How to Start Snack Foods Business
The idea of making various snack foods has quite a prospective opportunity. Because, the demand for snack foods is always increasing from day to day. Not only targeting the children’s market segment, the snack foods business can also be enjoyed by teenagers and adults.
Currently, the types of snack foods are increasingly diverse. Starting from chips, pancakes, smoothies, and so on. You can also create new business ideas because the opportunities are wide open.
Most people like to have a small snack foods both in the morning and a couple of hours after lunch. You feel how your blood sugar starts to drop and your whole body gets tired. With a well-chosen snack foods, however, you can manage to end the working day without too much trouble. The important thing is to choose the right one, because otherwise it can even have the opposite effect.
A healthy snack foods is not only a way to cope with the day but is also part of the daily intake. Everyone needs vitamins, minerals, proteins and all the other building blocks that the body uses to function. Sometimes you may need a little extra of a particular substance, such as in times of colds or if you have a deficiency. But in general, a healthy diet with healthy snack foods can be enough for the person to stay healthy. By adding regular exercise, you can get in top shape.
Setting up snack foods business is a very common business idea among people who want to have their first experience or adventure as entrepreneurs.
The apparent simplicity and ending the crisis through food are factors that attract entrepreneurs in search of a good project.
But the management of this type of business is not so simple: three out of every five open establishments do not last the first year of operation. So today I leave you basic concepts that you need to know to successfully start your snack foods business and grow with it.
In summary:
- Why Start?
- How to Start
- Success Tips
Why Starting Snack Foods Business
The upward trend in food quality is a pronounced global trend. It will be strengthened in the future. Snack foods that can be eaten without pre-treatment or washing are popular with consumers. The production of dietary snack foods food is a lucrative business in the current field.
Snack foods production is a business idea with great potential. There are not many workshops for their manufacture, but their number is growing approximately twice per year (according to data for 2012-2016).
How to Start Snack Foods Business
- Market research
If you follow our tips for starting a business, surely you will realize that the first steps that must be taken in starting any business are research, research, and research! Research is so important because it will determine your future business journey.
First do some careful product research. Decide what snack foods you want to sell. You must get full information of the products you want to sell.
If you want to sell snack foods made from cassava, of course you have to look for cassava suppliers that have relatively low prices but with good quality. Market research prevents you from making a product that you don’t know where to find a supplier for its basic ingredients.
Don’t forget after choosing the product, look at your competition. If your competition is big, you have two choices. Look for alternative products or keep fighting if you really believe your product is better than your rival’s. This means that you plan to play in the same market.
- Research the competition
In the gastronomic field, competition is very strong, whether direct or indirect. After all, in addition to those establishments that serve the same type of food as yours, there are still those that offer other options, but which are also snack foods businesses. That is, they indirectly compete with you.
To differentiate yourself and find your space in this environment, you first need to know the other establishments and know what they are doing. What is the menu of these places? How is the environment? What is the price range practiced in other snack foods business. Do they have any differential?
The answers to these questions will help you to define your position and your planning. The idea is not to copy what they are doing, but to be able to do better and thus differentiate themselves from them.
- Target audience
Adjusting the type of culinary business with the target market is one of the keys to successfully running a snack foods business. Analyze people’s interest in the types of snack foods you want to choose. The product you choose must match the tastes of potential customers.
The entrepreneur must be able to know his target audience through market research. From this, it is possible to map and identify which products require investment and, even, to set up the most attractive menu for your snack foods business. In short: you need to know who to sell to.
Make sure that your snack foods products are accepted on the tongue of potential customers. Even if you offer cheap prices, if it doesn’t suit consumer tastes, this can be an obstacle. For this analysis you can try to do a small survey by distributing product samples or creating a questionnaire on social media.
Conducting a survey is quite important to do and don’t take it lightly. Because from this survey you can find out how people’s purchasing power estimates for your business.
From this, you can to know your customer’s profile well and take into account:
- age and gender;
- preferences;
- their way of life;
- interests;
- purchasing power;
- place of residence.
