How do I start a food company

Found a food startup - start your own business with lifestyle foods

Food startups are a current hype. But what do you have to pay attention to when founding a company, how do you ensure that you position yourself in the hotly contested market? Here is some practical advice.

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4.53 / 5 (19) One thing is obvious: In the startup scene, nothing is currently more hyped than nutrition and a healthy life. More and more founders present absurd ideas at first glance and show where the food market is headed. Success stories such as the food supplier Hello Fresh or the beverage manufacturer Fritz Kola show the potential that the industry offers. The following steps for founding a food start-up show what makes nutrition so special and what things are important when starting a business.

Step 1: From the idea to planning | Target group, location and style

Everything starts with an idea. In the nutrition and food sector, these are coming even faster than in other industries. After all, we all have to do every day with the question: What do I eat today, what's in it and how healthy is it actually? But once you've found something that should conquer the food market in the future, you need to plan carefully. Because the targeted sales groups are particularly important for lifestyle products. You should therefore answer a few questions in advance:
  • Do I want to produce and sell locally or develop a global product?
  • Do I only address specific target groups with my product? (Vegetarian, vegan ...)
  • Should my product be developed for the masses or should it symbolize a certain lifestyle?
The last question in particular is very important. Because in the food sector it is essential that you make an important differentiation with your product. Either you are a product suitable for the mass market, something that pretty much everyone finds in their refrigerator and that satisfies a direct need. Such items are, for example, bread, milk or drinks.

Even more important today: the brand and its point of view

On the other hand, there is a product that is really special. With the purchase, the customer is committed to a certain lifestyle and makes a statement. With the purchase, he shows that he follows a certain worldview or believes in something. What sounds completely exaggerated at first glance is the core of the success of many companies in this sector. The best example is Fritz Kola. The Hamburg manufacturer conveys an alternative stance against corporate capitalism (Coca-Cola) and positions itself clearly politically. The best example of this is the brand's last poster campaign. Sometimes this is also the reason why customers buy a Fritz Kola.

Learn from the best - food startup founder stories

Some have already made it and have presented their food start-up on the start-up kitchen in the start-up stories. Here is a selection to read:

Step 2: concept and practical steps

Once you have clarified the previous questions and have an idea of ​​what your product should look like, you can move on to practice. It takes a lot of work to turn an idea into a company. You should not only create a plan for your product, but also for your company, which regulates how the process will be in the near future. There are a lot of questions that you should answer about the product, such as where you get your means of production from or where you want to produce at all. This should also be followed by a very basic cost calculation: For what price do I have to sell my product in order to make a profit in the end?

The plan should be before the official establishment

You can find some potential suppliers even before the official foundation and contact them to find out which prices are called. Overall, it is important that you have an approximate plan for your product before founding it and that you do not undertake an expensive start-up only to quickly find out that the product cannot be produced profitably at all. In today's globalized world, suppliers are often abroad, so this research sometimes involves a certain amount of effort. Of course, you don't have to plan the entire production and sales process completely, but rough considerations should be made. In this way, you can ensure that you can start right away as soon as all the formalities have been settled before the foundation.

Writing the business plan is easier and more structured with templates or software that guide you through the individual points. We are happy to recommend the free tool of the start-up platform, because the steps are well explained here. Try the free business plan tool »

Network - and be present

The hype surrounding the food startups is no coincidence - the market is changing, but rather the demands of your potential customers have changed. How important these changes are can also be seen in the special competitions that are held for founders in the food industry. The most important here:

Gastro startup competition

The gastro startup competition is aimed at young restaurateurs as well as those who have a good idea and are still dreaming of entering the gastro business. Possible prize money: 10,000 euros. More information here

Food Invention

Innovation in the food sector - here is the start-up competition. Possible prize money: 25,000 euros. More information here

And the startup association has also set up a Food & FoodTech group.

Step 3: clarify finances & financing

The next question you should ask yourself is whether you want to finance the project yourself or hunt for donors. If you decide to finance yourself, only one thing counts: Getting started! If you have already founded your company, you can go straight to practice and work on getting your product to market as quickly as possible. So you get quick feedback and see what you can improve. If you are dependent on external funding, you should think about a concept that you can present to potential donors. Because regardless of whether it is a bank or a business angel, you have to be convincing in both cases. Easier said than done, because the concept has to be so convincing that the investor, like you, is enthusiastic about the idea. After all, they have to believe that an investment in your company will sooner or later pay off financially.

Founding council

There is another promising way to get financial resources: crowd investing / crowdfunding.

