If you’re growing, making, or baking so much you have enough to sell, there are a few things you need to know first. Depending on your local and state regulations, there can be quite a few rules that come into play when it comes to selling your wares. There are laws regarding how and where some foods can be made, where you can sell them and who you can sell them to and even some very specific labeling laws. While I’m not an attorney, the following is a general guide to get you started and at least know what kind of regulations you may need to be aware of before you pop up that table and tent to sell your amazing homemade merchandise.
1. COTTAGE LAWS
Cottage laws allow you to make and sell certain foods without having to have the same requirements as a commercial food operation. Most states allow you to make baked goods, jams & jellies, nuts, honey (pure honey only, no additional ingredients) and dry mixes such as baking mixes and those used to make soups or dips. Most of these foods require specific labeling to include the name of the food, where it was made, net weight and ingredients.
You, or someone in your family who helped make these foods can sell them directly to your customer, but you cannot sell them to a store or restaurant. Some states have an income limit for sales. Missouri is $50,000. If that amount is exceeded, you will have to get a license to be a food manufacturer. There are some laws that allow sales tax exemption for farmer’s market food sales up to a maximum amount. Check your local regulations or market for specifics. For a complete list of cottage laws per state, click here.
Some states will require certain foods be made in an approved commercial kitchen such as acidified foods like pickles and tomatoes, low acid foods like green beans and fermented foods such as sauerkraut. There will also likely be regulations regarding the sale of meat/milk products and poultry/poultry products (outside of chicken eggs).
2. PRODUCE REGULATIONS
Produce regulations are typically the same as cottage laws. As long as you are selling your vegetables, fruits or eggs directly to your customer you don’t need a specific license. If you’re selling at a farmer’s market, you might need a retailer license from the municipality the market is in. Here in Missouri you can get a Dealer’s license to sell your eggs to a store or restaurant based on how many dozen per week you plan to sell. For example: 1-25 cases (24 eggs per case) a week is a $5 license. It is also worth checking with your local health department to see if there are any additional requirements. Surprisingly, overlapping regulations from different departments are often unclear. You could get a city retailer license to sell your famous apple pie but not be told that you’ll also need one from the county or health department. The reality is, it’s all up to you to find those answers. If you’re selling at a farmer’s market, there is a good chance they’ll have a checklist for you.
3. SOAP AND LOTION REGULATIONS
Most states will allow you to sell your homemade cosmetics such as soaps, lotions, lip balms and moisturizers directly to a customer. Again, any sales can require other local licenses. Much like cottage law products, you will have to label them with the name of the item, ingredients, where it was made and amount. There are two big no-no’s with cosmetic items and these are federal regulations. 1- They can’t be adulterated. Basically, only use legal ingredients and list them on your label. 2- You can’t make health benefit claims. You might use lavender to relieve stress or plantain to stop an itchy bug bite. You can’t advertise your lavender tea reduces anxiety or that your plantain oil stops the itch of a bug bite. While I personally feel that the FDA has as much a responsibility to approve or disapprove herbal medical uses, for now they only approve pharmaceutical drugs.
4. SEED AND PLANT REGULATIONS
As of today, you cannot sell seeds without a license. Seeds are big business. Plants are more complicated. There are patented plants that can only be sold by the company that manufactures them. That’s right, plant DNA can be patented and because of the possibility of cross pollination, you could unknowingly have a plant with that DNA. Farmers in almost every state of the union have been sued by the makers of these genetically modified agricultural dominators, because their own plants were cross pollinated. Banned plants (primarily invasives) are also illegal to sell, some are regulated by the federal government, some by states. Most states also require a nursery license to sell plants. Because this is such a complicated issue, it is best to check with your city/county or an attorney.
5. CRAFTS REGULATIONS
Candles, wool, sewn items and wood products are just a few examples of things you can make at home and sell elsewhere. If you’re selling direct, you’ll need a business license so that you can collect and pay local and state sales tax. If you’re selling online with a platform like Etsy they will collect and pay sales tax to your municipality. Other online stores might not which will mean you still might need a local retail sales tax license if your city collects sales tax from online sales. If you’re planning to sell at a farmer’s market simply follow their requirements. We sell candles to a local store and although we have a registered business, we aren’t collecting sales tax on our candles because the store is.
Go grow something fantastic, bake something delicious, make something unique. Having your own business, no matter how small is rewarding and you'll meet a lot of wonderful people and even likely make a few friends.
Audrey L Elder
Fourteen Acre Wood
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