cold storage facility business plan

Cold Storage Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Food Industry » Cold Room & Frozen Foods

Are you about starting a cold storage company? If YES, here’s a complete sample cold storage business plan template & feasibility report you can use for FREE to get started .

Okay, so we have considered all the requirements for starting a cold storage company . We have analyzed and drafted a sample cold storage marketing plan backed up by actionable guerrilla marketing ideas for cold storage companies. So let’s proceed to the business planning section.

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Why Start a Cold Storage Business?

If you live in the united states and are interested in owning a business portfolio in any industry and you have not made up your mind on what kind of business to engage in, then you should consider starting your own cold storage unit business.

Although, you can also start a cold storage business in London or some cities in Canada and Europe, but the United States of America still remains the only country where this type of business is indeed a big industry.

What you need to do before venturing in into cold storage business is to carry out a survey to know if such business is needed in the area you intend establishing it, and how many people will be willing to pay to store their stuff for a short period.

No smart business man or women would want to invest his or her money into a business venture that they aren’t sure will fetch them money.

Also, you will need to have reasons why you want to be in the line of business you have chosen. That means there has to be a real connection between you and the people whose problems you want to solve. This could be categorized as the vision of the business as you will see in the sample business plan as you forge ahead.

You can write your own business plan by fixing in the appropriate details of your business after you have gone through the sample cold storage business plan template below.

A Sample Cold Storage Business Plan Template

1. industry overview.

Cold storage business is classified under the refrigerated storage industry and operators in this industry include establishments that operate refrigerated warehousing and storage facilities. Temperature-controlled services include blast freezing and tempering.

Establishments that primarily store furs for trade are included in this industry. These furs are used as raw materials for the manufacturing of garments and personal accessories such as bags and shoes.

In the United States, over the past five years to 2018, the Refrigerated Storage industry has benefited from consumer spending levels and growing trade activity, which have increased the volume of goods being shipped. Additionally, although some downstream companies decided to manage their own warehouse facilities instead of outsourcing these functions to industry operators, this trend has not substantially hindered industry performance.

Over the five years to 2023, industry performance will likely be bolstered by continued growth in the total value of US trade activity, as well as continued improvements in the level of domestic consumer spending. The Refrigerated Storage industry is indeed a large industry and pretty much thriving in developed countries such as United States of America, Canada, United Kingdom, Germany, Australia and Italy et al.

Statistics has it that in the United States of America alone, there are about 2,203 licensed and registered cold storage cum refrigerated storage facilities responsible for employing about 55,663 employees and the industry rakes in a whooping sum of $6 billion annually with an annual growth rate projected at 5.4 percent between 2013 and 2018.

Americold Logistics LLC, Lineage Logistics and Preferred Freezer Services are the market leaders in this industry; they can boast of having the lion market share in the industry.

Businesses in the Refrigerated Storage industry provide a variety of warehousing and transportation services to retailers, manufacturers, wholesalers and other relevant customers. A recent report published by IBISWorld shows that the storage of goods is expected to generate 70.6 percent of industry revenue in 2018.

Generally, wholesalers, retailers, importers and exporters outsource the storage operations of their supply chain to specialized third-party refrigerated storage operators, either on an as-needed basis or by contract.

These storage services can differ substantially in terms of the duration and temperature required, ranging from the short-term storage of fresh produce in tepid conditions to the sub-zero storage of ice cream and other frozen products for extended periods of time.

The entry barriers for new operators in this industry can vary significantly by state and city. Overall, barriers are moderate, but are increasing across the United States. Costs to purchase or lease of land or facility vary across regions and are a major barrier to entry.

These expenses can be more manageable, though, in well-established, highly populated cities, whereas land costs can be significantly lower in smaller cities and suburban regions. There are several regulatory requirements that must be met by companies in the cold storage business. The most difficult of these generally relates to zoning and land development conditions.

Over and above, a cold storage business in the United States of America can be started by anybody as long as you have the startup capital to acquire a property and then design the property to fit into the purpose you want to use it for.

2. Executive Summary

Sub ZERO® Cold Storage Company, LLC is a licensed refrigerated storage facility that will be located in a commercial hub in Dallas – Texas. Our basic aim of setting up the business is to make available refrigerated warehousing and storage facilities for our clients who are resided in Dallas and neighboring cities.

We have been able to secure a standard facility in a central and easy to locate location in Dallas. Our cold storage facility is of international standard. We conducted a thorough research and feasibility studies and we were able to come to the conclusion that Dallas community is the right place to start our cold storage facility.

At Sub ZERO® Cold Storage Company, our client’s best interest would always come first, and everything we do is guided by our values and professional ethics. We will offer trusted cold storage services to all to our clients and also ensure that we work hard to meet and surpass our clients’ expectations whenever they make use of our facilities.

Sub ZERO® Cold Storage Company, will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible.

We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.

Our plan is to position the business to become one of the leading brands in cold storage business in the whole of Dallas – Texas, and also to be amongst the top 20 cold storage companies in the United States of America within the first 10 years of operation.

Sub ZERO® Cold Storage Company is owned by Gerald Moses and Thomas Mickey his business partner. The business will be managed by both of them since they have adequate working experience to manage such business. Gerald Moses has over 10 years’ experience working at various capacities in the refrigerated storage industry in the United States of America.

3. Our Products and Services

We are in the cold storage business to provide safe short – term refrigerated storage for residents of Dallas – Texas which is why we have been able to put up a facility that can help us achieve this goal. These are the amenities and services that will be made available to our clients;

• Storage of goods that needed to be refrigerated
• Leasing or rental of mini refrigerated storage truck units
• Providing blast freezing services
• Providing tempering services
• Operating modified atmosphere cold storage facility (private and public)
• Other related cold storage services

4. Our Mission and Vision Statement

• Our Vision of starting Sub ZERO® Cold Storage Company, LLC is to build a brand that will become one of the top choices for residents and businesses in the whole of Dallas – Texas.
• Our mission for establishing Sub ZERO® Cold Storage Company, LLC is to build a standard and well – secured cold storage facility that can favorably compete in the industry.

