Skip to Content

How to Start an Indian Grocery Store

India is well known as the land of spices — and that’s for valid reasons. Have it in mind that most of its cuisine depends massively on saffron, cardamom, red chili, black cumin, and other spices that are cherished globally owing to their unique flavors.

Owing to that, starting and operating an Indian grocery store can be quite lucrative and exciting. If you are someone who relishes ethnic cuisine, then you should consider opening an Indian grocery store.

These stores are known to sell Indian foods and spices, often providing a wide array of otherwise niche and hard-to-find items coupled with an assortment of local products. A good number of these stores also sell prepared foods as well as boxed goods.

Steps on How to Start an Indian Grocery Store Business

  1. Conduct Market Research

Same as with all other business enterprises, you need to carry out extensive market research as this will ensure that you can properly define your target audience. Begin by finding out everything you can regarding the market, your intended demographic, and potential competitors.

To attain success in this line of business, you need to source and carry the right products. When patrons are seeking Indian ingredients or spices that are barely found in normal retail outlets, they start searching for specialty stores, and this is where your business comes in.

a. Who is your target audience?

The target market for an Indian grocery store will be any community where there exists no Indian store already or demand is growing.

Indian dishes are known to be mostly based on vegan and vegetarian food ingredients, but some also contain poultry or fish. Spices and herbs are massively used in most meals. It simply entails that your target audience will be vegans and healthy eaters in general.

Aside from that, Generation Z and millennials are rapidly moving away from the norm, preferring specialty foods and beverages.

Have it in mind that both generations are always willing to try authentic multicultural flavors, particularly meatless meals, and ethnic foods. When put in comparison with older generations, they tend to focus more on food quality and don’t mind spending on healthy snacks and dishes.

b. Is the Indian Grocery Store Business a Profitable Business?

Yes. Ethnic foods according to reports have enjoyed massive popularity, particularly among millennials. As of today, there are over 44,732 ethnic supermarkets in the United States, with an annual revenue of more than $40 billion and about 190,000 employees.

c. Are There Existing Niches in the Industry?
  • Online Market
  • In-store cooking classes
  • Takeout Services
d. Who are the Major Competitors?
  • Indian Grocery
  • Patel Brothers
  • Instagolocal
  • iShopIndian
  • Zifiti
  • Vedic Pro
  • Grocery Babu
e. Are There County or State Regulations or Zoning Laws for Indian Grocery Store Businesses?

Yes. Although this will mostly depend on where you intend to locate your store in the United States. Note that you might be expected to obtain certain business licenses and permits from your state, county, and local government. Along with general operating licenses, there is a wide array of other business licenses that are necessary for selling groceries.

f. Is There a Franchise for Indian Grocery Store Business?
  • Truemart Supermarkets
  • Big Mart
  • India Bazaar
  • Patel Brothers
  • Hyper Supermarket
  • Batala Supermarket
  • Marche Ricxman
g. What Do You Need to Start an Indian Grocery Store Business?
  • Efficient vendor
  • Viable market
  • Industry knowledge and experience
  • Adequate capital
  • Time management
  • Good communication skills and awesome customer service
  • A business plan
  1. Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable. Some of the catchy business name ideas suitable for an Indian grocery store business are;

Creative Indian Grocery Store Business Name ideas
  • Namaste Flair
  • Bardezshop
  • Curry Zone
  • Indimoon Market
  • Kera Grocery Store
  • Soul Veggies
  • Indian food web
  • Spice and Herb
  • Mangalor Lounge
  • Verlish
  • Punjab Nation
  • Dorishop
  • Goan Store
  • Hanady Shops
  • Mirabais Market
  • Indiemagic
  • Yndshop
  • CoreIndieStore
  • PureStoreIndigo
  • Shiva Stores
  1. Register your Business

a. What Type of Business Structure is Best for Indian Grocery Store Business?

There are numerous options to consider when looking to select the ideal business structure for your Indian grocery store. It is possible to start off as a sole proprietorship, which means you and the business are one, and your personal assets are not shielded if there are any financial liabilities.

