Major Components to Keep in Mind to Start a Grocery Store in India
If grocery business ideas seem attractive to you, here are a few components you must keep in mind before starting:
Choose the Right Business Model
Before setting up a grocery store business in India, choose the right business model and create an effective action plan. It should include details like:
Size: You can set up a small, medium, or large store depending on your budget and the type of products you want to sell.
Finance and Capital: Evaluate the financial requirements and determine how much capital you will need. Generally, the financial need depends on the size and scale of your business. So, look at your savings and assets and see if they are enough to set up a grocery store. If not, apply for a new Business Loan from Hero FinCorp and get the required funds instantly without any security or guarantor.
Ownership: Do you plan to open a store as a sole proprietor or with a partner? Determine a legal, organisational structure for efficient administration and management.
Setting Up Your Business
The charm of your retail store depends on the experience you offer through its design and setup. Atmospheric factors like music, scent, colour, and light improve the overall shopping experience of your customers. Aesthetic factors like colour, size, and texture also help you stand out and build a memorable customer experience. Think long-term and prefer quality over price while setting up your store. Look for storage, movement, and display solutions that meet quality standards and leave behind your competitors.
Pick a Suitable Location
Picking a suitable location for your grocery store is half the battle won. The best idea is to avoid far-off places, but opening a store in a crowded market is not a good location either. Moreover, ensure the store has a decent floor and storage space to accommodate several customers at a time. Also, give attention to the parking space, as most people will come for grocery shopping in their vehicles for easy commute and transportation. A place close to offices and commercial spaces is good as people come here daily.
Hire the Right Staff
When it comes to a retail grocery store, your staff is the key to securing repeat customers. Positive customer care provided by your staff is directly related to customer retention. Therefore, ensure hiring candidates who are pleasant, friendly, and know how to deliver great customer service. Moreover, they should be comfortable working in a team and learn how to calm unhappy customers. Since your employees are the face of your grocery business, ensure they contribute to a pleasant atmosphere inside your store.
Get all the Legal Formalities Done
You will need the necessary licenses and permissions before setting up any business. Although the compliance requirements and certifications are the bare minimum for a grocery store business, they may vary based on your state. You will also need a certificate of safety protocol and a challan, a rental fund your local municipality will collect from you. Permits from the health department and fire safety are also mandatory. Other legal formalities include the following:
Business registration under a partnership, sole proprietorship, or another ownership option
Trade license for the store
Business registration under the 1953 Shops and Establishment Act
FSSAI license
Tax-related registrations like GST number, TAN, etc.
After obtaining all the necessary permits and licenses, you are ready to set up your grocery business.
List of Required Documents to Start a Grocery Store Business in India
While planning to start a grocery store business in India, here are a few legal documents you must possess:
1. Trade License: Municipalities issue exchange permits in various Indian states. While setting up a grocery store, you must obtain these permits from municipal bodies. The process is simple and takes only 5-7 days to complete.
2. Lease Agreement: To rent a space for your grocery store, you must follow a proper registration process. A lease agreement with your landlord is mandatory to keep the deal intact and safe.
3. FSSAI License: You will need an FSSAI license if your store deals with food-related activities. Apply for one with your local state or government office.
4. Shop and Establishment License: You must submit a shop and establishment license that includes your employment terms and worker services in your store. Get one from your state authorities.
5. GST Registration: GST Registration is an essential compliance for every Indian business. It becomes mandatory if your annual turnover is over Rs 40 Lakh.
How a Business Loan is Helpful to Open a Grocery Store?
Now that you know how to open a grocery store, the next hurdle can be finance. You will need a substantial amount to set up your grocery business, depending on the size, type, extent, and nature of the business. You can get in touch with Hero FinCorp to get a Business Loan for business owners. However, the applicant should have an experience of up to five years in a similar field. Here is how a Business Loan helps open a grocery store:
Ample loan amount of up to Rs 40 lakh to cover various needs
Competitive interest rates that keep the loan cost affordable
Flexible repayment terms of up to 60 months to keep the EMIs budget-friendly
No collateral requirement to access funds without collateral, guarantor, or security
No end-use restrictions to cover diverse expenses
Easy eligibility conditions and minimal documentation requirements for easy funding access
Conclusion
The grocery business is vital to a country's community and economic development. It is also a profitable business option that requires minimal effort and investment. If you plan to set up a grocery store business in India in 2023, consider new-age NBFCs like Hero FinCorp Business Loans to get the required funding without collateral.
Frequently Asked Questions (FAQs)
1. How profitable is a grocery?
Establishing a grocery store is a profitable business in India. An average store owner has a 5 to 20% profit margin, making significant monthly earnings.
2. What is the business of grocery?
Grocery is a retail business selling everyday household products like food and beverages, cleaning supplies, fruits, vegetables, poultry, meat, frozen and canned foods, etc.
3. How to start a grocery trading business?
Starting a grocery trading business involves choosing are right business model, picking a suitable location, getting the formalities done, hiring staff, and setting up the store.
4. How much capital is required for a grocery store?
You can successfully set up a grocery store from Rs 10 Lakh to Rs 2 Crore, depending on the size and location of the store and the type of products you want to sell.
5. Do grocery stores make a profit?
Yes, grocery stores make a 5 to 20% profit depending on the profit margin the wholesaler provides.
