Startup Idea: Starting A Cold Room Business
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Brief: If you are passionate about agri-business, then a cold room could be an excellent investment that you can try. It brings in passive income and will have a great impact on the lives of farmers in Africa.
One of the biggest problem African farmers have is storage of fresh produce. In effect, about 45% of fresh food gets bad because of lack of cold storage facilities. We all know that most Africans consume fresh and locally produced food more than packaged and processed foodstuffs.
It is no news that perishable fruits and vegetables start to loose its freshness the moment they are harvested. Most of us depend on these for a living. They loss their flavor, nutritional value, weight as well as appeal since they have been cut-off from their source of life. This leads to the fresh food thrown away as soon as it starts rotting off since the poor farmers or ‘buyam sellams’ (those who buy fresh food from farmers and resell in urban areas in Cameroon) lack cold storage facilities to preserve them in order to slow down the rate at which they deteriorate.
Solution – Cold Room Storage Facility
To reduce the post-harvest losses, you can invest in small solar-powered cold room given that most of these places where fresh food is produced lack electricity or have frequent power failures. You can place small solar-powered cold storages around markets or key agriculture areas. This will create for you a passive income stream. It will also have a huge impact on the lives of farmers who are the main beneficiaries.
The cold rooms could be installed in markets as well as farms. You can also provide farmers with plastic crates where these fresh produce could be put before stacked in the cold room. This will help keep the food for at least 2 to 21 days before it could be sold. This is food that would have been thrown away maybe after one day.
Cold Room Business Model
Farmers can subscribe on a monthly bases or pay as soon as they have something to store. This is a pay-as-you-store model which could be set at a daily flat-fee. After payment, farmers or ‘buyam-sellams’ can store their perishable foods neatly into the crates and stacked in the cold room.
Food Waste Reduction: Putting your perishable food in a cold room could extend its shelf-life from 2 to 21 days after harvest. This will reduce loss by about 80%.
Job creation: Those to manage the cold rooms could come from the community where it is based. This helps create jobs for that community.
The Business Model is Self-sustainable: You can get your ROI (return on investment) within the first year of operation. With solar panels, there is no need for frequent maintenance and a great assurance that it will work 24/7.
Increase Nutrition: The population, both urban and rural dwellers will have nutritious food on the table. This is especially good for children.
Farmers’ Income: Farmers will get more income especially as they will not have to throw away fresh food after they could not sell in the market. This can increase their annual income up to 25%.
Cold Room Resources
I did a research online and got some DIY cold room designs that can be cost-effective for those who might be interested in running a cold room business. Check out the links below:
Cold rooms in practice: ColdHubs
If you are interested in this business model and need a detailed business plan, don’t hesitate to get in touch with us Email: firstname.lastname@example.org or call +237 699 421 947.
Have you tried a cold room business before? Share your ideas with us below in the comment section. Do not hesitate to share this article with others. It can change a life.