written by Sourish | March 26, 2021

Interested In Setting Up A Sweet Shop? Explained In 8 Easy Steps

If you are willing to start a business of your own then opening a sweet shop can be a good idea for a business plan. It will result in long-term profit. India is a country that celebrates a huge number of festivals throughout the year. The Indian community celebrates, greets guests, etc. with various kinds of sweets. Having a sweet shop of your own means that you’ll always be in business. You can look for these simple eight steps that can help you in opening a sweet shop:

The Eight Easy Steps to opening a sweet shop in India

Opening a sweet shop in India has never been this easy with steps we have laid down for you below

1. Getting the required capital

Before opening any kind of business, the main issue becomes the amount of money required. How much to contribute? Who will contribute how much? What will be the share of profit/loss? These kinds of questions may give rise to confusion. 

When it’s a single owner, then the responsibility of bringing money falls on the owner. On the other hand, if it is going to be a partnership then the responsibility will fall on the partners either equally or as decided among them. 

However, both options have their own sets of advantages and disadvantages. In the case of a single owner, he can enjoy the whole of the profit to himself but in the case of a partnership or Hindu Undivided Family, the profits get divided among the partners. Just like profit, the loss also gets divided in the case of a partnership. It is important to keep in mind that the partnership deed must be made only after proper guidance to avoid any future dispute.

The arrangement of capital must be made the priority as without this the business cannot be started. If there is any problem in arranging money from own funds, a loan can be taken. For example, in the case of the State Bank of India, the interest rate for a business loan is 11.20% (at present), but it may vary in the future.

Also Read: How to Apply Best Business Loan

2. Legal Formalities

A very important aspect of any business is to follow all the legal formalities as required. A proper certificate is required for every kind of food business and also businesses require a registration certificate, license certificates from the food authority, any special permission or certification as required by the tax authorities. 

For a sole proprietor in India, there is no strict formality as such. However,  the furnishing of 

  1. PAN Card, 
  2. Aadhar Card, 
  3. Bank account in the name of the business owner, 
  4. Adequate proof of the place of business, 
  5. Electricity registration is mandatory and 
  6. GST registration is only required at the time when the annual turnover crosses the threshold limit under the GST.

While in the case of a partnership it is important to make a valid partnership deed with certain other additional documents like electricity registration required at the time of registration. Also, the required documents of the business and the partners like their bank account details, PAN card, Aadhar Card, and also GST registration, are required if it crosses the threshold limit.

In case any confusion arises regarding the requirements of the documents then the advice of an expert must be taken to avoid any legal dispute and also you can check the government's official website to be sure about the required paperwork.

3. Deciding the location of the business

The location of the business place plays a huge impact on its success. If your shop is located in the middle of the city then there is a high chance that it will incur a huge profit. But keep in mind that this area will also have a higher rent or costlier to purchase, as the case may be. If it is situated much further away, then only a few people will come to know about the shop unless a lot of advertisement is done. But that will again increase the costs. 

Locations can be of three types- primary, secondary, and tertiary. 

  • Primary Location: The primary area includes schools, commercial buildings, colleges, malls, etc, which means that it includes all the busy areas of the city. 
  • Secondary Location: The secondary location may include areas that are not too far from the above-mentioned primary areas. 
  • Tertiary Location: The next one is the tertiary location which includes all the distant remote places. Hence this decision shall be made keeping in mind all the factors.

It may so happen that an area that is now less-developed may develop further. These kinds of places are ideal for opening a business. For example, if an apartment complex is being constructed or inaugurated then there is a high chance that any sweet shop near it will get more business and the profit margin will also increase.

Also Read: Top 10 Cities for Doing Business in India 

4. Market Research

This is one of the most important points before starting any kind of business. The market study shall be done to know the details about the business's competitors, their main business, their weaknesses, etc. If you visit the nearby sweet shops in the area where you decide to start your business, then you will get the idea of the operation of their business. 

Whenever possible, try taking notes about their way of doing business and whether they are following a particular trend. Making their weakness your strong point will give you an advantage. 

