How to Start a Food Staple Business

Start a food staple business by following these 10 steps:

1. Plan your Food Staple Business
2. Form your Food Staple Business into a Legal Entity
3. Register your Food Staple Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Food Staple Business
6. Get the Necessary Permits & Licenses for your Food Staple Business
7. Get Food Staple Business Insurance
8. Define your Food Staple Business Brand
9. Create your Food Staple Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your food staple business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Business Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a food staple business?

Depending on the level of involvement in this industry, you will likely have to raise some capital before starting. Let’s also presume that you will be operating a modest staple food shipping company with seven vehicles in your fleet. You are also operating regionally to start off.

• Insurance, licensing, state, federal, and local fees
• Mortgage or lease on a building
• Office set up, including furniture, technology, and utility services
• Leasing or buying vehicles
• Advertising and marketing, company uniforms, signage, and a website
• Manufacturing and processing machines and employees

What are the ongoing expenses for a food staple business?

Maintaining a fleet of delivery trucks and salaries for your employees will make up most of your ongoing costs. If you are also manufacturing or processing staple foods, the maintenance of your factory and machines will also remain a cost. Also, the price to mortgage or lease buildings and vehicles can be factored into the total costs. 

Finally, insurance, operating fees, and training and certifying employees will affect your bottom line, as well.

Who is the target market?

Grocers, retail centers, restaurants, and food vendors are your audience.

How does a food staple business make money?

Delivery of products to grocers and retailers completes your part of the loop for this complex commerce ecosystem. Revenue is generated through this and other related services.

How much can you charge customers?

Shipping and delivery costs are the majority of the costs to your customer. A staple food’s cost is often regulated and monitored on a state and federal level. Staple food companies will usually charge a fee for the brokering of the goods, as well.

How much profit can a food staple business make?

Food staple pricing is fairly regulated and standardized, so your earnings will ultimately stem from your ability to keep your overhead costs low. The type of state food you service will also determine your earnings. Overall, most state food services can expect profit margins in the 30% range.

How can you make your business more profitable?

Essential food and lifestyle products can evolve. Be aware of changing trends and capitalize on new opportunities.

Consider shipping non-essential items, as well, when you have excess payload space.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your food staple business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a 3D printing design business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

If you are developing a unique product, concept, brand, or design, it is prudent to protect your rights by registering for the appropriate trademarks and copyrights.

Learn more about trademark and copyright protection

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

Individuals with experience in commercial food services, such as sales, manufacturing, and shipping would be solid fits for this business. Also, experience in the grocery industry will be pertinent. Overall, any experience in shipping and supply and demand will come in handy.

What happens during a typical day at a food staple business?

As the name implies, staple foods and products are in almost constant demand. Therefore, logistics for shipping and receiving are important factors for success. Checking shipping manifests and product inventory will also continually take place. Often, time will also be spent conversing with existing customers and meeting new ones.

Depending on the state food industries your business represents, you may also be spending time on conference calls and industry seminars in order to stay competitive in your field.

What are some skills and experiences that will help you build a successful food staple business?

As we mentioned above, the staple food industry is healthy and thriving, as are associated businesses. Understanding how all businesses and industries spider web together helps an entrepreneur make more educated choices and decisions.

For instance, the grocery, farming and agriculture, shipping, trade, and futures markets are tied together around these human necessities. Understanding the financials and supply and demand aspects for each entity helps you to be a stronger business owner.

What is the growth potential for a food staple business?

Staple foods will continue to be in high demand, although the trends towards some food alternatives may adjust the types of foods in greater demand. Just the same, there is ample room for entrepreneurs to enter the staple food market. Growth will continue to happen in the industry, along with consumer appetite. Still, we are in the midst of uncertain times, and competition in this industry also always exists, so be savvy and business smart when you look to expand and grow.