There are also other important issues when it comes to defining your business identity. A good study of the region in which your snack foods business is located is also essential to obtain consistent results.
Think a little: is the business area commercial or residential? The answer to this question mainly influences the menu. If it is a place very frequented by families, it may be interesting to offer a kids menu, to name just one example.
So, know your target audience. They are the starting point for your planning. If you don’t know where you are and who your customer is, the chances of your business going wrong are very high
Alternatively, you can recognize a busy street there and put your shopping cart or box there.
Even better, frequently visited places like hotels and restaurants can create a very profitable base, just locate yourself outside such a place near the entrance and record all the routes entering and leaving the hotel.
Urban areas like busy cities are more receptive to snack foods consumption compared to rural areas. This means, therefore, that you should give preference to urban settings over rural settings for your snack foods business idea.
If you are starting out on a large scale and prefer a store that is not a shopping cart or box, then this will be fine.
Just make sure it is in a place where so many people visit it.
The best locations for a snack foods business can include bus stops, learning facilities, bars and restaurants, markets, hubs, hospitals, industrial and residential spaces.
- Business plan
After studying the market and its possibilities for snack foods business, it is time to create your business plan.
- Define your key activity, that is, “I have a snack foods business, so my commercial establishment prepares and serves: delicacies, snack foods, sandwiches, portions, drinks…”. Here it is important to define what kind of service you provide.
- Establish the main material and human resources needed to operate your business;
- Which sales channels will you work with? Example: will you have an establishment with over-the-counter sales or will you innovate and implement delivery service as well? Is it possible to unify the two to sell more?
- Understand your cost structure and optimize spending without losing quality.
- What are the sources of revenue? How do I make money beyond the ordinary operation of my snack foods business?
- Innovate in the value proposition, that is, what differentiates you? Understand what your customers expect.
- Tax and health legislation
Inspection is not an enemy, but an aid for all establishments to strive to maintain quality in processes and services. In the management of snack foods business and other establishments, it is essential to keep up with the issuance of invoices according to the requirements of each state.
And speaking of health surveillance, follow the rules of hygiene and handling of the snack foods you are serving. Work with fresh and quality merchandise. When in doubt, do it right and seek to operate with total quality.
- Marketing
If you’ve done all of this, you need to communicate in the best possible way. For this reason, companies – even small ones – see marketing and advertising activities as an investment, not an expense. Have a beautiful visual identity, an attractive facade and also invest in different communication strategies.
Today it is essential to be present on social networks, such as Facebook and Instagram. In these channels, a very functional tip is taking care of the photos and creating attractive and beautiful montages of your snack foods. They have great results, since they usually engage consumers, leaving them hungry and willing to eat their snack foods.
- Create referral programs
Referral marketing is just another aspect of the famous word of mouth marketing. This is an old strategy that determines that a satisfied customer will express positive opinions about your establishment in your social circle. However, even with good ratings, it is not guaranteed that friends and family will attend your snack foods business.
Therefore, the most modern tactics started to take a new inspiration in an old formula. It is not by chance that the referral program models we know today offer incentives and benefits to help spread the business image.
One of the most common practices involves sharing discount coupons, in which the already loyal customer sends the coupon or code to his friends and, in return, both receive discounts or take advantage of promotional prices.
If your goal is to expand the image of your business and win new customers, it is essential to be open to ideas for promotions for snack foods business – without forgetting, of course, to know exactly what to sell in a snack foods business.
Certainly, reaching the goal of increasing your establishment’s sales is a joint effort that requires a lot of dedication and focus from everyone involved. However, the customer and their experience inside the cafeteria must be the main elements of the company’s management.
Finally, we recommend that you carefully evaluate the tips described here and put them into practice so that you start to get positive results faster than you imagined.
- Invest in promotions
We know that there are more and less busy days in snack foods business, influenced by numerous external factors. To attract customers on the busiest days, invest in specific promotions.
Offer differentiated products for each day of the week, with a price lower than what you usually practice. In addition to attracting the customer for the lowest price, this allows him to know your daily menu. Combos are also great tips for snack foods business: “order this one and take that one too”.
