Monday, July 21, 2008

Welcome to Mind Equity Inc Blog!


I was surfing sites where hopeful entrepreneurs can ask for advise and found this. It made me crazy so here's what I wrote back ....


Hopeful Entrepreneur:

I make homemade maple syrup. I starting making the syrup one day in 2006 when we ran out at home. I looked at the back of the empty syrup bottle and the first four ingredients, I knew that we had in the cupboards. The rest is history. I've been making the syrup ever since. It is delicious on pancakes, waffles, french toast, biscuits and what ever you put maple syrup on. My husband won't go to the store when we run out. He will wait for me to make more because he likes mine better than the syrups in the stores.


Random Adviser:

I love this idea and I love the fact that you shared it with us. There are SOOO many small businesses that started out as "mom and pop" organizations like this.
Examples (read the "our story" at these links): hancockgourmetlobster.com , tortugarumcakes.com , I think even clif bars started out in the guys kitchen!

If you can make the stuff better and everyone loves it and agrees go for it! You just need to have high end marketing and get one or two grocery stores to pick it up. Maybe bottle it and put it in those touristy type shops in Vermont?

Can you do this? I have no doubt, start small make it and bottle it in your kitchen, when you outgrow it, then get commercial space. Use the money you can scrape together to get some custom printed labels (available for less than $200 bucks) and some bottles! Consider glass or tin type containers over plastic ( maybe even mason jars?), they will give you that home made feel, while the labels lend to your professionalism.

Also, maybe get a one page website so people can find you amorend can call or email if they have questions... Don't immediatly try to market it online as this product needs to gain a name for itself first. I will be patiently waiting for when your syrup hits stores here in philly :)


Here is our advice:


Can you say Salmonella in a jar!

When people start talking about making their own food product out of their kitchen I have to cringe. I know that “everyone does it” but should they? Last time I looked, there isn’t a homeowner’s policy with a clause for product development.

If you make and sell a product and someone gets sick, you will be liable and if they sue you will have no protection (product liability insurance) to protect your home and family. On top of that, if the FDA gets a complaint you face fines from a few hundred dollars to thousands.


Food Development can be simple if you do it the right way.

  1. If you believe you have a great product then go to a packer. They already have FDA approval. This will save you months and headaches you would not believe.
  2. Packers will also have the chemists, nutritionists (for your labels) and packaging.
  3. They will give you one price which will include your recipe, container, label (with nutrition statement) in cases ready for you to pick up, or have your distributor pick up.
  4. You will need to provide them with your recipe, label art, UPC# (UPC is a whole other animal)

Here is an example to show that it can be cost effective. Let’s use mango-chutney sauce for the example:

They make your recipe

Put it in a container

Put on label

Put in case

Ready for pick up at the dock!

You pay (roughly) $1.50 per lb

So let’s do the math:

For our example, let's say your cost is $1.50 for each one pound tub. There are 6 tubs to a case, so that is $9.00 per case. The minimum number of cases the packer will prepare (the packer will have this), let's say is 50. So $9.00 per case x 50 cases is $450. So for $450 you get 300 tubs of sauce ready to sell.

You then can sell it at fairs or wherever for $4.00 per tub. Ok, let’s look at your profit! $4.00 - $1.50 = $2.50 net per tub. For 300 tubs, that equals a net profit of $750.

However, if you want to sell at through a store you will not make that kind of profit. That is a different marketing plan.

There are many things that go into making a product sell. Marketing and advertising drive a product successes, and that is where all the hard work, time and money comes in!

Because of the many food handling rules for processing and preparing food for sale, the entrepreneur is advised to consult an expert prior to investing in a food processing venture.

As in any business venture, know and understand the rules before you get started.