Business Idea

Start A Food Distribution Business

About

Starting a food distribution business requires a great deal of effort, dedication, and most importantly passion.

If you're interested in how to sell food distribution, or selling food distribution online, you can use this page as a guide for everything you'll need to know.

Want to learn more? You can check out our full guide on how to start a food distribution business ➜

Key stats

market size
$18.7B
revenue (monthly)
$10K
starting costs
$34.7K
gross margin
60%
avg product price
$5
time to build
11 months
growth
Email marketing
business model
E-Commerce
time investment
Full time
work from home?
Yes

About

Starting a food distribution business requires a great deal of effort, dedication, and most importantly passion.

If you're interested in how to sell food distribution, or selling food distribution online, you can use this page as a guide for everything you'll need to know.

Want to learn more? You can check out our full guide on how to start a food distribution business ➜

Key stats

market size
$18.7B
revenue (monthly)
$10K
starting costs
$34.7K
gross margin
60%
avg product price
$5

 

time to build
11 months
growth
Email marketing
business model
E-Commerce
time investment
Full time
work from home?
Yes

Startup Costs

Min Startup Costs Max Startup Costs
Office Space Expenses $750 $7,000
Employee & Freelancer Expenses $151 $352
Equipment & Supply Expenses $563 $5,200
Website Costs $303 $7,215
Business Formation Fees $5,600 $20,400
Inventory Expenses $350 $14,750
Software Expenses $162 $3,094
Advertising & Marketing Costs $0 $2,800
Other Expenses $0 $800
Total Startup Costs $7,879 $61,611

Successful Businesses

Business URL Rank
FoodTec Solutions foodtecsolutions.com #40,131
KeHE Distributors kehe.com #59,755
FoodBev Media foodbev.com #108,992
Muscle Foods USA musclefoodsusa.com #237,328
World Central Kitchen wck.org #256,861
N.C. Department of Agriculture and Consumer Services ncagr.gov #298,675
What Chefs Want! whatchefswant.com #333,278
Four Seasons fsproduce.com #362,683
Performance Food Group pfgc.com #410,972
Smithfield Foods smithfieldfoods.com #425,048
Cheetah gocheetah.com #441,527

Pros & Cons

Pros Description
Flexibility You can put as much time into the business as you'd like. If you like the work and have some initial experience, you can start small and manage all aspects of the business on your own.
Scalable With businesses and processes changing daily, there will always be demand for new features, products and services for your business. Additionally, there are several different business models and pricing tiers you can implement that will allow you to reach all types of customers.
Meaningful business connections You never know who you will meet as a food distribution business. This could be the start of an incredible business opportunity!
High customer retention rates Once a customer invests in your product, they've invested their time and energy to utilize your product/service which is highly valuable to them. Typically, your product or service becomes indispensable to your customer.
High margins The gross margins for your food distribution business are typically around 60%, which is considerably high and allows you to grow your business and manage costs easily.
Control of workload With starting a food distribution business, you have the unique ability to choose how little or how much you want to work. You also have the freedom to decide which projects you want to work on, and can turn down the ones that do not interest you.
Cons Description
Motivation of employees If you plan to have a sales/content team on board, finding creative ways to motivate them can be a challenge. It's important that you're able to offer great incentives and a good work environment for your employees.
High employee turnover In the food distribution business, employee turnover is often high, which can be quite costly and time consuming for your business. It's important to try and avoid this as much as possible by offering competitive pay, benefits, and a positive work environment.
High overhead expenses With starting a food distribution business, there are overhead expenses that come with selling a physical product. You will want to make sure you strategically budget for these overhead costs. We discuss this more in the startup costs section below.
Work can be repetitive You may find creating the same product over and over repetitive and tiresome. One way of avoiding this is to diversify product lines and revenue streams - this will keep things interesting!
Time commitment With starting a food distribution business, all responsibilities and decisions are in your hands. Although this is not necessarily a negative thing, work life can take over at times. This can place a strain on friends and family and add to the pressure of launching a new business.
Difficult to build trust with your customer With starting a food distribution business, there can be minimal face-to-face interaction, which means it can be a lot more difficult to establish trust with your customers. You'll need to go the extra mile with your customer to grab their attention and business.

Marketing Ideas

  • 1

    Affiliate program

    Affiliate marketing is a great way to bring in a new revenue stream, especially when you don't sell products or services.

    Simply put, an affiliate program is an agreement where a business pays another business or influencer ("the affiliate") a commission for sending traffic and/or sales their way.

    The affiliate typically gets a unique link where clicks and conversions can be tracked.

  • 2

    Word of mouth

    Word of mouth is when a consumers reflects their interest in a company’s product or service in their daily dialogues.

    Therefore, word of mouth advertising is essentially a free advertising triggered by the customers experience.

    According to Nielsen, 92% of people trust recommendations from friends and family.

    Therefore, in today’s hyper-connected world, a single recommendation through a word of mouth can have a huge impact to your business.

  • 3

    Social Media Advertising

    Social media advertising is the use of social media platforms to connect with your audience with the objective to build your brand, increase sales, and drive website traffic.

    According to Oberlo, approximately 48% of the global population use social media, and the number is ever-growing.

    Therefore, social media allows brands access to cost-effective advertising by enabling them to interact with a large audience.