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Produce distributors have a very important role to play in the food industry as they are the link between the food growers on one hand and the retail, wholesale or food service companies on the other. A good produce distributor can be a boon both for the farmers and the final customers who use the produce. A constant client base and never-ending demand for food make produce distribution a very lucrative and safe business opportunity. With few logistics in place and a good business plan at hand you can really excel in this business.
Find a supplier. Since you will be distributing produce you will need a supplier who will be your constant source of the produce. Research around your area for farmers or commercial growers who deal with the kind of produce you want to distribute. Get a lawyer to write up contracts that clearly describe your responsibilities as a distributor and the grower's responsibilities as your supplier. This will help you protect your business and ensure that you get the products you need on time.
Set up a warehouse where you will be conducting your business. Warehouses have space and docks which will make loading and unloading your vehicles much easier. Ensure it is a food grade warehouse. Invest in appropriate vehicles for transporting your products and refrigerators which will hold the perishable products. Your drivers will need a commercial driving licenses which allow them to drive trucks. You will also have to look into how you will be packaging your products. You can use crates that are branded with your company name to pack foods, such as onions or potatoes.
Get a tax ID number from your local county office. You will also be required to get a food distributor license, a warehouse operator license and register as a food wholesaler. In some states you will not require a permit for produce distribution. The application forms for the licenses can be found at the Department of State Health. The fees for the warehouse operator are determined by the size of your warehouse and may vary from $362 for 6000 sq ft to $2100 for 250,000 sq ft. The food wholesaler license fees is about $260 while the food wholesaler registration fee is $106 approximately. The licenses are valid for 2 years. The whole process will take about 4-6 weeks. Your warehouse will also be inspected to ensure that it is hygienic enough to store produce.
Market yourself. Go around your area passing out fliers to retail produce shops and look for wholesalers as well. You can also set up a website with details on your location, your prices and the products you distribute. Ensure you keep in touch with the shop managers so as to know what products are in season and on demand as they keep changing from season to season. Build lasting relationships with your customers to have a constant client base. Start locally before distributing nationally. This will enable you to gain experience in the business.
You can also buy a franchise which will save you from having to look for a warehouse and other equipment.
- produce stand image by Tammy Mobley from Fotolia.com