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Starting An Online Bulk Food Business In Canada

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There are countless online opportunities for Canadian entrepreneurs. Our country is large and its population is scattered, which creates a unique demand. While many products are available to Canadians in the US, there is a strong preference to buy Canadian whenever it is feasible to do so (if for no other reason than the low Canadian dollar). Lower shipping costs without the worry of duty and broker fees are always appealing as well.

Many small businesses thrive online due to the low overhead. There is no need to lease an expensive storefront in a prime location. Your business and/or warehouse can be in the middle of nowhere (although a central location decreases shipping costs).

One wide-open Canadian niche is bulk food sales. I occasionally encounter attempts at cornering this market, but virtually all of the websites in Canada are more retail than truly bulk. To thrive in this market, your prices must be comparable to any offline bulk store (such as The Bulk Barn). Your real target markets will be the many Canadian locations without local bulk-buying options and those seeking unique products.

Five under-served, online Canadian niches in the bulk food sector are:
  1. Bulk candy and baking supplies (every Halloween I search for bulk candy online in Canada without success)
  2. Bulk herbs and nutraceuticals
  3. Bulk specialty coffee, tea, gourmet hot chocolate, premium cocoa, or health drink mixes
  4. Bulk fish and reptile food
  5. Bulk organic freeze-dried - Exotic meat, fish, fruit, etc. This niche often focuses on survival food, but there is a demand for many freeze-dried foods in bulk due to the higher nutrient retention, better taste, and faster re-hydration. You'll find a demand from pet owners as well.

What You'll Need

A full understanding of the volume "bulk" profit model
Business license
Health-inspected storage
Domain name
Canadian-friendly website hosting with e-commerce / catalogue support
Food Scales
Heat Sealer
Food-grade bags
Printer labels
Shipping supplies

You can cut that list in half if you use drop shipping suppliers and you won't have the in-house inventory headaches. Drop shipping allows you to order products at wholesale prices from the supplier, which are then shipped directly to your customer on your behalf.

10 Success Tips

  1. Market research and emulating similar successful businesses in other countries will get you off to the right start in Canada.
  2. It's tricky to start a bulk food business because you must have enough stock, yet it could expire while sales are slow. You may have to order smaller quantities at first, which will cut into your profit margin until you're established enough to benefit from volume discounts. The same applies to introducing new products, as you'll have to wait to see if they're popular enough before placing larger orders. Start slowly and focus on products with a long shelf life, such as freeze-dried food.
  3. You can offer popular products if you can give shoppers a seriously good bulk discount. A larger minimum size (such as one pound) can offset costs.
  4. Lure consumers and encourage orders with a higher profit margin by stocking unique products that may not be easy to find in Canadian stores. These can be offered in smaller quantities. Unique items can overcome online sales objections, such as shipping costs.
  5. Keep an eye on your local bulk food stores to maintain your originality and competitive pricing.
  6. Keep size and weight in mind when choosing your bulk stock. Bulk canned goods may seem like good idea, for example, but the shipping weight would make it cost prohibitive.
  7. Offer complimentary products for a full shopping experience.
  8. Never underestimate the competitive advantage of excellent customer service.
  9. Provide as much information as possible on your website. For example, a bulk herb business can provide information about natural healing with herbs. Information brings search engine traffic and allows your potential customers to research your products without leaving your website.
  10. Start a newsletter with helpful information, coupons, etc. A mailing list can bring customers to your website and is a proven way to increase sales and engagement.

There are easier businesses to start online that don't involve inventory. If you have your heart set on selling physical products online, however, bulk food has mouthwatering potential.