Bone Broth Business Plan, With a 12-Month Projection

A bone broth business plan sets out what you'll simmer and who buys it, what a jar costs and sells for, the kitchen and freezers, the food safety and inspection rules, and the first year month by month. Bone broth is slow: bones simmer for a day, so kitchen time, often overnight, is the biggest fixed cost, and a pot of broth has to be cooled fast before it's jarred and frozen. Selling it frozen to your own customers keeps it within the retail rules; canning it or selling to stores brings inspection. In the example below, a maker in Duluth sells frozen beef and chicken broth at markets, monthly subscriptions and hot cups, makes a profit from month 5, and ends the year about $12,100 ahead on $54,500 of sales, after paying $20 an hour for the work. Below is a description example, each part of the plan, the rules, the projection, the startup budget, and a free template.

The short version

• Describe the business in a paragraph: the broths, where you sell, the kitchen, the goals.
• Cost a jar from the bones up: yield, vegetables, jar, energy for the simmer, your time.
• Sell frozen jars at markets, monthly subscriptions, and hot cups on cold days.
• Cool broth fast in shallow pans or with ice wands; a full stockpot cools too slowly.
• Frozen jars sold to your own customers fit the retail exemption; canned broth and sales to stores don't.
• Kitchen time is the biggest fixed cost; plan overnight simmers.
• TaroStack keeps every batch with its bone lots and its date. More below.

Part 1: the business description

North Shore Broth Co., a made-up bone broth maker in Duluth, Minnesota, I use in these examples, writes:

North Shore Broth Co. simmers beef and chicken bone broth for 24 hours in a licensed commercial kitchen, from bones bought from inspected local suppliers, sold frozen in glass jars at two farmers markets and by monthly subscription with home delivery, and hot by the cup at markets. Every jar carries a batch code and its date.

Part 2: what a jar costs

In the example, 10 pounds of beef bones with vegetables and water simmer down to about 2.5 gallons, 13 jars, so a jar carries three quarters of a pound of bones. The yield moves with the bones and how long they simmer; measure a few batches. How to work out a batch's yield and cost is in batch size calculator.

Part 3: customers and prices

A subscription leaves less a jar, $5.45, than a market sale, but it's paid every month and tells the kitchen how much to make. The hot cup is the market's sample that sells: a cold Saturday customer who likes the cup buys a jar to take home. How a subscription's steady demand helps the plan is the same idea as a catering business plan's booked events.

Part 4: cooling, freezing and inspection

Broth comes off the stove hot in a deep pot, and a deep pot cools slowly. USDA's advice for cooked food is shallow containers for quick cooling and refrigeration at 40 °F or below within two hours (USDA), so the plan strains the broth into shallow pans and uses ice wands before it's jarred and frozen; the cooling is part of the 6 minutes a jar.

Meat and poultry products generally have to be made under USDA or state inspection. Federal rules exempt operations of the kind retail stores and restaurants carry out, selling in normal retail quantities to their own customers, but the exemption doesn't cover retort processing of canned products (9 CFR 303.1; for poultry, 9 CFR 381.10, which excepts canning). So this plan sells broth frozen, from a licensed kitchen, to its own customers at markets and by subscription. Shelf-stable canned broth, or jars in a grocer's freezer, means an inspected kitchen or a co-packer with one; how to find one is in how to find a co-packer. Check with your state's meat inspection program and county health department first. This is general information, not legal advice.

Part 5: the first year, month by month

Fixed costs are $1,435 a month: commercial kitchen time for overnight simmers ($900), freezer storage ($100), market fees ($200), insurance ($60), the delivery vehicle ($100), the website and online shop ($40), and software and card fees ($35). Sales start at 15% of full speed and reach it by month 11:

The year's sales are $54,548 and the profit $12,125, on top of $20 an hour for the work. Cash goes $1,851 below zero by month 4, nearly all of the $2,000 of working cash, because the kitchen is paid for before the jars sell; a slower start would need more cash, so the kitchen hours grow with sales rather than ahead of them.

Part 6: the startup budget

Get the template

Download the bone broth business plan workbook. Four sheets: your products with price, variable cost and monthly volume at full speed; the year, month by month, with sales, profit and cash; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

Beef and chicken bones from two suppliers, batches simmered overnight and frozen by date in two freezers, 40 subscriptions to pack each month, and two markets a week. A notebook can't say how many beef jars are frozen, which batch a subscriber got, or which supplier's bones were in a batch if one recalls a lot.

How TaroStack does it

TaroStack keeps every batch with its bone lots and its date.

Batches with their lots. Each broth is a recipe of bones, vegetables, jars and labels, and units convert: bones bought by the case, used by the pound. Recording a batch takes them off stock from the lots used, at what you paid, notes the lots automatically, and divides by the jars that came out, so a batch that simmered down further shows in its cost.

Frozen jars by lot and date. Every batch goes into a lot with its date, picking takes the oldest jars first, and one report walks a supplier's bone lot to every batch and every customer who got jars from it.

And the subscriptions. Each month's subscriptions are sales orders for their delivery day that show whether the jars are in the freezer while you're still typing, and margins are reported by product and by customer.

Recipes, batches, lots, recalls and margins by product and customer are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

Is a bone broth business profitable?

It can be, once the kitchen time is covered. In the example, a maker selling frozen jars, subscriptions and hot cups ends the first year about $12,100 ahead on $54,500 of sales, with $20 an hour paid for the work.

Can I sell bone broth at a farmers market?

Generally from a licensed kitchen, to your own customers, frozen; federal rules exempt retail-type operations selling in normal retail quantities to their own customers, but not canning. Check with your state and county.

How much does it cost to make a jar of bone broth?

In the example, $1.88 of beef bones, 30 cents of vegetables and 40 cents of energy for a 24-ounce jar, and $6.05 with the jar, label, your time and card fees.

How do you cool bone broth safely?

Strain it into shallow pans or use ice wands, then refrigerate or freeze it. USDA advises shallow containers for quick cooling and refrigeration at 40 °F or below within two hours.