Aside from that, if there is a lawsuit against your business, your personal assets are not protected. Nevertheless, you can choose to go for the LLC, particularly since it offers the following benefits:

  • Protected assets
  • Heightened credibility
  • Limited compliance requirements
  • Flexible management structure
  • Few restrictions
b. Steps to Form an LLC
  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.
c. What Type of License is Needed to Open an Indian Grocery Store Business?

It is important you understand that the license and permits you will need will vary depending on your state or location in the United States. Nevertheless, you’ll require the following licenses in most places.

  • Business License
  • Zonal permit
  • Sales Tax Permit
  • Driver’s License
  • Retail Merchant License
  • Resale Certificate
d. What Type of Certification is Needed to Open an Indian Grocery Store Business?
  • Retail Management, Certificate
  • Certified Advertising Specialist (CAS)
  • Certified Sales Professional (CSP)
  • Certified Food Manager (CFM)
e. What Documents Are Needed to Open an Indian Grocery Store Business
  • Federal tax identification number
  • Business plan
  • Resale certificate
  • Business name registration certificate
  • Insurance certificate
f. Do You Need a Trademark, Copyright, or Patent?

In this line of business, there is a possibility that you wouldn’t have any need to register a patent, trademark, or copyright to protect the products and services you offer to patrons. Nevertheless, you might want to protect company features such as your business name and logo.

Since your brand name and logo are some very vital components of your brand and business, you might consider protecting them with copyright and trademark filings.

  1. Do your Cost Analysis and Budgeting?

a. How Much Does It Cost to Start an Indian Grocery Store Business?

Truth be told, you will need substantial capital to start and operate an Indian grocery store. This is because you will have to obtain or rent adequate space as well as stock your inventory. You will also have to pay for things like shelves, equipment, computers, and even websites especially if you have plans to sell online. Ideally, it will cost around $50,000 to $300,000 but will majorly depend on the size of the business.

b. What are the Costs Involved?
  • Initial inventory: $22,700
  • Equipment like upright freezer and cooler doors, carts, RFID scanners, etc.: $10,000
  • Shelves and display units: $650
  • Cash register, computer, and other office equipment: $1500
  • Working capital to cover initial costs for lease, insurance, payroll, and extra cash: $10,000
c. What Factors Determine the Cost of Opening an Indian Grocery Store Business?
  • Size of Store
  • Equipment
  • License and Permits
  • Branding, Promotion, and Marketing Plans
  • Insurance
  • Supplies and Ongoing Expenses
d. Do You Need to Build a Facility?

Yes. An Indian grocery store requires massive retail space with adequate visibility and foot traffic. There is a good chance that commercial landlords will be eager to work with you, offering excellent properties at attractive leasing terms. Nevertheless, note that it cost around $77.06 per square foot to build a big grocery store facility.

e. What are the Ongoing Expenses for Running an Indian Grocery Store Business?

There is a wide range of ongoing expenses that come with running an Indian grocery store. Have it in mind that a good number of those have to do with the maintenance of the space and purchasing inventory. Truth be told, it can be quite daunting to manage inventory loss in an Indian grocery store.

For instance, if fresh products are not sold in time, it can bring about massive losses to the business. Owing to that, most successful enterprises build in specific loss values as a component of ongoing expenses.

f. What is the Average Salary of your Staff?
  • General Manager: $35,000 per year
  • Human Resources and Admin Manager: $32,930/Year
  • Cashier: $9.20 per hour
  • Store Clerk: $32,000 per year
  • Security: $21,340 per year
g. How Do You Get Funding to Start an Indian Grocery Store Business?
  • Business loans
  • A business line of credit
  • Friends and family
  • Angel investors
  • Crowdfunding
  1. Write a Business Plan

a. Executive Summary

Raaja Kasthaan is a new Indian grocery store in Bombay, New Jersey, that will provide a vast range of Indian groceries and goods sourced from varying brands.

We intend to provide every Indian food our clients can imagine, from freshly fried chana masala to cumin, dals, spice blends, and chapatti. We also intend to offer self–service options and delivery options and ensure that all our outlets provide varying payment options.

