In 2019, U.S. organic sales broke through the $55 billion mark, and they are just one fragment of the health food industry. A health food store of your own can indeed be a lucrative business.

However, this doesn’t mean it’s easy money. Before you get to reap the rewards, you will have to put in a lot of work. To help you get started, here are a few tips for opening a health food store.

Conduct Market Research

Before opening a health food store, you need to conduct thorough market research. You need to study local community demographics as well as the competition.

If there are already a few natural food stores in the area, you will have a hard time targeting local customers. To conduct market research, you can use data from the U.S. Census Bureau. It can also help you figure out who your target audience is.

Define Your Business Structure

You can choose to start an online business or a brick and mortar shop. You can even do both.

Rather than starting from scratch, you may have the option of buying an existing store. If you buy an existing health food store, you will have a known revenue stream and an existing customer base.

Another option is to join an established franchise. This way, you will have operating support and brand name recognition right from the get-go. The initial fees will be higher if you join a franchise, but this will allow you to avoid many risks that come with running a business.

Prepare a Business Plan

To achieve your goals, you need a concrete business plan. It should include an executive summary, financial projections, product description, company description, and market analysis.

Your business plan should also give an overview of your business goals. If you need some help with this step, check out the U.S. SBA’s guide for writing a business plan.

Register Your Business

You need to get a federal Employer Identification Number and a business license. The permits and licenses you need will depend on the location of your business.

Legally speaking, if you want to open an organic health food store, you are not required to have it certified. But, if you want to sell organic goods, you can get a third-party organic store certificate through organizations such as the CCOF.

Look for Natural Food Suppliers

Trust is of the essence in the natural foods market. For your health food store to thrive, you need to find reputable and trustworthy food suppliers. For instance, you need to make sure that the organic goods you sell are certified organic.

The same goes for all-natural foods. However, government regulations for foods labeled “natural” are fairly lenient. So, again, it’s a good idea to look for products that are certified by a reputable third-party agency.

To find a suitable supplier, you can search online directories such as WholeFoods Magazine or Organic Wholesale. Do know that price fluctuations are common in the health food industry. To protect your business, sign a contract that will secure long-term pricing.

Set Prices

In order to set prices, you need to research the competition. Generally, health foods tend to be more expensive than regular foods.

You don’t want your store to be too pricey, but you also want to avoid underpricing your products. Undercutting the competition seldom works out.

Consider the net profit margin of grocery stores in the U.S. if you don’t have local competitors. To cover expenses such as overhead and wholesale costs, you need to find the correct markup. You may need to enlist the help of an accountant for this.

Brand and Market Your Store

To stand out from competitors, you need a strong brand. Define what your company stands for and how you want others to perceive your store.

The next step is to start working on marketing and promoting your business. These steps can help you set your business apart from the competition. And you can’t brand, market, and promote your store without an online presence.

You need a website, and, ideally, a blog. You can use your website to showcase what makes your health food store unique. For instance, the Irish health food store chain Health Matters gives their website visitors the option to search health products by the ailments they can help cure.

Inventory Management

The inventory turnover rate for the average health food store is very high, so inventory management will be of great importance. It’s key to establish a consistent inventory tracking system.

It may be best to get a point of sale system that will automatically order and track inventory since the products you will hold will have a varying shelf life.