How to Start Coffee Café Business in India?

Cafes are popular and well-known businesses in India which people visit to spend some time with friends, family. It is a great place for businessmen and individual who want to a quiet and a peaceful place to work. In order to start a café in India, the businessman must obtain several licenses from the Government. In this article, the process of obtaining all licenses will be discussed which are required to start a coffee café in India.

What factors must be considered to start a coffee café in India?

If an individual wants to start a café, he must follow all of the rules and regulations that are stated by the authority.

Below mentioned are certain factors that must be considered while starting a coffee café –

Location

An ideal location for a café is crucial for the business in the long run. It is important to choose a place that has the maximum chances of earning profits to the café.

Unique Selling Proposition (USP)

A USP is defined as an aspect that differentiates a business from other businesses. There are multiple cafes in India which makes the industry very competitive. Hence, it is important for the business owner to have a unique selling point. He must have a business plan that differentiates his business and explains the target customers as to what makes his café different other coffee places.

Marketing and Financing

The business must have a strong marketing strategy that attracts target customers. They must think of new and innovative ways to promote their products through social media.

Arranging adequate finance for the business is important because a certain amount of investment is necessary for the business to get started.

What licenses must be acquired by the café business before business incorporation?

Acquiring licenses before undertaking business activities is crucial. Thus, below mentioned are some registration which must be acquired by the coffee business.

Company Registration

Registering a company is the first and the most important step in company establishment. On the basis of the legal nature of the business, it can be started as a sole proprietorship, partnership, LLP or company)

Steps required to obtain Company Registration

Following are certain steps that must be followed to obtain company registration –

  • Application filing for Digital Signature Certificate
  • Acquire Director Identification Number
  • File the SPICe+ form
  • Prepare and submit Memorandum of Association and Articles of Association
  • File an application for PAN and TAN of the company
  • File for the certificate of incorporation along with TAN and PAN
  • Create a bank account in the name of the company

What documents are required for company registration –

Following are certain documents that are important for company registration –

Documents required Shareholders and Directors

  • A copy of PAN card and copy of Passport
  • A copy of the address proof of the applicant, documents that can be used as an address proof is voter card, aadhar card, passport, electricity bill, ration card, telephone bill, and driving license
  • Passport size photograph of the applicant
  • Rent agreement if the company is starting in a rented property

Documents required for from company’s Directors or Members

If the Director or Member is an Indian resident

  • Proof of Identity, documents which can be submitted as ID proof are Passport, Driving License, Voter ID card, Aadhaar Card
  • PAN card of the applicant
  • Certified copy of bank statement
  • Email address and mobile number of the applicant

If the applicant is a foreign national

  • Passport copy of the Applicant
  • Residential proof of the Applicant
  • Email address and mobile number
  • Attested copy of Visa (If the applicant is not in the country)
  • Attested copy of Resident Permit certificate, If the applicant is in India

FSSAI Registration

FSSAI Registration is food license which must be obtained from Food Standards authority. It is mandatory for food operators and businesses to obtain food license.

Requirements to fulfill to obtain FSSAI Registration

Selection of the type of License

BASIC FSSAI License

Food business operators such as importers, 100% Export Oriented Units, large manufacturers, operators in the Central Government agencies, airports, seaports, etc. are must obtain a Central Food License. The Central Government issues the Central license. Further, FBOs must obtain the Central License for their head office, and if they have operations in more than one state. Thus, it is mostly for the units with an annual turnover of more than INR 20 Crores. The maximum duration of this license is 5 years and the minimum is 1 year.

State FSSAI Registration

Food business operators such as small to medium-sized manufacturers, storage units, transporters, retailers, marketers, distributors, etc. are required to obtain State FSSAI food License. The State Government issues state License and it is important for food business operators to fulfill the requirement of undertaking business operations in only one state, in order to obtain the State FSSAI food License. The units that have an annual turnover of more than 12 lakh must obtain a state license. The maximum duration of this license is 5 years and the minimum is 1 year.

Central FSSAI Registration

Food business operators such as importers, 100% Export Units, all types of manufacturers, operators of Central Government, airports, etc. are required to acquire a Central Food License. The Central license is issued by the Central Government of India. Furthermore, FBOs must obtain Central License for their head office and if they have business activities in more than one state. Central license is for units that have an annual turnover of more than 20 Crores. The duration of this license is 5 years and the minimum is 1 year.

Eligibility Requirements

To obtain Basic License Registration

  • Wholesalers, distributors, suppliers and retailers, food vending institutions, canteens, hotels etc. that incur an annual turnover of less than INR 12 lakhs.
  • Retailers that sell food products with limited business activities.
  • Small producers who produce their own products.
  • Businesses that are involved in selling food at social events, etc.

To obtain State Food License

  • Food Business Operators such as suppliers, wholesalers, distributors, retailers, food vending establishments, canteens and restaurants with an annual turnover of within INR 12 Lakh to up to INR 20 crores.
  • Hotels with a rating of 4 star or less.
  • Storage(s) that have a size of less than 50,000 metric tons on an annual basis.
  • Dairy Units such as milk units which have the daily limit to handle or process the milk units must range from 500 to 50000 liters.
  • Daily slaughtering size of more than 2 and 50 large animals.

To obtain Central Food License

  • Food Business Operators (FBOs) that have more than one branch of restaurants or food joints must apply for a Central Food License.
  • FBOs that are operating in two or more states must apply for Central License for its registered head office and a separate license or registration for all branches as per to the eligibility standards.

