No Charge
So.. I'm not allowed to commercially sell cake because I don't have a separate/commercial kitchen. What if I give my cakes away for free but charge a delivery fee worth my time and effort?
Anybody know the legalities or pitfalls as to how this can be a good business model?
(I'm in Arizona)
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Replies to This Discussion
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Permalink Reply by Theresa Happe on
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It seems to me you could still have issues with this approach. First, if you get referrals by word of mouth, you hardly want people to say your cakes are free. If you advertise, you don't want to say "free cakes." What happens if the customer picks the cake up instead of having it delivered? How do you charge that person? How do you take a deposit on a cake that's free?
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Permalink Reply by Eileen S on
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Carmelo - I'm with Theresa. I have the same issue here in Wisconsin so I need to be very careful who I bake for. I thought about saying that people don't "order cakes" from me, they "commission a work of art to use as a centerpiece for their event." I make all my art works from edible materials. If the customer CHOOSES to consume the item, then that is their decision. I haven't had the guts to confront the health department with that one, though. :)
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Permalink Reply by Jennifer Cintron on
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I agree with these ladies, and in any case, it's a slippery slope with a very weak legal standing - you would need some pretty crafty lawyering to make that stand up.
And Eileen - that is an awesome "take" on what you do!
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Permalink Reply by Carmelo Ricarde on
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Thank you all for your replies to my topic. I really do like Eileen's thoughts!
Theresa, my thoughts on this business model was around a 'delivery only' system, so customers could not pick them up. I was thinking about having them order a week in advance and dependent on my schedule. I've never taken a deposit, but its probably because I'm so amateur and don't know what to charge for a cake, let alone a deposit. I would simply let them know ahead of time how much the delivery, set up, cake cutting, etc would be. I would ask for cash or check on time of delivery. I'm not looking at trying to get into wedding cakes, just smaller stuff like birthdays and stuff like Halloween parties.
Jennifer, I'm not clear on the legal standing. Would this be illegal? That is the big question I'm trying to figure out.
I've researched some commercial kitchens and have found their rental to be crazy expensive and I would have to pass that mark up on to the customer. I think my skills are adequate, but I don't feel at this time that they are worth hundreds of dollars.
I guess another question to ask is, for those who rent a kitchen, do you just bake there and what portion of the decorating is done at home?
I just feel that I have a passion for this, but don't really want to make it consume my life or feel like work or it will be work when overhead cuts into profit and i HAVE to bake and decorate and sell to live at my normal level of income. This is probably how a lot of people feel or have found ways to overcome it. I haven't. : (
So in the meantime, since I still enjoy it, I was wondering about making a few bucks on the side, but as money I know I can live without if I don't do it.
Thanks everybody, in advance, I truly appreciate this feedback.
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Carmelo, I don't know the laws in Arizona and this should in no way be construed as legal advice, but your original post said that you can't sell cakes because you don't have a separate or commercial kitchen, leading me to believe that to legally sell cakes, you would need such a kitchen. If the health department or whoever enforces these types of ordinances in your community discovered you selling cakes but labeling it as a delivery fee, it seems to me that they would have just cause to shut you down. If your argument is that you are not selling cakes, but making cakes for free and then charging a delivery charge, I think you would have some obstacles to overcome:
First, would your charge for free cake + delivery/setup be equivalent or competitive to other similar delivery charges in your area? If it's not, I'm sure you would have to explain why your charges are so much higher and the fact that you're delivering "free" cake that you prepared for delivery is going to play into the argument.
Also, I wonder if the preparation of the free cake in a kitchen that is not coded for commercial sale would be ok, even in the delivery-only (which activity IS commercial) sense?
What I am saying is - and it is NOT meant to discourage you from baking and decorating - if I were the attorney or even the regulator issuing your citation for not complying with the local health codes, I would have ample, rational argument to bring your delivery business into question and make the citation stick. I think you should do what you love but I feel that trying to put a relatively transparent "spin" on the true nature of your business is selling yourself short. Like you, I would love to do this business on the side but have the problem of a not having a separate or commercial kitchen, so I limit my cakes to family and friends.
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Permalink Reply by Deah on
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Eileen, I love your idea. Let me know if you decided to run it by the health department. You'd better practice your speech a while so you can say it with a straight face.
Eileen S said:Carmelo - I'm with Theresa. I have the same issue here in Wisconsin so I need to be very careful who I bake for. I thought about saying that people don't "order cakes" from me, they "commission a work of art to use as a centerpiece for their event." I make all my art works from edible materials. If the customer CHOOSES to consume the item, then that is their decision. I haven't had the guts to confront the health department with that one, though. :)
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Jennifer,
In Arizona, one must have a separate or commercial kitchen that is inspected by the department of health. If I did free cake, i'd probably keep them simple as in a 2 x 9inch round and would keep the price somewhere close to a grocery store cake as the delivery fee (depending on their location).
I think you are right though about free cake being made in a non-commercial kitchen. So regardless, I'm going to have to rent or just settle with friends and family. mostly family.
Thanks for your feedback!
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My biggest question is this:
If a baker's customers are FULLY AWARE that the items they are purchasing are being made in a non-licensed, non-inspected kitchen (full disclosure by the baker), and they still choose to purchase from that baker - why on earth does the health department care? Could they really be held liable if someone gets ill from the baker's cake? Wouldn't the liability fall on the baker? Couldn't the health department turn around and ask the customer "Did you know they weren't licensed? Yes? Then you bought and ate at your own risk." If it is truly a tax issue, I'm sure all home bakers would be willing to pay the taxes they owe on the money they make without question. It's not like someone is going to contract some kind of pandemic illness from a cake. Maybe I'm being naive, but it seems like the government wants to tell the consumer what they can and can't do. If I want to buy raw milk from a local dairy for home consumption - and I know the risks - why does the government care (you can't buy raw milk in Wisconsin)? (I don't use raw milk, by the way, it's just a hypothetical question.) If I want to buy a loaf of bread my neighbor baked, why can't I? And if a friend of one of my friends wants a birthday cake for their husband's birthday, why can't they buy it from me? They know the risks. They are grown-ups, and they are SUPPOSED to be living in a free country.
O.K - I'm done with my rant now. I think. I'll probably think of a lot more on this topic later.
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Eileen, i'm in complete agreement with you!
We're going to have to pretend to be like drug dealers!
Psst! Hey you! Yeah you! Are you a health inspector? You wanna buy a few pounds of cake? Shh!!!!! keep it on the down low!
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Don't judge me! i have student loans!!!!!!!!
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Permalink Reply by Karen Marie on
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Carmelo being ifn the food service business for many years you would NOT get over on the health inspectors so dont even try. If you start marketing your product publicly be prepared for someone to check you out to see if you are legal. I live in FL and we have to same dilemma and there is a group trying to chnge the laws but for now you need a commercial kitchen. There are some options....save your money and buy some used equipment and rent a small warehouse to set up a kitchen. (look into the laws in your state for minimum square feet....probably 500 sq ft or so) Or get a job working as a cake decorator. If it is your passion you wont feel like it is work....I never do....you will laugh and tell yourself, :"They pay me to play? How cool is that?"
Carmelo Ricarde said:Don't judge me! i have student loans!!!!!!!!
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Permalink Reply by Sherry Qualls on
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:D.....those drive many o'twenty/thirty somethingers!!!!
Carmelo Ricarde said:Don't judge me! i have student loans!!!!!!!!
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