market for it.

• Find a way to TEST your product's acceptance– to try it out before you risk everything you've got.
• Are there people who want to buy it? What’s their "profile"? Where do they buy similar products?
• Can you make and deliver the product at a price where you will make a profit and people will buy it?

And a final caution: if you've got a dollar and a dream – find out as much as possible what it's like to run a business. A business is comprised of both the dream and the details of how to make the dream come true. And the details take up most of your time. DEFINITELY speak with others, try to get a realistic picture of what your life will be like (it's not all fun), and get coaching from people who can advise you on the business side– as well as equipment dealers who can educate you regarding labor-saving equipment and minimizing operating expenses such as energy costs. Reinventing the wheel – trying to "go it alone" – can cost you more when you think you're saving money.

 

Steve Caccavo, President of Constructive Business Solutions™, is the founder and former owner of The Well-Bred Loaf, Inc., a specialty wholesale bakery that invented "blondies." He draws on his years of entrepreneurial experience to help owners strengthen and grow their small and mid-size businesses. ©2010 by Constructive Business Solutions™, a division of Positive Employment Practices, Inc. You can e-mail Steve at: Steve@ConstructiveBusiness.info.