First customers in packaged food
The first hundred customers are research paid for in cash, at a farmers market table. Applications go in months ahead, booth fees $20 to $50 a day, three products at most, one flavor rotated weekly to read demand. Write every spoken objection ("too spicy," "ten dollars?") down that night; each recurring one is a packaging, product, or price fix. Capture emails on a clipboard, not a QR code; the list carries your winter. At week six or eight, with repeat faces visible, walk into independent stores on a weekday morning:
"Hi, I'm [name], I make [product] here in [town]. We've been selling it at the [market name] for [n] weeks and people keep asking where to buy it between Saturdays. Can I leave you a jar and a sheet with the wholesale price and our terms? I deliver and stock it myself, invoiced net thirty, and it comes with our liability certificate."
Then stop talking. First accounts are a case or two, self-delivered and self-restocked, insurance certificate on file, lot code on every unit; time-limit consignment as advertising expense. Mechanics in your first hundred customers, on the first-ten method.
Pricing in packaged food
Price from the shelf backward: everyone between you and the shelf takes a contractual share. Margin is not markup: a store taking a 40 percent margin on a $10 jar pays you $6. The channel table: booth keeps 90-plus percent of retail, direct independents 60 to 70, chains through a distributor 40 to 45, and club stores look like a gift at roughly 86 percent until the pallet-scale terms arrive, an expansion operators price at fifty to a hundred thousand in cash. The working target: landed COGS at or under a quarter of retail, so $1.30 of cost supports a $10 jar. Budget trade spend at 15 to 20 percent of gross wholesale, with slotting fees industry-estimated at $250 to $1,000 per item per store. The cascade is the money math of a jar; the logic is the pricing method.
Rules in packaged food
The regulator inspects before your first customer. The kitchen question has three levels, cottage home kitchen, licensed shared kitchen at $15 to $45 an hour, or co-packer, and you ask both your state's health and agriculture departments which licenses you. Federal layer: FDA facility registration is free and renews in even years, and acidified or low-acid canned foods require a process authority and Better Process Control School under 21 CFR 114 and 113. The USDA line is a cliff: meat, poultry, and eggs mean federal inspectors on-site. Labels carry five mandatory elements, and two small-business nutrition exemptions cover a first-year brand until any nutrient claim voids them. Buy the real GS1 barcode at $30, never a reseller code. In the legal kitchen and the label and the code, inside the legal setup framework.
Money in packaged food
The cash conversion cycle is the shape of the business: pay for ingredients, packaging, and kitchen time now, wait for the market Saturday, the store's thirty-day terms, or the distributor's forty-five. The lean entry, $2,700 to $4,700, fits the one-to-five-thousand band with almost no buffer. Reinvest by rule, a fixed percentage of every market and store dollar into inventory, decided in a calm week. One operator's public arc ran $7K, $40K, $80K, $144K across four years, weather-bitten. Online, own the site (Shopify at $29 to $30 a month plus 2.9 percent and 30 cents) and rent the marketplace (Amazon's grocery referral runs 8 to 15 percent). The ladder is capital: the lean entry and the ladder; the wiring, the money system.
First hire in packaged food
The quietest death is underpricing, a hobby with a license, and the killers are cash, quality, concentration, and fatigue, mapped in how these brands die. The scale move is not payroll but the production ladder, shared kitchen to co-packer, minimums from 50 to 500 cases regionally up to 10,000 pounds at large plants, triggered when producing hours exceed selling hours. For an actual first employee, the first-hire module owns the decision.
Everything here is condensed from the full course, which adds the buyer's-desk walkthrough, the demo discipline, and the 90-day plan.