Salad Dressing Business Plan, With a 12-Month Projection

A salad dressing business plan sets out the dressings you'll bottle and who buys them, what a bottle costs and sells for, the process and food safety rules, and the first year month by month. A vinaigrette is mostly oil and vinegar, about two dollars of ingredients and bottle; the oil is the biggest cost and the one whose price moves. The line that shapes the business is between shelf-stable vinaigrettes, safe at room temperature because of their acidity, and creamy dressings made with dairy, which are kept refrigerated from the kitchen to the customer. In the example below, a dressing maker in Keene, New Hampshire, sells vinaigrettes direct and to grocers, a refrigerated creamy dressing, and gallon jugs to restaurants, makes a profit from month 3, and ends the year about $24,500 ahead on $75,600 of sales, after paying $20 an hour for the making. 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 dressings, the buyers, the kitchen, the goals.
• Cost a bottle: oil, vinegar, seasonings, bottle and label, making time and fees.
• Oil is the biggest ingredient cost; watch its price.
• Shelf-stable vinaigrettes rely on acidity; test the pH of every recipe.
• Creamy dairy dressings are kept refrigerated all the way to the customer.
• Food service gallons leave little; price them from the cost.
• TaroStack keeps every batch with its oil and vinegar lots and its date. More below.

Part 1: the business description

Monadnock Dressing Co., a made-up dressing maker in Keene, New Hampshire, I use in these examples, writes:

Monadnock Dressing Co. makes maple balsamic and lemon herb vinaigrettes and a refrigerated buttermilk herb dressing in a licensed commercial kitchen, sold at farmers markets and online, to grocers and co-ops, and by the gallon to restaurants. Every bottle carries a lot code and a best-by date.

Part 2: what a bottle costs

A 12-ounce bottle of vinaigrette is about 6 ounces of oil and 4 of vinegar, with mustard and maple to hold the emulsion. A gallon jug is the same dressing in bulk, with the bottling time saved. How to cost the bottle and label properly is in packaging cost per unit.

Part 3: customers and prices

Grocers are the volume, and a grocer bottle leaves $2.45. A restaurant gallon holds almost eleven bottles' worth and leaves $6.90, because a restaurant won't pay retail for bulk; it keeps the kitchen busy and the name on menus. What it costs to set up a bottled sauce business is in how much does it cost to start a sauce business.

Part 4: pH, refrigeration and the process

FDA's acidified foods rules cover low-acid foods made safe by adding acid, and they exclude acid foods, including food dressings and condiment sauces, that contain only small amounts of low-acid ingredients and keep the pH of the predominant acid, as well as foods kept refrigerated (21 CFR 114.3). A vinaigrette that's mostly vinegar and oil usually sits there, but a recipe heavy with garlic, shallots or herbs in oil can move toward the line, so the plan has each shelf-stable recipe reviewed and its pH tested by a lab, and checks pH on every batch. The creamy dressing is kept refrigerated throughout and labeled "keep refrigerated." A process authority can say which rules a recipe falls under; what one does is in process authority letter. This is general information, not legal or food safety advice.

Part 5: the first year, month by month

Fixed costs are $1,235 a month: commercial kitchen time ($700), insurance ($60), process review and pH tests ($50), market fees ($200), delivery ($150), 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 $75,616 and the profit $24,511, on top of $20 an hour for the making. Oil is the cost to watch: a 20% rise in oil adds 18 cents to every bottle and almost two dollars to a gallon, more than a quarter of a gallon's contribution.

Part 6: the startup budget

Get the template

Download the salad dressing business plan workbook. Four sheets: your dressings 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

Four dressings, oil and vinegar bought by the case at prices that move, batches with their pH readings, a refrigerated dressing with a short date, and grocers reordering weekly. A notebook can't say which oil lot went into a batch, which grocers got it, or what a bottle costs now that oil has gone up.

How TaroStack does it

TaroStack keeps every batch with its oil and vinegar lots and its date.

Batches from their lots. Each dressing is a recipe, and units convert: oil bought by the 35-pound jug, used by the ounce. Recording a batch takes the oil, vinegar, seasonings, bottles and labels off stock from the lots used, at what you paid, notes the lots automatically, and puts the bottles into a lot with their best-by date.

Batch records with the pH. Batch record forms carry your own fields, such as pH and fill weight, with limits and sign-off, so each batch's reading is recorded as it's made.

And the grocers. Grocer orders are sales orders that show whether the bottles are on the shelf while you're still typing, one report walks a lot to every customer who got it, a price-creep report shows whose oil prices are rising, and margins are reported by product and by customer.

Recipes, batches, lots, recalls and batch record forms 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 salad dressing business profitable?

It can be. In the example, a maker selling vinaigrettes direct and to grocers, a creamy dressing and restaurant gallons ends the first year about $24,500 ahead on $75,600 of sales, with $20 an hour paid for the making.

Can you sell homemade salad dressing?

Generally from a licensed kitchen. Shelf-stable vinaigrettes rely on acidity, so each recipe is reviewed and its pH tested; creamy dairy dressings are kept refrigerated. Check your state's rules.

How much does it cost to make a bottle of salad dressing?

In the example, $1.65 of oil, vinegar and seasonings and 85 cents of bottle and label in a 12-ounce vinaigrette, and $3.27 in all with making time and card fees.

Does salad dressing need to be refrigerated?

Vinaigrettes are often shelf-stable because of their acidity until opened; creamy dressings made with dairy are kept refrigerated. A lab test and a process review tell you which yours is.