Based upon a need to provide affordable groceries within a dim economy, salvage food retailers are coming to the rescue for many American families. Small stores are opening up in cities and towns near you, offering near-dated and distressed packaged name brand food at unheard of pricing.
Those entrepreneurs looking to fill this need are asking questions as many of them have little to no experience buying and reselling scratch and dent food. A reader of our business to business blog, The Closeout Industry, has a couple of questions before he opens his salvage grocery store:
Hello Robert, thank you for publishing Wholesale Liquidations Exposed. I just finished and am very impressed. I believe it will benefit me in a lot of ways, none more than avoiding some of the pitfalls you warn about. I do have three questions:
The Salvage Grocery section was awesome. The reason I was searching in this field was that I am exploring opening a salvage grocery. My question is about food stamps. I really need to be able to take them as this parish is very poor and it would greatly benefit. Do you have any experience in this area and if so, any advice. (I visited a salvage grocery store about 75 miles away and he said it was crucial to his business.)
Will 1000 sq ft be enough store floor space to start the Salvage Grocery? I am currently renting a lumber warehouse at the main intersection of our town where a hardware company used to be. The office area that was remodeled is where I want to put the store. It is about 19′ x 56′. It does have another 19 x 75 directly behind me that I can use for bringing in the pallets and sorting or, if necessary, I could incorporate it into the store. But it would need a new floor and ceiling if I did that. Let me know if you think a 19 x 56 is big enough to start.
PS: We’re in a rural area, the town has about 5,500 people and the parish (it’s Louisiana) has about 25K. The Walmart here also pulls in people from neighboring parishes. We have one other grocery store in town. We are on a main highway that has lots of traffic from 100K person city to the state capitol.
I would have to agree that accepting this form of payment is critical to the success of your salvage grocery store. Food retailers must apply to this merchant program much like you would apply for a standard Visa and Mastercard merchant account.
As I stress in our guide that you purchased, it would be best to round out your salvage food inventory with perishable food staple items including all dairy products along with fresh bread. In your local area it should not be difficult setting up accounts with perishable food distributors.
The Supplemental Nutrition Assistance Program, or SNAP, provides food assistance for an estimated 30 million US families per month. Eligible recipients use an electronic debit card to purchase food from grocery merchants much like a debit card.
Learn more about accepting food stamps (SNAP) as a retailer-
I believe you can get started in a small space, but you will begin to feel the stress of cramped quarters soon after opening in my opinion. Processing salvage food for retail merchandising is a daunting task that takes time and space. In addition, you will need storage for un-merchandised inventory awaiting placement in your store.
From my experience there were many times loads would become available that we could not take advantage of because we did not have the room to store anymore banana boxes of food that was not on our sales floor. We would combat this issue by renting railway storage containers and placing them out back in our receiving area. The containers would provide additional warehousing space for inventory. Often, containers can be rented for a nominal monthly fee. I would encourage you to look into this option.
If you can take advantage of more space I would go for it. Or better yet, is there a larger location you can secure? I wish you great success in your business, please keep us posted as time goes by. Our readers here would love to hear about your experience!
Further Posts about Salvage Food:
For further information, we recommend How to Open a Salvaage Food Grocery Store, which includes some of the nation’s top contacts for buying banana boxed truckloads.
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