Rice farming is labor intensive and requires certain soil
and weather conditions. An investor looking to make money selling rice has many
options.
The person could invest in haulage, re-packaging,
wholesale or retail. The market is huge and attracts good price in the open
market.
The distributor needs to find a ready source of the grain
and sell to retailers. The retail end only requires networking with wholesalers
of the commodity.
Stocking rice in large quantities is capital intensive
and you need funding. To start the business you need funding, good storage
facility and location. Other requirements are haulage, company registration,
casual labor and marketing.
Write
a Business Plan
Write a rice distribution and retail business plan. Then
carry out a feasibility study and survey. Make sure you have suppliers, storage
facility and transportation
Funding
for Rice Distribution Business
The capital requirements are huge because rice is
expensive. A wholesaler needs to stock several tons of the grain.
To rise funds apply for loans from a bank or financial
institution. Make sure the loan is long termed and has low interest rate.
Other funding sources are venture capitalist, angel
investors, cooperatives or core investors. You could form a partnership or borrow
from friends and family.
- bank loans
- venture capitalist
- angel investors
- cooperatives
- core investors
- partnership
- borrow from family
- Personal Savings
Warehousing
Warehousing is very important in the commodity trade. The
warehouse should be secured, easily assessable and dry. The storage facility
should be well aerated and have pallets.
Rice
Supplier
The main suppliers are local farmers, farmer markets or
huge wholesalers. Many Asian countries are destination locations for local
wholesalers. Try to network with farmers, warehouse and commodity markets.
Permits
and Licensing
In some countries importation of rice is banned. This is
usually a Government initiative to stimulate local production.
Therefore before venturing into the rice business find
out what is obtainable in your country. If importing rice is forbidden then
there is a good business opportunity in farming.
Find out the legal requirement applicable to your
country. Once you have the license, register the business as a limited
liability company. You need insurance cover and tax identification number.
Marketing
The price of your rice should be competitive and same as
those obtainable in the market. You could use credit supply for trusted
retailers, free delivery and discounts.
Other marketing strategy includes product sampling,
branding and promotions. Reach customers through television advertisement,
radio and print media.
Build a website and introduce the product, price and
location. Add contact information, telephone number and address of warehouse.
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