The frozen food business has been around in Indonesia for several years. It became increasingly popular during the pandemic because people minimized meeting lots of people. So once you buy it, you can keep it for a long time.

Who doesn't like frozen food ? Due to practical reasons and the large variety of frozen foods, people like this type of food. Everyone from children to adults will definitely not refuse if served this food. Entrepreneur friends will also definitely like this food.

So, with so many people liking this food, it could be said that frozen food has a fairly wide market share. This makes frozen food a quite promising business opportunity. In this article, we will review frozen food business opportunities. What are the advantages and disadvantages? So, what are the steps to starting a frozen food business?

Why You Should Start a Frozen Food Business

Excess

1. Properties of frozen food

Frozen food can last a long time with good packaging and storage methods. Its long-lasting nature is what makes the frozen food business worth considering because Entrepreneur Friends don't need to worry about having excess stock when the business is low on buyers. Entrepreneurial Friends only need to provide adequate storage space so that frozen food stocks do not spoil quickly.

2. Wide market share

Frozen food has become very popular among people, especially in the pandemic era which requires reducing outdoor activities if they are not really needed. We only need to shop for frozen food once a week or several times a month and the frozen food will still last in the refrigerator.

Moreover, with online shopping sites, we can order frozen food without having to leave the house. Then, for people who are busy, frozen food can be a helper when their stomach is hungry. We only need a few minutes to heat or fry and the dish is ready to be enjoyed. Undoubtedly, a wide market share is one of the advantages of this business idea.

3. Minimal capital

The frozen food business can be run with minimal capital. You don't need to have a freezer with a large capacity, just use the freezer from the refrigerator at home temporarily. For their own production, Entrepreneurial Friends can also use cooking equipment available at home.

Entrepreneur Friends only need to spend capital to buy raw materials and packaging for frozen food or buy frozen food stock if you only want to become a reseller . Quite simple, right?

4. Suitable for housewives

For housewives who like to cook, this business idea could be a business option that can be done at home. What needs to be done as a start is to make a product example, document the product example, then promote it via social media or through word of mouth to neighbors, relatives and friends.

Lack

1. Competition is tough

One of the disadvantages of entering a large market share is the emergence of intense competition in the frozen food market. This is due to easy access to enter the market caused by the high demand for frozen food.

Many competitors will flock to take the opportunity to enter the frozen food market. If you want to enter this type of market, Entrepreneurial Friends need to have competitiveness so they can survive in the intense competition. Competitiveness can be obtained if we are able to offer added value to the products to be sold.

2. Risk of spoiled food

One of the risks that should be taken into account when selling frozen food is the risk that the food will be damaged if there is too much stock, inappropriate packaging, or too long at hot temperatures during delivery. To minimize this risk, Entrepreneurial Friends must have packaging equipment (if self-produced) and a suitable cooling machine. Always monitor existing stock and use the FIFO ( First In First Out ) method.

How to Start?

1. Determine the product type

There are many types of frozen food. Entrepreneurial Friends must determine what type of frozen food to sell. Also determine whether you will carry out your own production or take stock of goods from suppliers (become a reseller /agent).

  • Ready-to-eat frozen foods, such as nuggets, sausages, dim sum, meatballs, risol, pastels, donuts, potatoes, kebabs.
  • Ready-to-eat frozen food is home-cooked food that is frozen so it needs to be warmed before eating. Included in ready-to-eat frozen foods are rendang, anchovies, stir-fried clams, green chili squid, balado shrimp and many other processed dishes that can be frozen.
  • Ready-to-process frozen foods, such as beef, chicken, squid, shrimp, fish and various seafood that have been marinated (with basic spices), then frozen.
  • Frozen fruit and vegetable food, in the form of corn, beans, carrots, apples, bananas and so on

Due to the various types, to minimize business risks, Entrepreneurial Friends should focus on one type of frozen food first while conducting market tests. Entrepreneurial Friends can diversify after finding a suitable target market and having loyal customers.

2. Product research and market analysis

Entrepreneurial Friends, product research and market analysis are carried out to see how the market responds to the products we offer, who our competitors are in this business and what they offer. Then, how do we do market research?

Online Research

After determining what type of frozen food to sell and deciding whether to produce it yourself or just become a frozen food agent, Friends of Entrepreneurs can start doing online research .

