The pandemic has transformed how Indians consume food. Opening any food delivery app can lead to several minutes of scrolling due to the sheer variety of appetizing options available. You can get a wide variety of cuisines beyond just Indian food.
While there’s something for everyone’s taste, some niche cuisines could be hard to find. If you think you can cook certain mouth-watering dishes better than many others, how about the idea of starting a food business from home?
Along with the restaurants that are in this game, cloud kitchens have created a whole set of new food business opportunities that focus entirely on delivery without a physical space for serving food.
The latest trend includes people working from homes to cook the food they love, and delivering it to their customers via their apps or websites. For those who love home-cooked meals, this is the most appealing option too.
Do your friends and family always tell you to “open a restaurant” after they eat the food you cook for them? It’s time for you to explore the opportunity that exists. Wondering how to start a food business from home.
This guide will answer all your questions related to this business opportunity, including what to consider, steps to get started, and tips to thrive. Let’s start with some numbers first.
Indian food market- where are we standing now?
Before diving deeper into the thought – ‘Can I start a food business from home?’, you would want to know how the existing businesses in this niche are performing.
The online food delivery market has grown tremendously over the past five years. The pandemic has caused a major blip but overall, the growth remains steady. According to a recent report, the market grew from USD 4.7 billion in 2016 to USD 10.2 billion in 2020, at an annual growth rate of a healthy 21.4%. The industry is projected to grow further till 2025 at a rate of about 12.2% a year to reach USD 18.1 billion.
The aggregator platforms have been a big driver in this growth while the share of restaurants directly delivering the customers has also remained steady.
According to the same report, the direct delivery model has grown from USD 4.4 billion in 2016 to USD 5.4 billion in 2020 and is projected to reach USD 8.4 billion in 2025.
The numbers show that the aggregators have taken the major pie, while the restaurants now have an additional channel to reach their customers and deliver directly to the customers. The direct delivery model has been promoted by a lot of restaurants and independent food brands and has seen a good amount of success too.
Feeling more convinced about starting a food business from home? Let’s get to the action items now.
8-Step checklist to starting a food business from home
Now that you have moved from the thought of ‘Can I start a food business from home?’ to ‘How can I start a food business from home?’, follow the steps given below to lay its foundation:
1. Choose the right set of cuisines
One of the first few things to look at is the cuisines that you would like to cook and sell. You can decide on the niche depending on what you are good at and map your skills with the demand for the same. Along with your cooking specialties, include some cuisines that are not run of the mill but are high in demand.
Thinking that there are 1000 restaurants delivering Indian food in any locality? Turn towards creating differentiation for the items you want to sell to start a food business from home.
To further narrow down on the list of cuisines to be included in your menu, set your exclusive dishes as the highlight of your food business and pair it up with what has a lot of demand.
This will help you stand out from the competition easily.
2. Define your business model – Cloud kitchens, Dhabas, or something else
Deciding the model you can follow for starting a food business from home is critical. For example, cloud kitchens have become increasingly popular as a way to start a food business from home and it is quite easy to get things going.
On the other hand, you can think of a Dhaba which is also very popular and can be mixed with the cloud kitchen model. Similarly, you can think of a small restaurant with very little seating if the infrastructure allows for it and can focus mostly on delivery.
If all this does not fit your current way of life, simply cook food at home in limited quantities with a limited menu and deliver it to the customers. Like how Instagram stores work, you need not even have a website or an app for this and can focus entirely on taking orders via social media or phone.
Defining the right model will give you a lot of clarity on starting a food business from home and how to scale it forward in the time ahead.
3. Check for the licenses and permissions you need
To start a food business, you also need certain licenses and permissions. Without these licenses, you could run into trouble. FSSAI license is one of the key requirements. You will also need a shop act license, health trade license, GST registration, and trademark registration for your brand to get started with your food business from home.
If you find it difficult to understand how to get these required licenses, ask the food business owners and restaurants nearby for help or recommendations. You can also take help from licensing professionals.
Once you have these necessary licenses, you can start your food business from home with all the legal and regulatory backing you need.
4. Manage sourcing ingredients, inventory, and packaging
While running your own food business, getting access to high-quality ingredients in the required quantity on a regular basis can be a big challenge. Your local market may suffice if you are running the business on a small scale in the beginning. But as you scale the business up, you will need to find suppliers that can provide you with the ingredients regularly and at a comparatively lower cost.
