Home kitchen, home food entrepreneurs have often asked whether they need to signup with an IFSI.

To IFSI or Not To IFSI*

*(With apologies to the bard)

Short Answer

Technically, there is not legal or regulatory requirement for signing up with an IFSI. You can run your #homefood business any way you see fit within the regulatory framework. But ...

Long Answer

There are good reasons to signup with one or more IFSIs.

1. The IFSI serves as a marketing and distribution channel. Even the large multi-billion dollar businesses push their products and services through their marketing and distribution channels. Mutliple channels allows a business to reach wide audience of customers.

2. If an IFSI does not charge a fixed upfront fees and only collects a cut (commission) from the order brought in by the IFSI, then there is no reason to no use it as a channel. In this case, the channel is basically free till it brings in revenue for it and then it gets paid from that revenue. It is a no-brainer.

3. Most IFSIs (perhaps all) are non-exclusive. So far as you avoid any exclusive contract with an IFSI that prevents you from working with other IFSIs and the fee structure is as in #2 above, it is in a home chef's interest to signup with as many as available. Think of it as multiple funnels that can possibly bring customers to you. In any case, your cost till an order comes in is zero.

Our Take

We believe that home kitchen businesses should not shy away from taking a critical look at using IFSIs. As shown above, it could be a zero cost marketing and distribution channel that can funnel in customers. What is there not to like?

Home kitchen, home food entrepreneurs love cooking but getting a home food business going takes more than cooking. The business needs to attract and engage customers, have channels of interaction with them and of course take orders and process payment, refund for non-delivery and so on.

That is quite a bit of Information Technology to string together.

If the entrepreneur can set it all up and have time to manage it operationally, the question to consider of course, is that, is it the best thing to focus on. Different entrepreneurs may have different opinions about it. For those who want to follow 80-20 rule and focus on their expertise of cooking and engaging the customers, it would serve well to choose a perfect partner to team up with.

This article explores important factors to consider for choosing the perfect partner.

As a business owner, you want your IFSI partner to add significant value to your enterprise. Here are the areas your IFSI can bring value to you.

1. Full Coverage of Functionality

   The intermediary should provide all the IT functionality under one roof so that you do not have to put together solution from multiple vendors. Here is the list of features to consider.

• Ease of getting started with a menu

  It should be as easy as signing up on a Web app or downloading a smartphone app. Assuming that you have pictures and write ups available for your dishes, getting a menu up should be a very quick affair. In the modest it should take hours or less; certainly not days. And of course should allow later updates to it.

• Easy way for consumers to find your business

  This one drives your customers to you. The platform should offer flexibility for letting you work on your schedule and give clear indication to the customers about your schedule preferences to avoid any disappointment.

• Easy way for consumers to communicate to you

  As clearly laid out your menu might be, customers might need additional information from you. The platform should have a communication channel built into it to make that easy.

• Order and payment processing

  This is obviously a necessary componenent. It should be very easy for customers to pay with credit card and optionally other payment methods.

• Earning disbursement

  You want the money you earned in your account as quickly. The platform should have earnings disbursement plant that is fair to you and offers different mechanisms for disbursement.

• Statement history and analytics

  Once you are in business for some time and have ongoing operations, you would benefit by analyzing the order and revenue patterns. At the least, you should be able to see how well your business has been doing. Better yet, the platform should provide you insights into how you can do better.

2. Commission / Fees

   The intermediary being a for-profit business, is likely to charge a monthly fee or a percentage commission on the revenue. There could be big differences between the intermediary that could directly impact how much you get to keep. You want to keep as much of your hard earned money as possible. Choose the one that lets you keep the most while providing a high quality of services.

3. Support

   With the best of the systems, you might occasionally still run into issues and need help from the intermediary. Partner with the intermediary with good, helpful support

In summary, we believe that home kitchen businesses can leverage an intermediary IFSI to provide IT infrastructure. It would serve the business well to scrutinize the aspects mentioned above for selecting an appropriate IFSI that can become a valuable partner for the long run.

Note: The company I work for, LocalChefs is a registered IFSI.

LocalChefs (https://localchefs.us) is now a recognized, registered Internet Food Service Intermediary with the State of California.

LocalChefs provides an online marketplace for home food businesses with the lowest commission and is entirely app based. All you need is an iPhone or Android phone to run your home food business. The app does the rest.

Think of LocalChefs as an additional sales channel that has no upfront fee and the commission on the order is the lowest in the industry. It provides connection to the customers, credit card processing, earnings disbursement.

Please take a look at https://localchefs.us.