3 Things We Wish All Food Producers/New BRFV Clients Understood
I have always had an interest in making food – indeed, many of my first jobs were in restaurants, starting, ironically, at a McDonalds. In fact, when my sister and I were growing up, coming home from school and waiting for our parents to come home from work, we would sometimes sit in the kitchen looking for a snack before dinner. While my sister would often survey the cabinets and refrigerator and conclude that there was nothing to eat, what she really meant was that there was nothing ready to eat. It is at that point that I would start rummaging around the same cabinets and fridge she had just abandoned, pulling out ingredients and preparing something from scratch, often a recipe of my own on-the-spot devising. Sometimes I came across new combinations of food that I loved (pickles and sharp cheddar cheese! M&Ms and salty potato chips!), but it was that experimentation that planted the seed for my enduring love for preparing food.
Various other career paths came and went (teaching, grant-writing, editing, delivering beer) before I found myself helping steer the ship that is Blue Ridge Food Ventures, a facility that specializes in helping entrepreneurs develop their food and natural product concepts. Blue Ridge Food Venture’s mission is to provide infrastructure and technical assistance to enable small businesses entering the marketplace with safe and wholesome foods and natural products, thereby assisting in the creation of new businesses, new jobs, and new revenues for the region. This could include anything from assisting food trucks and
caterers to manufacturing retail and wholesale food products – in fact, BRFV even accommodates the production of non-food natural products such as cosmetics, body and skin care items, and CBD infusions. We are also open to new and unique ideas outside of these categories – we recently consulted with a new potential client who makes candles, and while we had never considered that type of product before, it turns out we have several pieces of equipment that could help expand a production of that type. You never know what new and interesting products might be made at BRFV – there’s never a dull
When budding entrepreneurs begin looking for a place to begin or expand their production needs, BRFV is a natural option that many turn to first, and we are happy to help anyone develop their ideas regardless of what stage they may be at. Sometimes new clients come to us with only the twinkling of an idea, while others have already been successful selling their product lines. No matter one’s level of experience with their production needs, there are some things that, in an ideal world, all clients would
know – with that in mind, here are three things we wish all new clients understood:
1) Business Planning Resources:
Since WNC is blessed with such a large and diverse entrepreneurial community, it makes sense that we also have an abundance of local business planning resources that businesses may take advantage of to help them succeed. We encourage all new food and natural product entrepreneurs to develop a robust business and marketing plan to help guide their decision
making and illustrate the roadmap they will follow. A good business plan can also help a new business secure additional funding, on-board new business partners, or satisfy investors who are looking for a return on their investment. This may seem daunting, particularly if one is in the early stages of idea development, but the good part is that while it may seem like a big hurdle, it
is not as hard as it may initially seem. And luckily, there are many places you can turn to for help! The following are three of the resources that we have found to be the most helpful to new BRFV clients, but there are many more – when you visit the ABTech link below, don’t forget to scroll to the bottom of the page to see a list of many additional resources.
- ABTech Business Incubation and Small Business Center
Your local community college system offers a wide range of programs and services for existing and prospective business owners that encourage entrepreneurship and economic development, from seminars, workshops and classes to professional business counseling. And since BRFV is located on the Enka Campus of ABTech along with the SBC, they make a natural fit for our new clients who may be unsure of how to take the next steps with their business planning needs. BRFV highly encourages anyone starting a food or natural products business to reach out to this organization in the early stages of their growth.
- Mountain BizWorks
Mountain BizWorks has been serving WNC entrepreneurs for over thirty years, and while their operation may seem small, they have an outsized impact on entrepreneurship in our region, with over 2800 loans totaling $74,0000,000 in 2019 alone. Entrepreneurs can benefit from the organization’s free orientation session that can help understand the many offerings on tap here, from their flagship business courses taught by experienced local business owners, to business coaching in strategic growth, as well as specialty offerings to further develop local and regional entrepreneurship.
SCORE is a team of successful executives who provide business consulting services to entrepreneurs, business owners, and professionals who want to start a company or expand an existing business in Western North Carolina. The best part about SCORE is that its offerings are FREE! The organization can help you find a mentor who can help you start or grow your business and offers webinars, courses, workshops, and events to further assist entrepreneurship in our region.
