How to start a food business in Oakland #2: City and county permits, a step by step guide

This is our second post in the series on how to start a food business in Oakland. This post is written by Matt Johansen, co-founder of Forage Kitchen. Our first is written by co-founder Iso Rabins, and covers the existential crisis of what to decide to focus your business on. Check it out here.

 

Starting a new business can be hard. And starting a new food business can be downright overwhelming.  Working with food comes with a unique set of challenges due to the multitude of permits that can be required by city, county, state or even federal entities. These administrative requirements can stop anyone in their tracks and kill their dream.

I’ve started a number of businesses in my life, ranging from educational non-profits to restaurants. While each one had its own complexities, the food-related businesses by far outweighed the others in terms of the sheer number of rules, regulations, and just plain unknowns that I initially found very frustrating to navigate.

Below is a step-by-step process, with corresponding resource links, that I hope will make it a little easier to chart your course when you venture into your dream of ownership. The bureaucrats don’t make it easy to navigate the labyrinth of permits and licenses (which need to be obtained in a specific order), but following this guide will put you on the right path! At Forage Kitchen, we pride ourselves on being a resource for our chefs, so if you have any questions, definitely feel free to reach out.

 

CITY & COUNTY PERMITS

Step 1: Business Name & EIN Number

Fictitious Business Name: What’s the name of your business? If you plan on giving your business a name different from your own, you’ll need a fictitious business name statement. If you’re going to use your own name, you are exempt from this step.

1)    Below is a link to an overview about how to file a fictions business name in Alameda County. Link: http://www.co.alameda.ca.us/auditor/clerk/filefbn2.htm

2)    It’s recommended that you search the fictitious name directory to see if anyone else has the name you have in mind.

       Link: http://www.co.alameda.ca.us/auditor/clerk/fbn.htm

3)    Once you’ve chosen your business name, here is the form you’ll need to fill out and send in, along with a check.

Link: http://www.co.alameda.ca.us/auditor/clerk/fbnforms.htm

Employment Identification Number (EIN): Below is a link to the IRS website where you can obtain an EIN number. You will need this if you are applying for a business license in Oakland.

Link: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Employer-Identification-Number-(EIN)-Online

Step 2: California Seller’s Permit

If you are engaged in business in California and wish to sell products, then you are subject to sales tax and you’ll need to obtain a seller’s permit. Please find the link below that will guide you through the process. This is essential if you are applying for a business license in Oakland.

Link: https://boe.ca.gov/onlineservices/#page=Overview

 

Step 3: Insurance

Insurance is always a challenging thing to figure out. The Food Liability Insurance Company (FLIP) is an inexpensive and straightforward general liability insurance company for new food businesses. Below is a link that will guide you through the signup process.

Link: https://www.fliprogram.com/

 

Step 4: Oakland Business License

Every business operating out of Oakland must have a business license. To obtain a business license, you will need to do two things. First, obtain a Zoning Clearance Number. Second, file an Oakland business license application. Please note that you will need to have a state seller’s number and an EIN number before taking this step.

Zoning Clearance Number: This is required for all Oakland-based businesses and notifies the City of the type of business you are operating. Simply fill out this form and return it to: 250 Frank Ogawa Plaza, 2nd Floor, Oakland.

Link: http://www2.oaklandnet.com/oakca1/groups/ceda/documents/form/oak037285.pdf

Oakland Business License: Once you receive your Zoning Clearance Number, head downstairs to the Business License Office and file your New Business application. The link below will give you a rundown of how it works and a link to the application.

Link: http://oaklandbusinesscenter.com/index.php?option=com_content&task=view&id=63&Itemid=59

Hope that helps you in your journey to becoming a legit business. If you ever have any questions or are looking for kitchen space, feel free to reach out to me directly at matt@foragekitchen.com

Matt Johansen
Partner: Forage Kitchen

Next up: A step by step on navigating the labyrinth of state licenses.

How to start a food business in Oakland #1: Figuring out what to make

At Forage Kitchen, we’ve created a space where people with or without a food background can fulfill their dream of starting a food business. To that end, I thought I’d write up a no-nonsense guide on how to get started. Here goes!

1.     What to make:

If you don’t know what you want to make, starting a food business can seem daunting. I suggest picking something you really love and which—in your opinion—you haven’t seen done well. Running a business is hard, and it’s even harder if you’re making something that you’re not really excited about. Don’t worry if you can’t see yourself making it for the rest of your life, just make sure you’re excited about it RIGHT NOW.