Our Business Structure

Sub ZERO® Cold Storage Company, LLC is in business to become the leading cold storage facility in the whole of Dallas – Texas and we are fully aware that it will take the right facility, management and structure to achieve our goal.

Our business will not be built only for the purpose of giving our customers value for their money, but also we will ensure that we make our work environment highly conducive for our employees. We will provide them with facilities that will help them stay motivated and deliver on their various tasks.

In view of that, we have made provisions for the following positions to be occupied by highly qualified and experienced staff;

• Chief Executive Officer

Facility Manager

Admin and HR Manager

Marketing and Sales Executive

• Customer Care Executive / Front Desk Officer

Refrigerated Truck Drivers

• Security Guards

5. Job Roles and Responsibilities

Chief Executive Office:

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results and developing incentives
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Accountable for handling leasing or rental of mini refrigerated storage truck units
• Handles goods that need to be refrigerated
• Provides blast freezing services
• Provides tempering services
• Operates modified atmosphere cold storage facility (private and public)
• Handles other facility operations such as repairs and renovations et al
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Carries out induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Oversees the smooth running of the daily office activities.
• Writes winning proposal documents, negotiate fees and rates in line with company policy
• Responsible for handling business research, marker surveys and feasibility studies for clients
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Develops, executes and evaluates new plans for expanding sales
• Documents all customer contacts and information
• Represents the company in strategic meetings
• Helps to increase sales and growth for the company
• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting for one or more properties.
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the company
• Serves as internal auditor for the company

Client Service Executive/Front Desk Officer

• Welcomes guests and clients by greeting them in person or on the telephone; answering or directing inquiries.
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s services
• Consistently stays abreast of any new information on the company’s products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients
• Receives parcels/documents for the company
• Distribute mails in the organization
• Handles any other duties as assigned by the line manager
• Delivers customer’s orders promptly
• Runs errand for the organization
• Handles any other duty as assigned by the sales and marketing executive and manager

Security Officers

• Ensures that the facility is secured at all time
• Controls traffic and organize parking
• Patrols around the building on a 24 hours’ basis
• Submits security reports on a weekly basis
• Any other duty as assigned by the facility manager.

6. SWOT Analysis

Sub ZERO® Cold Storage Company engaged the services of a professional in the area of business consulting and structuring to assist the firm in building a well – structured cold storage business that can favorably compete in the highly competitive refrigerator storage industry.

We hired the services of Dr. Pius Cesar, a HR and Business consultant with bias in business structuring to help us conduct SWOT analysis for our company and he did a pretty good job for us. Here is a of the result we got from the SWOT analysis that was conducted on behalf of Sub ZERO® Cold Storage Company, LLC, Dallas – Texas.

One of the obvious strengths that will definitely stand as a plus for Sub ZERO® Cold Storage Company is the fact that our facility is centrally located in a commercial hub area in Dallas – Texas; our location and high level of security is in fact our major strength.

We equally have a team that can give our clients value for their money; a team that are trained and equipped to pay attention to details and to deliver excellent services. Lastly our service package is one of the best that anybody living in Dallas – Texas can get; it is cheap and affordable.

We critically looked into our Business model and we were able to identify two major weakness. One is the fact that we are a new business and the second is the fact that we may not have the financial resources required to match up with existing and well established cold storage facilities when it comes to acquiring large facilities in choice areas.

• Opportunities:

We are centrally located in one of the busiest areas in Dallas – Texas and we are open to all the available opportunities that the city has to offer. We will be open 24 hours in a day during weekends (Fridays to Sundays) and from 6:00 am to 12 midnights from Mondays to Thursdays giving us the advantage to leverage on any available opportunity.

Some of the threats that are likely going to confront Sub ZERO® Cold Storage Company are unfavorable government policies , demographic/social factors, downturn in the economy which is likely going to affect consumers spending and lastly, the emergence of new competitors within the same location where our cold storage facility is located.

7. MARKET ANALYSIS

• Market Trends

The trend in the industry is such that if a cold storage facility is positioned in a place where people can easily access without much stress, there is the likelihood that the facility will enjoy high patronage. Many companies have begun operating their distribution and storage functions internally.

So also, the industry will be supported by increasing demand from downstream markets. The industry performance will likely be bolstered by continued growth in the total value of US trade activity. The owners of cold storage facilities are always looking for ways to increase their market share; they go as far as signing deals with merchants, importers and businessmen and women who needed temporal refrigeration of their goods.

It is a common trend that as cold storage facility grows (fully occupied throughout the year), it becomes necessary for them to develop new service offerings or install new facilities that will help them attract more people.

8. Our Target Market

The target market for cold storage facilities cuts across people of different walks of life and businesses. The fact that people would need a secured place to keep their goods refrigerated for a short period of time makes the cold storage business a thriving and growing business. These are the category of people that we intend marketing our cold storage facility to;

• Merchants, Importers and manufacturers
• Restaurants and hotels
• Ice cream productions businesses

Our competitive advantage

The refrigerated storage industry is indeed a profitable and highly competitive industry. Clients will only make use of your cold storage facility if they know that your facility is reliable, highly secured and spacious enough to contain whatever goods they want to store.

Our competitive advantage is that ZERO® Cold Storage Company is that we can boast of optimum capacity utilization, we will leverage on automation to reduce operational costs, particularly those associated with labor and of course, our output will be sold under contract – incorporate long-term sales contracts.

Plus, our facility is centrally located in a densely populated area in Dallas – Texas; our location and high level of security is in fact our major strength. We equally have a team that can give our clients value for their money; a team that are trained and equipped to pay attention to details and to deliver excellent services.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.

