It may not be as new and shiny as AI or AR, but let’s face it, we all need fruit and veg. It has been a staple in UK business for centuries, with whole towns and cities being built around the market square.
Times have changed a bit over the centuries, of course, and while the value of fruit and veg has decreased over time with competition from overseas producers, there are plenty of avenues to explore. Companies have made successes from selling organic fruit and veg boxes for local delivery, producing smoothies and running farm shops.
Take veg boxes for example. Interest in delivered grocery boxes was almost non-existent before the pandemic. Between March and April 2020, sales in veg boxes spiked by 111 per cent and interest has only increased in the years since with 85 per cent of veg box schemes implementing waitlists. Likewise, appetite for vegan plant-based boxes has also soared. According to Gousto, the number of people ordering plant-based boxes has doubled in four years, and now makes up a quarter of their deliveries.
It is an industry that requires some creativity to succeed, however. The rush for land suitable for housebuilding has pushed up land price. But if you have some land you can use already, this could be a good option to explore.
Jump straight to the relevant section or read on for the full details on starting a fruit and veg business.
- Why start a fruit and veg business?
- Fruit and veg produce growth trends
- Business opportunities for growing your own produce
- Who else has started a fruit and veg business?
- Small business expert opinion
Why is becoming a fruit and veg producer a good idea?
A 2022 survey from Lancaster University found that the UK had the potential to grow up to eight times more fruit and veg if urban and underused available space was used for production.
If this space was used, it concluded, the UK could satisfy up to 40 per cent of its fruit and veg consumption – most of which is currently brought in from overseas.
In fact, Britain doesn’t even import or export enough fruit and veg for the population to get five a day currently, according to research from Sustainable and Healthy Food Systems (SHEFS) research group. The analysis found the UK would have to import or produce 9 per cent more fruit and veg for the population to intake the recommended 400g of fruit and veg per day.
Around half our vegetable intake is imported, while 80 per cent of fruit comes from overseas.
That, together with a growing appetite to eat organic, local produce means there is an opportunity to profit from growing your own produce.
Fruit and veg produce growth trends
Organic produce trade has both thrived and remained resilient over the past decade. According to Statista, fruit production in the UK has almost doubled since 2010.
The current import value of fresh fruit is £3.9 billion, while the export value is £64 million. Annual expenditure on fruit in the UK sits at £10.5 billion, with £15.8 billion being spent on vegetables.
But it’s when looking at the organic fruit and veg trends where things start to look interesting. Organic sales rose for the 11th year in a row in 2022 despite the cost-of-living crisis, according to The Grocer.
It is reported that eight out of ten supermarket shoppers now buy organic. In total, £3.1 billion was spent on organics in 2022 – a rise of 1.6 per cent – and £8.5 million is spent on organic food and drink every day. This growth contributed to the 25.4 per cent organic food and drink sales increase over the past three years.
What fruit and veg producer business model opportunities are there?
To go down this path, you will need to become a certified organic farmer before you can call anything you produce ‘organic’. This is a process that could take two years if the patch of land you’re using hasn’t been used for organic farming before.
This process involves your premises to be visited by a government-backing body such as the Soil Association, who will audit your operations around a set of standards and principles. These include inspections on crop production, seeds for cultivating and yeasts used for feed.
The cost for the certification varies depending from the size of your land and what exactly you’re doing, but costs from £475 annually if you’re a small-scale grower.
There is help out there to help offset costs such as this, though. The government can provide funding through the Fruit and Vegetables Aid Scheme. To be recognised under the scheme, your business must have at least five grower members, have an annual turnover of €1 million and use ‘use environmentally sound cultivation practices’.
Once you do have the right certifications, though, you can look to sell your produce to local restaurants which pride themselves on using local ingredients, farmers’ markets (which will require a small fee for a stall), farm shops, cafes, festivals and even bars which use fruits and herbs for their cocktails.
Some ingredients will be bigger earners than others – and may take up less room, too. Asparagus, herbs, chillies and rocket are some ideas to get off the ground, while tomatoes, peppers and cucumbers are known as bankers for their demand and relatively high prices.
Online marketplaces like BigBarn allow producers to list or sell their produce and food markets like the Crystal Palace Food Market allow anyone to set-up shop and sell their produce as weekly guests.
You can always look to scale up by using your ingredients to make your own pesto, smoothies and chutneys, or even keep bees for local honey.
One area which is growing currently and could provide a profitable route is the production of organic plant-based powders for protein drinks. The protein supplements market is expected to increase from $25.2 billion (£20 billion) to $36.7 billion (£29 billion) by 2028.
Who’s already selling fruit and veg?
Small businesses that have turned their fruit and veg produce into veg box products include Abel & Cole. The Wimbledon-based company allow customers to tailor what they want in their fruit and veg box each week and deliver it on the same day each week. They are also eco-friendly, promising carbon-neutral deliveries and produce that is organic, seasonal and sustainable.
Another organic company is Riverford. The Devon-based business has grown exponentially over the last six years, with sales increasing by 50 per cent since 2018 and now delivers over 65,000 boxes a week.
Small business owner opinion
Cheltenham-based Slipstream Organics ask their suppliers what they have available that week, and then pick it up to include in their weekly veg boxes.
But because the prioritisation of housebuilding has put the price of land at an all-time high and a couple of years of land conversion is required before you can call something organic, starting from scratch is not advisable, says its owner, Nick McCordall. “The best thing would be to see if there is some college with some land you could work with or you could start up a box scheme or a farm shop on a family farm,” he says. “But there is definitely appetite from people within the suburb of a town who want a £13 box of mixed organic veg.
“Probably the best way is to start up a box scheme or do a farm shop so that the lettuce that you’ve got in your field – you actually get £1.50 for, instead of 50p wholesale. A box scheme aims to get the produce to the customer as soon as possible.”
An example McCordall gives is a farm shop on the edge of London which produces its own food and sells it as it is or in the form of café lunches.
“They had lots of land and they just got it together in as much as they had a café, a shop and enough foresight to make sure that shop was a good one and they started to understand there was a big demand from people in London,” he explains. “They got a butchery in there and the amount of money going through there with the organic meat was phenomenal because you’ve got people from London on good salaries that want the best food and are willing to pay for it. They were getting the retail price and it evolved into this rustic place to visit with a pizza oven and everything. It was amazing.”
There is a touch of realism that needs to sprinkled on this idea, though. “There’s definitely a market for it and there is an undersupply,” McCordall says, “but the market is only going to stretch so much with premium, the recession and to get produce to market so it isn’t too expensive and it’s organic, there are a lot of hoops of jump through. Really, you want to know a landowner or get a generous loan first.”
