Warning: Do not read this blog on an empty stomach!
Everyone’s got to eat, so if you love cooking and feeding people- why not make a business out of it and explore the world of selling food online? Having a business selling food online is no longer meant only for restaurants and caterers. Several small businesses have been set up in the past year by cooking enthusiasts and food lovers.
In this blog, we explain everything you need to know to start an online food business and inspiring stories of food entrepreneurs across the country!
Impact of lockdown on food delivery businesses –
Last year, several restaurants shut shop due to lockdown restrictions, and many more resorted to taking away food orders only. Big food delivery giants like Swiggy and Zomato saw a major drop in orders by 70% during the lockdown, restaurants faced huge losses due to low orders, and jobs vanished overnight.
However, there was a silver lining – the rise of home chefs.
Food delivery vs dining out – the rise of ordering food online
According to a Gallup Poll, 72% of customers prefer to go with the food delivery option because they don’t want to get out of the comfort of their home, and 41% just want to avoid going outside because of bad weather.
With the second wave hitting India, once again, customers are opening apps to order food online, rather than go out to eat.
Street food took the biggest hit when the lockdown struck. However, they did not waste time adapting to the online food delivery space and quickly began to sell food using third-party delivery apps or setting up their own WhatsApp groups and online stores.
Fun fact – Did you know that the most popular food item ordered in the past year was biriyani?
Restaurants too, have pivoted their business to cope with the intermittent lockdown and have set aside menus and food delivery options as a backup for when dining out becomes impossible.
“We have learned one thing from last year, and that is – the show must go on and we have to try our best to adjust in this situation. So, we have started delivery from a few of our outlets last year and by god’s grace we have been doing well in delivery.”- Vikrant Bantra, Passion Hospitality
Lockdown or not, people need to eat, so pick up a spoon and some salt, and let us show you how to sell food online.
How to start selling food online – 5 steps to get started
Something I have realized every food entrepreneur swears by is taking lessons from their mothers and grandmothers. Back then, Indian families lived in packs, with over 10-12 members in each household. There would be a Head Chef (grandmother) and sous chefs (mothers and aunts) helping her out. They would prepare delicious, aromatic food for a huge household in less than 4 hours.
Times have changed. Men cook in the kitchens at home too, and women run the accounts and source the raw materials. But otherwise, the lessons remain the same. Good food, delivered on time, makes for happy customers.
1. Decide what to sell
You do not need a master’s degree in culinary arts to start cooking. During the lockdown, the need for food delivery alone led to many homemakers and home chefs selling food online.
First, if you are looking to sell food, try and pick a niche, as this will help you create a strong customer base too. If your strong suit is baking, then consider setting up a bakery as Marie George Kuruvinakunnel did. Her home bakery ‘Temptations by Marie‘ caters to special occasions in Kerala, and she takes any orders via WhatsApp.
Define the WHY of selling food online too.
Selling good quality food
For example – Shashank, CEO of The Whole Truth, sells protein bars that ONLY have 3-4 ingredients. His motive is to dispel the brands that pretend to care about customer’s health with fake ‘sugar-free’, ‘100% natural’ labeling.
Delivering the ‘Maa ka khana’ narrative
Pikkle Shikkle is a homemade pickle brand started by Satbir Singh Saluja, to promote his mother’s delicious jams and pickles, made right in their home kitchen. Indians have always held their mother’s cooking close to heart, and Gurdeep Kaur’s pickles made everyone reminisce about their childhood.
Providing job opportunities with cooking food
Who said you need to know cooking to sell food online? Sometimes, selling food online is not just about the food itself. You can consider starting a cloud kitchen that delivers food to people in your city or pan India! For this, all you need to do is hire staff that you can train and equip to cook.
For example – Cooked By Moms is a social enterprise that empowers women from different parts of India to cook homemade food and deliver it to workplaces.
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2. Draw your business model
To help you decide what food to sell online, you need a business model, a plan. It is pretty simple to create a business model. This helps you understand – your target audience, your working capital costs, your logistics, and your vision.
Keeping this in mind, we partnered with msmeX, an advisory platform for small businesses to help you create your ideal business model. All you need to do is register for the short, free online course on mojoVersity – our e-learning platform.
Obtain licenses and register your business
Once you decide on your business model and niche, register your business online. Small businesses can register business easily. Here are the different licenses are resources you need to refer to and obtain.
- FSSAI registration – Food selling operators who have an annual turnover of under Rs 12 lakh are required to mandatorily register themselves; (those above the Rs 12 Lakh limit need to apply for a license). This guide helps explain different FSSAI registrations that apply to your business.
