Home Based Business Info

**The below is just for reference, and should not be taken for legal advice**

  • What is a home based food business.
  • What licenses are required to sell create & sell food from home
  • Do I need a permit or license to sell on MarMo
  • How to get a home-based food license
  • Where do I put my home-based permit / Cottage Law license on MarMo
  • What is a Cottage Law
  • States with the Cottage Law
  • Types of Cottage Law licenses & how they affect your sales
  • Resources

  • What is a home based food business.

    A home based business, is exactly as it sounds. For food businesses, it means that the food is made on the same premises as the owner’s living space. More information on small businesses can be found on the US Small Business Administration (SBA) page.



    What licenses are required to create & sell food from home

    This is a tricky question, as it entirely varies by state, and sometimes even by county! We’ll go over California’s laws — called the Cottage Law — as an example. However, approx 32 other states have a similiar law, so to find your specific state’s laws and needed permits, use this list from the US Small Business Administration’s to find your state and specific laws. A good first step we recommend is looking into your zoning laws as they can limit your ability to work from your home.

    For California home based food businesses, on top of any general business licenses such as the Business License Business Tax Certificate, you must have a Cottage Food Operator Permit (class A or class C), Cottage Food Operator Training certification, and must follow the Cottage Food Labeling Requirements. More information on these laws can be found here.

    The above licenses can cost and time varies, but often take less than a month to apply and receive.



    Do I need a permit or license to sell on MarMo

    You may need a license or business license no matter what type of operation you have. Typically, yes, your local or federal government will require you to have some sort of license to operate. Additionally, some customers may not trust your products until you show proof of your license or permit. For this reason, we recommend posting your permit on your store page (similar to how you’d see a certificate of health hanging in a restaurant) to build buyers trust.

    In general MarMo is a community of trust, and we will always stand by our sellers and customers, so please always provide accurate representations of your business and your self.



    How to get a home-based food license

    The first step after figuring out your zoning, and what type of license you want, would be to file with your local county for a permit. Here is the San Francisco permit packet — it even provides the checklist of items you need to submit to be considered for a food license!



    Where do I put my home-based permit / Cottage Law license on MarMo

    Once approved to be a vendor on MarMo, we recommend putting your license information on your “Store Settings” page under your “Seller Dashboard.” This will then be visible for all of MarMo’s customers.



    What is a Cottage Law

    The Cottage Laws allow individuals to prepare certain foods in their home kitchen with their home appliances.

    Here is a list of foods allowed to be prepared under the Cottage Law in California according to the Sustainable Economies Law Center.:

  • Baked goods, without cream, custard, or meat fillings, such as breads, biscuits, churros, cookies, pastries, & tortillas.
  • Candy, such as brittle and toffee.
  • Chocolate-covered nonperishable foods, such as nuts and dried fruits.
  • Dried fruit.
  • Dried pasta.
  • Dry baking mixes.
  • Fruit pies, fruit empanadas, and fruit tamales.
  • Granola, cereals, and trail mixes.
  • Herb blends and dried mole paste.
  • Honey and sweet sorghum syrup.
  • Jams, jellies, preserves, and fruit butter that comply with the standard described in Part 150 of Title 21 of the Code of Federal Regulations.
  • Nut mixes and nut butters.
  • Popcorn.
  • Vinegar and mustard.
  • Roasted coffee and dried tea.
  • Waffle cones and pizelles.
  • Cotton candy.
  • Candied apples.
  • Confections such as salted caramel, fudge, marshmallow bars, chocolate covered marshmallow, nuts, and hard candy, or any combination thereof.
  • Buttercream frosting, buttercream icing, buttercream fondant, and gum paste that do not contain eggs, cream, or cream cheese.
  • Dried or Dehydrated vegetables.
  • Dried vegetarian-based soup mixes.
  • Vegetable and potato chips.
  • Ground chocolate.
  • Seasoning salt.
  • Flat icing.
  • Marshmallows that do not contain eggs.
  • Popcorn balls.
  • Other foods can be added to the list by the California Department of Public Health (CDPH).


    States with the Cottage Law or similar

    Up to 2013, (and to the best of our knowledge) all but the following states have some form of a Cottage Law. These vary it restrictiveness by state though, so be sure to do your homework!

    States that Do Not Allow Cottage Food Operations

  • Connecticut
  • District of Columbia
  • Hawaii
  • Idaho
  • Kansas
  • New Jersey
  • North Dakota
  • Oklahoma
  • West Virginia


  • Cottage Law Class A or Class B Licenses, and how they affect your sales

    When you file for your home-based business license, you’ll see that you have the option of filing for a Class A or a Class B license. Below are the key differences between the two taken from Sustainable Economies Law Center.

  • Class A:”[Allows you](your household members and/or your employee) to sell only directly to consumers. This includes sales at a farmers’ market, at roadside stands, at festivals and other events, from your home or anywhere where you or your employee are selling the food product directly to consumers. This also includes selling wedding cakes or other foods that will be purchased by an individual to serve to their guests at an event.” Class A will not require an annual kitchen inspection in most states. Price varies but generally cheaper than Class B.
  • Class B:”[Allows you to] sell indirectly to consumers such as by selling your food to a store, restaurant, cafĂ© or any other business that will sell the product. In other words, you need a Class B permit if you will have any wholesale accounts. Note that you can only sell wholesale to businesses within the county you produce your food unless a different county specifically chooses to allow indirect sales of cottage food products from other counties. […] If you obtain a more expensive Class B license, which involves an annual inspection of your kitchen, you can also sell your products to grocery stores, restaurants and shops that are within the same county where you process your foods (and possibly other counties if their health departments explicitly allow indirect sales of cottage food products from other counties).”

    Obviously, this means the type of license you have will limit the type and location of the sales you make. Specifically, the difference the license will have on MarMo:

  • Class A: You will not be eligible for wholesale.
  • Class B: You are eligible for wholesale.
  • In both cases of Class A or Class B you are NOT allowed to sell across state lines unless you have other permits, and it’s imperative you enter the correct state and county information under your Products “attributes” section for that reason.

    You should also note that if you sell food in other counties or even cities within your county, you may need a permit. You’ll find most events, retail stores and farmers markets have their own separate set of requirements or policies on selling certain food types.



    Resources

    Below are some resources that can help you in setting up your home-based small business.

  • US Small Business Administration
  • Forager Cottage Food Community
  • Sustainable Economics Law Center
  • California Department of Public Health – Cottage Food Law
  • California Required Permits
  • The above is for reference only, and is not meant to be taken as legal advice. It’s always best to talk to a professional when pursuing any legal documentation.