Most of the success of any business rests on the passion of its owners. People want to support people who are excited about what they’re doing. That excitement will show though in all kinds of ways, from the way you talk about it and how good it tastes, to your marketing and the employees you hire, so make sure the excitement is there, or your chances of success will probably be slim.

If you’re still stuck, go to a market you see yourself selling in and observe what they have. Is there anything you LOVE that you’ve never seen sold? Look at what’s out there, but most importantly, at what’s not there.

2.     Start at home with a Cottage Food Permit:

As much as I’d love to tell you that, as soon as you find your idea, you should come to Forage Kitchen, it just wouldn’t be true. Start at home. With all the costs of renting a kitchen (even the much-reduced costs of being in a shared space like ours), it’s very hard to get a brand new business off the ground. You want to be 100% certain of your product before making that investment.

We’re lucky in California to have access to Cottage Food permits, which allow you to make products at home to sell at farmers markets and to local stores.

Unfortunately, this permit doesn’t cover all food products, only “non-potentially hazardous foods.” (Basically, you can’t make anything that you’d need to store in a refrigerator).  I’m not an expert on this, but the great folks over at SELC (a group that was VERY instrumental in getting the law passed) have an FAQ section that should answer any questions you have on this issue Check it out here.

For everything else, you’ll need to use a commercial kitchen before you start selling. I’d still recommend being insanely over-prepared before taking this step. Have everything ready: your branding,. your packaging, your consumer trials. Get people to try your product (and not just your friends, because they’ll all tell you “IT’S AMAZING!!!”)

I’m not suggesting that your product isn’t amazing, but you’ll save a lot of time and cash by getting second opinions. Forage Kitchen organizes a great venue called “Tasting Table” at BatchMade Market (each first Friday of the month), where you can drop off your food items and get consumer feedback, which is super helpful. But you can go even further. Set up a table down the street from a farmers market and offer samples. Go on Craigslist and offer free food in exchange for feedback. Email food makers you love and ask for their opinion. Come up with your own clever ideas! In my experience, food veterans love to help passionate newbies—but you need to ask. Don’t be shy! I had knots in my stomach cold calling folks when I first started (I still do!), but I can’t overstate the importance of putting yourself out there. You won’t be sorry.

Just make sure you know what you’re doing before paying for a kitchen. Money burns fast once you get to that step.

Here’s a link to the cottage food permit: https://www.acgov.org/aceh/documents/CFO_Model_Registration-Permitting_Form_12-21-2012.pdf

SELC FAQ: http://www.theselc.org/cottage_food_law_faq

Next post: Brass tacks! My business partner Matt will give a step by step layout of what permits you'll need and where to get them.

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How to succeed on kickstarter #4: Running a successful campaign

This is the fourth and final post in my series on kickstarter. If you havn't read the first one, check it out here

Planning how your campaign is actually going to run is as important as creating a great video. Too many people create a great campaign page, press go, and just hope it will all work out. Don't do that! When pledges don't come in as quickly as you'd hoped, you want a real plan of action to make it happen. If you wait to think of this until your kickstarter is running, you'll be stressed and make bad decisions.

Plan exclusive events

During my campaign, I organized many events to which I only invited those who had pledged their support. Whenever I did this, I saw a spike in our pledges. Try to keep down the production costs of these events, as you’ll be paying for them out of your own pocket during the campaign.

Beat the doldrums

You will notice that you receive the most pledges in the first and the last weeks of your campaign. Things tend to sag in the middle, but you should do everything you can to combat the slump. I firmly believe that, when it comes to a funding drive, people need to be reminded about something many times before they will act upon it. There is so much noise being thrown at everyone; if you wish to break through it, you will have to be quite persistent. I think we can agree that there is a fine line between reminding people and annoying them to pieces. To be honest, I'm pretty sure I crossed that line during my campaign. Try to keep in mind that the relationships you have with the people in your network will extend beyond the campaign. You want people to respect you even when this is all over.

Create a team

Do not attempt to do all of this by yourself. If you don’t have partners working with you on the project, you should recruit some volunteers to help you with the campaign. There is plenty of work that you can delegate: contacting reporters, sending out personalized e-mails to your Facebook friends, posting flyers around town, and so on. Involving other people will help to make the whole process seem a lot more fun and social. Even if you're pulling your hair out, you won't be doing it alone.

Run a shorter campaign

In the supporting materials, Kickstarter recommends running a campaign that lasts for between 15 and 30 days, as these tend to be the most successful. I would have to agree with this. I chose to launch a 45-day campaign. Apart from the fact that this did nothing to preserve my sanity, I could see that it would have been easier to maintain the momentum if it had been slightly shorter. People lose interest if the doldrums last too long. If you are setting a high goal, I'd recommend running a 30-day campaign. This gives people enough time to hear about it a few times, and when they receive the “Our campaign is almost over!” e-mail, they will still remember who you are.

