Selling Food Online In India: What You Need To Know

E-commerce growth in India 2015

An article by Gartner,Inc. has estimated the Indian e-commerce market to reach $6 billion by end of this year, which is, 70% increase over 2014 revenue of $3.5 billion.

“Digital commerce is at a nascent stage in India. However, India is one of the fastest-growing e-Commerce markets in Asia/Pacific, “said Praveen Sengar, research director at Gartner. “India represents a $3.5 billion market, growing at approximately 60-70 percent every year. It represents less than 4 percent of the total retail market.

Online food stores- A need for modern customers

E-commerce in India has allowed many sellers to earn huge profits by selling non-perishable products, online. With the advancement of technology and improving comfort with online payment, selling groceries online is giving a tough competition to offline players and is slowly proving to be the next big thing in this year 2015.

In today’s fast pace of living, it becomes difficult for many people to stay up with their personal commitments like watching movies, going to restaurants and other social happenings. Such activities can be missed out, but, there is no way one can live without toothpaste, vegetables and other daily necessities of life.

Considering modern customer’s busy life- the advent of online food stores is on a high, especially in India.

Online Food retail opportunities for sellers in India

According to retail consultancy Technopak, the online grocery retail market is growing at 25 to 30 percent in the metros and other large cities in the country. “Urban India’s increasing shortage of time is fuelling the growth of online grocery,” says Pragya Singh, associate vice president, retail and consumer products, Technopak. “It is a largely standardized category; it doesn’t require much touch-and-feel as, say, apparel. Hence, online works fine. And it is highly convenient.”

Sales of food and groceries currently account for more than two-thirds of all retail sales, consultants Technopak added, and the value of these sales is expected to nearly double to $686 billion by 2020.

Voice from the Director of AaramShop.com– one of the first launched food online store in India that allowed customers to shop groceries over the web.

“The spending on grocery and daily essentials is the largest and most consistent share of the wallet for any household. However, it is still out of the ambit of online shopping and, therefore, represents a huge opportunity,” says Vijay Singh, chief executive and managing director of AaramShop.com, a network of neighborhood retailers based in New Delhi. AaramShop.com currently operates in 30 Indian cities with more than 3,000 partner retailers.

Food products selling online

The future of online grocery across the globe is experiencing a good response over the web. Hence, brick-and-mortar store owners need to understand people in India are increasingly shifting towards technology and that they need to evolve.

Today, there are many online grocery stores that offer an assortment of spices, beverages, pulses and more which are included in their grocery products section.

Ready-made food canned products is another best selling product and has a great demand by modern customers, as they are quick to cook that saves them a lot of time and effort.

Dealing with food canned products with a longer expiration date can be stocked in advance, which makes it easy to supply immediately as per the demand. However, unable to track your stocked food products can lead to waste of money.

An inventory management software in place will help you bring all your stocked product information at one place, giving you proper insights to make the best optimization of your inventory.

But, are you ready for starting a food business online?

Indian Sellers have already been acquainted with shopping non-perishable goods online. However, selling perishable products (for instance, vegetables), storing and supplying them, is all together a different ball game than storing and supplying clothes.

What are the basic requirements that one needs to consider before starting an online business?

1- Get your business registered with FSSAI

There are certain food safety measures and standards acts involved when you think of selling food online. Before you think about managing your back-end processes, you need to first register your business with Food Safety and Standards Authority of India.

FSSAI license will help you legally sell your food products to customers as well as retail stores who prefer to deal with merchants that are FSSAI approved. Because, operating a food business without a license can penalize you.

2- VAT Registration

TIN Number, also known as VAT registration number is mandatory for sales of goods and products. However, not all items are taxable under VAT. Ensure you check eligibility for your product and obtain a VAT registration number from the local sales tax authorities. TIN consists of 11 digit numerals throughout the country. Its first two characters represent the State Code and the setup of the next nine characters can vary in different States. Click to know more about VAT CST Registration in India.