We will always work to ensure that all our customers relish the first-class treatment we offer whenever they visit our grocery store

 b. Products and Service
  • Different types of lentils, such as massor dal, urad, and toor
  • Cumin seeds and cumin seed oil
  • Dried fenugreek leaves (kasuri methi)
  • Tandoor masala
  • Garam masala
  • Turmeric
  • Cumin
  • Paneer (a traditional cheese)
  • Black mustard leaves
  • Gram flour
  • Baked chickpea flour (sattu)
  • Assorted spices
  • Sona Masoori rice
  • Assam tea
c. Mission Statement

Our mission at Raaja Kasthaan is to become the people’s choice for fresh and original Indian groceries in the United States, offering a vast array of high-quality products that will most definitely align with the needs and preferences of our customers. We will work every day to provide a seamless shopping experience and top-class customer service.

 Vision Statement

At Raaja Kasthaan, our vision is to grow to become the go-to Indian grocery store in the United States, where patrons can find everything Indian. Our aim is to cultivate an enticing environment that buttresses the vibrant Indian culture, and at the same time satisfies the diverse culinary needs of our customers.

d. Goals and Objectives
  • Provide authentic products
  • Customer satisfaction
  • Cultural appreciation
  • Community engagement
  • Sustainability
  • Expansion and growth
  • Employee development
  • Operational efficiency
  • Strong vendor relationships
  • Customer loyalty and retention
e. Organizational Structure
  • General Manager
  • Human Resources and Admin Manager
  • Cashier
  • Store Clerk
  • Security:

Marketing Plan

a. SWOT Analysis
  • A vast array of fresh and original Indian products that will meet the needs of diverse customer preferences
  • Top-class customer service and personalized assistance
  • Great emphasis on cultural appreciation and education
  • Vibrant community engagement and support
  • Magnificent possibility for expansion and growth
  • Properly trained and knowledgeable workers
  • Properly cultivated vendor relationships
  • Constrained geographic reach and prospective client base
  • Comparatively higher prices especially when compared to traditional grocery stores
  • Issues with sourcing certain specialty items
  • Reliability on external factors such as market trends and customer demands
  • Increasing prevalence of ethnic cuisines and a wide range of food options
  • Growing demand for fresh, original, and high-quality products
  • E-commerce possibility to reach a wider customer base
  • Partnership with local restaurants and businesses for cross-promotion
  • Massive competition from many other Indian grocery stores and traditional grocery stores
  • Price sensitivity and other financial constraints that will impede customer spending
  • Ever-changing consumer preferences and food trends
  • Issues with sustaining and maintaining consistent product quality and availability
  • Modifications in government regulations and trade policies
b. How Do Indian Grocery Store Businesses Make Money?

These businesses generate revenue by selling foods at a higher price especially when compared to what they paid to acquire them. They more or less obtain products from distributors in the area and markup prices to profit from patrons.

c. Payment Options
  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards/Point of Sale Machines (POS Machines)
  • Payment via online bank transfer
  • Payment via mobile money transfer
d. Sales & Advertising Strategies

You need to understand that advertising an Indian grocery store begins with making sure that every product you offer is of high quality. Aside from that, there might be a need to let people know what you sell by leveraging sales and outreach programs.

Also take into consideration online promotion and branding, particularly in situations where the locals might possibly not have that much experience shopping at Indian grocers. Have it in mind that it is a viable way to educate the public on your offerings and also to entice them to learn to cook.

Financial Projection

a. How Much Should You Charge for your product/Service?

Note that how much these businesses charge varies depending on the item. Nonetheless, always make sure you price your products using what it cost to purchase them in addition to a profit margin.

b. How Much Profit Do Indian Grocery Store Business Owners Make a Year?

Same as with what these businesses charge for items, the profits they make will also vary based on the products themselves. Have it in mind that all the products in these stores tend to have their own specific profit margin protection ranging from 5% to 25%. Prepared foods might very well be a profitable avenue in some areas.

c. What Factors Determine the Amount of Profit to Be Made?
  • The size of the establishment
  • The local market
  • Business management style
  • Marketing and advertising plans
  • Branding and credibility
d. What is the Profit Margin of an Indian Grocery Store Business?