That’s about it. Again, this was my experience, and it will be slightly different for everyone. Kickstarter is great platform on which to raise funds, and to get your idea out into the world, but running a campaign is also one of the most stressful experiences you’ll ever have. It’s a big deal to send your idea out into the world for people to judge with their hands on their wallets. If it works—great! You will have raised some cash, gathered some momentum, and gotten a lot of folks to stand behind your dream. If it doesn’t work, it can really have a chilling effect on your confidence. You may have failed to meet your goal because you didn't run a tight campaign, but it may be seen as a sign that your idea lacks viability or potential.

So, now it's time for you to go out and make your dreams come true. I wish you all the luck in the world!

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How to succeed on kickstarter #3: Making the perfect video

This is the third post in my series about kickstarter. If you havn't yet, check out the first one here

The promotional video is the most important part of your campaign. In my opinion, this needs to be truly great, so go ahead and spend some cash on it. It's possible to make it look polished and professional without spending a ton of money. You might be able to recruit some film or media students to help you out. Maybe you have a friend with some editing skills.

Some quick tips:

·      Make it no longer than three minutes. This is an elevator pitch.

·      When you're structuring the pitch, place the most important information at the beginning. Keep in mind the inverted triangle that is used in journalism. The first sentence should contain everything that the viewer needs to know, and from there on out, the sentences appear in decreasing order of importance.

·      Appear in the video, even if it's just for a few seconds. People like to see the founder talking. They will feel more enthused about supporting the project if they can connect to the personality behind the project.

·      Be honest and forthright. Sure, it's a sales pitch, but people do not enjoy feeling as if they are being sold to, so don’t be afraid to speak frankly and openly about your personal interest in doing the project.

·      Be passionate. Many people who pledge on Kickstarter do so because they feel inspired by people who are brave enough to pursue their dreams. Show them that your ambition and enthusiasm are real.

·      Make the visuals striking and dynamic. I used an animator to add movement and excitement to my video. You can play around with other ideas—anything that's pleasing to the eye and helps to keep things moving. Be creative!

 

Court the media

Our project received hardly any publicity. I had thought that people would be excited to write about it, but getting publicity was like pulling teeth. Most responses I received ran in the following vein: Definitely let me know when the kitchen opens. Would be happy to write a piece then. It drove me insane, but, at the same time, I could understand it. There are so many campaigns on Kickstarter; no one will want to write a story about your project unless there is something truly groundbreaking or quirky about it, for example, if it is making an insane amount of cash or it's the first campaign to raise money to buy an electric chair to help people with a fetish for electricity to live out their ultimate fantasy. Unless your project has that wow factor, you should brace yourself for very little media coverage, perhaps a few small stories here and there.

 

Manage your contacts

As I said in the previous post, it's best to approach Kickstarter as a platform on which people whose support you already have will be able to further express their support in financial terms. Compile a list of all the people you’ve ever met; all of their connections; the organizations to which you belong; the organizations bearing some kind of link (no matter how tenuous) with your idea. Reach out to any journalists you know, as well as all of the publications you want to be in.

Make a calendar of whom you’ll contact, and when you will do that. This will help to provide some structure during the campaign (when you’ll really need it). Once the campaign launches, you’ll be frantically checking and re-checking the pledges, and wondering and worrying about how to get people to go to the site. Having a calendar and a plan will provide you with a sense of calm and help you to remain focused. 

My approach was to select four or five people or organizations to contact each day. This helped me to maintain momentum throughout my campaign. I drew up a schedule of when I would hold events to promote the campaign, when I would send posts to my e-mail list,  and what would be covered in those posts.

Iso 

Partner: Forage Kitchen

 

in the next post: how to organize and run your campaign

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How to succeed on kickstarter - post #2 - nuts and bolts of creating a campaign

This is the second post in this series, if you havn't read the first, check it out here

Across the next few posts, I’ll be sharing a step-by-step guide to launching a Kickstarter campaign, based on my own experience. I didn’t come up with all of these ideas by myself; I received a ton of help from Whately. He had recently completed his campaign, and he gave me some great tips on how to run a successful one.

