How To Start A Homemade Chocolate Business?

Chocolate is a beloved sweet treat that appeals to everyone, whether young or old, rich or poor, man or woman, across all ethnicities and races. In fact, the popularity of chocolate can be judged by this quote that says “nine out of ten people like chocolate, the tenth person always lies”. Chocolate is everyone’s favourite form of expressing their feeling and the first thing that comes to mind while in the mood to celebrate, whether it is a small achievement or a big milestone or even to set the mood, given that it is one of the best known aphrodisiacs. Interestingly, statistics from a study report conducted in 2016 reveals that the amount of chocolate consumed in a year is approximately more than two hundred thousand tonnes of chocolate. These astounding figures just give an inkling into the massive popularity of chocolate, whether the commercial branded bars or the premium exotic varieties.

Since chocolate has so many takers and is a perennial favourite, getting into the chocolate business is a rewarding opportunity. Aspiring entrepreneurs who are passionate about chocolates, and are willing to spend time conjuring up mouth-watering chocolate delicacies and can think innovatively and creatively, must definitely consider getting into the chocolate making business. The biggest advantage of chocolate making business is that it does not require a large space for the business or even several equipment and can be started from home too using the basic utensils available, thus making it a feasible and ideal business option for women entrepreneurs as well as for those who want to initially start small and not invest much in to the business. The homemade chocolate business is a great idea that can bring in profits too, provided the entrepreneur is familiar with the basics of how to start a chocolate making business.

How To Start A Homemade Chocolate Business?

To begin with a homemade chocolate business plan, entrepreneurs need to be aware of certain basics which will help them flag off their business successfully and without any hurdles.

Research The Market

The first step to consider, while learning to start a homemade chocolate business is to research the market and the existing competition. The chocolate business is not a novel business idea and chocolates have been here for a very long time now, and there are already several established commercial brands like Cadbury, Nestle and Amul in the market. And giving competition to these brands are also several small, home grown chocolate brands that are taking up shelf space in supermarkets and grocery stores. Therefore, entrepreneurs must carry out market research to analyse what types of chocolates are already present in the market, their flavors, the pricing of the products, the packaging of the chocolates, etc. The market research must also include observing and noting down which types of chocolates are consumed more, what do the consumers look for while purchasing chocolates, what price range has more buyers, etc. as these factors will help prepare the entrepreneur and their homemade chocolate business for the market.

Make The Preparations

Once the market research is done, entrepreneurs need to check how much they know about chocolates and about making various kinds of chocolates. Entrepreneurs can even do a small professional course or class that does not require a significant investment in order to learn new skills, trends and technology in order to offer the customers exotic and unique chocolates. Along with acquiring or improving one’s chocolate making skills, entrepreneurs even need to prepare for the business in terms of purchasing the necessary equipment and inventory. The ingredients needed to make chocolate include cocoa, cocoa butter, chocolate compounds including dark chocolate, milk chocolate and white chocolate, sugar, full cream milk powder, lecithin, vanilla and cocoa liquor for liquor chocolates. Additionally, chocolates could even include fruits like cranberries, raspberries, raisins and nuts like almond, cashew, walnut etc. Some chocolates even have soft fillings which could include ganache, fruit compote, caramel, peanut butter, rice krispies, butterscotch and numerous other types of fillings and flavors depending on the creativity of the chocolate maker. Therefore, apart from the basic ingredients the other list of ingredients varies according to the skill and creativity of the chocolate maker. The list of equipment for a chocolate making business operating out of home can be arranged from home itself, however the utensils and equipment needed include, pots and pans to melt the chocolate in, spatulas, spoons and ladles to handle and temper the melted chocolate, various moulds to pour the chocolates in for them to form different shapes, a thermometer to check the precise temperature of the chocolates, a melanger to mix the ingredients for premium chocolates, a roaster if the entrepreneur will roast their own cocoa beans instead getting compound chocolates, wrapping paper and packaging material to make the chocolates look attractive and unique. This is the basic list of equipment needed to make chocolates at home.

While preparing for making the chocolates, it is important to allocate a separate area or timing in the kitchen for the preparation or create a separate station which is exclusively allocated for making chocolate. This separate timing and designated area is necessary so that the quality of the products prepared is not hampered nor are there any disturbances while making the chocolates. This also ensures that a standard quality of the products is established.

