Saturday, October 15, 2016

Cake Business License, Bank Account, & Insurance!



Ok, so as of now we have talked about cake pricing and cake tastings (see past few posts!).  Now, let's chat about some business legalities:

Licenses

 I know it is VERY common for cakers to run their businesses without a business license.  However, if you are serious about running a professional business this piece is very important.

In the past, California (this is where I live!) didn't even allow you to obtain a license for a home-based cake business.  But things have change and now they do!!  It seems more and more states are embracing the home-based food concept in our new digital (and less brick-and-mortar) age.  

But yes, I recommend obtaining your Cottage Foods License if you want to enjoy the benefits of being a real business.  Hiding under the radar and stressing about crossing the line between legitimate and illegitimate business making isn't much fun.  And not to mention your much deserved tax write offs at the end of the year!

So here are my tips for obtaining your Cottage Foods License:

* If you or your business partner were/are part of the military check if it your fee can be waived for you!  It is in California at least:).

* DO NOT stress out about feeling watching or just not being "good enough".  The truth is the department wants you to succeed because your success is their success (at least from my experience!).  Just do what you are required and make sure you follow the regulations to the best of your ability.

* DO NOT worry that it is difficult.  Registration requires forms, an online safety class, fees, and an initial inspection.  Just make sure to obtain all the information you need and fill out the paper with the items they require.

After you obtain your Cottage Foods License you are ready to get your actual business license!!

Your local at-home business license is really not expensive AT ALL especially since you might be just starting out.

Bank Account

I absolutely recommend that you keep your business finances separate from your personal finances.  This makes it super easy to keep track of your income and expenses.  Try adding your business account along with your personal checking in order to try to get a deal and make transfers a cinch.  And, like with the Cottage Foods License, look into military discounts to try to lower fees if you can!

ALSO look into your business bank options for payment options for your customers.  For instance, I bank with Chase and they have what they call Chase QuickPay.  Their QuickPay let's your customers make you quick, easy, and free online payments/deposits by just using your email!  This works seamlessly if they are Chase customers.  It also works if they are not, however, I believe there are some additional account verification steps for them.  WellsFargo has a similar service called SurePay so check it out if your bank has any similar type of feature!

And since we are on the subject of customer payments check out Venmo, a PayPal meets Facebook if you will, for quick and easy payments!  Just make sure your customer has your email or user name right when they submit their payments!

Insurance

Then there's insurance...so I didn't have insurance when I first started.  However, I quickly learned that as I was going to more established and reputable venues, that some locations required insurance.  So that's what got me there at least, but really it is a good way to protect yourself. 

Being a sole proprietorship can really expose you to crazy law suits so it is good to play it safe!:)

For my business, and likely for other similar businesses, you might pay in the $300-$500 range.  HOWEVER, check out this link first!!  This is where I SHOULD have gone first instead of going through a specialty insurance broker.  They seem to give the best rates for just this sort of work!:)

Check these guys out for your insurance first!

Thanks for reading and that's the legality bit for now!!
Have a cakey weekend!

Christie

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