Challenges Faced By Food Tech Startups

By | November 25, 2017

When we heard word “Startup”; many words came into our mind like adventurous, technology, success, market, capital, creative, failure etc. The word itself is a combination of all this.  Anyone can start a food business with full planning and passion, but getting luck in an already crowded market is a difficult thing nowadays. Some startups are sustaining good while others are facing numerous problems and so they are struggling for traction. So let’s get started with Challenges Faced By Food Tech Startups.

Challenges Faced By Food Tech Startups |

While running a startup, one can face many problems that directly or indirectly affect whole business. The problems that food-tech startups face are –

Challenges Faced By Food Tech Startups

1. Product development process

Every startup wants something new to attract customers and so they focused mainly on developing a new product. Product development is not an easy process. It should meet all the standards set by regulatory bodies, it should be scalable. It comprises of a variety of ingredients with different process and prices and certificates. Food-tech startups fail to evaluate all these risks while creating the product and face many problems.

2.Lack of structure

A good business needs strong & healthy culture, clear goals, training for maximum utilization of manpower. Well established companies have all these things. But startups lack these things, therefore, they struggle for good culture, reasonable goals, and experienced leadership. These affect the turnover, manpower and overall business. So it’s a big problem for startups.

3.Food Quality 

The Food quality is an important quality characteristic required and acceptable to consumers. External and internal factors affect the quality. Proper hygiene and sanitation are required while manufacturing and presenting the food. Product traceability and good labeling also deal with the quality. So for good business one should be aware of all quality factors.

Check out How Cold Chain Management helps to maintain Quality.

4.Restaurant Selection

Now a day’s people are dining out often for business meetings, for spending quality time with loved ones and they preferred restaurants with good food, good ambiance and good hospitality. So it’s a big challenge for food startups to select right restaurants as every restaurant has its own specialty for which it is famous for.


Hiring a right candidate at the right place at right time is all required for the success of any startup. Both qualitative and quantitative aspects are taken into consideration while doing manpower planning. The company has to support, motivate and reward their employees, provide them healthy work culture as they are the one helps to achieve desired goals.

Challenges Faced By Food Tech Startups

Challenges Faced By Food Tech Startups | Source –


Food & beverage startups require a large amount of capital to get started. Underfunding creates a serious problem as unable to complete the customers’ requirements. Most startups are one or two men armies with the passion but because of lack of capital and manpower, they get failed. So, enough funding is very important.


We are living in an era of technology. Though its Tech world majority of people are unaware of this coming and going technologies. Most people don’t have internet connections, they don’t know about how to order food online and many new things that are changing the world. Hence educating the people about new technologies is the major challenge. 

8.Limited access to market insights 

Every startup must study market requirements before developing and launching a new product. Market research plays an important role in understanding consumers and shoppers trends. Fortune observed that “companies make a product that no one wants” this is the reason why most startup fails. As limited access to market insights will result into denying new products, startups must focus on this important point.

9.Essential brands and design mistakes

Branding is an important thing that you need to plan before launching the product in the market. 99% customers buy the products based on its visual appearance so; the company has to focus on its attractive packaging design and building a good brand. Both things will help to grow the company in the right direction.

10.Wavering profit margins

There is big competition in the market, in which a large number of producers competes with each other for attracting customers and earning more profit. So, many companies work on low margins and compromise with quality. It’s a big challenge in-front for startups to maintain quality while competing with price.

11.Discounts and offers

Discounts and offers get quick attention from customers. Shopping culture has changed and people are not purchasing unless they are getting a great deal. But this is not profitable for startup. So offering discounts and working on low-profit margin is difficult for startups.

12.Fierce Competition 

Startups are like a kid in a big market. They have to face competition as a major challenge as rival companies are in the market for many years and know the market better. Both B2B and B2C businesses feel this tough competition. To survive in this competition, startups always have to be careful and two step ahead for much-needed recognition.

So, keep in mind that, problems are everywhere but who can manage and find solutions can attain sustainable growth.  Because it is said that “If things are not failing, you are not innovating enough.”


Written By :
Pratiksha Supekar
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