Are you a baker or a cook? Do you want to make your loved one stop eating takeout? You’d be a great person to teach you how to sell food online if you answered “yes” to both questions.
You can showcase your creativity while selling food is a great way to tap into a resilient industry. Statista predicts that the value of the grocery and food market will reach around 4.2 trillion US Dollars by 2027.
Everyone loves delicious food and must eat it every day. No matter what ecommerce trends may be, it is important to have an audience when selling food online.
There are also some issues to be aware of. Selling food online requires extra packaging precautions. You could be in trouble with the authorities if you fail to include an allergy risk or ingredient.
A little guidance can help you start and manage a successful online food company. Here’s everything you need to know about selling food online, and how to overcome them.
How to start an online food business in 7 steps
1. Know the Law
Before you start serious about your online food business, it is important to understand the rules. You put your customers at risk if you do not follow the rules, from your packaging to your ingredients.
If you don’t follow the regulations, you could face huge fines.
Anyone in the US who plans to sell food from their home must follow the “Cottage Food Laws.”
Also, you will need:
- A state business license
- Permits and zoning clearance from your government
- Once a year, kitchen inspections are conducted
- Regular food handling training sessions are necessary to ensure food safety
- You can license your business in the state you choose. This can be done online at the SBA website.
- Find out the regulations and guidelines that govern food sales and management in your area.
- You should also take courses in food safety so that you can answer any questions your customers may have about your food.
2. Choose Your Niche
Food is a broad industry. Although it might seem tempting to market “food for everyone”, the more specific your niche is, the more you will stand out. Begin by identifying the food types that you are passionate about. Are you passionate about making bread or can you make delicious pasta in a matter of minutes?
Even if you don’t have a preference, you can do some market research to get an idea of what people are looking for. To find out what people are searching for in the food sector, you can use a keyword research tool. You can also look at trending food items, such as vegan and plant-based dishes, or artisanal foods. A few niche options include:
- Specialty cakes and other novelty foods
- Organic, natural, fair-trade foods
- Special diet food (gluten-free, dairy-free)
- Gourmet, small-batch and artisanal food
It might be a good idea to start selling food products online if you are just starting out. You can make canned goods, candies, dried herbs, canned foods, and baked goods with no need for special equipment. It’s important to keep it fun and simple at the beginning.
3. Locate Your Supplier
A reliable supplier is essential, whether you are creating food products from scratch or selling items to your customers. It is crucial to choose the right supplier in the food industry. Not only could it put your brand at risk but it can also cause food poisoning or illness for your customers. When selling food at home, ensure you do your research.
Look at reviews from customers before you shop for ingredients or suppliers. You should look for transparency from your suppliers, such as well-defined supply chains that provide detailed information about the origin of products.
If you are looking for a supplier that has specific credentials, such as sustainably sourced ingredients, and can’t find any evidence online, get in touch and ask for further information. A good supplier will be able provide all the information you need to make your mind at ease.
You should also ensure that your suppliers are able to provide products with a reasonable shelf-life so that you don’t send out food that is near expiration. Your chances of keeping food fresh can be increased by properly managing your inventory. Food is best when it’s first in, first out strategies.
4. Do you want to work on packaging, branding, or labeling?
Good branding is essential for any business. However, it’s especially important when you are building an online food business. Your branding should be easy to understand and appropriate for the product you are selling. A company that sells all-organic foods might use lots of natural colors and plant imagery. An example of a business that sells custom cupcakes could be brightly colored and have a novelty appearance.
After you have your brand personality established, you can start thinking about how to pack your food properly. Not only for compliance but also shelf appeal. The FDA’s food ingredient and packaging guide outlines the information that you will need to provide to customers to make informed purchasing decisions. Transparency is key when it comes to your ingredients.
It will be easier to identify the right suppliers for your ingredients, and you’ll be able to make sure that you are aware of all products that go into your finished goods. You can find guidelines for labeling in each country on the internet.
Before you begin designing your packaging, make sure to read the FTC fair Packaging Act and the US Food Packaging Manufacturer Directory. You should ensure that the packaging you choose matches the type of food you are selling.
5. Get a Price for Your Food Products
If you are new to selling online food, pricing can be difficult. You don’t want your profits margins to suffer if you charge too much. Low prices may also signify low quality in certain parts of the food business. You could also risk alienating your customers by setting too high prices. It is crucial to strike the right balance for your success.
Begin by looking into the industry you are in and the prices that your competitors have set. This will give you an excellent starting point for determining the best price strategy for your online business. You can price your products higher if you believe in their value or if you have something special to order (like unique ingredients). Make sure to communicate the value of your food to your customers.
Notice: The profit margins of food businesses will vary depending on what products they sell. Breakfast foods, for example, have the highest profit margins of any edible product. Premium foods such as Wagyu beef, for example, can be more difficult to source and therefore require a higher price.
6. Your Online Store
- You are almost ready to sell food online.
- First of all, you will need a website. Your website is the core of your online food business.
Shopify is a popular store builder. You can start by designing something that appeals most to your target audience.
It is also important to make your food as appealing as possible. It is a smart idea to make your customers salivate when selling food online. High-quality product images are essential. To encourage people to purchase, write compelling product descriptions. Your website visitors must be compelled to act by the images and written content.
Also, you will need:
- A page about you: This helps customers get to know your company better
- Contact page: Any customer questions
- A FAQ page: Information about your suppliers
- Any certificates or accreditations: To show the safety of your products
- A blog page: For content marketing
- A lead generation strategy: This could be pop-ups and landing pages that encourage people to sign up for your email list.
- The best store builders today offer everything you need in order to sell food online.
Pro tip: Before you start creating a website, make sure you are familiar with your brand guidelines. Consistent branding will ensure that your business is easily identifiable across all digital touchpoints.
7. Promotion of your food business
Once your store is set up, it’s time to start promoting your food brand. This is the perfect time to make your products irresistible. There are many great ways to get attention online. Social media is an excellent choice for food businesses because people love to see food photos on Instagram and Facebook.
You can post anything, from Instagram Stories to TikTok videos featuring your mouth-watering treats. You can also experiment with guest blogging. You can also form a partnership with an influential food blogger and share your recipes on their website. You can also ask an influencer to promote your products.
These are just a few of the great marketing strategies that you can use to sell food online:
Pin your recipes on Pinterest. These visual forums can be a great way to meet new customers. People will be excited to see your recipes and ideas for using your ingredients or foods.
Offer great deals: Rewards your customers early with vouchers and discount codes. Sending influencers free samples of new products can increase interest in your food.
Selling through other companies: Partnering with larger brands and supermarkets can help you bring your food to new places. Make sure to shop around for the best profit margins.
Offer cooking education: Make your customers more interested in your food by offering them learning experiences that will help them create new recipes.
What is the cost to start a small food business?
You might be wondering what initial investment is required to sell food online. There are many factors that will affect the cost of starting an online food company.
The initial costs for opening a brick and mortar food store or launching a cafe or restaurant will be higher if you are looking to expand your business. To rent a physical space, it can cost upwards to $200,000 per year. You have little capital to start a business. Start small as a producer. You’ll be able to create food products at home and sell them online for a lower cost. As your business grows, you’ll find it easier to expand into commercial space and discover new opportunities.
Start your own small business. Make sure to check out how to inspect your kitchen. An accountant can help you figure out what home workers you can claim on your tax returns. You don’t want your whole company to be run from home. Consider hiring space to make your batches.