Granola is one of the easier foods to start selling: it's baked, dry and shelf-stable, so many cottage food laws allow it from a home kitchen, and a licensed shared kitchen covers you where they don't or once you outgrow them. The steps: a recipe by weight, so every batch and every bag is the same; the kitchen question, cottage food or licensed, which also decides who you can sell to, since many cottage laws stop at direct sales; a label with the name, net weight, ingredients and a Contains line, where granola's nuts have to be named by the nut, "almonds", "pecans"; a shelf life you've tested, by tasting stored bags for crunch and staleness; bags, a heat sealer and an accurate scale; and insurance. FDA facility registration waits until it applies: a business selling mostly straight to consumers is a retail food establishment, outside registration, and once sales to shops pass sales to consumers, it registers. In the example below, a granola maker launches for about $2,550 and registers with FDA the year shop sales overtake the market. Below are the steps, the rules, the example, and a free launch checklist.
The short version
- Granola is baked, dry and shelf-stable; many cottage food laws allow it.
- Recipe by weight, so every bag is the same.
- Cottage food or a licensed kitchen: it decides who you can sell to.
- Label: name, net weight, ingredients, Contains line with the nuts by name.
- Test shelf life by tasting stored bags.
- Bags, a heat sealer, an accurate scale, insurance.
- FDA registration starts when sales to shops pass sales to consumers.
- TaroStack makes each bake a batch with its lots and its cost a bag. More below.
The steps
| Step | What it means |
|---|---|
| Recipe | Every ingredient by weight; a full batch baked and costed |
| Kitchen | Your state's cottage food rules, or a licensed kitchen you rent |
| License | Whatever your state asks for where you make it |
| Shelf life | Bags stored and tasted at 4, 8 and 12 weeks |
| Labels | Name, net weight, ingredients by weight, Contains line, your name and address |
| Packing | Bags, a heat sealer, a scale that weighs bags accurately |
| Insurance | Product liability; markets and shops ask |
| Selling | Markets and online first; shops when you're ready for wholesale |
Scaling the recipe is in how to make granola in bulk, the business plan in granola business plan, and bagging in how to package granola for sale.
The rules
| Rule | Where |
|---|---|
| FDA registration | Retail food establishments are outside it (21 CFR 1.226) |
| Retail food establishment | Sales of food straight to consumers exceed sales to all other buyers; businesses aren't consumers (21 CFR 1.227) |
| Allergens | Major food allergens declared, tree nuts by the specific nut (21 U.S.C. 343(w)) |
Cottage food rules differ by state; yours are in your state's cottage food law. This is general information, not legal advice.
An example: a granola maker's first year
Cache Valley Granola Co., the made-up granola maker in Logan, Utah, I use in these examples, started with a honey almond granola in a rented licensed kitchen, aiming at a market opening on April 10:
| Step | Weeks before | Cost |
|---|---|---|
| Recipe by weight, test batch | 12 | $120 |
| State license for the kitchen it makes in | 8 | $100 |
| Labels | 6 | $350 |
| Bags and a heat sealer | 6 | $520 |
| Scale | 5 | $160 |
| Product liability insurance | 4 | $650 |
| First runs: oats, nuts, honey, oil | 2 | $600 |
| Market stall | 2 | $50 |
| Total to start | $2,550 |
The label reads "Contains: almonds", checked against every ingredient's own label, the oats' included, for anything else. The shelf-life test settled the best-by date at 12 weeks, after the 16-week bag tasted flat. In year one, market and online sales led; by year two, shop sales of $75,600 passed direct sales of $54,000, and Cache Valley registered with FDA as a food facility. What a bag costs is in how to make granola in bulk.
Get the checklist
Download the granola launch checklist. One sheet: type your first sale date, and each step's due date counts back from it, with the cost and the date done; the status shows on time, late, to do or overdue, and the total to start adds up. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
Three flavors, two bag sizes, shops ordering every two weeks and honey from two beekeepers: after launch, the questions are which batch is in which shop and what a bag really costs this month.
How TaroStack does it
TaroStack makes each bake a batch, with its lots and what it cost.
Each bake a batch. A bake is a batch from the recipe, taking oats, almonds, honey and bags off stock and adding finished bags with a lot and best-by date.
Cost a bag from what you paid. Each batch is costed from what its ingredients cost, so the cost of a bag follows the price of almonds.
Where it went. Each shop's order records the lots it got, so if a batch has to come back, one recall report shows every shop it reached.
| The job | Notebook | In TaroStack |
|---|---|---|
| Which honey went into a bake | Not recorded | Lots on the batch |
| Cost a bag | Worked out once | From each batch |
| Best-by on each bag | Written by hand | The batch's lot and date |
| Which shops got a batch | Invoices | One recall report |
Recipes, batches, costing, lots and recalls 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.