Ever since the pandemic started, local businesses and restaurants have been encouraged to set up shop online and start selling. If only it were that easy! Before they can start picking hero graphics for their new home page, businesses that sell food and other perishable goods have more fundamental concerns. Namely, how can they make sure the customer’s order is as fresh as possible when it arrives so the customer has ample time to enjoy it?
If you sell food, preservative-free cosmetics, or other items that expire quickly, you might have questions about whether selling online is viable for your business. Common concerns include:
- Should I work with my existing menu or mix up what I offer online so I can build in more shipping-friendly items?
- As I transition to consumer packaged goods, what regulations should I be aware of?
- How can I ship an item that needs to stay refrigerated?
- What if my customer doesn’t get their order before it expires?
- How do I manage inventory for high-turnover products?
We’ll answer all these questions and more as we walk you through everything you need to know about selling perishable goods online.
Should You Sell Perishables Online?
First of all, this is a 100% doable business model. Food and beverage ecommerce is a fast-growing sector, with revenue that’s expected to hit $26 billion by 2022. Popular brands like Blue Apron and Hello Fresh have perfected the art of the refrigerated delivery, and fulfillment centers give you the chance to warehouse and ship products locally no matter where you’re based.
The question isn’t can you sell perishables online, but should you? If you’re a restaurant and you’ve never touched ecommerce before, you know the transition won’t be as simple as packaging up existing favorites and shipping them. You won’t be making a pivot so much as rotating into a new sector entirely. Outside of local delivery, your lovingly-prepared and plated menus will only minimally help you as you determine how you’ll build a shipping-friendly product line. Then there are news labels and packaging to purchase, regulations to keep up with, and an entire logistical arm to add to your business that didn’t exist before (fulfillment and shipping).
The bottom line is, you’re more likely to succeed if you think of going online not as a seamless transition from running a restaurant or local shop but as a new venture entirely. This isn’t a switch you can flip on and then flip off again when things return to normal; it takes too much work and time to get an online business off the ground to treat it as a casual solution. Manage your expectations so you don’t feel financially or mentally blindsided when you encounter many of the same issues you faced in the earliest stages of your business.
If you’ve already “done your time” with startups and/or your passion for your business is rooted in the restaurant world, channel your efforts into that. Double down on local marketing and make sure you’ve seized every possible local pickup and delivery option. If you’re ready to establish an ecommerce presence and help that part of your business take off, your existing infrastructure puts you way ahead of the pack — not to mention your industry knowledge and deep understanding of your customer base. You have all the right ingredients for a successful ecommerce store!
Unless you’re ready to pull a full Hello Fresh, think less about how you might replicate entire dishes and more about how you can package up the local flavors that make people love your restaurant. Does everyone go crazy for that secret sauce? Sell it by the jar so people can use it in their recipes at home. Make a mean marionberry jam? Ship it. Are your house chips an underrated gem? Package them up so people can snack on them whenever they want.
You can also offer products inspired by your restaurant’s menu. This allows you to stretch your creative wings and expand beyond literal duplications into items that will be practical and shipping-friendly. Can you concoct a salad dressing that will capture the magic of a favorite salad? Or whip up some truffles that embody the flavor of a favorite dessert? Or put together nonperishable “deconstructed” recipes that only require the customer to add the perishable ingredient later? Perfect!
Regulations for Selling Perishables Online
If you’re already running a restaurant, your state’s cottage food laws still apply. If you’re starting a new business from scratch, these include:
- Food handling & safety regulations
- State business licenses
- Zoning clearance and local permits
- You must have a kitchen inspection made by the health department at least once a year
- Additional commercial kitchen rules that vary by state
Now for your introduction to a whole new set of regulations: labeling laws! According to FDA regulations, every food product should include a label and a complete disclosure of the ingredients. The label should also include:
- Net quantity
- The weight of all ingredients combined
- The name and location of the manufacturer
- Nutrition information
- Disclosure of food allergens, including whether the food was made in a kitchen that exposes it to cross-contamination from allergens
- An expiration and/or “sell by” date
Shipping Perishable Foods
For non-refrigerated products, a “Fragile” label will suffice from a legal standpoint. Don’t skimp on packaging, though! Your packaging can make or break the quality of your shipment — literally. Look for vacuum-sealed wrapping, watertight containers, and tamper-proof seals. Even if the product doesn’t require refrigeration, the FDA recommends that packaged food items arrive to the customer at or below 40 degrees Fahrenheit.
Give each product the padding it needs to survive the journey, aiming for no movement within your inner and outer packaging. Even if you sell durable products, treat them like they’re fragile; the shipping process can be tough on packages.
Use the smallest box that will fit your products so you don’t have to incur unnecessary extra costs.
Try to get the package into the customer’s hands as soon as possible. If that means you can’t choose the most economical shipping options, build the cost into your product margins. Consider offering a local pickup option so you local customers can save a few dollars on shipping!
For refrigerated or frozen food, work with UPS or FedEx; both offer same-day or next-day shipping, and both ship refrigerated products all the time. In fact, UPS has a handy guide to shipping with dry ice.
Regardless of the provider you choose, the insulation is largely up to you. Most people use a combination of dry ice or gel packs, styrofoam coolers, and insulated pads and liners. Display information prominently on the outer packaging that lets your shipping provider know there’s refrigerated food in the package. Your shipping provider should also be made aware of this beforehand.
Expect a 2-3 pound refrigerated package to cost about $30-150 to ship. Whew! Use this option only if your products have a high price point. If you can’t make it work with your budget, look to alternatives like using local fulfillment centers or, better still, selling wholesale to local grocery stores.
Managing Customer Expectations
Selling perishables means communicating with your customers as much as possible. Starting on the product page, make nutrition information clear and set the proper expectations for shipping. Shore up your return policy and communicate it clearly to your customers.
Don’t make the customer liable for food that arrives late and/or spoiled. Refund or replace their purchase, and explore the issue with your shipping provider if you notice a pattern emerging. If your customer just doesn’t like what they purchased, use your discretion.
After your customer has checked out, reiterate shipping information in your confirmation email and notify them again when the product ships. If they need to be home for the delivery, include information about the delivery window as early as possible and give them a fast way to contact their shipping provider if they need a different time.
If you’d like more information about marketing and selling your food products online, check out the following posts:
And of course, we’re always happy at Grow With Studio to help you get set up right. Happy selling!