The next important aspect is the storage of all the ingredients in your inventory. Since you will also deal with a lot of perishables, you need good quality storage facilities that can keep the ingredients safe for long.
Packaging is yet another aspect to consider while starting a food business from home. Your food should be delivered to your customer in a hygienic manner, ensuring that there is no leakage and damage when in transit.
5. Choose delivery partners
It’s now time to figure out how your food will reach your customers safely and on time.
You can join hands with reliable logistics providers providing hyper-local delivery services. You can also choose to have your own team deliver food in the areas near your home/kitchen.
While there are several platforms offering last-mile delivery services for home-based food businesses, select the one that offers reliable delivery services at a price you can afford.
6. Set up your website or online deliveries
An online platform where your customers can order food is also essential. Depending on the initial scale of your business, you can choose to have a full-fledged website or just a portal showcasing the exclusive menu of your food business.
From both branding and business perspective, having a website is highly recommended while starting a food business from home. You can use any of the no-code or low-code platforms available or hire a designer to make things easier for you.
If you have the skills to design a website, pick a theme, upload your menu, and get started quickly.
7. Select the right payment gateway for your food business
Here’s the crux of it all – a way for you to get money coming in.
A payment gateway is required for your food business to accept payments online from costumes. Selecting the best payment gateway will make it easy for your customers to pay for the food they have ordered.
Having a good payment experience is also very important because this will be the last step in the ordering process. If your customer has gotten here and can’t complete the payment as expected, he may drop your website without placing an order.
Before you select any payment gateway, doing a thorough payment gateway comparison is quite important for your food business.
Choose a payment gateway that is safe and secure, has all the features you need, and also gives customers the option to pay via their most preferred payment options.
Wondering if you can get a recommendation for a reliable payment gateway? Look no further than Paytm Payment Gateway. Being a leading payment gateway in the Indian market, it is trusted by some of the biggest brands in India, including major food delivery apps.
Recommended Read: What Makes Paytm Payment Gateway the Best in India?
8. Branding and marketing your food business
While you focus more on the operational aspects of your home-based business, branding and marketing are also essential components. It is important to establish a strong identity for your business as the food delivery space is becoming very crowded. Your brand and marketing efforts can help you build this differentiation.
You can include different marketing channels to promote your business, including local advertising, social media, and word-of-mouth marketing. All of this will help get your food business in front of more people and drive more orders.
Keep in mind that starting a food business from home takes time and consistent effort. Also, it makes sense to showcase aspects related to safety and hygiene as these are also important to your customers. Focus your marketing towards building long-term relationships with clients so that your business remains sustainable.
Helpful tips to market your food business online
Making people take notice of your food business is no easy feat, especially when there are several options out there for everyone to choose from. It may be difficult to match the level of marketing that some of your competitors may be doing because they are bigger establishments with much larger marketing budgets.
Still, your business has a chance to outshine if you think about this differently. Here are some valuable tips to starting a food business from home and then marketing it effectively:
- Build relationships with your customers to turn them into loyalists
- Focus on good food and safe delivery as this is what matters the most at the end of the day
- Ask for reviews and share them on social media to build credibility
- Use social media platforms for both organic and paid marketing to reach new customers
Bonus Tip: If you want to test out your food business idea from home without significant investments, you can also use payment links to accept payments from your customers.
Read more: Paytm Payment Links – A Faster Way to Collect Online Payments
Conclusion
Food is something that everyone loves. The pandemic has changed the way people consume food, making the food business reach new heights. With the market projected to grow at a breakneck pace in the coming years, it is a great time to start your food business from home.
Getting started with your food business is now easier than ever. There are a host of options available to promote your business and get new customers to order food from you. The trick of the trade is consistent taste, great customer service, and a safe payment experience. Your food will be the talk of the town if you get this right!
FAQs
Is it a good idea to start a food business from home these days?
Given the projections for growth, online food delivery is going to grow further in the coming years. Hence, it is a good time to understand how to start a food business from home.
How do I choose the right cuisine for my online food business?
Look at what is in demand. Also consider what varieties are not available or not great in your area. Depending on these factors, you can choose the cuisine.
How do I market my food business online?
You can use social media to advertise your business. Use organic or paid mediums on Facebook and Instagram to market your brand.
You can also market your food business in offline channels through exciting discounts and offers.
What is the safest payment gateway for my online food business?
Paytm Payment Gateway is the trusted choice for a lot of online businesses in India. You can easily integrate Paytm Payment gateway and get started!
