How do you start a cottage food bakery business in 2027?

Honest 5/10 baseline.

Startup costs: $1K-$8K to start. Cottage food laws let you bake from a home kitchen for low-risk goods (cookies, breads, jams). Mixer ($300-$2K), sheet pans, packaging/labels, scale, basic site or Square ordering page, cottage food permit fee, business license. No commercial kitchen needed at this tier.

Permits/licenses: Cottage food registration or permit (state-by-state - CA, TX, FL, etc. all differ), food handler cert in many states, business license, sales tax permit if applicable. Most states cap annual cottage food sales ($25K-$250K depending on state) and restrict allowed products (no cream fillings, refrigerated items, meat). Direct-to-consumer only in many states - no wholesale.

Customer acquisition: Instagram (visual category), local Facebook groups, farmers markets (check market rules - some require commercial), pickup from porch model, custom orders for birthdays/showers.

Revenue model: Per-item ($3-$8 cookies, $25-$80 custom cakes if allowed), market booth sales.

Realistic year-1: $5K-$30K revenue. It's a side income for most. Hitting the cap means you must move to a commercial kitchen.