Food Broker Business Plan and SWOT Analysis

Food Broker Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Food Broker Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Food Broker business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be immediately emailed to you after you make your purchase.

Product Specifications (please see images below):

  • Bank/Investor Ready
  • Complete Industry Research for the Industry
  • 3 Year Excel Financial Model
  • Business Plan (26 to 30 pages)
  • Marketing Plan (24 to 28 pages)
  • 425+ Page Funding Directory
  • PowerPoint Presentation
  • Loan Amortization and ROI Tools
  • Three SWOT Analysis Templates
  • How to Start a Business Guide
  • Easy to Use Instructions
  • All Documents Delivered in Word, Excel, and PowerPoint Format
  • Meets SBA Requirements

Food brokers play a very important part of the logistics as it relates to bringing consumables to the general public. Typically, most food brokers work extensively with farms, cooperatives, and small vendors that want to be able to feature their products within grocery stores and related businesses. Many times, these businesses operate in a similar capacity to a wholesaler with the exception being that they do not typically take possession of food products until they have been sold to a third party via a purchase order. These businesses tend to always remain profitable given the fact that people need to eat, and in many markets there is a very strong demand for highly specialized items. In fact, one of the ways that many food brokers are able to initially launch their operations is by maintaining programs that sources hard-to-find and unique food products that are in demand among the general public. The startup costs associated with the new food brokerage business are relatively low given that inventories are typically not held on the balance sheet of these companies. It can be expected that a new food brokerage will cost anywhere from $50,000 to $100,000 in order to launch operations. However, in the event that the food broker seeks to develop some level of wholesale distribution operations in these costs can be significantly higher given that inventories are going to need to be paid for from their producers.

A food brokerage SWOT analysis should be produced and is typically done in relationship to a business plan as well as a marketing plan. As it relates to strengths, a food broker is always able to generate income given the continued and ongoing demand for quality food products. The gross margins generated from the brokering food is considered to be moderate and typically most orders generate a fee equal to 10% to 20% of the food products that have been placed by the business. While the operating margins are somewhat low, this is typically made of for as extensive volume is usually carried out through these businesses. The ongoing operating costs are considered to be moderate is well given that most of these businesses do not carry their inventories on their balance sheet and they do not need to engage in storage activities.

For weaknesses, major declines in the economy can have a modest impact on the way that these businesses operate given the fact that specialty foods typically fall out of favor during times of economic recession. However, this risk is muted by the fact that many food brokers maintain extensive relationships with food selling businesses on a national level. As such, only a severe and sustained economic recession typically has an impact on the way that these businesses operate. There is also the ongoing issue relating to competitive issues.

For opportunities, the ways that a food brokerage business can expand their operations is substantial. These companies can aggressively expand their business by sourcing unique and rare food items that are sought after by the general public. Additionally, many food brokerages will seek to eventually develop wholesale distribution operations which typically carry higher gross margins than food that is simply brokered between the producer and the seller. However, there are significant amount of risks that are associated with the wholesale distribution of food.

Outside of the major competitive issues faced by these businesses, there are very few threats of these companies will face as they progress through their business operations. One of the major issues that may occur is that there are ongoing regulatory changes as it relates to food product labeling, nutrition information, and the way that food is handled. However, these risks are somewhat low for food brokerage business as they typically do not take possession of any food item that has been sold.

Given that food is a necessity for all life, almost all banks and lenders are willing to provide a startup business loan or working capital line of credit in order to establish and build a food brokerage business. The moderate gross margins coupled with the continued demand allows these businesses to satisfy their underlying debt obligations at all times. Food brokerages are also a strong candidate for equity financing from a private investor. Of course, a food brokerage business plan is going to be required. As with all business planning documents, a three-year profit and loss statement, cash analysis, balance sheet, in breakeven analysis should be provided to a potential funding source. As it relates to the industry, Food brokerages generate more than $100 billion on a yearly basis while providing jobs for about 200,000 people. The growth of this industry has remained strong and will continue to remain in lockstep with that of the general economy.

Given that these businesses do not market their operations to the general public, the demographic analysis required in the business plan is somewhat limited. However, a full examination of the food sellers including farms, cooperatives, supermarkets, specialty retail stores, and related entities should be included within the business plan documents. This examination should include the estimated amount of money that will be spent with the business on a monthly basis, annual revenues, annual profits, and the geographic distribution of the customer base.

A food brokerage marketing plan also needs to be developed in conjunction with the business plan and the SWOT analysis. Foremost, many people that enter this industry typically have extensive contacts among farms, food cooperatives, supermarkets, and other entities that are engaged in the buying and selling of food. As such, the entrepreneur that starts his business typically is able to generate revenues very quickly given that they already know how to source inventories that are in demand among supermarket and food retailing businesses. One of the ways of these businesses can readily market their services to the general public is by maintaining strong relationships with specialty farms – especially organic farms – they’re seeking to divest large inventories of their products to the general public. This is the quickest way that these businesses are able to achieve profitability.

Beyond establishing these relationships, a presence on the Internet is very important for more most food brokerages. This is due to the fact that these businesses can be sought after for their specialty products among food retailing businesses. The company’s website should feature all information regarding which products they are able to source on behalf of customers, hours of operation, contact information, and preliminary terms regarding how broker transactions are carried out. This website can be listed among all search engines and most of these businesses will engage in a moderate search engine optimization campaign in order to drive traffic to their website. Given the highly unique nature of these businesses, most food brokerages do not maintain a presence on popular social networking platforms.

Food brokerages will always remain profitable and cash flow positive as the demand for general food items and specialty food items only wanes to moderately during an economic recession. It is imperative that the food brokerage maintain sustained and ongoing relationships with both food producers as well as food sellers in order to ensure that they are able to generate commissions from the sourcing of specialty and general inventories. Although there are going to continue to be a number of changes within this industry as technology improves and as sustainable farming practices take hold – there is always going to be a strong demand among companies to have a food broker in place that can source inventories of in demand products.