With the rise of organic food products as a food trend, many families are preparing their own jams, jellies, and peanut butter. Consumer data suggests that alternatives to peanut butter are becoming more popular as well. This means that, with the help of eCommerce and modern marketing techniques, you can turn the process of making your favorite creamy nut butter into a successful business. In this article, we’ll elaborate on the different types of nut butter businesses you can start and how to succeed in the food preserves and spreads market.
Different Types of Nut Butter Businesses
Natural and Organic Nut Butter
Establishing a brand of all-natural nut butters requires sourcing the right products. This means they have to be bought by certified producers. Health-conscious customers are looking for various products that are made by small, local, and organic-oriented companies. Winning these clients means they will choose your products for years to come.
Specialty Nut Butters
Even though peanut and almond butter are the most popular ones, there’s a large variety of other kinds on the market. A nut butter business that specializes in unorthodox products can find a not yet filled market niche. For example, you can produce unique flavors like spicy pecan butter or cinnamon-almond. Experimenting can prove to be an extremely profitable strategy in the nut butter business.
White Label and Wholesale Nut Butters
If you have the production capacity, companies might consider outsourcing that part of their business to you. That way, you don’t need to handle things like marketing your own brand or dealing with retail packaging. Instead, you just produce wholesale peanut butter or other alternatives to companies that later sell it to retail customers.
Nut Butter Subscription
Culinary enthusiasts, peanut butter enjoyers, and even parents might benefit from a subscription service for different types of nut butter. If you decide to start a business like this, make sure to offer different subscription types as customization is key. Check out our comprehensive guide on how to start a subscription box business.
Nut Butter Bars
Both athletes and health-conscious customers enjoy nut butter bars. They are extremely nutritious and full of proteins. Additionally, the butter is acting as a binding agent between the other ingredients so they can be an on-the-go snack or consumed after a workout.
Nut Butter Bakery
Baked goods will always be popular for every meal of the day. They are both filling, delicious, and cheap. That’s why a nut butter business that specializes in baked goods is an evergreen idea. Some popular pastries to offer include muffins, brownies, cookies, and cakes. You can check out our guide on starting a bakery business as well as an article about the additional aspects of the bakery business.
Nut Butter Food Truck
Peanut butter and jelly sandwiches are enjoyed by everyone. That’s why it can be profitable to open a nut butter cart or food truck business. You can also offer alternative butters in order to upsell customers. Additionally, you can participate in festivals, farmers’ markets, and other events where you can offer both snack and nut butter products to customers.
Key takeaway: Nut butters can be a profitable business that can be started with a very small capital investment and from home. There are different types of businesses related to nut butters such as peanut butter food trucks and nut butter bakeries.
Nut Butter You Can Make at Home and Sell
Selling nut butter that you’ve made at home is subject to cottage food laws that vary in different states. Selling homemade cookies, nut butters, preserves, or different types of canned food at farmer's markets is possible even without having a commercial kitchen. However, since nut butters are low-risk food products, they don’t need extensive licensing to be produced. Here are some of the popular nut butters that you can make at home and sell:
- Peanut butter;
- Almond butter;
- Cashew butter;
- Walnut butter;
- Pecan butter;
- Pistachio butter;
- Macadamia butter;
- Different types of seed butters. Even though they aren’t, strictly speaking, nut butters, seed butters are becoming increasingly popular as well. The most popular kinds are sunflower seed, pumpkin seed, sesame seed, hemp seed, and chia seed butter.
Frequently Asked Questions about the Nut Butter Business
Starting a nut butter company requires a lot of research and you probably have a lot of questions before you start on that journey. Below you will find some of the frequently asked questions regarding starting a nut butter business.
What Is the Process of Starting a Nut Butter Business?
Starting any type of business can be broken down into a few steps. That’s true for a nut butter business too.
- Research the nut butter niche and write a business plan that includes competition, target marketing, pricing, marketing strategies, operations, and financial projections.
- Think of a brand name that is not too narrow and can be used if you decide to grow the business towards jams, jellies, or other types of nut butter businesses. Create a logo and branding elements for marketing materials.
- Find suppliers of ingredients. This includes not only nuts, but also sweeteners, preservatives, and flavoring.
- Find equipment and space where you can create nut butters. If your initial capital is lower, consider finding used equipment and machinery.
- Check with local regulators and health agencies regarding the necessary permits. Make sure you comply with cottage food laws.
- Create attractive packaging. It should catch the customer's eye. It’s also important what’s on the inside. Consider developing both traditional and creative nut butter recipes.
- Pricing and marketing are an integral part of a nut butter business. While your brand is not recognizable, consider offering more discounts and promotions.
- Adapt and change when needed. Every business should adapt according to the market’s needs.
Is Starting a Nut Butter Business Profitable?
Yes, starting a nut butter business can be a very profitable endeavor. The profit margins in this sector are around 40%. However, they can be higher if you offer organically-grown and eco-friendly products. Another reason why you should consider starting a nut butter business is the fact that it doesn’t take a lot of time to produce these products and sell them.
How to Grow a Nut Butter Business?
There are many ways a nut butter business can be grown. Here are a few growth opportunities to consider:
- Start offering different types of nut butters. If you already have the equipment to produce and sell nut butters, consider offering different nut butters as well. That way, your customers will have alternatives and you can even use that as an upsell technique to a more expensive type.
- Start offering jams and jellies. Selling jam and jelly wholesale or retail can be profitable as well. Additionally, clients that buy nut butters from a small business will be interested in buying jams and jellies too. If you choose this path to grow your nut butter company, make sure to research how to start a jam business and the equipment needed for it.
- Offer nut butter subscription service. Nowadays, people wish to automate as many things as possible. That’s why a peanut butter subscription box might be a great business idea.
- Organize nut butter workshops and other experiences. These can be fun activities for families. You can show them how nut butters are made in your facility and give them the chance to produce their own peanut butter.
What Investment Is Needed to Start a Peanut Butter Business?
Anywhere between $500 and $100,000. The good thing about starting a nut butter business is the fact that you can do it with limited capital. Literally, in the beginning, you can manufacture nut butters at home. However, you should do research related to the regulations on selling homemade nut butters and food items in your state.If you decide to buy machinery and equipment, the cost of that will be around $100,000. But that will give you the opportunity to increase the production capacity drastically.