Table of Contents
- Step 1 – Checking Your Competition
- Step 2 – Check Your Regulations
- Step 3 – Create and Test Your Own Recipes
- Step 4 – Packaging and Labeling
- Step 5 – Pricing
- Step 6 – Gather Dog Treat Supplies and Equipment
- Step 7 – Naming Your Business
- Step 8 – Register Your Business
- Step 9 – How to Handle Sales Tax
- Step 10 – Setting Up a Website
- Is a Dog Treat Business Profitable?
- Dog Treat Business Pros and Cons
Step 1 – Checking Your Competition
Open your browser and try every search for dog treats you can think of on the eCommerce platform you’re looking to use. Amazon, eBay and Etsy are already loaded with hundreds of people selling some form of dog treat.
Take a look at larger commercial dog treat operations as well. For a while, homemade dog treats were an easy sell because pet owners were concerned about artificial additives and preservatives in dog treats.
A few of the major dog treat brands are now offering organic alternatives. These are usually priced higher than those offered by individual dealers.
Make a note of the prices people are charging for different sized treats and see if you can’t do better. You might also want to consider sizing your products differently to help them stand out from your competitors.
Step 2 – Check Your Regulations
Check to see if your city or county requires you to register for a manufacturing license and open a commercial kitchen if you plan on selling dog treats. You may have to request a formal health inspection and prove that your treats are being made in a facility that meets or exceeds cleanliness guidelines.
Dog treat vendors are required to have a business license in every state. You’ll need to file a request for certain documents and potentially pay a processing fee before you’re able to open your business.
The FDA monitors claims placed on pet food labels, so you’ll need to check these regulations before your state any benefit of using your new company’s product. These guidelines are updated on a regular basis, so you’ll want to monitor them for any future changes.
A non-profit trade association known as the Association of American Food Control Officials has provided a map that can help new business owners check what kind of regulations their states have on the books.
Step 3 – Create and Test Your Own Recipes
Write down any treat recipes you currently have and test them repeatedly, making sure that they come out solid and that dogs will actually eat them. While it might sound fun to create and test multiple batches of dog treats, it’s going to be a lot of work so make sure you set aside enough time to do this.
Some people might claim you’re a plagiarist if your treat recipe is too close to theirs, so make sure that it’s as original if at all possible. You’ll also want to ensure that you don’t have any ingredients in your treats that are toxic to dogs.
Step 4 – Packaging and Labeling
Buy packaging materials in bulk if at all possible, to reduce costs. You can design simple labels with a standard piece of graphics software and print them out yourself.
Ink tends to be the most expensive consumable when it comes to printing out labels. Try designing something creative that doesn’t use a large amount of color ink so you can keep labeling costs reasonable without sacrificing too much in terms of image.
While dog treats don’t have to be FDA certified, the agency does keep a list of things you can’t claim without proof. Keep your labels simple and only use words like organic if your treats truly are.
FDA rules require the following on the label:
- A clear explanation of the product
- Amount inside
- Name and address of the place making them
- An ingredients list ordered by quantity
Step 5 – Pricing
Price your treats reasonably, but keep your expenses in mind. If you can figure out anyway to reduce your expenses, you’ll want your price to reflect this.
Consider selling your products for half of what your competition charges, at least until you’ve established a clientele. If everyone else sells similar products for $20, then see if you can’t charge $10 for them.
Step 6 – Gather Dog Treat Supplies and Equipment
The exact type of recipe you use will decide what kind of supplies you need to invest in. Peanut butter, eggs, flour are all common choices, but you’ll probably have a number of other items on your list to consider.
Keep a record of everything that goes into your treats, since this will have to be printed on the label. You’ll also want to consider keeping track of how much you use over time so that you can figure out how large of a lot you’ll need to purchase.
Other supplies, like baggies, packaging and materials used for shipping will also factor into the equation. Keep an eye on how much you’re spending on these so you don’t ever exceed the amount of income you’re making.
Step 7 – Naming Your Business
If you already know a potential name for your company’s business, then you’ll want to check with the Patent & Trademark Office to see if anyone else owns it. Those who don’t have a name picked out yet can use a website domain creation tool to brainstorm dozens of names quickly.
Once you find something you like, make sure that it’s not currently held by anyone as a trademark. You’ll also want to check and see if anyone in your state owns it so that you don’t get accused of infringing on someone else’s intellectual property.
Step 8 – Register Your Business
Even dog food treat businesses that don’t have to register with special authorities will still need a business license. Any commercial enterprise is required to possess a business license from the state their headquarters is in.
More than likely, you have only one facility, so you merely need to register your business in the state that you’re currently in. The federal Small Business Administration can be of assistance, but you normally can register a business simply by filing a form on your state’s government’s site.
Step 9 – How to Handle Sales Tax
You need to establish a presence in every tax locality that could potentially purchase from you. Try using a tool like TaxJar or Amazon’s built-in tools to help you figure out how much sales tax you’ve collected and who it has to be paid to.
Some localities won’t require you to collect taxes while others will make you report specific fees. Certain states, like Florida and Wisconsin, may not collect any form of sales tax on items they consider to be food.
County and local taxes might play into the equation, especially if you ever plan on selling in person at shows or craft fairs. Working with a tax professional is probably your best bet, because sales taxes can get really complicated.
Step 10 – Setting Up a Website
Set up an independent website even if you plan to sell on Etsy, Amazon or eBay. Shop around for hosting fees and make sure that your domain name is the same as the name of your business.
Chances are that you used a domain name tool to name your business, so this shouldn’t be difficult. You may even consider using “.com” as part of your company’s name.
Create and grow your social media presence as well. Most of the major social networks won’t charge you a dime, so you can use them to promote your business for free.
Is a Dog Treat Business Profitable?
A dog treat business will remain profitable as long as your annual revenue outpaces expenses. Typical Etsy and eBay prices for homemade dog treats are around $6-20 plus shipping.
An increasingly large number of vendors offer free shipping to their clients, so you’ll probably need to factor this into your costs. The price of ingredients and the amount of energy used to make the treats will also be part of your expenses.
Profit margins should grow as you ship items in greater numbers. You can reduce your costs by purchasing ingredients in bulk, but you’ll need to be sure that you can sell a large portion of what you make to justify larger supply purchases.
Dog Treat Business Pros and Cons
- Easy to start
- Can be very fun
- You may already know potential customers
- Readily translates into an online business
- Expenses can quickly add up
- Can be a hard sell
- Lot of competition on sites like Etsy
- Need to be careful about the quality of your ingredients