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Why food license registration is necessary for starting a food and restaurant business?

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In recent years, the Indian food industry has become one of the most lucrative and sought-after businesses in the world. The food sector is a high-growth, extremely profitable industry due to the potential for value addition within the food processing industry.

 In its India Food Services Report, 2019, the National Restaurant Association of India (NRAI) estimates the Indian food industry will grow at a compound annual growth rate (CAGR) of 9% to reach Rs. 5,99,782 crore by 2022-2023. 7.3 million people were employed in the restaurant industry in 2018-2019. In the 2018-2019 fiscal year, the organized food service sector contributed around Rs. 18,000 crore in taxes.

 FOOD LICENCE

 Obtaining a food license from the Food Safety and Standards Authority of India (FSSAI) to produce, manufacture, distribute, and transport food items is the first and most important step in beginning a food business in India. 

What is FSSAI?

There is an organization in India called FSSAI that monitors and governs food businesses in India. It is that body that comes under the Ministry of Family and Ministry Welfare. Restaurant licenses are not simply licenses, instead, they are approved by the government, assuring Indian customers that the food at that restaurant meets the country's food safety standards.

 How is FSSAI registration done?

 Getting an FSSAI registration or either license is mandatory for Every food business driver. FSSAI registration is available both offline and online. The food company owner must apply to the Licensing Authority together with the required fees to receive the license offline. The license can, however, be obtained online through the FSSAI Food Safety Compliance System (FoSCoS), which is a more convenient and hassle-free method of registration.

The following are the three categories of FoSCoS food licenses:

  • A basic FSSAI license is required if the annual turnover is less than Rs. 12 lakhs.
  • FSSAI State license - annual turnover of Rs. 12 lakhs to Rs. 20 crores
  • Annual turnover of more than Rs. 20 crores - Central FSSAI license

 

 

FSSAI Registration differs from FSSAI License in that FBOs need to obtain the relevant registration or license based on the size and nature of their operation.

 It's a 14- number enrollment or licensing number that appears on every food package. This number provides information regarding the state as well as the permit of producers. This registration method is intended to increase FBO accountability for maintaining food product quality. The Food Safety and Norms (Licensing and Registration of Food Businesses) Regulations, 2011, govern the licensing and enrollment process and norms.

IMPORTANCE OF FSSAI

 

  • Obtaining a license can bring legal benefits, increase goodwill, ensure food safety, raise customer awareness, and help with business expansion. It also aids in the regulation of import food manufacturing, storehouse, distribution, and trade. When an FBO is registered with the FSSAI, it's simple to raise finances from investors.
  • The FSSAI totem on food goods assures that guests admit high-quality food. The FSSAI enrollment number placed on the food establishment indicates that the establishment meets the needed hygiene and quality conditions.
  • 'Health comes before wealth,' as the saying goes.As a result, anything directly related to health is extremely sensitive. Many accusations of food adulteration and the use of cheap, dangerous additives have been leveled against the food industry. A food license safeguards your restaurant from such claims. A food license certifies that your food is safe to eat and poses no health risks.
  • It also makes your organization trustworthy. You can make an official announcement if you receive a food license. You can also promote the fact that you are FSSAI certified in your marketing. They begin to believe in you. You will gain not only clients but also investors and partners. As a result, obtaining a food license significantly improves your credibility.
  • Aside from ensuring that your food is safe to eat, a food license ensures the customer that your food is of excellent quality. This quality test ensures that your food product meets a high level, which gives your customers peace of mind.
  • Only after verification is a food license obtained. This verification is carried out on a chemical level, and it examines every ingredient utilized in the production of the food item. In this manner, you may rest assured that your food is being manufactured correctly. The verification process may reveal any flaws or opportunities for improvement in your food product.

 

Conclusion

With fewer chances for a decline in growth, the food industry is undoubtedly growing rapidly. Apart from these licenses, various other licenses are essential for running a restaurant. Due to a growing preference for e-commerce platforms and home delivery, the pandemic has had a significantly lesser impact on the food industry when compared to other industries, leading to a more developed market for the food industry with exponential growth potential. Entrepreneurs, therefore, should follow a strong legal framework to differentiate themselves from competitors in this market. As a consequence, obtaining a food license is extremely important as you can never take a chance on consumers' health You also need to ensure that your customers trust you and that you are protected from many false accusations about health and food safety. Obtaining a food license, therefore, is of the utmost importance.

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