Restaurants packaging and selling their signature sauces, dips and more
What you need to know ahead of time to be prepared and successful.
Restaurants that want to diversify their revenue streams sometimes turn to packaging and selling their secret sauces, pastes, and dips.
Selling packaged food requires a different business plan than a restaurant business and can be just as much of a full-time job depending on how it is approached. Based on how it is sold, tasks will involve production, documenting, tracking, marketing, distributing or shipping, merchandizing, and additional financial management, not to mention the financing to get the brand launched.
Consider the elements below as you determine whether it’s right for you.
How it will be sold
Will it just be sold at your restaurant and perhaps at a handful of stores within your own town? Or is your goal to sell in several stores within an hour's radius of your restaurant where you have brand recognition? Maybe your goal is to also add online sales. Regardless of the choice, recognize the logistics and employee time of each strategy.
Safety for the shelf
Once a product is put into a package and stored, food safety becomes a major concern. Any sauce, condiment, or dip product that you want shelf stable will need to undergo a Process Authority Review to determine its safety and classification. Refrigerated and frozen products will not need a Process Authority Review; however, refrigerated products are restricted to a 7-day shelf life unless you can prove otherwise through a shelf-life test from a food lab. See the Michigan State University Extension article, “Understanding shelf-life testing for packaged food products” for more information.
Does your business have kitchen time and staff to dedicate to the production of the product plus time to market, distribute, and merchandize it? Or, would it be better to send it out to be processed by a co-manufacturer and your time would be focused on marketing and distribution? See the MSU Extension article, “Preparing for high-volume food product sales: Are you ready for a co-packer?” for more information. You might want to note that local health departments often require that packaged foods need to be made separately from ready-to-eat foods to avoid cross-contamination.
Your restaurant customers will likely purchase your packaged food products when they come to eat at your restaurant. Typically, these sales don’t require a significant investment in label design and packaging. Selling the products within your city or town where you have product and brand recognition will be easier than other areas. Once you step into the world of selling to people who have never tried your food, your label is everything. Your label will either get them to pick it up or look past it. Budgeting enough capital to design and print a colorful and exciting label with your logo and branding will be critical to your success.
It’s tempting to find a unique bottle or jar that you believe will set you apart from the others on the shelf. However, it’ll also likely break the bank to buy a pallet or truckload of it if it can’t be sourced locally in smaller quantities. Instead, check with local distributors to see what is in stock.
Other related articles:
- From restaurant to wholesale: Part 1
- From restaurant to wholesale: Part 2
- From restaurant to wholesale: Part 3
- From restaurant to wholesale: Labeling and shelf-life for a refrigerated product,
The Michigan State University (MSU) Extension Product Center has business counselors ready to assist you with Process Authority Review, Nutrition Facts Labeling, and wholesale sales. Register today at the MSU Product Center website to become a client. There is a one-time $100 application fee to apply.