Just trying to get some suggestions on how to start up. O.K. I know I'll have to call the HD and not trying to be a BACKYARD BANDIT and take any money out of the mouth of any of you REAL BBQers. I cook for 80 guys every month at my firehouse and still work full time, just going to be a weekend thing till I retire in a couple of years then hope to go full time .That's all. Thanks.
You are in the same position that we were when we first contemplated getting into the business of BBQ. What we (the Brethren) are saying is, if you are serious about doing this full time later on, then approach it as starting a business and not as a "paying hobby". The days of "paying hobbies" are over. With all of the Federal, State and Municipal regulations in place nowadays it is almost impossible to do this as a "sideline" and not spend a fortune with little to no profit.
To do what you propose, legally and with protection for your personal assets from liability, you will still need to ensure you are compliant with ALL business laws/regs. The cost of doing so, for weekend cooking/serving, is the same as if you go full time. The only difference is that you profits will be much less, if any, until you go full time due to the lower volume of sales you can generate.
Here are the steps we took when we started out (part time/weekends), in order of importance.
1) Work up a complete business plan. A comprehensive business plan gives you direction and something to use as a road map to your goals. Without this first step you will more than likely find yourself losing money due to avoidable mistakes that were not thought through in advance. If you need to consult a professional for this expect a cost of between $500 to $1500 for assistance/creation.
2) Shared a copy of our complete/comprehensive business plan to our HD Inspector. He then told us what licenses, permits, etc were required to be compliant with the food handling/sales regs. He also informed us of what types of equipment and processes/procedures we would need in order to be compliant. The cost for this is dependent on your area. A good approximation would be in the range of $500 to $1500.
2) Consulted an Attorney and Accountant for advice concerning the best form of business entity to operate under for reasons of tax liability and personal asset protection. (For our purposes a well constructed LLC was our choice. It allows for the same personal asset protection as a C Corp but allows the business profits to flow to our personal income reporting which avoids the higher C Corp tax rates) The cost for this could range from $1000 and up depending on how much work the attorney/accountant needs to complete what you choose.
3) Consulted insurance companies to secure all of the insurance required to protect our personal assets. (vehicle, equipment, liability, etc) Approximation of insurance costs; Liability- $300 to $800/yr for $1M coverage, Commercial Vehicle-$350 to $550/yr, Business (equipment,etc) if applicable $500-$800/yr.
4) Consulted governmental organizations to ensure we were complying with all laws/regs involving operation of a business. i.e. Federal (Business ID#-EIN, IRS Tax #,etc); State (Sales Tax #, Business License if applicable, etc), this can involve multiple jurisdictions if you plan to operati in multiple States; Municipal (Sales Tax # if applicable, Business License if applicable, etc) his can involve multiple jurisdictions if you plan to operati in multiple Municipalities. Costs for these are minimal, probably less than $300 total.
5) Researched other BBQ businesses to find out how they operated and what types of equipment they used. Worked for/with a vendor/caterer to gain experience. Doing BBQ as a business is a lot different than doing it as an unpaid/paid hobby.
6) Purchase necessary equipment. This item is dependent on the type of business you will operate. i.e. Vending, Catering, Brick and Mortar, etc. We stated vending at Festivals since in KS we could do 6 per year with needing a food license and we were deemed as operating under the festival events insurance and business licenses. We still need a State Tax # as sales tax was still required. KS allows for the tax to be calculated off of the total gross sales reported so we didn't have to "charge" sales tax on each purchase. We reported our gross sales, calculated the tax due and paid it out of the gross receipts. (you state may not allow this method). Equipment needs were somewhat minimal due to the rustic setups allowed at festivals compared to the reg requirements for permanent licensed food vendors. Equipment costs could range from $500 to $5000 depending on your operations.
We mostly broke even for the five years we were doing BBQ part time. However, it did pay for itself and then allowed us to go into full time with very little capital outlay since the five years prior had paid for most of our start up costs and capital requirements.
If you are prepared for this type of journey then you can be successful at it. Just don't go into it expecting to become rich. It is a journey of love for BBQ. :grin:
I hope this helps to answer some of your questions. I have tried to cover the basics and to provide an approximation of capital investment needed.