Online research can be done in several ways, such as distributing online questionnaires, asking friends and relatives directly via WhatsApp broadcast , conducting searches on Google, checking hashtags on social media to see what food is going viral, or you can also visit competitors' social media. closest to see what they offer and how their customers respond to competitors' products.

By conducting online research , it is hoped that Entrepreneurial Friends will be able to find out how tight the market competition is for a product. This can help Entrepreneurial Friends to determine what kind of value-added will be added to the products we offer.

Offline Research

For offline research , Entrepreneurial Friends can visit local frozen food stores or agents to see what kind of products they sell. Usually the products that are sold the most are the products that are best-selling in the local environment. On the other hand, if Sahabat Entrepreneur wants to become a frozen food agent, this method can be used to conduct research on competitors.

2. Added value to the product

As mentioned above, added value to a product is needed to increase business competitiveness against competitors. If you are able to offer the added value that customers want, then Sahabat Entrepreneur is ready to compete with competitors. The added value that we can provide to frozen food products is:

  • cheaper prices than competitors,
  • healthy food concept , such as product raw materials that use additional vegetables, non-MSG, no preservatives or no other additives,
  • Variants that have many variations and are unique, for example in one package providing many variations of products and flavors.

3. Find suppliers

Choosing the right supplier is one of the keys to achieving success in the frozen food business. If you do your own production, entrepreneurial friends need to consider the quality of the raw materials to maintain the quality of the frozen food to be sold.

Apart from the quality of raw materials, Entrepreneurial Friends need to consider the price offered and additional costs, such as shipping costs. Choose a supplier with good quality raw materials, but offers a reasonable price. This also applies to Entrepreneurial Friends who want to try becoming frozen food resellers /agents.

4. Calculate initial capital

After determining the type of frozen food product that we will sell, next Entrepreneur Friends must start calculating the initial capital budget needed to start this business.

Calculate what needs must be included in the initial capital calculation, including the costs incurred if you have to collaborate with raw material suppliers for the needs of this frozen food business. Make sure the initial capital calculation is done as detailed as possible.

What needs to be underlined is that this initial capital calculation estimate can change according to the needs of Entrepreneurial Friends. Entrepreneurial Friends can buy a freezer with a smaller capacity if they only produce small quantities. Then, if you diversify your products and sell in larger quantities, Friends of Entrepreneurs can reduce monthly operational costs, especially for charging overhead costs and depreciation for each product.

5. Prepare the main equipment

When calculating initial capital, we can also categorize primary needs and non-urgent needs. Focus your initial capital budget on spending on main equipment first such as a vacuum sealer machine and a cooling machine to store frozen food stock.

If you have more capital, Entrepreneur Friends can invest in buying high-quality equipment to avoid risks, such as machines breaking down long before the depreciation period arrives. This will be detrimental because business operations will be hampered and Entrepreneur Friends will have to spend extra money to repair machines or even buy new machines.

6. Choose a packaging method (if your own production)

As mentioned above, one of the risks of the frozen food business is that if it is not packaged and stored properly, the frozen food will quickly spoil or go stale. To minimize the possibility of this risk occurring is to choose a good packaging method.

The recommended packaging method is packaging using a vacuum sealer machine, where the machine will suck air (oxygen) from inside the frozen food packaging to reduce the risk of spoilage due to bacterial contamination with oxygen. Make sure the food is completely cold before packaging so that no water vapor is trapped in the packaging.

7. Have an official license/distribution permit (if self-produced)

To ensure that the products sold are safe and suitable for consumption, Entrepreneurial Friends are strongly advised to have official licenses and permits if producing frozen food. Especially if you want to produce large quantities, having a food license will be very helpful in distributing frozen food and if you want to collaborate with vendors or distributors.

Entrepreneurial Friends must at least obtain a Home Industry Food Permit (PIRT) if the industrial scale is still a home industry. Apart from that, other permits that need to be obtained are a BPOM certificate and a halal certificate from the Indonesian Ulema Council (MUI). By having an official distribution permit, Sahabat Wirausaha can increase overall sales.

8. Use the right business strategy

In this digital marketing era, Entrepreneurial Friends must be smart in promoting through various digital platforms , such as social media and e-commerce . Entrepreneurial Friends can create a special social media account for the frozen food business as a branding strategy .

SOURCE

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