Dollars and sense of your food business (part 3)
The Michigan State University Product Center innovation counselors can help emerging food producers incorporate good business practices into their plans.
Sound financial and recordkeeping systems are just as much a part of the food business as grandma’s pumpkin pie recipe. The Michigan State University Product Center innovation counselors can help emerging food producers incorporate good business practices into their plans.
The sustainable food business incorporates sound financial and recordkeeping systems from the beginning. Through partnerships, professionals, commercial software products and your own resources you can assure that your business plan is equipped for financial stability.
Your first thoughts about a new business warrant the start of a filing system, notebook or other organizational system. This will help put you on firm ground when developing a full-fledged plan or make documentation a snap.
The question of how you will price your product is not only a marking issue. In addition to food ingredients, packaging, testing, shipping, and advertisement, there are those fixed costs like insurance, and rent. How about labor? You will probably want to pay yourself. At some point, you will need hired labor or services. Take all into account to cover your expenses.
Prepare to track your expenses and revenues with a service or software system. Many community education programs, community colleges, and business development agencies offer introductory classes to help you get started. Private payroll, bookkeeping, and related services are another option for good financial practices.
Some food entrepreneurs will seek outside financing through banks, credit unions, family and friends. Be prepared to develop projected cash flow projections and other financial statements that demonstrate your capacity to make your dream food business a reality.
You will not likely make, market and manage your food business all by yourself. Start your business planning process with a team approach in mind. Michigan State University Product Center’s statewide network of Extension educators and innovation counselors will help you conceptualize your new food business venture.