Specialty Food Business

How Profitable Is A Specialty Food Business? (Updated for 2024)

Updated: July 9th, 2024

How Profitable Is A Specialty Food Business? (Updated for 2024)

So you want to start a specialty food business?

And the first question that came to your mind was, “well, are specialty food businesses actually profitable?

Especially considering:

  • You could start a specialty food business with as low as $500
  • Based on our data, specialty food businesses generate an average of $597K per year

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a specialty food business.

Let’s dive in!

Is a specialty food business profitable?

Yes, a specialty food business is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $597K per year with an estimated gross margin of 50%, you could expect to recover your investment within 12 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your specialty food business.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your specialty food business is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is a specialty food business worth it?

If you’re wondering if a specialty food business is worth it, the answer is a big YES. With specialty food businesses, you have the potential to earn $597K per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a specialty food business to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful specialty food businesses case studies.

Examples Of Profitable Specialty Food Businesses

Here are a few examples of profitable specialty food businesses, and a few more details about them:

1. Urban Smokehouse ($1.5M/year)

Andrew Buehler, founder of Urban Smokehouse, came up with the idea for his business after noticing the growing market trend and opportunity for online delivery of perishable items during the COVID-19 lockdown. As a foodie with a background in financial services, Buehler saw the rising demand for BBQ, a food that tastes great but is often inconvenient to make, and decided to create a digitally native BBQ brand that offers pre-cooked and sauced ribs that can be easily prepared at home in under 20 minutes. He launched Urban Smokehouse as a Kickstarter project and quickly surpassed his goal, raising over $30,000 in pre-orders.

Is it profitable? Yes
How much money it makes: $1.5M/year
How much did it cost to start: $15K

How We Hit Our Goal Within 24 Hours On Kickstarter And Raised $30K+ Worth of Preorders

Andrew Buehler launched Urban Smokehouse, the world’s first digitally native BBQ brand, through a Summer Kickstarter campaign, raising over $30,000 in pre-orders; since then, the company has achieved monthly sales of over $5,000 split between their website and in-person pop-ups and events, relying heavily on word of mouth and organic social media.

Read by 2,822 founders

2. Jaju Pierogi ($960K/year)

Jaju Pierogi, founded by sisters Casey and Vanessa White, started as a side project selling pierogi at farmers' markets and pop-up events. With a background in the corporate world and a love for their Polish heritage, they saw a gap in the market for high-quality, handmade pierogi. Fast forward to August 2022, Jaju Pierogi is now in multiple grocery chains and over 650 specialty independent stores, with a monthly revenue of $80,000-$100,000.

Is it profitable? Yes
How much money it makes: $960K/year
How much did it cost to start: $3.5K

Our Grandfathers Recipe Inspired Us To Start A $1M/Year Pierogi Business

Jaju Pierogi started off as a side hustle at farmers' markets and festivals back in 2016, and as of August 2022, they are in multiple grocery chains and over 650 specialty independent stores with a monthly revenue hovering between $80,000-$100,000.

Read by 3,505 founders

3. Karachi Kitchen ($24K/year)

Sadaf, the co-founder and designer behind Karachi Kitchen Foods, started the business with her mother, a long-time chef and culinary instructor. They launched their business after collaborating on a self-published cookbook, which won a Gourmand Award. Despite facing setbacks due to Covid and learning about federal and state regulations, they have seen sales more than double since launching their online store.

Is it profitable? Yes
How much money it makes: $24K/year
How much did it cost to start: $5K

This Mother And Daughter Started A Side Hustle Selling Chutneys And Spices

Karachi Kitchen Foods saw over 200% growth in sales in the past year, offering seven different chutneys and spices, and plans to launch an online subscription box and publish recipes on their website in coming months.

Read by 1,942 founders

Learn more about starting a specialty food business:

Where to start?

-> How to start a specialty food business?
-> How much does it cost to start a specialty food business?
-> Pros and cons of a specialty food business

Need inspiration?

-> Other specialty food business success stories
-> Marketing ideas for a specialty food business
-> Specialty food business slogans
-> Specialty food business names

Other resources

-> Specialty food business tips

How much can you make with a specialty food business?

With a specialty food business, you can make an average of $597K revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $500. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 12 months.

How much does a specialty food business make a week?

Based on our data, average weekly revenue for a specialty food business ranges around $12.4K. As such, you could see monthly revenues of $49.8K.

To know if your specialty food business achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your specialty food business.

How much do specialty food businesses owners make?

The income of a specialty food business owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established specialty food business is about $12.4K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as a specialty food business owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Specialty Food Business Profit Margins

Generally speaking, a specialty food business can expect profit margin of around 50%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of a specialty food business, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, specialty food business owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, specialty food business owners can ensure long-term sustainability and profitability for their business.

Specialty food business owner salary

The salary of a specialty food business owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established specialty food business, in a prime position, might see an average weekly salary around the ballpark of $6.22K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, a specialty food business is quite promising if you plan on starting such. With a market size of $, you can enjoy a potential revenue of around $597K per year with a gross margin of 50%.

Considering this information, you can enjoy a return of investment within 12 months, especially if you have a monthly profit of $24.9K. Overall, the success of your specialty food business also depends on your effort and knowledge about it. If you persevere with these things, you can ensure that this specialty food business is profitable.

Make sure you have a proper specialty food business plan and know how to get clients for your specialty food business.