Read, read, read

Read everything you can get your hands on about how to launch an amazing campaign. Check out people's blogs, which can offer helpful tips and warn you about common pitfalls. Read Kickstarter's How To page. This provides invaluable insight into how to craft a successful campaign and how to create an application that's more likely to be accepted. It contains some really great info about the success rates of different lengths of campaigns, the optimum length for a promotional video, and tons of other useful stuff. Since Kickstarter operates on a commission basis, it's in the company's best interests to help you to run a successful campaign, and that's why they’ve taken the time to create a great overview.  Read it!

Conduct thorough research

Before starting my campaign, I spent weeks on the site just looking at other folks' campaigns. I paid attention to which strategies and techniques seemed to be working and which ones didn’t seem to be working quite as well. It's worth spending time on this phase of the project. Also, try to be a sport. Pledge on a few projects you think are neat or worthwhile, as it helps to create good karma. It makes you look a little hypocritical if you're trying to raise money, yet your profile says you’ve never helped out anyone else.

Compose a strong application

It's essential that you submit a strong application, otherwise your campaign will not be approved. You may be tempted to put this off until just before you are ready to launch. I would strongly advise you against leaving it until the last minute, because there may be something in your pitch that doesn't mesh with the Kickstarter rules and regulations. If, for example, you say you're aiming to start up a business or to raise a portion of the funds you'll need in order to complete the process, your application may be rejected.

If your application is rejected, don't lose hope. First, make sure you understand why you've been rejected. Then, redraft your proposal and resubmit it. If you've submitted your application early, then you'll have plenty of time to rework it; however, having to do this under time pressure can be an incredibly stressful experience. Try to have your application approved before you make your video. If you make the video first and there is something in it that doesn't pass muster with Kickstarter, it will be a hassle to fix.

In my next post I'll talk about creating the perfect campaign video!

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How to succeed on Kickstarter (or at least some tips to point you in the right direction)

 

Over five years ago, I launched my first Kickstarter campaign, and raised $156,000 to launch Forage Kitchen, and I've been meaning to write about it ever since. Now that the business is open and running seems like a good time to relay my real experience creating and running a campaign in the hopes it will help someone out there to jump over mistakes I made and see what worked for me. If you’re creating a campaign for a product pre-sale, a lot of this won’t apply, but more so for community based projects

I’m sure you’ve all witnessed the meteoric ascent of million dollar projects succeeding. Perhaps, with rose-colored glasses, and stars in your eyes, you imagined yourself achieving the same success for your project. The truth is, while Kickstarter is an amazing platform for product pre-sales, it's only a fairly good platform for everything else.

After my campaign, a lot of people got in touch with me and asked for my advice. Wanting to be optimistic and supportive, I told everyone that I was certain they could do it, and to go for it! Unfortunately, a number of those people haven't had that much success with it, so I have started to be a bit more conservative in my responses.

Before you even think about launching a Kickstarter campaign, here are some things to think about:

First, it's important to understand that Kickstarter is a platform where people whose support you already have will be able to voice that support with their dollars. Rather than expecting to win people over with your campaign, you must build your audience elsewhere and then lead them to your Kickstarter campaign. The good folks at Kickstarter have made this clear in their supporting materials, and I feel it's extremely important.

Unless people are already aware of the product or service you offer, it will be difficult to find support for your campaign. It's highly unlikely that people will find out about your project from the site itself. My campaign was featured for several weeks on the Popular Projects section on the front page, and it was mentioned twice in the Kickstarter newsletter. Neither of these initiatives helped me to gain very much in the way of pledges.

What I found to be the most effective strategy was to reach out to the people in my e-mail database and in my networks on Facebook, Twitter, and other social media. At the time I started my campaign, I had an e-mail list comprising over 40,000 locals, and a social media reach of a further 15,000.  I'm not saying it's impossible to  succeed without this scale of reach, but it is a factor worth considering when you’re setting your goals. It isn't easy raising money via Kickstarter. I’ve come to think of it as a tool that's more suited to promotion rather than to fundraising.

Think very carefully and objectively about the people whose support you're counting on. Why will they want to support you? Is there a clear and specific need for what you do in your community? Will you be addressing a social issue that affects a great number of people? Are you offering a reward that people truly require or desire? Have you spoken to a lot of people about your idea, and have they expressed their interest in supporting it? Do you have a long list of media contacts who will help to promote your campaign? Is there a huge niche community eagerly anticipating this kind of product, film, space or event? If the answer to one or more of these questions is no, I would advise you to think twice about setting a high Kickstarter goal. The month I spent promoting my Kickstarter campaign was, by far, the most stressful month of my entire life. There are easier ways to raise money. I’m glad I did it, but I never will do it again.

