Starting a cold storage business is profitable and knowing ‘what is the business model of cold storage in India’ is helpful. Time and again there is wastage increasing, and this is due to insufficient cold storage facilities.
Why consider the cold storage business model?
Considering a cold storage business model is common in the food industry, its efficient preservation technique is to the best advantage. However, it is understood says NSSPL MD, Yogesh Dahiya, that the cold storage equipment is useful to other sectors, as well. Cold storage is of great use to science labs and pharmacy labs, hospitals, clinics, flower boutiques, and lots more. Cold storage facilitates keeping the products in order and safeguards them from spoiling. It is used by beverages, food, and all other related businesses that aim to keep products from spoiling.
The need of the hour is to consider ‘what is the business model of cold storage in India.’ It is because one gets to earn a good profit margin with this business. Starting a cold storage business following a robust business plan and strategy may prove beneficial. Cold storage helps increase product shelf life, and hence it is in high demand among big vendors. They store their products for a longer time. Even multiple uses of cold storage are beneficial to keep fruits, dairy products, meat, vegetables, crops, and other products without damage.
It requires proper market research and planning to assure earning a profit margin. If you are considering a business of one-time investment, then initiating cold storage is ideal. This business requires high initial investment than all other small businesses. But, it ensures in the long-term a constant return of income.
What is the business model of cold storage in India?
The demand for cold storage and its profitability
The wastage is huge of fresh fruits and vegetables. It is a global issue. The countries growing food crops do not realize the wastage of their products and the loss they incur. It happens due to a lack of cold storage infrastructure. Cold storages are essential to extend the shelf life of farm produce.
The perishable commodities need immediate movement to cold storage. To enjoy profits, marketing the availability of the cold storage facility is a must. It will also help in post-harvest losses, and the bottlenecks of transport in the peak times are handled in balance. Cold storage provides the growers with the prices for their farm products, and the consumers get their choices at affordable prices.
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Investment cost of cold storage
The cold storage business model’s initial investment is high. It includes acquiring land, constructing buildings, obtaining licensing and permissions, and arranging utilities such as electricity, water, etc. Besides, you require a major startup capital as an investment to procure the cooling machinery. The updated, modern machinery assures long-term sustainability and better performance.
Secure a Location
The most crucial factor according to NSSPL MD is securing a location. It should be close to the consumer centers or the producing farms to reap profits. Catering the local produces is of value. You also need an acre of land, if you plan a 5000MT multi-purpose cold storage plant.
Obtaining Licenses & Permissions
The cold storage business requires different permissions and licenses. It varies with location, check the tax liabilities and upcoming compliances. Even the mobile cold and freezer rooms are high in demand.
For more ideas on cold rooms or a business model for cold storage in India, contact NSSPL. You will receive the right support.