Whichever option you choose, it is important to keep the team always informed of the day’s promotions, as well as the customer. You can have a different menu for the days of promotions, or even invest in digital menus, which allow daily changes, highlighting or suggesting a certain product to the customer. It is a convenience for those who choose, but also a resource to increase their efficiency.
- Build customer loyalty
Captivating your customer greatly shortens the path for them to become loyal. And a satisfied consumer more easily attracts other customers, especially at a time when word of mouth marketing and social media are so high. With that, you end up even saving on investment in advertising, because the appointment of an acquaintance counts a lot when choosing an establishment.
So, you might be asking yourself, “How do I retain my client?” Some factors are essential, such as good service, cleanliness of the place, a pleasant environment and a high quality product. All of this makes people want to come back and still recommend their diner to friends and family.
Others are:
- Offer good service
Fact: if the customer is poorly served, he will not come back. To avoid such problems, a trained and well-equipped team makes all the difference. Together with the clean and adequate environment, the service is the first impression the customer will have of his establishment.
Invest in training focused on the activities that your team performs and, thus, always be safe when answering or solving any problem that the client presents. Agility in service also counts as a positive point.
- Answer on different days and times
A good resource for increasing sales at your diner is to open on days or times when most are behind closed doors. This strategy aims to attract new customers who would consume in the competition.
Perhaps on Mondays the movement is weak and, therefore, no snack foods business in the city is open. How about going to answer that day? If you are the only option, you will end up winning many customers. So you need to think outside the box and understand that what works for others will not always work for you.
If your establishment only serves dinner, extend the service so that it also serves lunch options, for example. This is one of the tips for a snack foods business with great potential to increase your sales!
- Build a quality menu
More and more people want to have different experiences, and this also serves the gastronomic branch. The trend towards “gourmetization” has hit this sector squarely.
So, worry about putting together a quality menu that has options for all tastes. Today, the vegetarian and vegan audiences, for example, are quite large. How about having snack foods for these people?
But don’t forget: in addition to having a very varied menu, with a large amount of options, have a total focus on the quality of the products. Do everything with first-rate ingredients and good suppliers. This is what will really differentiate you from the competition. Service and environment are important, but the flavor of the snack foods still comes first.
- Have a flagship
Choose a snack foods that will be your establishment’s specialty and make sure that it really is a great product. It could be a family recipe, for example.
When choosing the snack foods that will play this role, put it prominently on the menu and instruct your team to offer it as the “best option in the region”. Gradually, it becomes a reference served exclusively in your establishment. Certainly new customers will come, appointed by old customers, to taste the much talked about dish.
Try to think of the times when you did this for a particular product. How many times did you go to a certain restaurant because it served the “best breaded” in the region, and also think about your satisfaction in tasting that food. That is what must be done here. Customers should feel like consuming their “reference product”.
- Expand communication channels
In today’s world, commercial establishments that rely on a telephone so that customers can call and place their orders can lose sales. This is because it is much more convenient and quick to send a message to register an order or to place the entire order through a food ordering application.
Therefore, your snack foods business must be aware of this type of trend in order not to miss business opportunities. It is important to note that, when sales occur over the internet, this is a second operation that the company must be able to maintain. Thus, it is essential to organize activities to ensure, also, the quality of service on site.
Therefore, the possibility of multiple communication channels, including social networks, only help to build a positive image in the market.
- Offer delivery service
Although the out-of-home food sector is considered stable and profitable, even in times of crisis, it is essential to offer additional services. One of the most sought-after amenities is the home delivery service for snack foods and meals.
This is an alternative with great return, since each order is added a fixed tariff that serves to prorate costs. In addition, there are strategies that encourage increased consumption, such as promotions that provide free delivery for orders above a value stipulated by the establishment.
If you are still unsure whether this strategy is worthwhile, we recommend a small-scale test. Hire only one or two couriers who work in the region near the cafeteria.
In addition, you can invest in a “loyalty program” and distribute courtesies to your customers (through points or number of orders, for example). But be sure to train and communicate all employees so that they are informed about the program in force in the period.
