Food Processing – Best Business Plan
Food processing is the transformation of raw ingredients by physical or chemical means into food products of various forms. Indian food processing industry is widely recognized as a ‘sunrise industry’, having great potential for the uplifting agricultural economy and thus more employment and export revenue. Two agencies MPEDA (for fish and fishery products), and APEDA (for other processed food products) oversee the export of processed food from India.
1. Product
The first step obviously should be to decide on what you want to produce. This decision should be based on the availability of raw material, market, and budget of your business. You must also keep in mind the benefits your product offers customers.
2. Market Research
After preliminary research of the market, one must go into an in-depth analysis of the demand and supply of the product. Market research will help you determine if there is a market for your product. This would be beneficial in generating ideas fine-tuning your product, and will also enable you to build a proper distribution network, to decide on a price, etc.
3. A Good Business Plan
Now, is the correct time to put together a business plan! Whatever you have researched till now should be synthesized and the information about your business; i.e, what it will do, how it will be operated, and what your goals are, should be incorporated in a professional business plan. A business plan is required by most lenders and is a valuable guideline to follow to improve your company’s chance of success.
4. Registering Your Business
Registering your business is a legal requirement for most forms of business. There are various options under which you can register your business; Sole proprietorship; Partnership; cooperative etc. Care must be taken also for naming the business as this name would be your brand name as well.
5. Food Safety
As a food processor, making sure your food is safe is your number one priority. To prevent food safety problems you need to have a well-designed food processing facility, procedures to prevent product contamination, proper food handler hygiene and food handling practices, a sanitation program, and a pest management system.
6. Product Development
You can always start with small and easy recipes such as Jams or Pickles. But they would have to be modified to suit larger batch sizes. Here, Food product development comes into play. It involves building on your product idea and fine-tuning it so that it is acceptable for commercial sale.
Product development also involves all aspects of a product including processing, packaging, and labeling. Packaging protects your product and provides a place to present important information and advertising to your customer. A product’s demand is also affected by how it is packaged. A label must be educational, user-friendly, markets the product, and meets regulatory requirements.
7. Marketing, Pricing, and Promotion
Marketing is the promotion and distribution of the product to satisfy the customers and your needs. To properly market your product you must know what is happening in the marketplace. Without good marketing, even the best product can fail. Another important factor is to set the correct prices.
The setup of good pricing should take into consideration the costs of production, competition, the amount of quality, service, and convenience provided, and the buyers targeted. The goal is to cover costs, maximize profits, and remain competitive. While promotion involves all activities designed to inform, persuade, and influence people to decide to buy your product.
8. Distribution
Distribution channels are the paths that products flow from producer to consumer. Distributors, or wholesalers, purchase products from food processors and sell them to retail stores. A wholesaler usually represents several different products and has greater access to retail stores than an individual processor. Through this channel, you will have regular and considerable profits every month.
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