If you are opening the shop in your own brand name then you will have to incur a huge amount on advertisements. Whereas, if you want to partner with any well-known brand then the cost of the advertisement is less. But the other costs such as commission costs are increased.

5. Providing additional services

This can act as a game-changer for the business if used properly. Any kind of additional benefit like home delivery of sweets can build an even more good reputation for the business. You can also do a small survey or research among the locals as to what are the additional requirements that a customer wants from this kind of business.

You can also add unique and sweet messages or quotes with each sweet packet to build a connection with the customers. For example, some brands provide beautiful eye-catching messages with each of their products.

Also Read: Benefits of Digital Khata for Small Business 

6. Choosing from a lease or buy option

The next thing is to decide whether to buy a place for your business or to take it on lease. If there is any shortage of funds then you can go for the option to lease the place. On the other hand, you can choose to buy the place if you have enough  funds and only after taking proper care of the required documents. However, this option is usually better where the business is incurring huge profits.

Therefore, we can see that it might not be a very good option to buy a business place in the initial phases of the business. 

7. Human Resources

  • Good Bakers: The employees are an asset to every business. The quality of the sweets to be sold greatly depends on the person who makes them. Therefore, the business owner should look into this matter very carefully as this is one of the important factors that is should be taken care of. 
  • Polite Staff: It shall also be noted that though the product might not be of the best quality every time, it is the behaviour of the staff that will be remembered by the customers. It is totally in the hands of the staff to behave politely with the customers. The customers tend to get demanding sometimes but it is important to handle the situation carefully. Workers are also required in cleaning the place and a suitable person should be hired for this purpose.
  • Cashier and Delivery Staff: If the business owner cannot be personally present in the shop then a cashier must be appointed in their place. The cashier can keep a proper record of every income and expense of the business. If the business chooses to give a home delivery facility then a delivery boy must also be hired. Always hire workers as per your budget and the size of the business. 
  • Hiring: Therefore, it is very important to hire reliable workers, a brief interview of them will be suitable for this purpose. Matters requiring the details about their salary and allowances must be discussed beforehand to avoid any disagreement in the future.

8. Improvements

You can also expand your business after some time, from just sweets to other snacks and chocolates. Also your interactions with customers, may give an idea of what else you can offer them. 

The constant need for improvement is the key to running a business successfully. Every piece of information must be used for the success of the business. 

Before spending any amount of money on your business you should always keep your budget plan ready so that you do not overspend. A budgeted plan gives you an idea about how you should manage your expenses with your incomes. You can make plans either monthly, quarterly, or annually as per your requirements. 

Even after so many preparations, you should always keep a backup option ready in case the business does not go well according to your budgeted plan.

Also Read: Generate Extra Revenue with Bakery Business 

Let your dreams come true

Keeping all the points in mind, it can be concluded that India being a multicultural country can never be tired of celebrating festivities. Therefore it can easily be said that the want for sweets will never cease. We should always make a note to fulfil the demand for the most popular sweets in the place of our business.

For example, if our place of business is in Kolkata, then Kolkata's most demanding sweet, that is Rosogolla should always be available in our shop. The same goes for Modak in Maharashtra, Basundi in Gujarat, Palada Payasam in Kerala, and so on. Therefore, the fulfilment of the customer's wishes should be the first duty of every business owner.  

Frequently asked questions

Are bank loans easily available for these kinds of businesses?

Yes, loan are available but it also on the type of loan and on your assets and credit history.

What is the minimum amount of capital required?

It depends on the size of the business you are willing to open. Although the minimum requirement for even small business start from Rs. 3 lakhs.

How can I decide on the location of my business?

You can set up in localities where there aren't many sweet shops. You can also open in newly developing areas. 

Is it preferred to take the place on rent?

In the initial stage of business it is not advisable to buy the place unless you have the money for it.  

Are the legal formalities too complex?

No, they are just basic formalities required by every business. If you are confused at any stage, you can refer to consultants. 

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