9. SALES AND MARKETING STRATEGY

• Sources of Income

ZERO® Cold Storage Company, LLC is established with the aim of maximizing profits in the industry and we are going to ensure that we do all it takes to attract clients on a regular basis and to ensure that our facilities are fully occupied at any given time. ZERO® Cold Storage Company, LLC will generate income by offering the following amenities and services;

• Storage of goods that needs to be refrigerated

10. Sales Forecast

It would be hard to create a sales forecast with a newly opened business because the statistics that will be provided will be on a short term basis. Experts say that usually a business should be in operation for at least one year before they can generate the statistics that will help in accurate forecasting.

We expect to attain 65 percent occupancy of our cold storage facility within our first year of operation and then in subsequent years we will grow to full occupancy (between 80 and 100 percent occupancy). Below are the sales projection for ZERO® Cold Storage Company, it is based on the location of our facility and the services and amenities that we will be offering to our clients;

• First Fiscal Year: $200,000
• Second Fiscal Year: $450,000
• Third Fiscal Year: $750,000

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major competitor offering same services as we do within 4.5 miles’ radius.

• Marketing Strategy and Sales Strategy

Our marketing strategies will be directed towards achieving specific objectives that support the strategic goals of the organization. The truth is that all that we do will be geared towards creating new market channels, increasing sales and our market share.

As part of our sales and marketing strategies, we will pay attention to the promotion of our cold storage facility so as to attract people to rent or lease our facility. Part of the marketing and sales strategies that we will adopt are;

• Advertise our cold storage facility on community based newspapers, local TV and radio stations
• Promote our cold storage facility online via our official website and all available social media platforms
• Introduce our cold storage facility by sending introductory letters alongside our brochure to businesses, sports clubs, schools, corporate organizations, hotels, restaurants, households and key stakeholders in Dallas – Texas
• Print out fliers and business cards and strategically drop them in offices, libraries, public facilities and train stations et al.
• Delivering consistent customer experiences to all our clients; making our first impression count positively to those renting or leasing our cold storage for the first time
• Make use of attractive handbills to create awareness and also to give direction to our cold storage facility
• Adopt direct mailing coupon marketing approach
• Position our signage / flexi banners at strategic places in and around Dallas – Texas
• Create a loyalty plan that will enable us reward our loyal clients especially those that refers their family members and friends to us
• Engage in roadshows within our neighborhood to create awareness for our cold storage facility.

11. Publicity and Advertising Strategy

We have been able to work with our branding and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.

We are set to become the number one choice for clients in the whole of Dallas – Texas which is why we have made provisions for effective publicity and advertisement of our cold storage facility. Below are the platforms we intend to leverage on to promote and advertise ZERO® Cold Storage Company, LLC;

• Place adverts on both print and electronic media platforms
• Sponsor relevant community based events
• Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, YouTube, Google + et al to promote our brand
• Install our billboards in strategic locations all around Dallas – Texas
• Engage in roadshows from time to time in targeted neighborhoods
• Distribute our fliers and handbills in target areas in Dallas
• List ZERO® Cold Storage Company, LLC in local directories / yellow pages
• Advertise our cold room facility in our official website and employ strategies that will help us pull traffic to the site.
• Ensure that all our staff members wear our branded shirts and all our vehicles are branded with our corporate logo

12. Our Pricing Strategy

Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more and we don’t intend to charge less than what our competitors are charging.

Be that as it may, we have put plans in place to offer discount services once in a while and also to reward our loyal customers especially when they refer clients to us or when they use our facility for a longer period. The prices of our services will be same as what is obtainable in the United States’ open market.

• Payment Options

The payment policy adopted by ZERO® Cold Storage Company, LLC is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that ZERO® Cold Storage Company, LLC will make available to her clients;

• Payment via bank transfer
• Payment via credit cards
• Payment via online bank transfer
• Payment via check
• Payment via mobile money transfer

In view of the above, we have chosen banking platforms that will enable our client make payment for our services without any stress on their part.

13. Startup Expenditure (Budget)

In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your employees are well taken care of, and that your facility is conducive enough for workers to be creative and productive.

The tools and equipment that will be used are nearly the same cost everywhere, and any difference in prices would be minimal and can be overlooked. This is what it would cost us to set up ZERO® Cold Storage Company, LLC in the United of America; These are the key areas where we will spend our start – up capital on;

• The Total Fee for Registering the Business in Texas – $750.
• Legal expenses for obtaining licenses and permits – $1,500.
• Marketing promotion expenses (8,000 flyers at $0.04 per copy) for the total amount of $10,000.
• The cost for hiring Business Consultant – $5,000.
• Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $30,800.
• The cost of accounting software, CRM software and Payroll Software – $3,000
• The cost for leasing facility for the cold storage facility – $500,000.
• The cost for facility remodeling – $50,000.
• Phone and utility deposits – $3,500
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
• The cost for start-up inventory – $15,000
• The cost for acquiring security locks, CCTV and other security wares – $20,000
• The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, tables and chairs et al) – $4,000.
• The cost for the purchase of cooling van – $40,000
• The cost of Launching a website – $600
• Miscellaneous – $15,000

We would need an estimate of $550,000 to successfully launch a standard cold storage facility in Dallas – Texas. It is important to state that the testing and evaluating expenses would be high because of the large amount of needed to secure a large facility in a good location.

Generating Startup Capital for ZERO® Cold Storage Company, LLC

ZERO® Cold Storage Company will be owned and managed by Gerald Moses and his friend and business partner Thomas Mickey. They decided to restrict the sourcing of the startup capital for the business to just three major sources.

• Generate part of the startup capital from personal savings and sale of his stocks
• Generate part of the startup capital from friends and other extended family members
• Generate a larger chunk of the startup capital from the bank.

N.B: We have been able to generate about $200,000 (Personal savings $150,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $35,000 from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.

