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Guide to opening a food and beverage manufacturing business

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This page will help you understand the steps to opening a food and beverage manufacturing business in San Francisco. It is a resource from the Office of Small Business, San Francisco's central point of information for small businesses.Office of Small Business

Set up your business

  • Create a plan for the type of manufacturing business you will open.
  • Choose a business structure.  LLCs, Corporations and Limited Partnerships must register their structure with the CA Secretary of State before registering locally. 
  • Apply for an Employer Identification Number (EIN), also known as a Federal Tax ID Number from the Internal Revenue Service (IRS). This is used to identify your business and allows you to hire employees.  If you are a sole proprietor without employees, you may choose to use your Social Security Number instead.
  • Register your business with the City and County of San Francisco through the Office of the Treasurer and Tax Collector.
  • Choose and file a business name.  File a Fictitious Business Name (FBN) Statement at the SF Office of the County Clerk if you will be using a name other than your given name, the names of your partners, or the officially registered name of your LLC or corporation.  Research the name's availability in the county before filing.
  • Apply for a Seller's Permit from the CA Department of Tax and Fee Administration (CDTFA).  Every location must have this permit to sell taxable goods.
  • Obtain liability insurance for your business.
  • Obtain workers' compensation insurance if you will have employees.  You will need these in order to obtain the DPH permit to operate.

Choose a location

  • Choose one of three location options: Manufacturing at home (subject to cottage food laws), in a commercial kitchen, or in your own space.
    • Note: If you prefer not to take on your own kitchen, you may also choose to use a co-packer – an established food company that processes and packages your product according to your specifications.
  • If manufacturing at home, you must follow California Homemade Food Act regulations including restrictions on gross sales, type of food, and employees.
    • CA DPH Resource: https://www.cdph.ca.gov/Programs/CEH/DFDCS/Pages/FDBPrograms/FoodSafetyProgram/CottageFoodOperations.aspx
    • Notes:
      • The California Homemade Food Act (also called the Cottage Food Act) is open to the following types of businesses: 
        • Businesses producing “non-potentially hazardous” foods (eg. foods that do not require refrigeration) 
        • Businesses making under $75K (for Class A sales) or $150K (for Class B sales) in annual gross sales 
        • Businesses with no more than one full-time employee outside the immediate family
      • There are two classes of homemade food producers. The class you fall under determines who inspects your home kitchen. Regardless of your class, you must attend a food processing course. 
        • Class A (Direct sales): If you only sell directly to the consumer (including shipped directly or via a 3rd party delivery service), you may conduct your own health inspections 
        • Class B (Indirect sales): If you sell through a third-party retailer such as a market, bakery, or restaurant, your home kitchen must be inspected annually by the county health department. In SF, that would be the SF Department of Public Health.
  • If searching for a commercial kitchen, be sure to consider cost, insurance, storage options, ingredients allowed, delivery rules, and hours.
  • If outfitting your own kitchen, find a location zoned for Production, Distribution, and Repair (PDR) use. This type of zoning code allows manufacturing and industrial uses with some on-site retail availability.
    • This website may assist you to understand whether your business is allowed at a particular location: build.symbium.com/business/sanfrancisco 
    • You can also visit the SF Planning Department’s Planning Information Counter at the Permit Center (49 South Van Ness Ave) to learn more about where you can open your manufacturing business. 
  • Visit the Office of Small Business Counter at the Permit Center (49 South Van Ness Ave) to understand permitting and licensing process. You will also be able to talk to different city departments about your permits during your visit. 
    • Resource: https://sf.gov/location/small-business-permitting-help
    • Notes:
      • Taking over a space that already was used for your type of manufacturing saves time and construction costs, as long as the space had recently passed inspections and was in compliance with current requirements.
      •  Consider common manufacturing needs such as loading docks, roll up doors, floor drains, and proper ventilation.
  • Review and sign your lease.

Prepare your space

  • For new construction: Submit plans and documents to the SF Department of Building Inspection (DBI).  Be prepared to work with an architect or designer to create your building project plans. 
  • Water and wastewater capacity charge: If your business will use more water than the previous business or resident, you may have to pay a capacity charge to the SF Public Utilities Commission (SFPUC).
  • Gas and electric services: If your business needs new or additional gas or electric services, contact PG&E Building and Renovation Services to start the application process.
  • Signs: If you want to install or change a canopy or sign on the outside of the building, ensure you comply with Planning Department and DBI sign guidelines.
  • Registration of Food Facilities: Register your food facility with the US Food and Drug Administration (FDA).
    • Resource: https://www.fda.gov/food/guidance-regulation-food-and-dietary-supplements/registration-food-facilities-and-other-submissions

Food and beverage

  • Obtain a Manager's Food Safety Certification for yourself and/or a designated employee.  This person is responsible for teaching other employees about proper food handling. 