3- Central Sales Tax

The benefit of having a CST tax, if sale is effected by transfer of documents of title to goods during their movement from one state to another, the CST shall be imposed and collected by the State Government where the movement of good have commences.

Selling food online- Packing and shipping know-how

Unlike shipping non-perishable goods, food products have specific shipping requirements and needs to be delivered at the earliest. And, with an auspicious festival “Diwali” around the corner many food items online are brought as gifts. Therefore, it is important for sellers to offer attractive packing and excellent delivery experience.

What are those three important parameters to keep in mind while fulfilling e-Commerce food orders?

1- Consider at what temperature the product needs to be kept throughout the fulfillment transit.
2- Invest in proper boxes, jars, dry ice, to ensure products are been delivered fresh.
3- Choose experienced fulfillment service to avoid late delivery, especially in the case of gifts.

Because, e-Commerce food business is still developing In India- you may have difficulties in finding the right fulfillment solution for your online food business. However, adopting a leading order and shipping management system, will help you experiment and find a fulfillment solution that is reliable, cost-effective and agreeable to your customers, too.

Tips to come up with a great e-Commerce store for your food business

Select an appropriate theme

The theme of your store will decide the engagement level and sales rate for your food store over the web. Make sure you offer a browsing experience that makes customers feel they are actually shopping from a brick-and-mortar store. This means, concentrate on your store design, product listing placements, descriptions, and photographs. Additionally, ensure you offer customers with informative resources relevant to your product line through an inbuilt blog page, as modern customers stick with brands that keep them updated with the latest style and trends.

Shopify allows a number of ready-made food and wine store themes that you can always consider for your online food business.

Allow easy and quick checkout options

Another factor, you would not like to make purchasing process complicated- now that doesn’t mean you force yourself with two-click ordering processes. Instead, make it simple and offer checkout indication to make it easy for customers to add products and proceed with the payments successfully.

Offer flexible payment methods

Next, you need offer payment methods that are already acquainted by customers that include:

1- Credit/Debit card
2- PayPal
3- Cash on delivery

Be loud about your brand

The visuals of your products will encourage more and more customers to visit your online food store and make purchases. Shouting about your food assortments on leading social networking Facebook will help you bring in traffic for your food business, however, promoting your food business on visually-enlightened social sites like Instagram, Vine can help you create a good impact on your offerings and increase click-through rate and sales order for your e-Commerce food store.

Know what features you want in your automation software-

Food business often comes with items that are built from a list of items such as cakes or pastry. In these scenarios, it is advisable that you know the features you would want from your Inventory and order management software. Bill of materials, multi-warehouse management, and others constitute as major features. We have developed custom systems for food inventory management and we know that the trade has its own complexity.

Leading e-Commerce food store examples ideal for start-ups

Grofers.com

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PepperTap.com

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BigBasket.com

Big-Basket-1447652204

Food Safety Mobile App – An ideal resource

Selling food online, sellers need to ensure they be in line with the FSSAI compliance needs. However, with the increasing competition in food business day-after-day, sellers find it difficult to stay updated. Hail to Food Safety Standards- India who has made seller’s life easy.

If you are deciding to start a food business online, adopting Food Safety Mobile App will ensure you are always updated and notified regarding the FSSAI regulations and also feature food safety inspections for food businesses.

Currently, the Food Safety Standards app is available only on the Android platform.

Sources:

www.forbes.com
http://www.indiafilings.com/

Savio Fernandes

Savio Fernandes

Savio Fernandes is a writer who influences. Writing for over three years at Orderhive, he is currently focused in offering eCommerce and retail solutions for start-ups and medium business owners.

2 Comments

  1. Avatar Vishal Chauhan Posted September 26, 2016 at 12:15 pm | Permalink

    Dear Savio Fernandes

    It was great information! I really enjoyed it. I hope it help to start my own store in nearby future 🙂

  2. Avatar Anand Posted March 26, 2017 at 11:04 am | Permalink

    I am having vat registration need to buy food products from manufactures
    and putting my company label as marketed by so and so
    please suggest me what type of registration i have to take further

    thanks & regards
    Anand