From Recipe to Retail: Steps to Create a Sellable Product

Are your customers always asking to take  home some extras of your salsa, BBQ sauce, or house salad dressing?

Do you think there might be a market to actually sell it; first at your restaurant and then to local retailers/grocers but you have no idea where do you start?

Do you just make “extra batches” and bottle it in your restaurant kitchen and slap a label on it? Nope! Not a good idea unless you want to take the chance of selling a product that is not food safe and being sued!

Not so “known fact”; there is a big difference between a “culinary recipe” used in a restaurant kitchen and the one that is handed to a manufacturer for bottling.

Below explains the steps in generalities of how to either get your product made, whether for sale in your  restaurant, for taking it retail or for e-commerce. 

What are the most important attributes you need to have before making any commitment to create a sellable product?y Money, time, patience and education, the latter meaning educate yourself as best as possible while still relying on the expertise of your consultant.

Step #1: Make Sure You Have Funding

Do you have money? You will need to pay a consultant (rates range from $200 an hour and up) and for initial recipe development and having samples made. This step could cost approximately $15,000.

Potential Costs

New Product Development Consultant

• They will take your product literally from concept to production and help with sourcing: 
  • Wholesale Ingredients
  • Packaging
  • Co-Packer
  • Process Authority Letter
  • Food Scientist
  • Third Party Lab
  • Fulfillment
  • Recipe Developer to help finalize your “kitchen recipe” for balanced flavor (this can also be your New Product Development Consultant if they have a culinary background). Or you can do it yourself

Note: In some instances, the Co-Packer will use their R & D department

Food Scientist

• • Turns your “kitchen/culinary recipe” into a Commercially Ready Recipe Formulationto hand to a Co-Paker unless they have their own R & D department and may do it for you.  In most cases, the Co-Packer prefers the Commercially Ready Recipe Formulation to even get started; this tells them you are a serious client willing to spend the needed money and shows that most of the work has been done

Co-Packer

Note: For start-ups, find a co-packer who will make your product with a minimal run just to get you started especially if you are starting by e-commerce which is most new products today

• • Co-packer will make “batch” samples for you at a fee, usually around $500 per recipe
  • Ingredients for samples

Packaging

• The cost of your product will also be affected be determined partially by the packaging you choose
• If you choose something “trendy” and not “practical’’ you may have a very hard time finding a co-packer with special machinery to handle what you want and it can also add months to the process
  • If you are doing several hundred thousand, it might be worth their investment
• If doing glass or plastic bottles, you will need labels
• A test roll will need to be purchased and tested by the co-packer

Third -Party Lab 

• You may desire to make claims od Gluten-Free, Soy-Free, Peanut -Free

Note: These are just “claims” and not certifications by the agencies and you will not be given a certification logo

• • There will be charges for each separate test
    • Should you decide you want to be “Certified," you can do this as well and approach the appropriate agencies
• • You may need shelf-life testing depending on if your product will be sold in: Frozen Section, Refrigerated Section, Shelf

Process Authorly Letter

• The co-packer may need you to supply this for manufacturing
• It is required approval for the co-packer to make your prout
• Additional samples from the co-packer are sent to the Process Authority Agency

Step #2: Do Your Research

You have an idea for what you think is a great new product. First lesson; don’t assume your idea is original. It’s possible the product is out there, but you haven’t seen it. If it’s not on the market, maybe that’s because it cannot be manufactured or has no market potential. This is not to say that you cannot break into an established product category with a new twist and knock out your competition. It can happen with great marketing. 

Before “diving in” and spending money, see what is out there in our category.

• Attend industry trade shows such as the Fancy Foods Show which is in both New York and Las Vegas and coves all food categories both National and International to discover what’s hot on the market and what is over saturated. 
•  Exhibit at these shows in ‘incubation areas” before making a large financial commitment to be a full exhibitor. Also, many of these type shows will only give you the option as a start-up to be in such an area. 
• • Many such trade shows also offer professional seminars to help with seminars on the process of developing a new product, costing, sourcing a co-packer and more so you can take advantage of the educational offering. 