  • Ensure all employees have a Food Handler Card. SF DPH offers a few options for obtaining this card.

  • Apply for the Processed Food Registration from the CA Department of Public Health (CDPH). This license is required to sell your goods to a retailer/wholesaler.

    • Notes:

      • Most manufacturers wait to apply for this license until they go after their first retail account.

      • Your application may require a Hazard Analysis and Critical Control Points (HACCP) Plan which is monitored by the US Food and Drug Administration (FDA).

  • Don’t serve any foods containing trans fats, per California State law. SF DPH enforces the trans fat compliance program to ensure that no food containing artificial trans fat is stored, distributed, served, or used in the preparation of any food.

    • Resource: www.sfdph.org/dph/eh/food/transfat.asp

Labeling

  • Name your food accurately. This name, often called the "Statement of Identity," can be either the "common name" or a "fanciful name" of the food. It should be placed on the Principal Display Panel (PDP) – usually the front of the box or container. 
  • Include a Nutrition Facts label on the information panel (the label panel adjacent and to the right of the PDP.)
    • Resource: https://www.fda.gov/food/nutrition-education-resources-materials/new-nutrition-facts-label
  • Declare the count, net weight, or volume of your product. This must be stated in both US (inches/pounds/fluid ounces) units and metric units (grams/liters). For example: Net Wt. 8 oz. (226 g). 
  • Packaged foods composed of two or more ingredients are required to include an ingredient list. Identify the manufacturer, packer or distributor on your product label. This is considered the responsible firm and must include the firm’s name, city, state, and zip code.
    • Note: Some businesses and products are exempt from nutrition labeling, including small businesses as defined by the Food and Drug Administration (FDA). Review the exemptions in the FDA’s Guidance for Industry: A Food Labeling Guide at https://www.fda.gov/regulatory-information/search-fda-guidance-documents/guidance-industry-food-labeling-guide
  • Identify allergens. All food labels must identify in plain language whether the food contains any of eight (8) major food allergens: milk, egg, fish (eg. bass, flounder, or cod), crustacean shellfish (eg. crab, lobster, or shrimp), tree nuts (eg. almonds, pecans, or walnuts), wheat, peanuts, and soybeans.
    • Note: While product dating is optional for most food products, there are two types to choose from: 
      • Open dating is recommended for all foods that are readily perishable as it provides information in a conventional date format. 
      • Lot codes on the other hand, provide information using letters, numbers, and symbols and are used by the manufacturer, rather than the consumer.
  • Potentially Hazardous Foods (PHF) must have the statement "Perishable Keep Refrigerated" on the label in a conspicuous location, normally on the PDP. 
  • If a confectionery product contains alcohol in excess of ½ of one percent by weight, state that fact on the food label. 
  • All beverages containing juice must declare the percent of total juice on the Information Panel and comply with Hazard Analysis and Critical Control Points (HACCP). 
  • Cottage Food producers are required by the CA Department of Public Health (CDPH) to note on their food labels that the product was made or repackaged in a home kitchen. Be sure to follow all CA DPH labeling requirements. 
    • Resources: 
      • Labeling Requirements: https://www.cdph.ca.gov/Programs/CEH/DFDCS/CDPH%20Document%20Library/FDB/FoodSafetyProgram/CottageFood/CFLabelingReq.pdf
      • CA DPH on cottage food operations: https://www.cdph.ca.gov/Programs/CEH/DFDCS/Pages/FDBPrograms/FoodSafetyProgram/CottageFoodOperations.aspx
    • Note: Cottage Food Producers must also state the registration or permit number of the “Class A” or “Class B” cottage food operation which produced the cottage food product and, in the case of a “Class B” cottage food operation, the name of the county of the local enforcement agency that issued the permit number.
  • Labels for meat and poultry products that are being sold out of the state are reviewed by the US Department of Agriculture (USDA) Food Safety and Inspection Service.
  • Raw meat and poultry products (e.g., fresh and frozen) including shell eggs must display safe handling instructions on their labels.
    • Note: Dietary supplements are regulated differently than conventional foods. Be sure to follow both Federal and State dietary supplement laws.
  • Obtain a barcode for each product if you will be selling to major retailers. GS1 US issues unique product codes (UPC) for a fee.

After opening

  • Post all required posters and permits including, but not limited to, No Smoking signs, minimum wage information, and health inspection results
  • Mark your calendar. Schedule equipment maintenance and set reminders to renew your permits and licenses as needed.  
  • Be prepared for SF DPH Health Inspections by checking walls, floors, and ceilings for damage; following best practices for food storage; collecting garbage; and ensuring workers have good hygiene.
  • Prepare and pay your local, state, and federal taxes. Learn more from these departments:

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Office of Small Business
Office of Economic and Workforce Development

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