How to Start a Spice Business

Throughout most of recorded history, commerce has revolved heavily around spices. Soldiers in ancient Rome were often paid in salt (hence the word "salary"), and when the Visigoths captured Rome, they demanded a ransom paid in pepper. In fact, the silk road between Europe and China had almost as much to do with the spice trade as it did with silk. The demand for spices has ignited wars, and early explorers sought spices as much as they sought gold.

Fortunately, spices are easier to come by than they used to be. Still, they pose a great business opportunity for people wanting to start their own business. You can grow spices yourself, mix your own brands of spices or resell spices bought at wholesale for a profit.

Production Opportunities in the Spice Business

One way of getting into the spice business is to start from the ground up by farming your own spices for resale. This will depend on your location and obviously will require some land. Before deciding to start making spices, you should carefully research the requirements for growing them and for what you are likely to be able to sell them. Some of the most common spices in the world include:

  • Cinnamon: $6 per pound. This is from the bark of the Cinnamomum tree and is grown in countries such as Sri Lanka, India and Indonesia.

  • Clove: $7 to $10 per pound. Native to Indonesia, the clove plant is also grown in Madagascar, Pakistan and India.

  • Cardamom: $30 per pound. Both black cardamom and green cardamom are grown primarily in India.

  • Vanilla: $50 to $200 per pound. Although many companies make artificial vanilla, real vanilla is grown primarily in Mexico and Madagascar.

  • Saffron: $1,600 to $5,000 per pound. Saffron comes from the stigma of the saffron flower, which is native to Central Asia. 

While none of these spices are common in the United States, saffron in particular could represent a good opportunity. Unlike the other spices listed, saffron can be grown in most of the United States, and there are saffron producers located even in Canada. Harvesting can be time consuming, as each small saffron flower has only three stigmas for saffron, and you will need about 80,000 flowers to get 1 pound of saffron. A good market for saffron is local restaurants and specialty food stores.

Franchises and Turnkey Business Websites

If you want to sell spices to consumers, there are two ways you can go. You can open a retail store or sell spices online. While you can certainly do this yourself from scratch by finding your own wholesalers and developing a client base yourself, you may also want to consider buying or buying into someone else's established business.

There are franchise opportunities available for spice stores, or you may be able to buy a store outright. In October 2019, Smergers had over 40 opportunities for buying a spice business, including retail stores and existing websites. Of course, research is key. Before investing, make sure you understand how well or poorly the current business is doing so you can gauge how quickly you can make back your investment.

Licensing and Registration

Before starting a spice company, you will need to ensure that your business will conform with local and state laws and regulations. In addition to a business license, some places have specific requirements for producing food or food products, including home businesses. Depending on the nature of your operations and the size of your business, you may also need to register with the Food and Drug Administration.

If you are harvesting or mixing spices, you may not need to register with the FDA, but if you are processing spices, including chopping them, you may need to register. Additionally, because you are selling products to be eaten, you will need to research FDA food labeling requirements, although this shouldn't be an issue if you aren't mixing artificial flavors into your spices.

References

About the Author

A published author, David Weedmark has advised businesses on technology, media and marketing for more than 20 years and used to teach computer science at Algonquin College. He is currently the owner of Mad Hat Labs, a web design and media consultancy business. David has written hundreds of articles for newspapers, magazines and websites including American Express, Samsung, Re/Max and the New York Times' About.com.