Registration Process

Following steps are required to be followed to obtain FSSAI License –

  • The applicant must file FSSAI registration Form A on the website and submit the registration fees.
  • Once the payment is confirmed, the applicant must fill Form B. Declarations and resolutions must be filed along with the applicant form.
  • It takes approximately 45-60 days to review and verify the application.
  • After the application is approved by the authority, license will be issued to the applicant after which he can start business activities.

Documents required for FSSAI Registration

For Basic FSSAI food License

  • Photographs of the applicant
  • Business owner’s Aadhaar card
  • A scanned copy of the applicant’s signature
  • Business activity details
  • PAN Card of the applicant
  • Declaration

For State FSSAI food License

  • GST Registration of the Company
  • Details of the business activities
  • Details describing food products that will be used in the business
  • Authorization letter of the consultant
  • Declaration Form
  • Aadhaar card of the Business owner
  • A scanned copy of the signature of the business owner
  • A scanned copy of applicant’s Photograph
  • Articles of Articles(AOA) and Memorandum of Articles(MOA)
  • Partnership Deed
  • Registration Certificate of vehicles with a declaration
  • Electricity bills of either the business, Factory or Warehouse
  • No-objection Certificate from the owner
  • Rent agreement of the property
  • NOC from the Property owner, if the property is rented

Health trade Registration

A health trade registration is compulsory keeping the health of the customers in mind.

How to obtain Health Trade Registration?

Following are steps which is followed to acquire health trade registration –

  • Fill in and submit application form
  • Pay the processing fees
  • The municipal corporation of the concerned state verifies the application
  • The authority sends a message to the applicant once the verification is completed
  • Submit the license fees

Documents required to acquire Health Trade Registration

  • Original copy of the Health License
  • Identity proof of the Partners
  • Previous years challan(s)
  • Receipt of property tax paid of the premises
  • Renewal application

Eating House Registration

Eating house license must be acquired by companies who offer products related to food and drink. Steps required to obtain eating housing license are filling application form, document submission and appointment with the commissioner of Police.

How to obtain eating house License?

Following are steps that must be followed to obtain eating housing license –

  • Fill in application form
  • Submit all documents
  • Appointment with Commissioner of Police

What documents are required for eating house registration?

  • Location plan
  • Photographs of the eating house
  • Identity proof and residential proof
  • Legal occupancy proof
  • NOC from the owner
  • Copy of Board Resolution
  • Details of employees
  • FSSAI License
  • Details of employees
  • Police Clearance Certificate

Trademark Registration

Trademarks are registered under the Trademark Act and provide the owner of the business the right to sue for damages when infringements of trademarks occur.

Steps to acquire Trademark Registration

  • Make an application for Trademark Registration
  • File in the application to the Trademark Ministry
  • Once the application is accepted, an advertisement is made by the Registrar
  • Parties are given a chance to raise objections with regards to the application
  • Amendments are made as mentioned by the Registrar
  • The Certificate of Registration with the Trademark Registry

Documents required obtaining Trademark Registration

  • Application form
  • Identity, address and nationality proof
  • Trademark entity documents
  • Legal process for agents
  • Soft copy of the trademark
  • A list of goods and services

GST Registration

Goods and Services Registration must be also be acquired by food operators before company incorporation.

Steps to acquire GST Registration

Following steps are required to be followed by the applicant to acquire GST License –

  • Fill in PART A of the form which includes all the details. The applicant must visit the online website and register the company by filling in necessary details.
  • Submit all the important documents required by the authority.
  • Fill in and submit Form B of the form.

Documents required obtaining GST Registration

  • PAN Card
  • Identity proof /Address Proof
  • Proof of Registration of business
  • Office Address Proof
  • Bank account details
  • Lease agreement

Shop and Establishment Registration

Lastly, shop and establishment act must be obtained by the food operators by following certain steps. Shop and Establishment Act is regulated by the Department of Labor. It is engaged in the regulation and supervision of commercial establishments, charitable trusts, societies, educational institutions.

Steps to follow to obtain Shop and Establishment License

Fill in the application form

The applicant must fill the application form and submit it to the authority.The application form must contain all the details concerning the shop.

Submission of the documents

Documents required for registration must be prepared and submitted along with the application form.

Submission of the application form with the details

After filling all the details, the form must be submitted to the authority within the stipulated time period.

Verification of the submitted application

The authority, after receiving the form and documents, conducts an evaluation of the documents and it is approved, license is issued to the applicant.

License Arrival

The registration process completed when the shop license is received by the applicant. The applicant can start operating the business activities after receiving the license.

Documents required to obtain Shop and Establishment License

  • Identity proof of the employer in the form of Aadhaar card, PAN (Permanent Account Number), Driving License, Voter ID.
  • Photograph of the shop
  • Copy of the rent agreement or lease deed is required
  • Any utility bill as a proof is required from the applicant such as electricity bill, water bill etc.
  • Memorandum of Association
  • Certificate of Incorporation
  • A list of all the designated directors
  • FSSAI License
  • Drug License
  • No Objection Certification

Conclusion

Starting a café is a long process and it requires various forms and documents to be filled and submitted. Only after receiving a license or certificate of registration from all the required places, the business can be started and operate, taking the rules and regulations into consideration.

Author
Lakshey Kumar