By Peter Ruddock, COOK Alliance Policy Director
Micro Enterprise Home Kitchen Operators (MEHKOs) often ask us at COOK Alliance about Internet Platforms that offer services to homemade food businesses. These platforms, officially known as Internet Food Service Intermediaries, or IFSIs, by the California Department of Public Health (CDPH) seem to be popping up everywhere. We estimate that at this point in time there are as many IFSIs as there are permitted MEHKOs in the US – just over 200 of each.
Some people have asked if MEHKOs have to work with an IFSI. They do not, though there are good reasons to consider working with an IFSI. MEHKOs first and foremost want to cook. But a MEHKO is a business that needs to be taken as a serious entrepreneurial effort. That means that you will need to market and sell your food, to keep books and pay taxes. Some people like to do all of these tasks, to retain full control over the way their business operates and to save fees. Others are happy to outsource this non-cooking work and are willing to pay a reasonable fee to do so. Your choice about whether to use an IFSI will depend into which bucket you fall.
So, what should you do if you are a MEHKO who wants to work with an IFSI? Definitely shop around. They are not all created equal.
First, visit CDPH’s new IFSI directory and make sure that the IFSIs you are looking into are registered with the state, as per the law. If they have not followed this basic law, you can wonder what other shortcuts they might be taking. We are aware that a few IFSIs are doing business by a name other than the name that they have registered with the state (such as a DBA). We do hope that they’ll make clear on their web-site their registration name as well. You might ask them if you are not sure.
You should make sure that you live in an area that actually permits MEHKOs. You can find out which counties in California do so by visiting our Status Tracker, which we keep as up to date as possible. If you are outside of California, only Utah permits MEHKOs, a process which is still being defined (a few states permit MEHKO-like businesses under Food Freedom laws). If you are in an area which does not permit MEHKOs, you would be taking a risk by selling food made at home. Some IFSIs will sign you up anyway. They too are taking a risk, but not as big as the risk that the MEHKO takes – you may be fined or shutdown for operating without a permit.
Some IFSIs tell you that all you need is to sign up with them and get a Food Handler Certificate. What you need will vary by your jurisdiction, but it will at least include a MEHKO permit from your county’s or city’s Department of Environmental Health, a Seller’s Permit (for tax purposes) from the state and a Food Manager Certificate. You usually will need a business license from your city as well. (Insurance is strongly recommended, though not required by the law.)
Finally, compare both services and fees, both of which can vary dramatically. Are there multiple fees? Does the MEHKO pay them all or does the customer pay some of them? This can make comparison more complicated, but it is worth the effort. You can find out that you’re paying a lot more than you first thought, and in fact more of your profit than you want to give up for the service, no matter how good the technical aspects of it are.
You’ll do yourself a good service by researching whether you want to work with an IFSI and if so which one. You’ll want to get good value for the cost, of course. And you’ll want to make sure that the IFSI knows what it’s doing and won’t lead you into trouble with the regulators. You want a safe and legal business, one that will thrive for a long time.