I’m currently in the process of figuring this all out myself. I have a buddy who is mentoring me every step of the way. He has nearly a decade of experience, but even then ... a lot will be up to me and my ability to learn the craft. I’m also starting from a close to zero and am sort of banking on him to help me fine tune my mistakes to get something presentable a little sooner than I could otherwise.
Here are the things I’ve dealt with and sort of the rabbit trail it’s all taken me down.
1.) Cottage Food Laws
I talked to my state’s department of agriculture and she practically laughed out loud when I asked if I could roast from my garage and sell it. Unless I had personally grown the beans myself for some reason, this was a no-go. So bye bye Bullet/Bullseye idea. Time to buck up and see what’s next.
2.) Small Business Loans aka Financing
Well, I talked to an entrepreneur buddy who has some experience with making things happen. Basically, coming from nothing a small business loan did not seem to be in the cards as I have no equity other than my home. So he said I could jump through some hoops to get a small business loan that uses my home as equity ... or I could shortcut the middle man and talk to my bank about opening an interest only line of credit against my home. This lets me withdraw only as much as I need and only pay interest for the first 10 years. So start up costs won’t destroy me and I have some runway for a lease. I have been approved for this but have not accepted yet. There are some other fees, $500 here and there so I’m waiting to get a little more information from my network to see if the idea is viable.
3.) The commercial lease and zoning headaches
If my primary revenue stream is going to come from wholesale accounts, I am considered a food manufacturer and am zoned as industrial aka big buildings outside of foot traffic. If I’m retail, I have smaller spaces and higher lease and I essentially have to open a coffee shop to make sense of it, but I’m almost guaranteed to have some sort of revenue from walk-ins vs finding wholesale accounts.
However, wholesale = roast on my schedule. Retail = hire a coffee shop manager or partner with someone to get things off the ground and lose revenue somewhere down the road.
4.) Branding.
Due to the rest of the stack being serious, I now have to consider paying for proper branding to compete in a potentially saturated market assuming I try and go wholesale and hope for online retail to make a dent.
5.) The Roaster
Currently I’ve gotten quotes from $20,000 to $35,000 for a 10 pound output. Back burners pricing for another $5,000-$20,000 as well. Ugh. This also makes the cost of opening a coffee shop simultaneously feel borderline impossible since I need all the espresso, drip and grinders equipment which can easily work up another $25,000-$30,000 as well.
6.) Business Plan (sort of)
Last step, it’s close to number crunching time. I need to get some realistic ideas in place of how to lose all of my money doing this on the way to returning some amount of value. I’m meeting with more and more people all the time, messaging the city planners and department of agriculture. Gotta call some HVAC people next to figure out what I need for a roaster and I need to commit to wholesale or retail which I hope to figure out from my next chat with a store owner.
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This is how I’ve had to handle the process. It’s fun to me, but it’s a huge endeavor and it’s a serious business venture at this point. It’s gone way beyond hobby and we’re to the 3-5 year plans and leaving my job and becoming a contributing member of my community phase.
I’ve seen other businesses that can set up in a garage, rock out some farmers markets and do local deliveries online. I’m not sure if these operations are necessarily legal in the eyes of the government.
As far as fluid bed roasters, you can look at Artisan 3-E, Ashe LLC or Sivetz our in Mt. Hood, OR. I would start by looking up your state’s department if agriculture and also you’ll have to verify with the FDA (or somebody) if you sell across state lines through deliveries as well.
Start there and figure out if it’s even viable. Then find the roaster that meets your budget. Then decide if you want to. This is much as I can provide as a newb myself.