14. Sustainability and Expansion Strategy

The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. One of our major goals of starting ZERO® Cold Storage Company is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running.

ZERO® Cold Storage Company, LLC will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

• Business Name Availability Check: Completed
• Business Registration: Completed
• Opening of Corporate Bank Accounts: Completed
• Securing Point of Sales (POS) Machines: Completed
• Opening Mobile Money Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Acquiring facility and remodeling the facility to fit into our cold storage facility and warehouse: In Progress
• Conducting Feasibility Studies: Completed
• Generating capital from family members: Completed
• Applications for Loan from the bank: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents: In Progress
• Design of The Company’s Logo: Completed
• Printing of Promotional Materials: In Progress
• Recruitment of employees: In Progress
• Purchase of the needed office appliances and security gadgets and software: In progress
• Creating Official Website for the Company: Completed
• Creating Awareness for the business both online and in the neighborhood: In Progress
• Health and Safety and Fire Safety Arrangement (License): Secured
• Purchase of cooling vans: Completed

Home » Food

How to Start a Cold Storage Business [Business Plan]

A cold storage business is a commercial facility for storing perishable products such as fruits, vegetables, meat, fish, furs, etc. under controlled conditions for longer periods. Based on the storage conditions, cold storage may be classified into three categories – short-term or temporary storage, long-term storage, and frozen storage.

Available data shows that the U.S. cold storage market size was estimated at USD 15.84 billion in 2019 and is expected to reach USD 16.43 billion in 2020. The global cold storage market size was valued at USD 107.18 billion in 2020, but it is expected to expand at a compound annual growth rate (CAGR) of 13.5% from 2022 to 2028.

The market has benefitted significantly from the stringent regulations governing the production and supply of temperature-sensitive products.

Steps on How to Start a Cold Storage Business

Conduct market research.

If you are considering starting a cold storage business, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your cold storage business should be to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source for information that will help you maximize your business, help you know what your potential market will be looking out for from the business, and also help you operate your cold storage business with less stress.

a. Who is the Target Market for Cold Storage Business?

• Fruit and vegetable farmers
• Poultry and livestock processors
• Furs traders
• Importers of temperature-sensitive goods
• Exporters of temperature-sensitive goods.

b. Is Cold Storage Business a Profitable Business?

Yes, the cold storage business is very profitable but you must be deliberate in marketing and promoting your facility if indeed you want to keep the business profitable all year round.

c. Are There Existing Niches in the Industry?

No, there are no existing niche ideas when it comes to the cold storage business.

d. Who are the Major Competitors?

• Lineage Logistics
• Americold Logistics
• US Growers Cold Storage Inc.
• United States Cold Storage
• XPO Logistics
• VersaCold Logistics Services
• Penske Logistics
• Burris Logistics
• Conestoga Cold Storage
• Midwest Refrigerated Services
• Trenton Cold Storage
• Hanson Logistics
• Confederation Freezers
• FW Logistics
• RLS Logistics
• Covenant Logistics Group
• Geodis (North America)
• Rinchem Co.
• Peoples Services

e. Are There County or State Regulations or Zoning Laws for Cold Storage Business?

Yes, there are county and state regulations or zoning laws for cold storage business, and players in this industry are expected to work with the existing regulations or zoning laws governing similar businesses in the county where their business is domiciled.

f. Is There a Franchise for Cold Storage Business?

No, there are no franchise opportunities for the cold storage business.

g. What Do You Need to Start a Cold Storage Business?

• A Feasibility Report
• Business and Marketing Plans
• Business Licenses and Permits
• Furnished and Equipped Cold Storage Warehouse
• EIN (Employer Identification Number)/Federal Tax ID Number
• A Corporate Bank Account

Memorable Cold Storage Business Names

• Farmers Network© Cold Storage Warehouse, Inc.
• Generation Next® Cold Storage Warehouse, LLC
• Storage Solutions® Cold Storage Warehouse, Inc.
• Future Solutions® Cold Storage Warehouse, Inc.
• Smart Sot™ Cold Storage Warehouse, Inc.
• Storage Base™ Cold Storage Warehouse, LLC.
• Jenny Blank© Cold Storage Facility, LLC
• The Arena® Cold Storage Warehouse, Inc.
• Ocean View© Cold Storage Facility, Inc.
• Central Park© Cold Storage Warehouse, Inc.
• Jades Investment® Cold Storage Warehouse, LLC
• Profitable Venture® Cold Storage Warehouse, LLC
• The Mark™ Cold Storage Warehouse, LLC
• Storage Plug© Cold Storage Warehouse, Inc.
• Pentagon Group® Cold Storage Warehouse, Inc.
• Your Choice™ Cold Storage Warehouse, Inc.
• Caleb Brothers™ Cold Storage Warehouse, Inc.
• Newton Joe and Co© Cold Storage Warehouse, Inc.
• Storage Hub® Cold Storage Warehouse, LLC
• Sub Zero™ Cold Storage Warehouse, Inc.

Register Your Business

A. what type of business structure is best for cold storage business.

Even though there are several options when it comes to the business structure of a cold storage business, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits. Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC

• Choose a Name for Your LLC.
• File Articles of Organization.
• Choose a registered agent.
• Decide on member vs. manager management.
• Create an LLC operating agreement.
• Comply with other tax and regulatory requirements.
• File annual reports.

c. What Type of License is Needed to Open a Cold Storage Business?

• General Business License
• Zonal Permits
• Signage Permit
• Operational State Facility Inspections for your facility

d. What Type of Certification is Needed to start a Cold Storage Business?

You don’t need any certification to start a cold storage business.

e. What Documents are Needed to Open a Cold Storage Business?