All zeal is necessary, because there is also the other side of the coin: nowadays, any complaint or dissatisfaction on the part of the customer goes to the internet and can take enormous dimensions for your brand. You don’t want that, do you?
- Equipment
The equipment and artifacts for a snack foods do not necessarily have to be these, but the ones we mention are generally the most used.
- Tables and balconies equipped for toys or snack foods.
- Freezers and refrigerators.
- Pastry showcases.
- Pancake Machine.
- Waffle maker.
- Slushies
- Juicer and blenders.
- Mixers
- Refreshments
- Coffee makers.
- Fryers, toasters, Sandwich maker, microwave oven.
- Kitchen utensils, crockery and cutlery.
The rest is the basic equipment for any type of business, such as furniture and accessories, as well as computer equipment, computer systems, etc.
The personnel needed to run a snack foods-bar or cafeteria can also vary depending on the size of the company, but basically would need:
- Administrator
- Chef
- Customer service personnel.
- ATM
- Delivery staff.
The entrepreneur must take into account the care, hygiene and quality of the dishes he offers, since they are very important aspects for the success of a snack foods business. In turn, the administrator will analyze the target audience, the location of the premises, the times of greatest flow of people, among other factors, this to make decisions in a strategic way that benefits the growth of the business.
Success Tips
Some tips you should pay attention to start a snack foods business.
1. Pay attention to the quality of the material
In order for the snack foods that you produce to sell well in the market, of course you have to pay attention to their quality. The quality of the product depends on how it is processed, the materials used, and the packaging method.
The materials that must be used are of good quality and hygienic. In addition, make sure the ingredients are safe for consumption. Processing must also be in accordance with the rules. If you produce snack foods that are fried, be sure to replace them regularly.
After that, make the packaging more attractive. Because, the first thing that consumers pay attention to is the packaging of a product.
2. Always Innovating
People who always win business, of course, always innovate in order to create new snack foods. Now, with innovation, the product you have will be different from other products. Also, it will be easy for consumers to see the characteristics of your product.
3. Creating Relationship with Customers
For someone who is in the snack foods business, he must always maintain a relationship with his customers. So, it’s not just a one-time purchase. But will be loyal and make purchases repeatedly.
You can maintain relationships by serving customers well. And create a deeper impression. Smile more so that customers are interested in your service.
Also take advantage of social media to create branding from your snack foods. Create close relationships with customers. So that one customer will be a free ad for the next customer. The spread of product information by word of mouth has also proven to be effective in capturing new potential customers.
4. Implementing Strategies According to Market Needs
In addition to creating relationships, the right strategy must be implemented so that business development will be more advanced. Build a sales strategy that is more precise and can read the market. Thus, an increase in sales can occur. Some of the strategies you can take when starting a snack foods business are adding weight to food, giving discounts, giving promo prices, and giving free product samples.
A snack foods food entrepreneur must also have forward thinking. Not only that, entrepreneurs must also have positive thoughts. Business travel requires a person to serve customers well.
Positive thoughts will make you calmer. For that, you must stay away from narrow and negative thoughts.
6. See opportunities
When you want to start a snack foods business, you have to look at the opportunities for what types of products people like. Then the competitors are selling the same food we are going to make. Of course, if there are no competitors, our snack foods business will sell well.
7. Make sure the food is made easy
Now this is also a consideration when you want to start a snack foods business. We have to know whether in terms of business force, it is profitable. In the sense that the manufacturing process does not take a long time.
8. Record every expense and income in detail
How do you know the profit or loss of a business if you do not keep track of every expense and income from your business?
You can use manual bookkeeping if you are just starting out in a business. However, if you already have a medium to upper scale business, using accounting software is a solution for overall bookkeeping optimization.
This is important, because the bigger a business, you need more time to plan a more focused business. Instead of wasting time with time-consuming manual bookkeeping, you can try using accounting software such as Accurate Online for free.
Those are the tips for starting a snack foods business that can be run. Make sure you consistently do each stage until it is truly successful.
Now that you know the steps on starting snack foods business, what are you waiting for?