Starting a food business comes with numerous challenges, and it is not always the best decision. Here are 5 reasons I strongly recommend ; to consider before you take the plunge:
I love Food: And so does everyone else. I am yet to meet a person who does not love food, the greenery or the Himalayas. 🙂 So your love for food is hardly a reason for you to start a food business.
My mom has this fantastic recipe of <XxXxX>: So does my mom. Food has an amazing association with nostalgia and that is the most overpowering thing that influences the taste. So your decision to start a food business should not be overly influenced by this factor
Food is a high-margin business: On the contrary, it runs on normal margins like any other industry. If you have talked to anyone in the business they will tell you that only 25% of the cost is that of the ingredients and the rest of it goes towards, processing, packaging, storage, transport, marketing and sales. Hence, profits in this industry are also like any other.
I know this food/recipe which helps you lose weight/improves digestion: You may know but if you have to make any claims on the food products, they have to be backed by scientific study and/or clinical research for you to be able to claim on your food package or marketing content.
Pakoda Seller is also an entrepreneur: No doubt about it. But it is important to understand the size and scale of the business. As long as you are aligned with that, please go ahead. The stories of pakoda sellers earning 2L per month come at a cost. Typically the whole family contributes free labour, their staff is typically underqualified for the job and they have back-breaking work hours. Be ready to pay that price
Having mentioned this, all the points above can definitely help you in business. Having a love for food is critical , a starting recipe can help you to reduce your go-to-market timeline as well as some cost of development , a generally accepted claim can help you create a more focused study and reduce the cost of doing the study and the entrepreneurial spirit will let you fight out the odds. Starting a food business is if anything, as hard/harder than most businesses and you should be ready for it. Here are 5 things that you should consider
Can you deal with skill shortage: First thing you will notice when you enter the industry is the shortage of skilled manpower. Farming and Food have over a period become a profession of the last resort. Hence most people are here for a living and not really to make a career. This makes it harder to run the food business.
Can you jump in and take over: This is especially true for the fresh food business. A lot of the food entrepreneurs will tell you that they have personally helped in the kitchen/factory during an emergency. So not just loving the food, a little bit of skill in the making would be really handy.
Can you handle the variety: A typical recipe will contain 8-10 ingredients but then you have thousands of them to choose from. Don’t believe me, just try looking for food colours and you will get a sense of the problem. It is not just the shades, there is the form which can be in powder, liquid, or concentrates. Then there are synthetic and natural and I am not even talking about the different suppliers. It is very easy to get overwhelmed.
Can you manage your costs: Food is a very cost-sensitive market. Indians will pay a premium for clothes but very few will pay a premium for food. So if you want to address a large enough market, you need to really manage your cost/price. Else you should be satisfied to remain a hyper-local player only. Nothing wrong with that.
Do you have access to technical resources: I had to put this so that we can pitch our services to you. 🙂 But on a serious note, there is a lot of science involved. As soon as you move beyond 4 hours gap between preparing and consuming food, things start to get complicated with an increase in time. It is important to understand this. You may not need a degree in Food Science but even a basic degree in science, especially chemistry and biology is useful. If you don’t have a degree in the subject, you might still want to go back and revise chemistry and biology from your school.
In conclusion, starting a food business is not for everyone, and it’s important to carefully consider the potential challenges and risks before making the decision to enter this competitive and complex industry. However, for those who are well-prepared and have a passion for food and cooking, a successful food business can be a fulfilling and rewarding experience.