• Business and liability insurance
• Federal Tax Payer’s ID
• State Permit and Building Approval (For your cold storage warehouse)
• Certificate of Incorporation
• Business License
• Business Plan
• Employment Agreement (offer letters)
• Operating Agreement for LLCs
• Insurance Policy
• Online Terms of Use
• Online Privacy Policy Document
• Contract Document
• Company Bylaws
• Memorandum of Understanding (MoU)

f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a cold storage business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

Cost Analysis and Budgeting

A. how much does it cost to start a cold storage business.

According to management firm JLL, “cold storage construction cost averages $150-170 per square foot, compared to $50-65 per square foot for dry warehousing space”. Hence it could range from as low as $120,000 to one million USD and more to set up a cold storage business.

b. What are the Costs Involved in Starting a Cold Storage Business

• The total fee for registering the business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as accounting services – $1,200.
• Marketing promotion expenses – $1,500
• The cost for hiring a business consultant (writing of business plans inclusive) – is $4,500.
• Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
• The cost of accounting software, CRM software, and Payroll Software – $1,500
• The cost for leasing a facility (long-term lease agreement) – is $175,600.
• The cost for facility remodeling and construction of cold storage warehouse – $150,000.
• Phone and utility deposits will cost – ($3,500)
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $20,000
• The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, tables and chairs et al) – $10,000.
• The cost of launching an official website – $600
• Miscellaneous – $2,500

c. What Factors Determine the Cost of Opening a Cold Storage Business?

• The size of the cold storage business (number of storage spaces and the size of the facility)
• The choice of the office location
• The required licenses and permits
• The cost of hiring a business consultant and attorney
• The cost for branding, promotion, and marketing of the cold storage business
• The cost for furnishing and equipping the cold storage facility
• The cost of insurance
• The cost for registering the business
• Cost of recruiting and training your staff

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

It is not compulsory to build a new facility for your cold storage business, but if you have the required finance, it will pay you to build your own cold storage warehouse from the scratch. The truth is that building or reconstructing a cold storage facility will help you come up with a facility that will perfectly fit into your overall business goals and vision.

e. What are the Ongoing Expenses of a Cold Storage Business?

• Electric bills
• Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al)
• Salaries of employees
• maintenance
• Marketing costs

f. What is the Average Salary of your Staff?

• Chief Operating Officer (Owner) – $60,000 Per Year
• Facility Manager – $45,000 Per Year
• Maintenance Engineer (Refrigerator) – $44,800 Per Year
• Admin and HR Manager – $40,800 Per Year
• Marketing and Sales Executive – $35,000 Per Year
• Customer Care Executive / Front Desk Officer -$30,000 Per Year
• Operators and Cleaners – $26,000 Per Year
• Security Guards – $24,500 Per Year

g. How Do You Get Funding to Start a Cold Storage Business?

• Raising money from personal savings and sale of personal stocks and properties
• Raising money from investors and business partners
• Sell shares to interested investors
• Applying for a loan from your bank/banks
• Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
• Source for soft loans from your family members and your friends.

Write a Business Plan

A. executive summary.

Sub ZERO® Cold Storage Company, LLC is a licensed and secured refrigerated storage facility that will be located in a commercial hub in Austin – Texas. Our basic aim of setting up the business is to make available refrigerated warehousing and storage facilities for our clients who have businesses  in Austin and in neighboring cities.

• Storage of goods that need to be refrigerated
• Leasing or rental of mini refrigerated storage trucks
• Handling of goods that need to be refrigerated
• Transportation of goods that needed to be refrigerated
• Providing blast freezing services
• Providing tempering services
• Operating modified atmosphere cold storage facility (private and public)
• Other related cold storage services

c. Mission Statement

Our mission for establishing Sub ZERO® Cold Storage Company, LLC is to build a standard cold storage facility that can favorably compete in the industry in the United States of America.

Vision Statement

Our vision is to become the number one cold storage warehouse provider in the whole of Austin, Texas, and to have cold storage warehouses in key cities all across the United States of America.

d. Goals and Objectives

The goals and objectives of a cold storage business are to provide a commercial facility for storing perishable products such as fruits, vegetables, meat, fish, furs, etc. under controlled conditions for longer periods.

e. Organizational Structure

• Chief Operating Officer (Owner)
• Facility Manager
• Maintenance Engineer (Refrigerator)
• Admin and HR Manager
• Marketing and Sales Executive
• Customer Care Executive / Front Desk Officer
• Operators and Cleaners
• Security Guards

Marketing Plan

A. swot analysis.

• A centrally located cold storage warehouse facility
• Well-equipped and furnished cold storage warehouse facility
• Experienced, trained, and certified professionals.
• Excellent customer testimonials.
• Not enough finance to build our facility
• We may initially struggle to procure enough revenue to offer the company to the public and sell shares.
• Inability to attract high paying clients as a new business.

Opportunities:

• A growing number of startups that make use of cold storage warehouse facilities in the United States
• Build upon existing clientele
• Online market, new services, new technology, and of course the opening of new markets.
• Favorable government policies and trends
• Loans diminish profitability until they are paid off
• The first year will be financially tight while we gain customers and pay off loans
• Competition in the area could increase
• Management of employees requires time, money, and effort
• Lack of capital to keep going if the business model doesn’t work
• Economic downturn; when the economy is bad it affects the flow of cash which in turn impacts businesses negatively.

b. How Do Cold Storage Business Make Money?

Cold storage warehouse businesses make money by;

• Leasing or rental of mini refrigerated storage truck units
• Transportation of goods that need to be refrigerated
• Other related cold storage services.

c. Payment Options

• Payment via bank transfer
• Payment via credit cards
• Payment via online bank transfer
• Payment via check
• Payment via mobile money transfer

d. Sales & Advertising Strategies

• Introduce your cold storage business by sending introductory letters to fruit and vegetable farmers, poultry and livestock processors and farmers, fishermen, furs traders, importers and exporters of temperature-sensitive goods et al in and around your city.
• Advertise your cold storage warehouse on national dailies, local TV and radio stations
• Promote your cold storage warehouse business online via your official website and all available social media platforms
• Hire the services of experts to make your brand the first choice in your city and other cities where you will open your cold storage business
• Adopt direct mailing coupon marketing approach to attract investors
• Position your signage/flex banners at strategic places

Financial Projection

A. how much should you charge for your product/service.

The amount you can charge should depend on some factors, and the monthly prices could range from about $90 for a small storage to nearly $300 for a large one.

b. How Much Profit Do Cold Storage Business Owners Make a Year?

