How to sell recipe to a company.?

Question by Ken R: How to sell recipe to a company.?
I need to know how to sell a recipe to a company that will but it and manufacture it. Want to make a deal with them and have them freeze the item so that no added junk is in it. If you know how to go about doing this or who to contact them please get back to me so that I can get this sold.

Best answer:

Answer by Been There~Done That!
How to Sell a Family Recipe

We’ve all heard stories of people who have taken an old family recipe and developed it into a company making megabucks. But before you invest any money into marketing your grandmother’s cookies, food specialty experts and entrepreneurs urge you to take the time to thoroughly research the industry and find out all that is involved in getting a new food product into stores and eventually into the hands (and mouths) of consumers. Here is some practical advice offered by two food specialty entrepreneurs, Kendra G. Bland (Vincenza’s Italian Foods) and Carin Froehlich (Ingleby Farms), as well as John Roberts, president of the National Association for the Specialty Food Trade.

“My best resource was and still is the public library,” said Froelich, who launched her business, selling hot or spicy condiments and dips and other products, in 1988. “As far as other entrepreneurs go, you can definitely learn from their mistakes, but you must always do your own homework first.”

Bland, who has just started her specialty Italian foods business, says, “The best startup resources that I recommend are the books From Kitchen to Market and Mompreneurs (by iVillage home business experts, Ellen H. Parlapiano and Patricia Cobe). I also received great advice from the host and the members in the iVillage Starting Out message board and from the Wisconsin state office of the Department of Agriculture, Trade and Consumer Protection, Division of Food and Safety. The gentleman who licensed me was always there to answer my questions.”

Startup costs and equipment: Depending on your ingredients, your packaging, whether you lease a commercial kitchen and so on, costs can run from $ 10,000 to more than $ 24,000. Writing a thorough business plan will help you prepare you for the expenses involved. “Have a good plan of action and possible financing available to you if you need to expand rapidly,” Bland said.

“Do not be afraid to ask for payment plans or low- to no-cost usage of kitchens in the beginning,” she said. “If you personally know anyone that can do marketing or labeling and packaging, ask them first. They will probably give you a great price and good advice as opposed to someone you do not know. If you can do things like letterhead or label design yourself in the beginning, do it. Keep things simple but elegant. The main reason someone buys a gourmet item before tasting it is because of the way it looks.”

Legalities: Check with your state’s or, in Canada, province’s offices that handle food licensing to see whether you are permitted to cook from a home kitchen and what regulations you must follow. Certain states, such as Kansas, Minnesota and Vermont, have programs to support specialty food entrepreneurs. You must also follow labeling laws. For information, go to the Food and Drug Administration’s site and click on the Foods icon.

Some realities: “The specialty food business is at its all-time worst,” Froelich said. “Most people, including myself, did not understand the market. Number one, I felt I had the best-tasting sauces, and I have won worldwide awards to prove it. I did not realize you can’t eat awards. When you get out there, it does not matter what your products taste like, it does not matter that you are a small family business. What matters is, how much can you give away in free product, how much can you write a check out for shelf cost (which runs thousands of dollars per item)?

“Sadly enough, in the last five years the supermarkets have put an extreme wedge onto the specialty market. They buy products in bulk, and the small gourmet shops cannot compete. A good example would be cheese — why stop at your local gourmet store and buy cheese when now you can go to chain grocery store and buy the exact same product for half the price? … Ingleby Farms produces hot sauces, and we never worried about the overseas trade because we felt we were just too small. Wrong! The Southeast Asian market will reproduce any product at half our cost. You must also realize that owning your own business is never a nine-to-five life. You must be willing to commit to seven days a week, 8 to 10 hours a day, and oftentimes no paycheck.”

Marketing suggestions and trade-show tips: If you have your food product already on the market, you may want to consider exhibiting at trade shows sponsored by industry associations in Canada or the United States (see Suggested Resources), such as the National Association for the Specialty Food Trade (NASFT).

John Roberts, president of NASFT, says that to qualify for their association membership, though, you must have been in business for at least a year, plus have your food products on store shelves at least that long. “Our association requires this because it makes the specialty food entrepreneur take at least a year to see if her or his product is selling,” he said. “Better to find out early in your venture that your food does not have a market than later

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