Get started with crowdfunding

This can be particularly worthwhile because you not only get money but also your first customer contacts: A good crowdfunding campaign is an excellent marketing tool. The report of a really successful food startup shows how this works: The successful crowd investing campaign (part 1) - planning a campaign using the example of Kaahée

Step 4: Regulations, permits and safeguards

Now it's time to start up. After all, your idea should become a company. If you already have an investor, they usually know the processes involved in setting up a company. This is not a very easy undertaking, because for a startup it should usually be a legal form that offers a limitation of liability. There is therefore a choice between the GmbH (limited liability company) and the UG (entrepreneurial company), both of which require an entry in the commercial register and a notarial certification. For the beginning, the UG is certainly the better choice, because a GmbH requires 25,000 euros as start-up capital. You will find all the information about the processes in our article on establishing a UG.

In the food sector, it is essential to obtain all permits

But founding a company is far from over, especially in the food industry. After all, you want to sell products that are consumed by people and are thus affected by a large number of regulations and tests. In addition to hygiene and quality requirements, these also regulate the preservation and packaging of your products. The health department is responsible for all of these topics and will give you an answer to all your questions and explain exactly which regulations apply and how you can obtain the relevant permits for your project. Once you have received all the permits and can start production and sales, you should, however, include another aspect: safety. Since food is almost always perishable and there are other risks such as transport and logistics, you should think about insurance. Because if you take the risk, you can face huge financial losses after an unexpected accident.

Step 5: the right marketing | This is how you start successfully and make your brand known

Now you have overcome all the bureaucratic hurdles and can start to dedicate yourself to the exciting part: marketing. If your product is a real lifestyle product, the subject of marketing is absolutely essential. The goal here is that you succeed in creating a unique product by building a strong brand. In the food sector, you should primarily rely on new marketing channels.

Influencer: Instagram and blogger

In the food & lifestyle sector in particular, influencers are the number 1 marketing tool. The concept is very simple. Thousands of bloggers and Instagramers speak to thousands of followers and readers every day on their respective platforms and tell them exactly what the current trends are. So use the reach of these influencers for you. Especially in the middle range (25,000 - 100,000 followers) the market for influencers is not yet particularly well developed. This means that by sending a free sample of your product, you can get the influencer to share your product with their followers. In this way you can reach many people quickly and cheaply and make your brand known.

Own social media channels and advertising

In addition to influencers, maintaining your own social media channels is also very important. Your brand's Facebook and Instagram accounts should be updated regularly and have good content. You can also use the advertising function of the respective networks, because here you can vote exactly which target group should see the advertising placed by you. In addition, the prices here are significantly lower than, for example, on TV or other advertising channels.

The most important thing: have the best and at the same time most individual product

In all marketing, however, you shouldn't lose sight of one central point: In the end, the winner is the one who offers the best product and provides it with good marketing. So before planning the world's best marketing campaign, it always counts to develop the best product. We'll also come back to a point from step 1 when it comes to marketing: the message. Your product has to be something unique, which at first glance clearly embodies a certain lifestyle.

Marketing tricks based on a practical example

Small marketing tricks can help here. Packaging is a current trend. In addition to the brand's figurehead, this is increasingly being converted into a means of communication. Individual packaging, which makes every single product unique, becomes a modern marketing tool. There is enormous potential here, especially with products that have so far left this completely unused. Let's look at the example of meat. Imagine you've been invited to a barbecue and bring your host, who is a huge grill fan, a steak that bears his name. By customizing the meat packaging, you achieve a unique selling point for the product - a very powerful marketing tool that sets you apart from any other competitor. Individualized solutions for the packaging of meat, such as those offered by Südpack at a very affordable price, can have an extreme brand value. Here you combine high-quality packaging with the representation of your brand. This is exactly why this can be such a powerful marketing tool and shows which levers you should also seek out for your product. After all, in the beginning you have to try to make a big impact with a small marketing budget. As in this example, it is important to find previously unused potential and to recognize which channels competitors have not yet used.

Summary

With the food sector, you have definitely chosen one of the most exciting industries. There is a lot going on and not only are new startups springing up, but consumers are also noticeably more interested in the area and are opening up to new things. Using the right channels can unlock a lot of untapped potential in this area, but beware: the food industry is extreme when it comes to rules and regulations and should be approached with caution.

Master chefs know: You have to love and live cooking. Every day. This is how the Gründerküche editorial team also understands startup and entrepreneurship: as an attitude to life. We are eagerly watching what is being brewed in the corporate kitchens: which trends are emerging among startups, investors, business angels and tradespeople. We are looking for the best tips on corporate management, discover successful models from small to large, from local to global and question proven recipes.