It depends, because cold storage business income directly depends on the capacity of cold storage and what items you store inside it. But on the average, a cold storage warehouse owner can rake in a profit of $60,000 to well over $150,000 annually.

c. What Factors Determine the Amount of Profit to Be Made?

• The size of the cold storage facility
• The services offered by the faciltiy
• The management style of the cold storage business
• The business approach of the cold storage business
• The advertising and marketing strategies adopted by the cold storage business.

d. What is the Profit Margin of a Cold Storage Business?

According to Pertel, an ordinary warehouse yields about 4% a year, whereas a cold storage facility can yield 5.5%.

e. What is the Sales Forecast?

Below is the sales forecast of a cold storage business. It is based on the location of the business and other factors as it relates to such startups in the United States;

• First Fiscal Year: $350,000
• Second Fiscal Year: $600,000
• Third Fiscal Year: $1.8 million

Set Up your Shop/Office

A. how do you choose a perfect location for cold storage business.

• The demography of the location especially as it relates to agriculture startups and small exporters and importers
• The purchasing power of businesses and residents of the location
• Accessibility of the location
• The number of cold storage businesses in the location
• The local laws and regulations in the community/state
• Traffic, parking and security et al

b. What State and City are Best to Open a Cold Storage Business?

• Austin, Texas
• New York City, New York
• Los Angeles, California
• San Francisco, California
• Washington DC
• Chicago, Illinois
• Dallas-Fort Worth, Texas
• Atlanta, Georgia
• Boston, Massachusetts

c. What Equipment is Needed to Operate a Cold Storage Business?

• Crates, boxes, and Casings
• Temperature gauges.

Hire Employees

When it comes to hiring employees for a standard cold storage business, you should make plans to hire a competent chief executive officer (you can occupy this position), facility manager, maintenance engineer (refrigerator), admin and HR manager, sales executives, customer service executives, operators, cleaners, and security guards.

Launch the Business Proper

You can choose to open your cold storage business with an opening party, but note that this is not compulsory. The most important thing when starting this business is to make businesses and individuals know of your services so that your cold storage facility would be occupied all the time. You lose money each time your cold storage facility is not fully occupied.

a. What Makes a Cold Storage Business Successful?

• Choose a good location and facility to launch the business
• Hire only competent, hardworking, and trustworthy staff
• Be deliberate with equipping and furnishing the facility
• Encourage the use of word of mouth to promote your cold storage business
• Leverage on all available online and offline platforms to promote your cold storage business

b. What Happens During a Typical Day at a Cold Storage Business?

• The business is open for the day’s work
• The cold storage facility is cleaned and ready for clients.
• Clients are attended to (their goods are stored)
• Maintenance of the cold room is carried out at regular intervals
• Marketing/website upkeep is carried out
• Other administrative duties are carried out
• The business is closed for the day.

c. What Skills and Experience Do You Need to Build a Cold Storage Business?

• Excellent facility management skills
• Excellent interpersonal skills
• Excellent customer services skills
• Business management skills
• Bargaining skill
• Work experience in a cold storage facility
• Experience in managing people
• Experience in business administration

More on Food

Cold Storage Business Plan: Requirements, Profits & Subsidy

• July 23, 2023
• Articles , Business Loan , Working Capital Loan

Effective cold storage is crucial in meeting the significant demand for preserving vegetables and other food products in the country. Poor storage practices have resulted in significant wastage of fresh produce. Investing in cold storage solutions not only helps to reduce waste but also presents a lucrative opportunity to maintain the freshness and quality of vegetables, thereby enhancing profitability.

The cold storage business is a profitable venture where the initial investment is on the higher side. The return is also higher and long-lasting than in other businesses. 

Cold storage facilities can be specified into two categories. Food products that need freezing storage like fruits and vegetables, poultry and seafood products, meat products, and other packaged food, including cigarettes and beer.

Why is a cold storage unit required?

Food waste is a global issue, with fruits and vegetables being a major contributor. In countries with high production rates, food wastage is even more prevalent. In such countries, cold storage is essential to extend the shelf life of processed or packaged foods, maintain quality during post-harvest processing, and provide fresh fruits year-round. By minimizing perishable waste and preserving produce, cold storage plays a crucial role in enhancing profitability while simultaneously addressing food waste.

Scope for the Cold Storage Business Industry in India

As the demand for processed foods increases and dietary habits evolve, the need for cold storage facilities is also growing rapidly. This demand has been further intensified by the significant investments and growth in the e-commerce sector, which requires efficient storage and delivery of perishable goods. Fortunately, advancements in modern technology, such as automatic temperature control systems and energy-efficient equipment, have resulted in improved efficiency and reduced operational expenses.

With its potential to prevent food waste and ensure food security, the cold storage sector has become a critical component in boosting India’s economy. By embracing this sector, India can unlock new opportunities for economic growth and development.

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Investment Cost of Cold Storage

The initial cold storage business investment cost is comparatively higher than the other businesses whether we are talking about vegetable cold storage project cost or in general. The investment is generally in acquiring the land, construction of cold storage facilities and permits for the required utilities, including electricity, water etc. You must spend significant sums on buying a cooling machine. Modernised cooling machinery ensures longer-term stability and higher quality. Apart from fixed costs, investment costs include some expenses like operating costs.

Guidelines on Cold Storage Business in India

In India, a cold storage company requires a detailed plan of operation before it starts. This business plan should contain every detail concerning cold storage, products and services that will be used, along with employee information such as your name and address. The locations of cold storage units are very important in operation. Storage facilities are recommended close to retail outlets and producers’ farms.

