I'd start small by working from home and selling at farmers' markets, as your cottage laws seem to allow. Once I'd built a big enough reputation and clientele (and surplus from the business), then I'd consider taking the leap from home to commercial location - after running the numbers and writing a business plan. The overhead associated with a commercial spot can be quite significant, so knowing what you need to earn to cover those costs is key. And having a sizeable customer base before you make the leap is also a good safeguard.
I started my bakery out of my home, which was illegal at the time in the state of Missouri. I was quickly picked up by the Department of Health as soon as my products were written about in the local paper. So I promptly had to find a space outside of my house to continue the business. I first sublet a portion of a kitchen from a local caterer; that lasted about 6 months. During that time, I wrote a detailed business plan (with projections based on the data I had already gathered in growing my business that far); then I went to a bank, got a loan, and bought a small building (fully equipped, as it had previously belonged to another caterer). Finding the right space was a several month process though, as few spaces seemed to be the right size. I didn't want anything too large, as my operation was still small and I didn't want the added financial risk.