How to Start a Fertilizer Business Shop

Fertilizer Business Shop – There is no business more lucrative than starting a fertilizer business shop if you are living in a rural area. It is a great business because the demand for food and nutrition is increasing every day. Moreover, Indian population is also on the upswing.

Naturally, food products production must also go up. Fertilizers and agricultural products will forever remain in demand.

For opening the shop, it is essential you devise effective marketing strategy. Networking with reliable suppliers of high quality fertilizers is also desirable.

To give introduction of my expertise in the field, I passed my Bachelor of Technology in chemical engineering. Immediately, I started working for one of the leading oxygen plant manufacturers company in India.

Here I learned all about producing industrial gases for meeting the requirements of industries. After 5 years, I started working for a top-ranking fertilizer company in India. I left after working for 20 years. Then, I started working as a consultant for food and agriculture based industries.

With experience of over 25 years, I have deep knowledge of food processing and agriculture based industries. Coming back to open a fertilizer shop, it is quite easy and does not require big investment.  The starting capital needed for starting the business is around 3-5 lakhs.

And, it includes cost of buying inventory, renting space and numerous other expenses. However, it is imperative that you must build a reliable network of suppliers and farmers.

It is a fact that ideal location for setting a fertilizer store is in a rural area. And, you also need to have excellent network of transportation of goods. In the present article, I will give you all the details for starting the business from costing, licenses and marketing strategy.

Categories of Fertilizer Shops

Retail Fertilizer Shop

This type of shop offers wide range of agricultural products including organic & synthetic fertilizers and plant nutrients. It is ideal if such shops need high footfalls. It is better if it is accessible to the public.

Wholesale Fertilizer Shop

It is a shop that sells agricultural products in bulk to the farmers, commercial growers and other enterprises. However, such shops are mostly found in commercial areas of the city.

Online Fertilizer Shop

This type of shop provides wide range of fertilizers to customers through online orders. It has become popular because it delivers the products directly to the customers. Lower overhead expenses lead to the lower prices.

Specialty Fertilizer Shop

This is the kind of shop that sells just one type of fertilizer product. Mostly they provide organic fertilizers. You are likely to find such shops where people use such products.

Franchise Fertilizer Shops

Reputed fertilizer making brands provide the franchises to interested parties who run the stores. The brand provides the training for sales and marketing.

Agricultural Cooperative Shop

It is a kind of shop which a group of farmers set up with their capital for bulk purchase of fertilizers and they sell to the members at lower costs. Mostly agriculture industry uses to nitrogen gas plant for production and process.

Eligibility for Starting a Fertilizer Shop

For opening fertilizer store in India, you must follow the following conditions eligibility criteria and requirements:

Minimum Qualifications

For starting the store it is imperative that open a store you must have BSc in agriculture or chemistry.

Space Needed for Store

Space requirements for starting a fertilizer store are small. However, the minimum space must be between 80 sq. ft. to 120 sq. ft. And, it would depend on the type of store you would want to open.

Staff Required

Manager of the store takes care of the overall operations of the business. He will be responsible for running the operations. Moreover, he will also oversee the staff, manage the budget and maintain the stock supplies.

Ideal Locations for a Fertilizer Shop

It is imperative that location is accessible to customers. And, there should be high demand for fertilizer products. Following are the factors that you must consider for choosing a location:

  • It should be near agricultural land with high demand for fertilizer products.
  • Locations with high population density are likely to have greater demand.
  • It must be easily accessible through public transportation with sufficient parking.
  • Must be in a place which is easy to find.
  • Do a diligent research to find a suitable place.

Documents & Licenses Required

There are specific documents and licenses that you must possess for opening a fertilizer store. However, these might vary as per the laws and regulation in your area. Following are the common documents and licenses needed:

  • Registration of your business with the state or local government. You might have to file articles of incorporation.
  • Get an Employer Identification Number (EIN) and obtain registration for sales tax.
  • Obtain specific documents, permissions and licenses. Check with local administration regarding area-specific permissions and licenses.
  • Get land-use permit from the local government to ensure location is in commercial use zone.
  • GST registration
  • FSSAI registration

Overall Costing For Opening a Fertilizer Store

In order to open the store, you would need to invest a certain amount depending upon the location, size and type of the store. Some of the costs incurred in starting the store:

  • Cost of buying inventory
  • Cost of purchasing miscellaneous equipment such as display cases, cash registers, etc.
  • Investment for leasing or renting space
  • Renovation or construction cost foe setting up store
  • Payment for getting licenses and documents
  • Cost of promoting your business
  • Expenses for paying salaries of 1-2 staff

Investment for starting a store would primarily depend upon the scale and size. For a small store, it would come around INR 1.5-2.0 lakhs. For a big store, it would be around INR 5-10 lakhs.

Fertilizer Dealership Companies

Following is the list of top 10 fertilizer companies in India providing franchise fertilizer stores to the members of the public.

  • IFFCO (Indian Farmers Fertilizer Cooperative)
  • Kribhco (Krishak Bharati Cooperative)
  • Chambal Fertilizers and Chemicals Limited
  • Coromandel International
  • Nagarjuna Fertilizers and Chemicals Limited
  • Shriram Fertilizers and Chemicals
  • Gujarat State Fertilizers and Chemicals (GSFC)
  • Deepak Fertilizers and Petrochemicals Corporation Limited
  • Zuari Agro Chemicals Limited
  • Rashtriya Chemicals and Fertilizers Limited