How to Start Your Own Cold Storage Business in India?

If you are working on a cold storage business plan, you must develop a comprehensive business strategy. The business plan should detail all relevant information on the products and services used for cold storage plants and the staff, such as your full name and address.

Basic criteria for an ideal cold storage plant:

Important Guidelines/Points for Cold Storage Business Plan:

• Property that needs to be used as a cold storage facility must be turned into non-agricultural land.
• You can not construct the facility unless you have a letter of consent from the local government.
• Labour is only permitted for 12 hours per day in cold storage facilities.
• A road must link the region, and there has to be enough drainage.
• There should be a site elevation.
• Testing is necessary to determine the soil’s ability and its load-bearing strength.
• As a precaution, the pressure and vacuum of the refrigeration system must be tested.
• Cold storage facilities must be equipped with alarms and fire extinguishers, among other things.
• A water-softening plant must be built if soft water is not available.
• You must also have insurance for the cold storage facility.

Eligibility Criteria for Cold Storage Business Loan

The following conditions must be met to qualify for this loan:

• Banks investigate the track record of the promoters of such firms, which might include: an individual, a group of individuals, a cooperative, a business, a private concern, and a partnership.
• If the building is already in use, it needs to be operational and the cold storage business profit should be there for the previous three years. The rules have to be adhered to when keeping the accounting.
• The bank must get the feasibility report for evaluation for all new projects making sure you can manage the total investment.

Steps to Apply for a Commercial Loan for Cold Storage Business

How to crack a loan deal from renowned lenders in India to meet urgent financial requirements? Follow three easy steps:

Step 1: First you need to submit a project report, and then the bank representative will discuss that report with you, to better understand your business plan.

Step 2: Now provide all the details such as names, mobile numbers, residential and email addresses, annual revenue and profits, and any other pertinent data related to your business. After the necessary document submission and scrutiny, your loan application will be processed. 

Step 3: Once approved, the bank may confidently accept this loan. The bank will deposit the amount into your specified bank account after approval of your repayment capability.

Top Banks Offering Loans for Cold Storage Business

Business loans are offered by these top financial institutions to help you meet your urgent credit requirements.

Loans and subsidies for cold storage business in India

Establishing a cold storage business requires a significant capital investment. Typically, an initial investment of approximately 3 to 4 crores is necessary. While the investment required is substantial, it is possible to secure financing from a bank to fund the development of a cold storage business. 

The National Horticulture Board of India finances cold storage chains for entrepreneurs. Building specialised cold storage with a capacity of 2,000 tons will require around 2 crores and have an amortisation period of six to seven years.

Types of Cold storages machinery

Cold storage equipment can be purchased in industrial coolrooms, combi refrigerators, and modular room refrigerators.

How to build a cold storage facility?

Following is the procedure for Starting a Cold Store Business

1. Finalizing Location 

The location of the cold storage facility should be near agricultural or consumer centres covering various market segments. For instance, A cold storage facility with a 5000 metric tonnes capacity requires an acre of land for a multi-commodity or multi-storage unit. 

2. Selection of the Right Equipment

In the summer, when it is hot, equipment must be carefully picked to manage heavy loads and power disruptions. Numerous factors must be considered when choosing the equipment used for cold storage. These factors include the age of the equipment, fan, light, and product load, in addition to the ceiling, wall, and floor.

3. Maintenance

Cold storage facility cleaning and maintenance are equally important. It is important to often check the cooling machine, including the temperature, humidity, and preserved items. Trays, containers, and storage bins must be serviced and cleaned promptly.

4. Promotion of product and target Audience

A cold storage company’s performance depends on its ability to execute advertising and promotional campaigns and use effective marketing strategies. In the early and later stages, an entrepreneur should concentrate on all market segments, including traders, promoters, wholesalers, marketers, warehouse companies, retail markets, and supermarkets in urban and rural areas. 

5. Arranging Funds

Raising finance is one of the most onerous challenges since the cold storage sector requires a pretty sizable investment and avoids cash crunch situations. Because one may face urgent financial requirements or to pay for other expenditures, savings are not a practical source of finance for the entire investment in the cold storage firm.

How much capital do you need to invest in the cold storage business?

The cost to set up cold storage space requires a minimum investment of 30-40 lakh. The better the technology, the higher you make the best cold storage available! Always set your financial budget and know all the facts before investing in cold storage businesses.

The investment costs include acquisitions for land, construction permits and licensing of utilities like water and electricity. Additionally, you’d need a large investment to buy cooling machines and erect proper infrastructure. 

Generally, modern machines guarantee better performance and long-term durability. With these fixed charges, you will also have to consider working capital expenses. Overall consideration for staff, utility billing fees, and promotional expenses exists.

OneNDF is committed to providing you with the best debt financing options in terms of a Term Loan or any working capital facility and all sorts of business-related information.

Cold storage facilities are specialized buildings designed to store perishable goods, such as fruits, vegetables, meat, and dairy products, at low temperatures. These facilities require specialized construction techniques and materials to maintain the desired temperature range and humidity levels, which can significantly impact the overall construction cost.

Cold Storage Construction Cost

The construction cost of a cold storage facility primarily depends on several factors, including:

• Size: Larger facilities generally cost more to build due to the increased amount of materials and labor required.
• Insulation: Proper insulation is crucial for maintaining the desired temperature and minimizing energy consumption. High-quality insulation materials, such as polyurethane or polystyrene, are typically used, which can be more expensive than traditional insulation materials.
• Refrigeration system: The refrigeration system is one of the most significant expenses in cold storage construction. High-efficiency refrigeration units, cooling towers, and other mechanical equipment are required to maintain the low temperatures, and these can be costly to purchase and install.
• Flooring and wall panels: Special flooring and wall panels designed for cold environments are often used to prevent condensation and ensure durability. These materials can be more expensive than standard construction materials.
• Lighting and electrical systems: Cold storage facilities require specialized lighting and electrical systems that can withstand low temperatures and minimize heat generation.
• Location: The construction cost can vary depending on the region and the availability of skilled labor and materials.

