Food as a Business Idea

Food truck competition

Competition (CC) Bob B. Brown (bit.ly1o2905w), on Flickr

If asked, many business advisors would say starting a business around food is probably the most common request they get.

Why is it so popular? One reason is that friends and relatives often comment on how much they enjoy a certain item and encourage that person to start a business. It may come from a long-standing family recipe or something the person spent hours working on. Food reminds us of our heritage and our years growing up. It also can take us to new places. We can be easily engaged as a consumer in our food and beverage experiences, yet we can also look at it as something we can grab quickly that will keep us going until we can take a longer break. Today we hear about local food, slow food, and all sorts of suggestions on how to change our diets for more energy and better health.

Yet making it in the food business is difficult. In grocery stores along some 20,000 new items hit the shelves every year. That number does not take into account the new restaurants opening each year, the recent trend of food trucks, and more and more farmers markets and consumer trade shows where food booths are plentiful in numbers.

So can you make it as a food entrepreneur? Yes.  Will it be easy? No. One of the first things such small business owners need to realize is that making a batch of something at home is nothing like doing it on a commercial basis. For one thing, doing as a business means needing a commercial kitchen or having a co-packer produce it for you.

You can find resources to help you get started. The Cooperative Extension Service in many states has materials on starting a business. If you have been a regular attendee of our Power of Business First Friday chats, you will have heard from several food based businesses. (past chats are archived here.)  At North Dakota State University Extension Service, we have:  Food Entrepreneur: Your Resource Guide to the Food Industry. Oklahoma State University, through its Food and Agricultural Products Center, and Penn State offer regular trainings for startup companies.

Selling online is one approach that many food entrepreneurs consider. If that interests you, check out these two resources from University of Nebraska Extension and NDSU Extension:

You also can find bloggers and other online sources of information. One blogger I follow is Jennifer Lewis, Small Food Business. Two recent articles that I enjoyed looked at convenience store food sales and where people go to buy specialty foods.

The challenges are great. Remember though there are resources available.

It won’t be easy. On many days you will want to give up. Planning, passion and persistence plus knowing your market and getting your product in front of that targeted group of people are keys to making your food idea a business success.

3 thoughts on “Food as a Business Idea

  1. Food business is a very good idea for the startups as it has gained a lot of popularity offline as well as online. The investment needed is very low as compared to the profits received once the business is fully established. Many e-commerce platforms have emerged that help the startups to launch their food business within their budget. The most popular among these platforms is Yo!Yumm that is being adopted by several young startups

    • It may or may not be a low-cost entry. It depends. Some would argue it is a high cost entry with low margins. The important part is understanding the market and doing your planning. Ecommerce can be an opportunity but food is a tough market to start online as people want to try before they buy.

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