Just as was noted above, all the products in an Indian grocery store tend to have their own specific profit margin ranging from 5% to 25%.

e. What is the Sales Forecast?
  • First Fiscal Year (FY1): $60,000
  • Second Fiscal Year (FY2): $180,000
  • Third Fiscal Year (FY3): $522,000
  1. Set Up your Shop/Office

a. How Do You Choose a Perfect Location for Indian Grocery Store Business?

The issue of location is one to take seriously when looking to start an Indian grocery store. Note that the fewer competitors there are, the easier it will be for your Indian grocery store to sustain your prices and grow your enterprise.

Truth be told, it wouldn’t be wise to open an Indian grocery store in an area with an existing branded store. Ideally, you have to understand that geographic locality impacts rental prices. For instance, locations with an encouraging density of visitors will have very high rents.

Same way, lower rent-paying locations might possibly not furnish you with the foot traffic you need to attain success. Don’t forget that affordable rent along with a valid number of customers will guarantee business success for your store.

b. What State and City is Best to Open an Indian Grocery Store Business?

The best places to open an Indian grocery store are locations with a high Indian population or places with a high concentration of Generation Z and millennials who are rapidly moving away from the norm, preferring specialty foods and beverages. Owing to that, here are the best cities to open an Indian grocery store.

  • Fremont, CA
  • Honolulu, HI
  • Sunnyvale, CA
  • Santa Clara, CA
  • Irvine, CA
  • Garden Grove, CA
  • Bellevue, WA
  • San Jose, CA
  • Torrance, CA
  • San Francisco, CA
c. What Equipment is Needed to Operate?
  • Box Cutters
  • Display Signage
  • Shelving
  • Upright Freezer and Cooler Doors
  • Walk-in Coolers and Freezers
  • Grocery Shopping Carts
  • Stock Trucks and Carts
  • Open Air Merchandiser Display Coolers and Freezers
  1. Hire Employees

It is indeed very possible to start a small Indian grocery store with only a few employees, but over time, there will be a need to recruit additional staff as more people start patronizing your store. If you can, go for employees who understand what the customers want, can speak their language, and is from the same locality.

  1. Launch the Business Proper

In this line of business, you have to understand that your brand is what your company represents, along with how your business is seen by the public.

Note that a strong brand begins from the very first day you open your doors for business. Ensure to soak yourself in the industry for some time. Take your time to learn to cook authentically. Also, put in the work to understand the Indian culture as well.

Note that all these will fit you with the skills you need to sell to customers who already know the industry and culture well.

a. What Makes an Indian Grocery Store Business Successful?

What makes an Indian grocery store successful is its ability to draw in customers. Note that drawing in patrons entails spending time on promotion and cultivating local relationships. Aside from that, offering a top-class level of service as well as good quality products on a consistent basis will guarantee that customers will always want to come into the business time and time again.

If you can achieve these, note that word-of-mouth advertising will ensure that your business stands the test of time. Don’t also forget social media and digital marketing strategies.

b. What Happens During a Typical Day at an Indian Grocery Store Business?

Ideally, a good part of your day will be spent working with customers. This might as well include stocking shelves with products, helping customers to ensure they find what they want, and processing sales.

A good number of Indian grocers are known to possess food prep in their stores, and this entails more work especially when it comes to preparing these foods for local carry-out or in-store purchase. In addition, you will have to put up with cleaning up and maintenance, product ordering, and customer service to provide daily.

c. What Skills and Experience Do You Need to Build an Indian Grocery Store Business?

To attain success in this line of business, it’s pertinent you possess a very comprehensive understanding of both Indian food and culture.

Note that patrons who visit your store will anticipate finding quality and a wide assortment of fresh and original Indian foods. Aside from that, individuals who work in this business would need to be conversant with Indian culture and capable of satisfying the needs of their target customers.

It is also very necessary to possess a strong customer service background and the capability to negotiate good prices for products coming into your location.