2) Cost of Goods Sold (COGS):
We believe that one of the most important things a new entrepreneur should understand is how to calculate their Cost of Goods Sold (COGS). While there are many different methods for calculating COGS, essentially your COGS include everything that is included in the manufacture of your product: ingredients, packaging, labels, overhead for renting a production facility, and labor. It is important to note that COGS does not include indirect costs such as marketing, advertising, and distribution. Once you understand how much it costs to produce an individual unit (ex: bottle of hot sauce, jar of honey, tube of face cream, etc), you can then determine what a suitable retail and/or wholesale price will be. Lowering your overall COGS will help you improve your profit margin, and BRFV can assist entrepreneurs by helping increase efficiency in manufacturing. Using our commercial scale equipment (which we can train you to use) will help you produce more saleable units in a shorter amount of time, putting more money where it belongs . . . in your pocket! Staff at BRFV, as well as many of the excellent business resources identified here, can help entrepreneurs determine their COGS.
3) Regulatory Environment for Food:
There is a common misconception held by people new to the food industry, especially those who have not grown up working in restaurants or other food production areas – getting into the food industry should be easy. It’s an easily understandable assumption, one that belies the actual complexity of the regulatory environment that one can expect to encounter: we eat food every day, we may have even made that food, and we will continue to make and eat food throughout our lives; we haven’t made ourselves or others sick when doing so – so why should we be subject to the often complex regulatory controls required to manufacture and sell a food product? Well, the answer to me is fairly simple: sick people and dead people are really bad for business! Of course, I’m NOT suggesting that you are going to sicken or kill your consumers. In fact, it is precisely these concerns that BRFV is here to help you manage. BRFV can help you navigate the complexities of the various regulatory environments you may find yourself confronting when getting into the food game. In food production, making a safe and wholesome product is a paramount concern, and our facility in conjunction with your regulatory agency can help you make that happen. As with all of the regulatory agencies discussed here, taking this step will help you develop a positive working relationship with your regulatory agency from the very beginning. We believe that thinking of your regulatory agencies as allies helping you create safe and wholesome foods, rather than as adversarial “Food Police”, is an important start to your regulatory relationship.
- Food Trucks, Caterers and Meal-Delivery Services
These businesses are regulated by the County Department of Environmental Health within which your business operates. We recommend looking up the point of contact for your county health inspector office and reaching out to them directly when you are planning to start a business of these types. All clients operating one of these businesses at BRFV will be required to maintain a valid ServSafe Food Manager certification.
- Retail and/or Wholesale Packaged Foods
Food businesses manufacturing most non-meat packaged food products for retail and/or wholesale distribution are under the regulatory control of the US Food and Drug Administration (FDA). Here in North Carolina, your packaged foods will normally be inspected by the North Carolina Department of Agriculture’s Food and Drug Protection Division on behalf of the FDA. Anyone manufacturing a shelf-stable acidified food (such as a hot sauce or bbq sauce) will be required to pass a Better Process Control School course, submit their formulations to a Food Processing Authority to obtain a Scheduled Process Letter, and submit FDA Form 2541e.
- Topicals and Cosmetics
According to current guidance, cosmetic products and ingredients do not need FDA approval before they go on the market. However, there are some exceptions for certain ingredients – entrepreneurs wishing to manufacture a topical or cosmetic product should review FDA Guidance on Cosmetic Products and Ingredients. Perhaps the most important consideration for these types of productions is the accurate measurements of ingredients, particularly when it comes to scaling formulations to larger batches. As with most formulations, we recommend that all ingredients be measured by weight rather than volume – one convenient online calculator for conversions can be found here: aqua-calc.com/calculate/volume-to- weight.
- A Note on CBD
While CBD may be included as an ingredient in topical and cosmetic products, since CBD has not yet been designated as Generally Recognized As Safe (GRAS) by the FDA, it is not yet permissible to manufacture a food or beverage product containing CBD. However, it IS permissible for entrepreneurs to manufacture and sell consumable CBD oil or tinctures. Please refer to this FDA guidance on the manufacture of CBD products.
If you are interested in learning more about Blue Ridge Food Ventures and how we may be able to help you take the next steps in your entrepreneurship adventure, please reach out to us. We love hearing about your new ideas! I would recommend first taking a good look at our website to learn more about what we offer – from there, you can also send us an email to schedule a phone consultation to best understand how we can help you take the next steps in your journey to success!