Here's a link to the Small Business Association. There's lots of good info for start-ups.

Start-up funds, if needed, are virtually impossible to obtain on this type of business through regular channels. States often have special program money available, if you meet their criteria. SBA also has a micro-loan program that may be appropriate.

Even if you don't require financing be sure to do all of your due diligence just like you were going to apply for a $1M loan! That means a professional business plan, etc. Again, help is available on the SBA site.

Established small businesses are going down in large numbers this year. It takes a sizeable amount of financial backing to ride through a couple year recession. Most small business failures are due to lack of financial planning. To have a chance you should prepare by stashing two years of operating expenses. On average, a small business does not show a profit for five years.

Food related businesses are especially failure prone. Target markets are fickle & tastes/fads change with the wind often leaving the small business owner unable to react quickly enough. Many owners hang on by their toenails for too long & end up in severe personal debt because it's so hard to accept the failure. Unfortunately, as a banker, I've shut down countless small businesses & taken everything they own in the process including homes & a lifetime of savings. It's ugly. Really ugly.

Be sure this is what you want & go into the venture prepared. An internet business will not have the startup costs of a brick/mortar store but it's going to cost something...I really suggest phoning SBA & chatting with a loan officer. They'll be a wealth of information & help you with that business plan. If you'd like, you may email me thru GW & I'll give you a suggestion for somebody to phone at a non-profit for information & assistance with start-up. I have nothing to do with the organization other than knowing they'll give you good solid advice & assistance. Once upon a time, in another life, my DH was an Emeritus Board member & then served as their CEO. They are the largest non-profit community loan fund in the country & a phone call to these folks could well save you a lot of heartache down the line.

I LOVE candy! Whatcha going to make???

Best of luck!

/tricia

Here is a link that might be useful: SBA

Hi tricia,

Thanks for the link and the thoughts. I'll check out the SBA site more carefully this evening. In general, I'd prefer not to take out any loans but to bootstrap the business myself. This means I'd only invest what I could afford to lose, and I'd have to start small. I can imagine how hard it is to shut down small family-owned businesses - what a tough job that must be.

I'm thinking of making caramels - a family recipe that my friends love. Would you pay $15-$20 for a pound of vanilla or chocolate caramels? (no, I'm not trying to sell them to you, just doing a little market research!)

Thanks again!

Etsy has stores that sell candy. But check your state laws--in Calfornia, you can only sell food made in an industrial, certified kitchen. Home kitchens never pass. (Oops--I see you're checking into that.)

You also have to carry pretty heavy insurance.

Here is a link that might be useful: Etsy caramels

Good morning, annkathryn.

$15-$20/lb. for caramels? Well, I'm in CT & I can purchase excellent caramels for around that price without the hassles of internet ordering & shipping costs. So, in order for me to order they'd have to offer something I can't get locally. What might that "extra" be?

Free Shipping? Extra special packaging? Delivery within your geographic area (for gifts...like fresh fruit bouquets)? Catering to the business community via custom packaging with the company's logo on the box? Wedding packaging?

My point is that the quality of the caramels isn't going to be the make/break factor in a successful business, or not. There are lots of good quality caramels on the market for metro areas. Rural areas may be shy on availability; but I wonder if somebody in rural Arkansas would pay $20/lb.? IMO, I doubt you'd get enough rural sales to be a viable business. You're going to need to attract people with a certain level of disposable income because let's face it...caramels are not a necessary purchase.

Your price is not out of line (for metro areas) but what are you planning that will set yours apart from, say, the gold-box stuff that I can purchase without paying shipping? Just being a yummy piece of candy won't be sufficient to create a successful business. The quality of your product is less important than the quality of your business plan. Sad, but true.

Who is your target market & how are you going to attract that market?

/tricia

Another place to research your business plan is the RMA Industry Comparisons book. (RMA = Robert Morris Association). I know your local SBA Business Center will have the book & you could try the library. The website will give you info on where your local SBA center is located. Every business imagineable is in that book. It's practically like a Bible to bank loan officers.

Also, don't overlook SCORE. They have a special section for women entrepeneurs.

/tricia

Here is a link that might be useful: SCORE

hi ideefixe and tricia,

Thanks for your thoughts! I'd already checked out etsy (what a cool site) and saw caramels there that are exactly like what I make. I don't see that as bad news (ie too much competition) but rather as good news that there's a market for this kind of thing.

My local area (Silicon Valley, California) is home to a lot of high tech corporate headquarters with cafeterias, gift stores, and lots of people with high disposable incomes (which is not to say that people aren't watching their budgets here too). I have contacts in a number of companies and am going to do some market research there as far as what products they'd be willing to place for me. The idea of corporate branding with the company's logo isn't one I'd thought about - thanks for suggesting it.

Packaging - yes, something unique and eye-catching would be good, but I also have to balance that with not wanting to be wasteful. I've seen a range of packages from very pretty gold cardboard boxes, to more simple plastic containers (think sour cream size) all the way down to cellophane wrap tied with a ribbon. An eye-catching label with fun graphics and a link to my website seems essential.

Pricing - $20 for a pound of caramels sounds (frankly) like a lot of money and probably won't appeal to a lot of people.

...off to take a look at SCORE.

Thanks again!

"...not wanting to be wasteful."

BINGO!!

There's one possible answer to setting yourself apart from everybody else's caramels.

Go GREEN with the packaging & ORGANIC! Advertise the heck out of that aspect. You're in a perfect location for that marketplace.

/tricia

I have no suggestion..just a price point..
Hubby and I were at our Local Health Food/Co op store today, and the girl was putting out caramels..she said they are the WORLD'S Best..so hubby decided to try two..they were 10.99lb. It was a buck 34 or so for 2 individually wrapped in plastic/cello.
I wouldn't pay it again. They were good. But I make homemade better. :O)
But given your area and with Tricia's suggestions of how to market you from the "rest"..You'd probably get the $15 atleast per lb.
Good Luck!

I've googled "green packaging" and have come up with a number of ideas for packing/shipping (popcorn instead of styrofoam peanuts, anyone?) Nothing has really grabbed me as being a good combination of truly green, stylish, and practical for packaging a pound of candy though.

Still researching, and have lots of ideas about selling locally.

Thanks for the ideas and good wishes.

Hello I am new on here and was so happy when i saw the article on starting a homebased candy business.I am about to start one but need some help and to talk to other people who have the same interests.I will not making my own candy but buying in bulk.