How to keep your food-based company on the right side of the law.
So, you have perfected your food product or you have mastered your art as a chef. You’ve developed a business plan, and you may have retail locations or customers lined up. Your startup food company is ready to be born. Now you just need to procure the right permits and licenses to legitimize your budding culinary company.
Unfortunately, this is where many early-stage foodpreneurs get lost, and understandably so. There is no standard set of requirements for any given food business. In fact, like the proverbial snowflake, each food company and product will have regulations and permits slightly different from any other depending on the product, location, distribution, production and so on.
Sounds intimidating, but it doesn’t have to be. Your first step is connecting with the right regulatory organizations for your product and providing them with the proper information and access to inspect your process. From a regulatory perspective, there are some general categories of food business.
This includes caterers, restaurateurs, meal prep services and specialty food services, such as cake decorators. These companies typically work in a select geographic region and prepare food that is ready to eat and not shelf-stable—that is, it couldn’t be sold on the shelves of your local supermarket. These businesses are regulated primarily by their local city or county.
If you are planning to build, buy or launch a restaurant or food service business, connect with your city and local health department early in the process. In most cases, your city or county will evaluate your plan and building before construction and make sure everything is up to code and that the location is zoned correctly. This can save a business thousands by avoiding costly changes or fees.
One of the major considerations for these kinds of businesses is making sure the building has the appropriate infrastructure, including proper ventilation, plumbing, grease traps, specific sinks and surface materials. The building must be up to fire code with proper fire suppression.
Another consideration is food safety and safe food handling. Employees must have the proper food handling permits, and the business must have the proper insurance for employees. Foods must be kept at appropriate temperatures and stored with respect to local health guidelines. There are also specific rules to limit food-borne illness and cross-contamination.
The Food and Drug Administration (FDA) has its recommended Food Code that is updated every few years. Chances are that your local health department follows the large majority of this code. Often you can request a copy of the local health code from the city or health department.
After this, there are all the extras—signage permits, patio and deck permits, alcohol permits, parking, remodeling permits and more. That’s a lot to consider, but as long as you reach out to your regulatory authority early in the process, it can help guide you to all the information your specific business will need.
Mobile Food Units
This includes food trucks, trailers and carts. Mobile food units are regulated similarly to food service businesses, but multiplied by however many health department jurisdictions they plan to serve within.
In Missouri, each county has its own health department. Some cities, such as Kansas City, Mo., and Independence, have their own health departments, and the state of Kansas delegates local inspections to its department of agriculture. A food truck could have a set of six or more permits just within the Kansas City metro.
The other major consideration for mobile units is that, in Missouri, they must have a brick-and-mortar commercial commissary that acts as their home base. This is where they store inventory, do prep work, clean dishes and so on. Some jurisdictions will require trucks to keep a log of their traffic to and from their commissary.
Trucks also must have an approved drain with a grease trap for dumping spent water.
From a regulatory perspective, the first step to starting a mobile food unit is to determine the commissary and what jurisdictions the business will serve. That will determine what regulations apply.
This includes farms, ranches and urban gardens. This is the beginning of the food chain, and these businesses typically are overseen by state or federal agencies. Some cities or counties will have farms register with them, and there may be zoning restrictions as well.
The rules that apply to growers will depend on the size of their operation and the size of their distribution. If a farm distributes solely within its state, it will need to abide by the rules of the state department of agriculture, the rules of the state health department or both.
If farmers sell their products across state lines, they could be subject to the regulations of the FDA or the U.S. Department of Agriculture (USDA). The USDA regulates meat and eggs; the FDA regulates all other foods. These organizations are responsible for inspecting farms, setting packaging and labeling rules and setting safety standards.
Now this only applies to unprocessed foods. As soon as you cut, cook, freeze or butcher anything, you are considered a food product manufacturer (which we’ll cover shortly).
The other organization that farms need to pay attention to is the Environmental Protection Agency (EPA). The major consideration for farms here is what chemicals can or cannot be used. The first step for farmers is to research their specific product and learn what rules apply to them.
Food Product Manufacturers
This includes any company that processes a food product. With the exception of raw fruits and veggies, and the deli, this is almost everything you buy at the grocery store.
Like food growers, manufacturers are regulated by their size, distribution and the type of products that they make. Each type of food has different rules and regulations. Just like with growers, if the food product is sold only in the state it’s manufactured, it is subject to the state health department or agriculture department’s oversight. As soon as that item is sold across state lines, it is regulated by the USDA for meat and eggs and the FDA for everything else.
The FDA simply requires that a company register its facility initially, and then the FDA has the option to inspect the facility at any time. Some products, such as canned goods, will require third-party lab testing to show they are safe for consumption before they start processing.
The USDA will require an application prior to a business opening a facility and will generally have an inspector present for any and all processing for the life of the company.
Both organizations will want the facility to have a HACCP plan. HACCP stands for Hazard Analysis and Critical Control Points, and is a written document outlining the procedures and safety protocols for the facility. Both organizations also set rules for labeling products.
In addition, the facility will need to consider the local and general rules that food companies have to abide by, such as zoning, local health inspections and building requirements.
The first step for manufacturers is to research their product. Local universities with food science programs are great resources. They may also be able to provide third-party lab testing for your food product.
Getting It Right Matters
“Getting legal” may not be the most glamorous part of being a foodpreneur, but it truly does help startup food businesses.
For starters, it greatly reduces their liability by making sure the products are safe and that they have records of compliance. A major recall can destroy a small food business. And as a regular eater of food, I greatly appreciate all the days I don’t have food poisoning.
Build a relationship with the regulatory agencies that oversee your business. It’s always cheaper and easier to have a building or process set up correctly the first time than to go back and make a change. Also, inspections are easier when you are transparent and have a reputation for proactively maintaining safe practices.
And always keep in mind, although food regulations may be daunting, there is help. Universities, small business development centers and culinary incubators are great places to get expert help so you can launch that budding culinary company.