Create A Speciality Product

There are a number of chocolate varieties already present in the market, so for the entrepreneur’s homemade chocolate business to take off, the products must be unique and exclusive from the rest. This could be in terms of the shape or even the packaging, by making it more attractive and innovative. But the best way to create a niche is to develop a speciality product, which has a different taste, flavor or texture from what the market is already offering. Entrepreneurs could make unique flavors such as gulkand flavor, paan (betel leaf) flavor, any berry filling flavor or make chocolate cups such as caramel chocolate cups or praline or nut-butter cups or make almond chocolate brittles or chocolate rocks, with there being endless variations and varieties. It could be any unique chocolate having exotic ingredients, thus making them premium and one-of-its-kind, which will up its saleability and give the product its own identity and brand image. Entrepreneurs must however, remember to keep the recipes a trade secret because the recipes contribute towards the uniqueness of the products and help create a speciality product.

Procure The Permits

A business, even if it is a homemade chocolate business that is operated out of the entrepreneur’s home, requires certain licences and permits for it to operate. Some of the licences and registrations required for a chocolate business include-

FSSAI Licence

The Food Safety and Standard Authority of India or FSSAI is an important licence that is required for any business that deals with food, its manufacturing, processing and packaging. Therefore the chocolate making business too requires an FSSAI licence or registration, which depends on the scale of production and the annual turnover of the business. An FSSAI licence however is mandatory for a chocolate business and the criteria and further details regarding the licence can be found by downloading the FSSAI checklist. 

Business Registration

The chocolate business requires a predefined structure and also needs to be recognised as an identity of its own, and this can be achieved via the business registration, thereby recognising the business either as a sole proprietorship, a partnership, a limited liability partnership (LLP) or a one person company (OPC), depending on the choice made by the entrepreneur. Business registration is a must for the business to have its own identity and for it to be recognised.

GST Registration

The chocolate business needs to comply with the current taxation norms and in order to do that it needs to register for GST and acquire a GST number. This is necessary since the Goods and Service Tax scheme provides a uniform taxation structure across the country and the GST registration helps the business follow these norms.

Trademark Registration

When the entrepreneur will be concocting delicious and unique chocolates, the recipe or the packaging or branding must be unique and must be protected from not being copied by others. And in order to ensure this, the entrepreneur must apply for a trademark registration to prevent duplication of the product, the brand or the logo.

Trade Licence

The homemade chocolate business needs to apply for a trade licence before starting the business, in order to obtain an NOC from the local authority of the particular State the business is situated within.

These are some of the licences that a chocolate business must apply for in order to operate without any hurdles.

Arrange For Funding

The chocolate business, just like every other business, requires funding for procuring the various equipment and inventory needed for the business as well as to obtain all the necessary permits and registrations required for the business. The funding requirements for the business can be fulfilled either from the entrepreneur’s savings or it can be procured from banks or non-banking financial institutions in the form of loans. The need for funding must not be underestimated, assuming that it is a business being operated from home without the need for several equipment, because funding is required for future expansion of the business and also for the marketing of the business, apart from the funding for the actual production process.

Plan The Marketing

While learning how to start a homemade chocolate business, the marketing of the business is an equally important aspect that needs to be learnt. Only knowing how to make the chocolates and being aware of the equipment, permits and techniques required to make the chocolates is not enough, because in order to sell the products marketing too needs to be planned. The entrepreneur can either sell the products by participating in various fairs and food related events or they can supply the chocolates to local grocery stores or supermarket chains to display and sell their products. Alternatively, or even along with the above marketing methods, entrepreneurs can create an online selling portal such as website or via established e-commerce sites such as Amazon or Big Basket. Entrepreneurs can even spread the word about their products via social media networks such as Facebook and Instagram, which are great marketing avenues, especially for small scale businesses. The marketing is part of the chocolate making and selling business and must be planned well.

These steps help an entrepreneur be familiar with the process of making chocolates, such as the preparations and equipment required to make them, the licences and registrations required for the business and the funding and marketing strategies necessary for the business. For further queries or for obstacles faced at any point while preparing for and starting the homemade chocolate business, an entrepreneur can approach deAsra for assistance and guidance on starting a home business.