Business Ideas | Small Business Ideas: How to Become a Fruit and Vegetable Trader

Saturday, January 24, 2015

How to Become a Fruit and Vegetable Trader | Business Ideas

Growing awareness of the physical value of a diet filled with produce is good news for anyone interested in starting a small business venture as a produce trader, whether you grow the fruits and vegetables yourself or not. Traders plant and harvest the produce or purchase in bulk from local farmers and make a profit selling at local markets and fairs. Even a small, backyard garden can get you started as a trader.

This document provides a template of headings for presenting any business idea. The objective is to produce a step-by-step tool that illustrates every step of the business creation process. It should be possible, by following the information, to produce a viable business.

Description of the business

Within each sub-heading are a series of questions that require detailed answers. Simply fill in your commentary beneath the headings. Note that these headings and the methodology are here, partly to be pedantic, but mostly to ensure a consistent approach across a number of unrelated businesses. It makes searching for information far easier if you know where to start.

What exactly is it that is going to be sold or done?

I am going to sell fruits and vegetables:

Apples
Oranges
Papaya
Water melon
Plantain
Pineapple
Bananas
Tomatoes
Potatoes
Green peppers
Red peppers
Onions
Carrots
Cabbage
Cucumber, etc

Getting Started

Step 1

Secure a good location for your fruit and vegetable business. Whether your business will be a roadside fruit and vegetable business or be located in a permanent storefront, location is very important to the success of your business.

Step 2

Write a business plan. In order to secure financing for your business, it is imperative that you have a comprehensive, professional business plan that will persuade a loan officer that you have a viable business idea he wants to finance. A business plan also gives you and any future employees a direction and starting point from which to focus your business.

Step 3

Contact your state, county and local governments to find out what business licenses fruit and vegetable vendors need. Business licenses and requirements vary by state and community. Food-handling training and licenses and a resale tax license might be required. Contact your local health department about food handling and your state and local business licensing and regulations department to obtain licensing applications.

Step 4

Grow or buy the fruits and vegetables. Local farmers sell their crops in bulk to traders, or you can learn to grow your own and harvest them for sale. Traders usually divide bulk purchases into smaller containers and price the smaller amounts for resale. Investigate what competitors are selling produce for before settling on the right price to charge customers.

Step 5

Choose the ways to sell your produce. Buy a booth at weekly or daily farmers markets or flea markets. Post fliers and business cards on bulletin boards or as newspaper advertisements. Contact restaurants and caterers and sell fresh produce on a weekly or semi-weekly basis. Consistency is important when selling produce. Establishing a routine that clients can depend on can lead to repeat and long-term buyers. Many farmers markets and restaurant owners allow only organic or pesticide-free products to be sold by producers.

Step 6

Buy the right equipment. Produce traders usually deliver items to the customer. A large truck, produce boxes and a delivery dolly are necessary items. Delivering fresh produce to restaurants or bulk customers might require a refrigerated delivery truck. Selling through farmers markets might require the purchase of tables, display bins, scales, portable devices to accept payment and an awning or tent-like structure to protect employees and produce from the sun and elements.

Step 7

Design efficient transportation and delivery routes. Transportation costs might be a high-ticket expense for many fruit and vegetable traders. Delivering produce several times a week instead of daily might help cut back on gas, insurance and vehicle costs.

Tips

Organic items sell for a higher price. Buy or grow organic produce and resell at local farmers markets where customers go to find fresh, organic and local produce.

People are more likely to stop at a produce booth that is decorative and conveys the care and pride the trader takes in growing, selecting and offering his produce to the public. Use colorful tablecloths, baskets and signage when creating a booth at a local farmers or flea market.

Inventory will vary from week to week depending on the growing season, region and weather. Learning about crops growing in your region will help you discern what type of inventory to carry and produce available at various times of the year.

Some farmers markets request non-organic farmers and growers to identify to customers the pesticides used to grow the produce.

Do not forget about schools, resorts, country clubs and large companies with employee cafeterias when making contacts with area businesses interested in fresh produce.

References

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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