- FSSAI license – If your revenue exceeds Rs 12 lakh, you need to obtain a license. This normally applies to medium-sized restaurants and hotels. According to law, not registering under FSSAI will result in a hefty 5 lakh fine.
What is FSSAI? The Food Safety and Standards Authority of India (FSSAI) is a legal authority that offers a food license to all food business operators (FBO) in India. All the FBOs must follow all the rules and regulations of FSSAI for food quality control.
3. Source ingredients from verified distributors
You registered your business and decided on what to sell, and now you need your ingredients. Based on your business size, approach distributors and wholesalers to procure ingredients, right from salt to a giant oven. Here are a few things to keep in mind before you look for a distributor –
- Manufacturing costs
- Quality of raw material
- Shipping and delivery time
- Referrals and reviews from previous clients
- Communication and availability of materials
What distributor can you start with? Indiamart is one of the most popular distributors preferred by food businesses with regard to supplies and ingredients.
Sell within groups
Test your food with a few customers. This could be friends, family, or peers. Obtain feedback and work on the problem areas before you sell food online. Create WhatsApp groups for initial orders to manage orders easily.
4. Create your online store
Every small business needs an online presence. It is easier to sell food online when you have an online store. You can choose to set up an online store for free with Instamojo and upgrade to a brand new premium store once you are familiar with the eCommerce business.
For example – Rajlaxmi stores sell fresh Maharashtrian snacks to customers with the premium store.
- You can give your store a clean, beautiful look with over 20+ themes
- Boost sales with leads management apps inbuilt in the store
- Collect online payments from over 100+ payment modes
- Offer promotional discounts to customers
- Keep customers engaged with custom emails and SMS campaigns
How Fresh Munch kept everyone healthy during the pandemic
Fresh Munch, a premium store on Instamojo that sells delicious homemade food online is a business set up during the pandemic. It promotes healthy, homemade chapatis, rotis, and parathas, made with a lot of love.
” When pandemic hit, we understood how important it is to keep our immune system robust. Keeping this in mind, we started our food venture with different fresh and frozen, ready-to-eat whole wheat chapatis, fully baked.” – Fresh Munch Team
Package and ship your products
Food needs to be delivered fresh in air-tight containers to avoid spillage or any damage. You could choose a third-party delivery partner like Swiggy, Zomato, or Dunzo to deliver your food across the city. These delivery partners are ideal when you want to get fresh food to your customer in under an hour or so. If you are looking to choose an affordable shipping partner, pick and choose from this guide.
SourHouse Bakey, a premium bakery in Bangalore, packs their freshly baked bread, croissants and cinnamon rolls in paper and places it safely in an eco-friendly cardboard box, followed by a paper bag. Package your food carefully in leakproof boxes. For pickles, jams, and food with a long shelf life, pack in glass bottles.
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You can always create your own personalized way of selling, like how Malberry Kitchen does with their logo printed on the food they sell. Add a thank you note to customers and leave your business email ID for them to reach you. Brand your logo on all the packaging your food has!
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5. Promote your food business online
Just think of all the people who crave delicious food but have no idea how to find you. It does not take too much effort to promote the food you sell online. All you need to do is –
- Ask for reviews – Tell your loyal customer base to send in reviews that you can add to the homepage of your website/online store. This builds trust and fun fact, over 80% of customers prefer a good, honest, review to a professional HD product image.
- Sell recipes online – We have compiled an entire guide to help you sell recipes online. A lot of food businesses also list out the process of how they cook their food. This adds a genuine touch and engages customers.
- Conduct workshops – Share your knowledge with your customers. All of them may not just want to eat the food you cook, but learn a little about your process as well. Therefore, it is a good idea to host a few LIVE workshops and build your customer base.
Started by Ketki Barfiwala, a professional pastry chef, Caramella is a patisserie that delivers desserts to anyone in Mumbai. Owing to the lockdown, Ketki took to conducting an extensive array of online backing workshops to keep her customers engaged and also share business tips and hacks.
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Bonus: Food entrepreneurs who stepped up in a crisis
Sure, you just started to sell food online. However, if you can, reach out to your community, offer to cook food for COVID-affected families. For example – Bengaluru Oota Company, known for its experiential dining concepts is offering nutrition-focused lunch and dinner meals for those in quarantine. The all-vegetarian dishes are packed with fresh veggies and seasonal ingredients. A typical meal comprises one type of curry, rice or chapatis, rasam, ragi mudde, palya, and homemade curd.
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Setting up a business online goes beyond just selling. It took a pandemic to teach us that can all bring our business ideas alive, even in a crisis. So, should you decide to set up an online business, we are here to help. All you need to do is schedule a call with our team and we can help you build your online store from scratch.