There's no license to crochet. A crochet business needs the ordinary layers, a registered business name, a sales tax registration where your state has one, and a local business license where your city requires one, plus labels. Under the FTC's Textile Act, crochet wearing apparel, scarves, blankets and throws carry a label with fiber content, the country of origin, "Made in USA of imported yarn" if the yarn came from abroad, and your name or an RN. Scarves need a care label too; hats and gloves are outside the care rule. Plush toys for children are the big one: they follow the federal toy standard, with third-party testing, a children's product certificate and tracking labels, though a small batch maker can register with CPSC for some testing exemptions. In the example below, a Montana crochet business sorts five products. Below are the layers, the labels, the toy rules, the example, and a free checklist.
The short version
- No crochet-specific license: a business name, sales tax where your state has it, a local license where required.
- Textile Act labels on apparel, scarves, blankets and throws: fiber content, country of origin, and name or RN.
- Handmade in the US from imported yarn: "Made in USA of imported yarn."
- Care labels on scarves and other apparel; hats and gloves are excluded from the care rule.
- Plush toys for children: the toy standard, third-party testing, a children's product certificate, tracking labels.
- Small batch manufacturers can register with CPSC for some testing exemptions, not all.
- TaroStack keeps each yarn lot and which pieces it went into. More below.
The layers
| Layer | Who issues it | What to check |
|---|---|---|
| Business name | State | An assumed business name, or an LLC filing |
| Sales tax | State tax department | Registration where your state has a sales tax; rules for other states you ship to |
| Local business license | City or county | Where one is required; home occupation rules |
| Market permits | Market organizers | Vendor applications |
| RN | FTC | Optional: a number in place of your business name on labels |
Every state and city differs; this is general information, not legal advice.
The labels
| Product | Textile Act label | Care label |
|---|---|---|
| Beanie | Yes: wearing apparel | No: hats are excluded from the care rule |
| Scarf | Yes: scarfs are listed | Yes |
| Baby blanket, afghan or throw | Yes: listed | Not required by the care rule, which covers apparel and certain piece goods |
| Yarn sold to other makers | Yes: yarns are listed | No |
| Plush toy | No: toys aren't listed | No |
A Textile Act label gives the generic fiber names and percentages, "100% Acrylic" or "60% Cotton 40% Acrylic"; the country, where yarn from abroad means "Made in USA of imported yarn"; and your business name or RN. The covered products are listed in 16 CFR 303.45, and the care rule's definition of apparel, which leaves out hats and gloves, is in 16 CFR 423.1.
Plush toys for children
A crocheted toy meant for children is a children's product. It meets the federal toy standard, ASTM F963, through a CPSC-accepted lab, gets a children's product certificate, and carries a tracking label with your name, where and when it was made, and the batch. Safety eyes and other small parts are part of what's tested. How it all works, including the small batch registration, is in CPSIA tracking label requirements, and for one maker's whole plan in teddy bear business plan.
An example: a crochet business
Fiddlehead Stitch Co., the made-up crochet and knitting business in Missoula, Montana, I use in these examples, sells at markets, online and by commission:
| Product | What it needs |
|---|---|
| Chunky beanie | A sewn-in label: "100% Acrylic, Made in USA of imported yarn, Fiddlehead Stitch Co." |
| Scarf | The same label plus "Machine wash cold, lay flat to dry" |
| Commissioned baby blanket | A fiber and origin label; the care line is a courtesy |
| Ear warmer | Wearing apparel for the head: fiber and origin label, no care label required |
| Plush whale for children | Third-party tested, a children's product certificate, a tracking label; registered as a small batch manufacturer |
Montana has no general sales tax, so the business registered its name and checked Missoula's rules. What the business earns is in crochet business plan, and how each piece is priced in how to price crochet items.
Get the checklist
Download the crochet business license checklist. One sheet: each layer, label rule and toy rule, who issues it, what it is, whether you need it, what it cost, when it was done and when it renews, with a status that stays yellow until it's done. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
A change of yarn changes the label: a beanie in a cotton blend can't wear the acrylic tag. And a plush toy's tracking label points to a batch, which means knowing which yarn and eyes went into it.
How TaroStack does it
TaroStack keeps each yarn lot and which pieces it went into.
Yarn by lot. Receiving records each yarn delivery with its supplier and dye lot, and fields of your own on the batch record hold the fiber content and country.
Each batch of plush. A batch of plush whales notes which yarn and safety-eye lots it used, automatically, and its lot goes on the tracking label.
Where it went. Each order records the lots it got, so one report shows which customers have a batch.
| The job | Notebook | In TaroStack |
|---|---|---|
| Which dye lot a piece used | A tag in the yarn bin | Recorded on the batch |
| The batch on a tracking label | Written by hand | The batch's lot |
| Who bought a batch of toys | Not recorded | One report |
Lots, batches, receiving and orders 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.