It’s 2019 which means that in California, you can now register as a microenterprise home kitchen operation. At first glance, this seems like a great thing however, there are some glaring issues once you dig into the details of Assembly Bill No. 626.
This has a lot of potential to become problematic for those who wish to cook and sell food from their homes and those who wish to purchase said food. The entities that it doesn’t seem to be problematic for are the tech companies and the tax man.
I should note that I do not currently cook from my home. I cook in my client’s homes. I have two weekly clients that I shop for and cook for in their home, therefore eliminating the need to use my home kitchen. I also do private dinner parties and again, prepare the food on-site.
In light of this law passing I knew I had to dig deeper so I read the entirety of Assembly Bill No. 626 and some opinion pieces. This is what I discovered.
The bill states that you can only make $50,000 in annual gross sales before extracting expenses. In the restaurant industry, most aim for their food cost to be about 20%. However, as a regular shopper without the ability to order from food service sources and in mass quantities, it is much higher. Mine runs about 40% for my weekly clients and this is not including pantry staples such as salt, oils, vinegars, etc. So let’s say your food cost is 40%. That means, your actual gross income would only be $30,000.
$30,000 is not too bad if you are a single person. But this law is being promoted as a savior to minorities. Less single people looking to make an extra buck on the side and more mothers and grandmas that are just trying to feed their kids by feeding others. Keep in mind that this is a California law where current living wage is $29,000 for a single adult, but $61,730 for 1 adult and only 1 child.
Chances are your abuelita isn’t currently paying taxes on her tamale income and you know she’s making them all herself so she’s not paying for help. With the new law in place, she’ll have to start paying those taxes and be capped at approximately $30,000 yearly income after expenses. Don’t get me wrong. I’m all for everyone paying taxes. I pay them on my income, but it’s just something to think about.
And now, she’ll have to start paying for “help”.
Money for Tech, not Minorities
So who is the law really going to help? Tech companies.
She’ll have to pay a tech company to “help” and must use their intermediary app or website in order to sell her tamales. This is a requirement noted in the bill.
I’ve already been getting soliciting messages from several companies looking to take a cut of my sales. This article explains in detail how this could turn into a situation like Uber. Which is fine, right? I mean, I embrace technology.
But it becomes a problem when one app does better than all the others and then monopolizes. They can then charge the home cook whatever fee they please and the home cook has no other option but to use their services. It will become the app that people purchasing will expect to use and that will be the only way for the driver home cook to find clients.
I can see it now! “Fuber!”
The Timing and Structure
Did you hear, the bill states that no more than 30 individual meals/day can be made.
Let’s do some more math here. Let’s say the average meal is $13 and you make the max of 30 meals/day. If you work 5 days a week, that’s $1950/week. Take away your 40% food cost that’s $1170/week. Multiplied by 52 weeks and you have $60,840/year. Well awesome! That’s super close to that 1 adult and 1 child living wage. But again, that $50,000 mark before expenses makes it so you are only allowed to make about half that. Minus whatever you are paying the tech company too, of course.
But then there is a further regulation that states no more than 60 meals/week. So, you can only work two days. Which would give you roughly, $20,000 year. Pennies in California.
Another issue is putting limits on meals when portion sizes vary so greatly. How will they regulate? Often, my meals are prepared and served family style. Take for instance, lasagna. I prepare an 8×8 dish and there is a family of 4. Will they eat the whole thing or cut smaller pieces and enjoy some more later? How many “individual meals” does that pan of lasagna equate too? How many tamales are one serving and who’s to say?
I was wrong about this initially. I thought for sure they would restrict homes that have pets, but after reading the bill carefully, I learned that if the animals do not have access to the kitchen and dining areas during preparation, they are allowed. Just a note for those of us who have pets. So, a good thing!
You Still Might Not Be Able to Cook and Sell from Your Home in California
Though it is a California law, it is still in the power of each individual county to decide whether they wish to allow it. This article goes into detail about how this is a problem.
So far, I have seen nothing about the law or signing up to be a microenterprise home kitchen on the Riverside County (my current home) Health Department’s website and I have high doubt that my original home, Orange County, will allow this. They recently outlawed even charitable operations from preparing food in-home. Remember that one time when a bunch of people fell ill and three died after eating a donated Thanksgiving dinner?
Which brings me to my last point.
Food Safety Knowledge
One of the very few things I dislike about being a “personal” chef is that anyone can go ahead and just call themselves one regardless of having any training, experience, or certification. I am classically trained, spent a year in very intense cooking competition, and maintain my Servsafe manager certification. There is nothing in the bill that requires this certification. It’s the first required course to even begin getting into the kitchen in culinary schools and for good reason. It covers foodborne illnesses, cross contamination, safe food handling temperatures, times, and more.
In fact, there is one mention of food safety in the bill. It’s about a much less extensive certification that a small child could pass called the food handlers card and it’s under the section of the things that are not required.
To Be or Not to Be a Microenterprise Home Kitchen
So, no, it’s not all great news. There are problems. Can some of them be solved? Maybe, but I imagine it will take time. The problems will have to start coming to light as they occur. It’ll probably be a learn-the-hard-way kind of thing.
Personally, I have not yet decided if I want to be able to cook out of my own home. Most of my clients enjoy the fact that I prepare the food in their kitchen. Despite the problems with the bill, I know it may work out very nicely for some. I just need some more time to see how it all plays out.
Thinking about becoming a microenterprise home kitchen yourself? Agree or Disagree with some of my thoughts? Let me know your thoughts!
*While I almost always use my own photos for my posts, this one called for some stock images. All can be found at Pexels.com.