4 Food Business Ideas in Malaysia and How Much Do They Cost?
As an evergreen industry, food business would be the first choice for most people when they are starting a business because food is a necessary daily expense. Therefore, there would be plenty of business opportunities to explore. On top of that, the threshold to begin a food venture is also lower compared to other businesses.
Recently, we see that Malaysia has experienced a wave of entrepreneurship, especially in the food business. Numerous chain restaurants, bubble tea outlets, as well as food trucks, pasar malam stalls, online food delivery and so on sprung up like mushrooms after the rain.
There are many food business ideas to start in Malaysia and each option has its own advantages and disadvantages, as a food entrepreneur, how should you choose?
From our experience, cost would be a huge consideration. Therefore, we have sort out the cost of each option to help you make a decision. At the end of this article, we will also recommend a way to start your own food business in Malaysia at a very low cost.
Food Business Ideas (1): Cost to Open a Restaurant in Malaysia
If you tell anyone you are starting a food business, I bet the first reaction you’d receive from is, “You want to open a restaurant?”
It will then followed by its classic duo: “It’s so expensive to open a restaurant. Do you have so much money?”
Everyone claims that the initial investment in opening restaurants (or cafes) is very high. But just exactly how high it is? Let’s figure it out together.
First of all, are all the costs incurred due to legislation:
- Business Registration Fee (RM60)
- Insurance premiums such as public liability insurance, income insurance, fire insurance and so on (about RM900 per month)
- Food Handling License (RM150)
- If you are planning to sell alcohol, you also need a license for that (RM150)
Then there’s the fee for your site:
- Rent (depends on the location, for example, rent Publika is RM6000 per month)
- Basic renovation (RM50,000, price would be higher if you require more exquisite finishing)
You’d also have to furnish your restaurant with the following basic equipment:
- Furniture and kitchen equipment (approximately RM10,000)
- Water and electricity charges (roughly RM5000 per month)
- Wifi (RM349 per month for Unifi 100Mbps )
- POS System (RM59 per month, price of a well-known POS system company)
By now, the restaurant is ready. Next, we’re going to start the business.
Employee expense is a major part of operation cost:
- Recruitment fee (RM1000, for a job post on Jobstreet)
- Employee salary (RM1500 per person, as per market price of waiter, you can certainly offer higher)
- EPF (RM180 per person, based on a salary of RM1500)
- Other benefits (e.g. medical benefits, RM800 per person per year)
That is about RM20960 per employee per year.
And like all good business, you’ll need a marketing budget.
- Logo (RM200, some designers charge more)
- Signboard (RM5000)
- Business card printing (RM50)
- Flyer printing (RM70, A4 size, 500 sheets, one-sided)
- Website design (RM3500)
- Domain and hosting for your website (RM300)
All the above costs add up to nearly RM228,000.
Moreover, it does not include the cost of ingredients, liquid fund and expenses on some bits and pieces.
The figure below summarizes how much capital is required to open a restaurant or cafe in Malaysia.
If you choose to open a restaurant, you’ll have to consider whether you can afford it. You’ll also consider the source of funds. You could self-finance or partner with others to raise the fund. Other options are to borrow from your family or loan from the bank. If you borrow, you should keep in mind that parts of your profit will go into paying back the loan.
Option (2): Franchise Food Business in Malaysia
Lots of famous food brands in Malaysia are actually franchise chains. Examples range from well-known fast-food restaurants to local cafes to the recent craze of bubble tea stores.
The benefits of joining these chains are obvious.
First, the headquarter will arrange all the details of the upstream supply chain for you, including the ingredients.
Second, the brand’s popularity guarantees customers traffic to some extent. As long as your store is not in a place too remote, you will have no worries on customer source.
But there is always a but. The main drawback of franchise is the expensive franchise fee.
Secondly, you will also be restricted in some sense.
Also, even if you make no mistakes, the negative news from other franchisees may affect you.
Finally, you will lose your most important thing by joining a franchise, which is your talent, passion and rights to cook and make good food. The price you pay to join a franchise is to strictly abide by the procedures and regulations of the head office.