If this rant hasn’t dissuaded you, I can understand that. When I was in your position, nothing would have convinced me that I shouldn't try it. If that's the case, you may be interested in next week's post. I'll be sharing a blow-by-blow account of how I went about it, what I did wrong, and what I did right. Launching a successful Kickstarter campaign requires a fair amount of preparation and support, and I'll be happy to tell you about how it worked for me.

In my next post I’ll give a step by step on what I did for my campaign…

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Iso
Partner: Forage Kitchen

Our first six months

 

It’s been six months since we opened Forage Kitchen, so it’s a good time to reflect on where we’re at and where we’re going. It still seems surreal that the space is actually open. After years of pushing, starting with our Kickstarter campaign almost five years ago, to when Matt (my cousin and business partner, an indispensable part of this enterprise) and I started working together in 2013, to our search for investors (it’s amazing how hard it is to get someone to invest in an actual building in the tech capital of the world), to the seemingly endless search for a location (we were so close to acquiring one of over a dozen spaces that we were designing the interiors before the deals fell through), to the delays with our construction (the project was more than a year behind schedule). It’s been quite an experience.

What kept us going through all that was a concrete faith that someday it would exist. We weren't sure how long it would take, or how we would afford it, or where it would be, only that it would eventually happen. I really feel that’s the recipe for success—just convincing yourself that there’s no other option.

Six months after opening, the space still has that new car smell. At the end of the day I sometimes sit alone in the café, with a beer and a cookbook, and I just revel in the reality of the space. How unlikely it was that it would actually work—how often it felt like it would never happen.

We’ve been really happy about the crew of chefs that are using the space.  We thought it was going to fill up a lot faster than it did, which caused some financial hand wringing, but we’ve come to see that these things just take time. In fact, it usually takes several months from the moment people email us to when they actually start booking, a multi-part process that involves obtaining permits and negotiating the amount of hours needed, among other things. Some people just disappear, but the good ones sign up. I’ve always said that in shared spaces, it’s always one person that ruins it for everyone: that one chef who doesn’t clean up, or uses more space than he or she needs, or brings in too many people. To be honest, that chef was sometimes me. That’s why I know the type so well!

Thankfully, no one in our space fits that bill. Our crew consists of friendly, open, interesting, and ambitious folks, including our friends at Thistle, who cook 10K meals per week, to Eat Nibble, run by Sally, a first-time food entrepreneur.  We like to emphasize that our space is perfect for novices, that there is no stupid question about how to use equipment or scale up a recipe, and that Matt will sit down with anyone who has permit questions. Likewise, I’m happy to give feedback on recipes or to lend a hand with cooking.

When I first walked into a shared kitchen, I had no professional experience, and it struck me as a pretty scary place: huge equipment I’d never used before, serious busy folks running around with no time to lead me through the finer points of emptying a fryer (I’m still not 100% sure how to do it well…). I want our space to be different, a space where people support each other and aren’t scared to ask questions. Everyone was a newbie at some point. Open communication is a treasured virtue at Forage Kitchen. The more I push for candor and openness, the more I enjoy being in it.

BatchMade Market, our monthly event when our chefs sell and sample food in the kitchen on First Fridays, has been a high point. I loved running the underground market, with the exception of the huge production and constant wrangling with the Health Department over legality. What made it so worthwhile was the community of eager chefs, all so excited to share what they made, and seeing how happy it made them to have an adoring public sample and purchase their food.

BatchMade represents what’s best about running a market. We get between 400-600 people per month, and currently five to seven companies are set up (which may expand as the weather improves), preparing everything from fresh oysters to BBQ pork sandwiches to heritage bacon. I get to bartend, which is one of my favorite things to do because it puts me in touch with people who are excited to discover the space. Meanwhile, all-night crowds roll through for food and drink. It’s always a great night.

There’s something about that event that feels like the culmination of my vision: tons of happy people working hard to realize their dream, with Forage Kitchen as their foundation. I think of the Kitchen as a real platform for other people’s ideas. Sure, we have our own projects, like the meat curing room I’m building and the temp-controlled fan/cooling system. But we really want it to be a space that other people use to create what they want to see. Whether that’s a pop-up, a product, a cooking class, or something we haven’t even imagined, the Kitchen is an amazing resource that should be used as much as possible. If you have an idea, we want to hear it!

It’s been a wonderful, sometimes stressful, six months. An important lesson I’ve learned throughout this time is that things work out as they should when you trust yourself and your intentions. I can’t wait to see how this space will change six months from now!

Iso Rabins
Partner: Forage Kitchen