With the growing awareness of healthy living amongst the modern generation, more and more people are now adopting organic foods to remain healthy.
This is why the Indian organic food market anticipates rising by 25% in the coming few years, and there is a tremendous scope in venturing out into the organic food business.
Also, for people who do not know, Organic foods are food items that grow organically without using chemical-based fertilisers and pesticides that make them harmless for people and the environment.
Given this health and environmental benefit, the demand for organic food is rising day by day. Hence it is an excellent idea to start an organic food store in India, either with your savings or by obtaining a grocery store loan.
Tips to commence an organic food business in India
The organic food store opening process in India demands the examination of several factors before the actual store gets set up and begins marketing products. Mentioned hereunder are some steps required in starting an organic food store in India.
1. Identify your target customers.
Many people in modern times have begun giving more attention to healthful living these days. Organic food signifies the riskless and wholesome nature of food products, which holds tremendous demand among health-conscious people.
Also, organic food items are usually more expensive than conventional food products. Therefore, the clients who can spend on healthful products must be your target clients.
Hence, choosing the organic store location where more and more health-conscious people from upper-middle-class economic backgrounds reside.
2. Choose a suitable business store location.
The organic store startup process must include selecting a suitable business location, the purchasing power of the customers, competitors working in that area, and the applicable rent if you want to start your business in a rented place. Here are some points to keep in mind while choosing a suitable business location.
- Convenient location: The organic store location must remain situated in a readily convenient place to the clients. The store area with a parking convenience in an overcrowded marketplace is an extra advantage that helps you get more clients.
- Store rental: You must pay a minimum of INR 10,000 per month rent of an organic food store with decent space to hold your organic product categories. However, ensure that you do not pay more than 4% of your cumulative product sales for shop rent.
- Competitor analysis: You must analyse the opponents in the target area as well. Also, if there are numerous organic stores near your store location, it would become more challenging for you to run a successful business.
However, sometimes, you have no option rather than choosing a competing marketplace due to the colossal need for organic food products in a particular location.
In this case, it is crucial to comprehend the strengths and vulnerabilities of your rivals in the market. Also, creating better promotional and marketing strategies is vital to face the competition and maintain a competitive place in the industry.
3. Register your organic food business.
Choose a suitable company composition for your organic food local business. The company structures in India comprise a partnership, sole proprietorship, one person company, private limited company, limited liability partnership, and public limited company.
However, if you are a single business owner, a Sole Proprietorship is the most suitable and convenient business structure for a GST registration.
4. Get a food safety license, trade, and organic certification.
To open an organic food store in India, apply for a current account in your company name in your favoured bank. The statutory regulations to receive the trade license for commencing an organic store may vary in each Indian state.
Bank Statement, PAN Card, and Rental lease of the store (or any other premises documentation) are the vital records needed to obtain a trade license. Apart from this, you must apply for the following certifications.
- FSSAI license: If you plan to produce any organic food and market in your organic shop, then an FSSAI license is crucial for quality assurance and food safety.
- GST registration: GST (Goods and Service Tax) is necessary only when your organic store company crosses the yearly turnover limit of INR 20 lakhs. You can choose to apply for GST Registration after beginning your organic food store. Nevertheless, you cannot overlook getting licenses or a GST or MSME registration since your business development depends on these certifications.
- Organic food certification: The NPOP (National Programme for Organic Production) by the Indian government oversees the organic food certification in India. Also, the India Organic label is a must for your organic food product to get accepted as an organic product.
5. Promotion and advertising.
To remain successful in your organic food business, you must stand out from your competitors. Nevertheless, as a newly established business, marketing top-selling food labels is the most prudent choice in the primary stage.
However, you can win client attraction by decreasing your profit margin and price-based advertisements like discounts for a confined period to earn a market share in your target area.
You can likewise offer discount coupons to attract more new customers. Also, the best way to promote your organic food business is without investment in SMM (Social Media Marketing).
Furthermore, Bulk SMS marketing, printed pamphlets, and billboard advertisements are affordable advertisements and promotional strategies.
The bottom line
To summarise, organic foods is one of the few classes that come into the high-margin, high-scale opportunity bracket. As customer mindfulness of healthy and natural foods rises exponentially, they are willing to spend more and more money on organic foods.
Also, with health and healthy living growing as a priority, MRP has taken a backseat when purchasing organic food. All and all, with increased spending power and raising awareness, these organic products are not just growing popular but are attaining an inevitable place in the shopping baskets.
If you wish to get a working capital loan for establishing your organic store business, Ziploan can be your perfect partner. Ziploan is a leading NBFC in India, well-known for its quick loan disbursal and affordable interest rate.