In terms of cost, taking the most popular bubble tea shop as an example, the startup fund will have to include the cost to open a restaurant as mentioned above and a franchise fee. From the official websites of some bubble tea brands, you need to prepare a capital ranging from RM300,000 to RM1,000,000 for your start-up costs. This would be extremely high if you are just starting.
F&B Business Option (3): Food Truck Malaysia Price
In some crowded places with parking spaces, you’ll see many nicely designed food trucks selling various kinds of delicacies. Salted crispy chicken, pasta, pizza, drinks, cakes and so on. Most of the food truck owners are youths in their 20s or 30s. Why do young people especially like to start a food truck business? The answer is simple: it’s cheap! Compared with traditional restaurants and franchises, the startup cost of food trucks is very low.
A reminder for you guys: You will still have to register your business if you are operating a food truck. Although you don’t have a store at a fixed location, you’re still running a business, so it’s necessary to register with SSM.
Next, let’s estimate what is included in the cost to start a food truck business in Malaysia.
- SSM registration fee (RM100)
- Local business permit from local authorities (RM500 per year)
- Food truck deposit (RM5500, assuming 10% from a total price of RM55,000)
- Monthly loan instalment (RM500 per month)
- Signboard and buntings (RM300)
- Kitchenware (RM4000)
- Typhoid immunisation injection (RM80. compulsory)
- Food Serving Course (RM200, compulsory)
- Food ingredients and packaging (varies for different businesses)
If you want your food truck business to go up a notch, you’ll need to do marketing. In this era of attention economy, you’ll have to fight for the eyeballs of your potential customers. Social media is the most common marketing strategy among mobile food truck business in Malaysia. You can choose to DIY or hire a social media marketing specialist to manage your account for you. The market price for social media marketing management is about RM3000 per month.
With this, the cost of operating a food truck, excluding ingredients, petrol, insurance and others, is a staggering RM11,000!
(For more info, please refer here)
Is there really no way to start a small home-based food business in Malaysia that doesn’t incur a huge upfront investment? Fortunately, the answer is : Yes!
Here’s how to start a food business from home at a cost lower than the price of an iPhone.
Best Food Business to Start in Malaysia: Join Food Beauty!
Among all the food business ideas in Malaysia, the best way to venture into the food business is by joining Food Beauty. Food Beauty’s main mission is to help ambitious, talented and determined food entrepreneurs like you to realise your dreams. Just send us your best food and we will take care of the rest.
It sounds like we’re looking for a chef, but it’s not! We are looking for business partners. We want to establish a long-term and mutually beneficial strategic partnership with you. You are your own boss, you own your own food business, and we are here to help you develop your business.
At Food Beauty, you don’t have to pay rent, hire employees, or do the selling yourself. We will help you sell your home-cooked food in Sungei Wang Plaza and through our own online channels. You just need to deliver your food to us before business hours every day. Our professionally trained staff will repackage for you and ensure that your customers are satisfied and happy.
This is a great opportunity for new food entrepreneurs. Firstly, as the starting cost is very low, you could own a business without any pressure and debt burden. Secondly, many entrepreneurs, especially solopreneurs, will find themselves wearing different hats at the early stage of their business. You will be torn between spending more times in making better food or putting more effort in marketing.
By joining Food Beauty, you won’t have this trouble any more. You will have a steady stream of customers while developing new menus. You could also adjust your menu according to customer feedback without wasting a lot of ingredients.
In addition, since Food Beauty has already taken the marketing works off your shoulder, you now have more time to learn other business knowledge. For example, you’ll learn how to manage profits and losses, how to manage inventory, how to manage time and a whole bunch of knowledge and experience that bosses need to master.
By now, I’m sure you are strongly interested in Food Beauty. You could turn your passion into income by selling your best food with Food Beauty. How great is that?
Contact us for more details. Just fill in your information in the form below and we will get back to you ASAP. Looking forward to hearing from you!
* Disclaimer: Food business ideas in Malaysia and the relevant data are only for reference purpose. We tried our best to provide the most accurate information. In the event of any discrepancy between the figures presented here and the actual figure obtained, the actual figure shall prevail.