Determine your USP: Unique Selling Proposition

• • What makes your product unique so that it will be successful?
  • What will your product offer that is not currently being offered.
  • Why will it stand out? 
• See if your product idea exists already. Do a “feasibility” study. Go to several Grocery Stores where you think you would like to have your product sold
• • What is your competition selling their product for?
    • Don’t compare a similar product sold in Costco to a similar one sold in Whole Foods’s; they have different consumer dynamics
    • Determine a price you can sell your product for before you get to your Co-Packer as you will work the product cost backwards to ensure you will not lose money
• • How can you improve on what is out there? Remember when Heinz changed their plastic bottles to sit upside down?
    • Does your product need to be Gluten-Free, Soy -Free, Peanut-Free, Non-GMO to cut through the masses?

Step #3: Protect Your Idea

• Sign an NDA Non-Disclosure Agreement
  • Between you and your consultant
  • Between you and your Co-Packer
  • Between you and your Third-Party Lab
• Trademark You Name/Logo
  • This may seem premature, but you never know how far your product may go and you need to protect yourself in advance
  • A Trademark Search is done to confirm that the product name chosen is available for you to use; if you skp this step, you could have your product manufactured and then receive a notice to  “Cease and Desist” and lose everything you put in.  This is not the place to be cheap.
• • Do a trademark search will tell you in advance if you are legally able to use the name/logo of your choice before you go to any expense on it

Step #4: Find a Co-Packer

This is who will manufacture your product, and your consultant should have many options. 

You can definitely search for a co-packer on your own and online but this  can sometimes be frustrating. Co-Packers own websites that are often designed for people already in the know. Descriptions of their processes may use strange terms like “flexible pouch retort,” “extrusion facility,” or “form and fill sealers.” Nevertheless, with careful research, education, evaluation and pa

• Find out early what your potential product may cost; you need to know it will be produced at a cost that you can sell it at

Step # 5: Understand Your Product Regulations

Meat products (like beef jerky) are regulated by the USDA and canned vegetables are regulated by the FDA—All food products are regulated by federal, state and/or local agency and you don’t want to break any of their rules! Your co-packer in step #5 will have explained some of these regulations to you, but you can access all that information on the USDA or FDA website.

Step #6: Audit the Co-Packer

• Make sure they are GMP or Good Manufacturing Practice compliant. 

This means the Co-Packer follows a system ensures that all products are consistently produced in a controlled envirmonment according to quality standards

• Find out up front if the facility is gluten-free, soy-free and peanut-free if that is important to your product. Believe it or not, if the Co-Packer carries any ingredients that you are trying to stay away from, even if their production lines are thoroughly cleaned, there still might be enough residue that can test positive in a lab and cancel out your claims.
• If you have a particular type of packaging that you are dead set on using, ask the co-packer in advance if they have the required equipment before you go spend any money on product samples

Step #7: Find a Food Scientist

There are big consulting firms and independent specialists-the key is finding one that has experience in developing your type of product

A Foos Scientist will usually give you up to four “go rounds”; have this in writing as sometimes it takes many tries before you, the client is 100 percent satisfied. 

You can also contact various food consulting groups  consultants who have been professionally vetted.

Step #8: Find A Third-Party Testing Laboratory

• This is not difficult to research and shop around for the best price and reputation
• The Foos Scientist will make and send samples directly to the Third-Party Lab

Step #9: Food Scientist Creates Your Samples for the Co-Packer and Co-Packer Makes Them

• Co-Packer uses the samples to match your flavor profiles
• Once they are to your liking, the products are costed out

Step #10: Packaging Test Run

• The Co-Packer does a test run with a small quantity of packaging
• If the packaging test is successful, you are ready to go.

As you can see, It truly does “take a village” to create a product and it's important to follow professional advice ever step of the way.