Cottage Food Budgeting Example - Home Strawberry Jam Costing

Sep 13, 2026

A detailed cottage food budgeting example for producing strawberry jam in a home kitchen using water-bath canning. The guide compares ingredient sourcing from home-grown, retail, and farmers’ markets, then estimates startup investments, fixed costs amortized per product line, and variable production costs for 500 jars. It further models expected returns when selling at a farmers’ market versus selling from home, highlighting how sales location affects net profit.

LanguageEnglish

CategoryPresentations

FormatPDF

Pages2

Reading Time1 min

AccessFree to download

Budgeting Scenario

Production Method and Batch Planning

Startup Investment and Fixed Expenses

Variable Costs by Inputs

Ingredient Source Comparisons

Net Return Based on Sales Location

A Cottage Food Budgeting Example Producing strawberry jam in home kitchen: 􀁸 Using 2 water bath canners on stove top 􀁸 Comparing 3 different sources for ingredients 􀁸 Using tested recipe from Ball for very small batches (test your own recipe for larger batches!) 􀁸 Budgeting to produce 500 ½ pints (8 oz jars) in 32 jar batches (16/canner) 􀁸 Comparing sales locations This example is based on water bath processing of strawberry jam, but you can construct a similar budget for dehydrating, roasting or baking a product too. Note that all expenses in this example are calculated per product line as well as per individual unit of product produced. This is designed to make the example more realistic since it is unlikely that anyone would just sell one product such as strawberry jam; rather they would have several product lines. Your investment costs | Item | Unit price | Total cost | Expected life of item | | --- | --- | --- | --- | | Purchase of 2 water bath canners | 80.97 | 161.94 | 10 years | | Canning equipment | 21.99 | 21.99 | 5 years | | ServSafe Food Manager training | 125.00 | 125.00 | 5 years | | Sales tax license (fee + $50 deposit) | 68.00 | 68.00 | One‐time expense | | Insurance premium | 500.00 | 500.00 | 1 year | | Time spent on licensing & training (10 hours) | 11.42 | 114.15 | 5 years | Note: These are estimated start‐up costs for home production, assuming you already have some small equipment on hand, such as pots, ladles, etc. Amortizing these costs over their expected useful life provides the following breakdown of fixed expenses: | Item | Cost per year | Estimated cost per product line | Cost per ½ pintof jam | | --- | --- | --- | --- | | Purchase of 2 water bath canners | 16.19 | 3.24 | 0.01 | | Canning equipment | 4.40 | 0.88 | 0.00 | | ServSafe Food Manager training | 25.00 | 5.00 | 0.01 | | Sales tax license (fee + $50 deposit) | 68.00 | 13.60 | 0.03 | | Insurance premium | 500.00 | 100.00 | 0.20 | | Time spent on licensing & training (10 hours) | 22.83 | 4.57 | 0.01 | The costs of produce used to make your cottage food product will vary, depending on where you obtain it. The table below shows per unit prices for strawberries purchased from three different sources: | Strawberry purchase location | Price per quart | Price per pound | | | --- | --- | --- | --- | | Home grown | $1.33 | $1.73 | Costs of small‐scale field production | | Retail store | $1.58 | $2.06 | Average USDA Agricultural Marketing Service prices for strawberries, for May 5 through July 5, 2012 | | Farmers’ market | $8.00 | $10.40 | Colorado State University Extension’s farmers’ market price reporting data | Your potential costs of production: | Item cost | Based on production of 500 jars | | --- | --- | | Labor: processing (based on a labor rate of $10/hour + payroll costs) | $ 267.54 | | Water | $ 3.28 | | Electricity for preparation | $ 3.75 | | Jars and lids | $ 395.42 | | Produce costs (using homegrown strawberries as an example) | $ 208.43 | | Pectin | $ 116.12 | | Lemon juice | $ 70.31 | | Sugar | $ 116.67 | | Jar labels | $ 22.96 | | Sales tax on product sold at market | $ 67.50 | | Other marketing costs (for attending 1 farmers' market for the season) | $ 404.72 * | | Total variable costs | $ 1,676 .70 | *Note: Costs are spread over 5 different product lines. Your net return on your product will depend on where you sell it, as illustrated below. 1. Sell your product at a farmers’ market: | Summary: | Source of strawberries: | | | | --- | --- | --- | --- | | | Your own
produce | Produce purchased from retail grocery | Produce purchased at farmers’ market | | 1. Fixed costs per 1/2 pint | $ 0.25 | $ 0.25 | $ 0.29 | | 2. Variable costs per 1/2 pint | $ 3.35 | $ 4.01 | $ 5.44 | | 3. Total costs per 1/2 pint | $ 3.61 | $ 4.26 | $ 5.72 | | 4. Expected revenue per 1/2 pint | $ 6.00 | $ 6.00 | $ 6.00 | | 5. Expected returns per 1/2 pint | $ 2.39 | $ 1.74 | $ 0.28 | | Net return on 500 jars | $ 1,1

FAQs

What production method does the example use for cottage food budgeting?

The example uses water-bath processing for strawberry jam and describes planning similar budgets for other methods like dehydrating, roasting, or baking.

How are fixed startup costs handled in the example?

Startup investment costs are amortized over their expected useful life and then broken down into fixed expenses per product line and per 1/2 pint.

How does selling location change the expected net return?

Net returns differ by where the product is sold: the example compares expected returns when selling at a farmers’ market versus selling from home using the same overall production volume.

Sep 13, 2026

Uploaded by Valentina