Introduction on How to Start a Frozen Food Business in India
If you are planning for business ideas in the food industry, the frozen food business will be a perfect one to give consideration especially if reside in a city. In villages and rural areas, people have ready access to green and raw foods because mostly they are farmers. They produce their vegetables. Some of them grow their turkeys, chickens, and other livestock. Therefore, the idea of starting a frozen food business in a village is not appropriate. But in cities especially in crowded urban areas like Kolkata, Mumbai, Delhi, Bangalore, Hyderabad, Chennai, and Ahmadabad just to mention a few, beginning a frozen food business in any of these cities will be perfect. Why? It is simply because of the inhabitant’s advantage. In cities, people are tiring and they don’t have time to kill and make live chickens and turkeys for cooking. Some people have time but they just like cooking what is needed on week offs. Therefore, frozen foods come easily. People can dash into a frozen food store and select the size of meat or fish required per time. With this, wastage is avoided or reduced to the barest minimum. Also, many food corners may try to buy frozen foods as part of the ingredients for their food items.
A step by step guide to Frozen Food Business in India
Demand for Frozen Food Business in India
Another reason the frozen food business is on-demand is the lack of a stable power supply. If individuals plan to stock fish or meat in their freezers, they require electricity or an alternative source of power. In the absence of a regular power supply, people cannot purchase and kill live chickens to be stored in the freezers. Otherwise, they will be at the risk of having their chickens get spoilt due to no power to drive their freezers. These challenges are what create a business opportunity for anyone that plans to start a frozen food business. The frozen food business is a good business idea that promises a regular flow of income during the year. There is always a good requirement for frozen foods. If you are willing to know more about the business, then check out how you can start a frozen food business.
Market potential for starting Frozen Food Business
The frozen food business is extensive. There are several things you can sell such as fruits, vegetables, chickens, meat, turkeys, fish, and candy, etc. You must carry out proper market research to identify what category of people in your locality will do the purchase. The purpose you are starting a frozen food business is to cater to the frozen food needs of your target market by providing them at a certain price. If you sell what they don’t need or buy, then it is a waste for your business. As part of your market research, you must be aware of the size of the market you want to serve and your competition. If there will be too many players, you may plan to move to another area where the competition is not much. Alternatively, you can look at how you can distinguish your service from your competitors. Offering a better service may grab the customer’s attention you. Another way you can attract customers is by ensuring that your products are of good quality and properly preserved. Selling other complimentary items along with frozen food such as spices and soup ingredients will also be favorable and attract customers to you.
Market research for Frozen Food Business
After careful market research, you can now decide who do you want to sell to? The ideal customers for Frozen Food Business are stated below:
1. Individuals: These comprise unmarried men who may like cooking their food instead of approaching restaurants to eat. We also have middle-class families in this niche.
2. Grocery stores: Even a few of the grocery stores plan to sell frozen foods. They may not need to purchase in a large quantity the same way you will do. Some of these grocery stores rely on people like you to provide them with frozen foods.
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3. If you have a good number of food corners around you, that will be an add-on to your frozen food business. You can sell them directly. However, it is significant that you establish a safe credit policy as many restaurants will like to buy on credit. But in case most of your sales are on credit, it will affect your liquidity.
How do you plan to sell to your target market? Are you planning for the delivery service? If you do, this will upsurge your market potential. But you must take care of how to include the delivery cost into your cost.
Area required to start Frozen Food Business
You must obtain a proper location to begin the frozen food business. The frozen food business is not the type of business you can locate in a secret region. You need a place with a high footfall. You must assign the store in a region where people can easily dash in and choose what they need on their way going home. Of course, such a place may be comparatively costly but it will pay off finally. A market where people get food items and soup components can be a good area to locate a frozen food business. Other places such as estates and major bus stops are also suiting.
Suppliers in Frozen Food Business
Having access to trustworthy suppliers is a crucial aspect that will lead you to the success of the frozen food business. People will need your product daily. It will be very disappointing for clients to get to your shop only to discover that lack what they are looking for when they reach you. This will be very disappointing. People will tend to go to any area if they feel they will get what they want on a timely basis.
Therefore, it is essential to keep a reliable source of supplies that will guarantee a continuous supply of stocks. Besides that, you should buy from suppliers who can provide you with a reduced price. The competition in the frozen food market will be comparatively more if compared to any other food business. The only way to safeguard profitability is for you to be able to control your expenses. If you have the source of good suppliers who providing you at discounted prices, this can allow a cost advantage over your competitors. With this, you can provide offers to your loyal customers and this will allow them to come again and again.
License, permissions, and registration required to start Frozen Food Business in India
You need to procure approval before you can begin selling frozen foods. Starting a frozen foods business without acquiring permission may land you into some illegal problem and you are helpless. This means that the government authority can prohibit your shop at any time. Imagine you just stock your shop and then come to a closure. You must be careful that there will be power throughout the period that you and your customers don’t have access to the shop. If not, all your stocks may get spoilt and that may mark the termination of your frozen food business. Therefore, it is a wise suggestion to obtain the necessary permits before you start the shop.
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Equipment required to start Frozen Food Business
The main equipment you must have to start a frozen food business is mentioned in the following section:
- Freezers: This is the chief equipment you must acquire to keep your items frozen. You can purchase new ones but if you don’t have enough funds for this, you can buy a fairly used second-hand freezer. If you are not purchasing a new one, you should get a primary servicing with the help from a technician so that you can identify and access the state and working status of the already used one you want to acquire. This will ensure that you don’t get the wrong one and you don’t keep using all money on repairs and maintenance of the freezer. Depending on the size you want to start your business will assess the number of freezers you should keep.
- Generators: Access to constant electricity is a must for anyone that desires to start a frozen food business. In case of power failure, you should have the capacity to carry your freezers properly. If the electrical power is reliable, one generator will be enough for you. But if you rely heavily on generators to power your freezers, it is recommended to have two generators. If any of them breaks down, you can use the other and, in the meantime, it will be repaired.
- Weighing scale: People sell frozen foods in Kg. Therefore, you must keep a weighing scale that you can utilize to weigh items that clients are willing to purchase.
- Delivery van: This is not obligatory for someone who is initiating a frozen food business on a low scale. But if you want to serve for home delivery or you have grocery stores and restaurants as regular clients, then it is suggested to have a delivery van.
- Other equipment you will need is some tables, plank, cutlass, and knife. This will help you serve the individuals who might request that you slice the fish, chickens, and turkeys for them. This is part of your customer comfort and it adds to your goodwill.
Investment required to start Frozen Food Business
- Cost of renting a shop facility
- Purchasing freezers, trays, knives
- Procuring frozen food supplies
- Hiring manpower
Profit margin in Frozen Food Business
You can earn good profits in Frozen Food Business. Initially the percentage will be low later on the profit percentage increases based on the quality and customer satisfaction.
Marketing strategies for promoting Frozen Food Business
As per earlier discussion you should pick a proper good location for your frozen food business. If you plan the business in a good place, you can market easily without spending much money or effort on marketing. A poster or signboard in front of your store will be sufficient. However, if you want to do home delivery, you should keep a website for the frozen food business. You can design it similar to an e-commerce website where people can book directly from the webpage. Besides that, you may also do advertisements in newspapers and the internet for getting traffics to the website.