Cold Storage Business Plan FAQs

Q: is cold storage a profitable business.

Yes, Cold storage is a profitable industry. The Indian government annually introduces additional subsidies and policies for its promotion.

Q: Is cold storage a good investment?

Cold storage means storing vegetables and fruits for longer durations without spoiling. While this company’s initial investment is significantly higher than other businesses, the return on investments is also higher for longer tenures.

Q: How much money is required to establish a cold storage unit?

Cold storage businesses are capital-intensive operations. The minimum initial investment required is around 30 to 40 lakh.

Q: What is the Cold Storage Machinery Cost?

For a cold storage facility in India, the refrigeration machinery is a major expense. The compressors, condensers, and related equipment can cost anywhere from Rs. 50 lakhs to several crores, depending on the storage capacity and desired temperature range.

Q: What will be the investment for 1000 mt of cold storage?

For your company to get 1,000 tonnes, the cold storage cost is a little under 2,75,00,000 INR.

Q: How much land is required for 5000 mt cold storage?

5000 MT godowns = 3 Compartments. Space between compartments: 135′-9″x70′ = 9502.20 sq. ft. The total area is 879.85 sq2 (41.23 m x 21.34 m).

Q: What is the 5000 mt cold storage profit?

Setting up a large 5,000 MT cold storage requires crores of rupees investment. In the initial years, there may be losses due to loan interest payments. But once the loan is paid off and the facility runs at full capacity, it can earn an annual profit of around Rs. 10-20 crores by charging rent for storing perishable goods at low temperatures.

Q: How much land is required for 3000 mt cold storage?

A 3000 mt cold storage will require 2 acres of land.

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Table of contents, a strategic cold storage business plan.

• 18 March, 2024

The Cold Storage Industry Overview

The cold storage industry plays a crucial role in the storage and preservation of perishable goods, ensuring their quality and safety throughout the supply chain. In this section, we will explore the growth and market trends within the cold storage industry and highlight the importance of cold storage facilities.

Growth and Market Trends

The global cold storage business market has been experiencing significant growth in recent years. According to Sunleaf Foods , the market was valued at $122.8 billion in 2020 and is projected to reach $212.54 billion by 2028, with a compound annual growth rate (CAGR) of 8.2% during the forecast period 2021-2028.

Several factors contribute to the growth of the cold storage industry. One significant factor is the rise of e-commerce, which has led to increased demand for cold storage facilities. As more consumers turn to online shopping for groceries and fresh produce, the need for efficient and reliable cold storage solutions becomes paramount. Cold storage facilities enable the safe and timely delivery of perishable goods, ensuring their freshness and quality throughout the transportation and storage processes.

Another trend driving the growth of the cold storage industry is the adoption of automation and robotics. Cold storage providers are increasingly implementing automated solutions to improve efficiency, reduce operational costs, and enhance overall productivity. Automation allows for streamlined processes, such as automated picking, packing, and inventory management, optimizing the storage and retrieval of goods within the facility.

Importance of Cold Storage Facilities

Cold storage facilities play a vital role in maintaining the integrity and safety of perishable goods. They provide controlled environments with precise temperature and humidity levels, ensuring optimal storage conditions for a wide range of products, including fresh produce, dairy products, pharmaceuticals, and more.

One of the key benefits of cold storage facilities is the ability to extend the shelf life of perishable goods. By storing products at low temperatures, the growth of bacteria and other microorganisms is slowed down, preserving the quality and nutritional value of the goods. This allows for longer storage periods and reduces the risk of spoilage, providing a longer window for distribution and sale.

Moreover, cold storage facilities are essential for maintaining the integrity and safety of temperature-sensitive products. They help prevent the growth of harmful bacteria and pathogens that can cause foodborne illnesses. By adhering to strict temperature control and hygiene standards, cold storage facilities ensure that products remain safe for consumption and meet regulatory requirements.

In addition to food and pharmaceutical industries, cold storage facilities also serve other sectors such as chemical and manufacturing industries, which require temperature-controlled storage for their products.

The growth and importance of the cold storage industry make it a promising sector for investment and business opportunities. By staying abreast of the latest market trends and understanding the critical role that cold storage facilities play in the supply chain, businesses can capitalize on the growing demand for reliable and efficient cold storage solutions.

Factors Affecting Cold Storage Efficiency

Efficiency is paramount in the cold storage industry, where maintaining precise temperature control and optimizing storage conditions are crucial for preserving the quality and safety of perishable products. Several factors come into play when considering the efficiency of a cold storage facility. In this section, we will explore three key factors: temperature control and design considerations, refrigeration systems and technology, and proximity and location.

Temperature Control and Design Considerations

Temperature control is of utmost importance in cold storage facilities. Perishable products are typically stored within a strict temperature range, such as -20 degrees Celsius to -28 degrees Celsius, to prevent any quality degradation. Even a slight temperature variation can result in significant costs for companies. Providers must maintain these precise temperature conditions to ensure the quality and timely delivery of frozen food products, which is essential for maintaining customer satisfaction and brand reputation ( ColdChainManagement.org ).

The design of cold storage facilities also plays a crucial role in their efficiency. Factors such as wall insulation, floor compatibility with heating systems, size, shape, and door design are essential to consider when selecting a cold room storage facility. Thicker insulation in walls is recommended for deep freezing applications, while proper floor design can prevent ice buildup and ensure safety in the storage space. These design considerations help optimize the energy efficiency of the facility and maintain the desired temperature levels throughout the storage area ( ColdChainManagement.org ).

Refrigeration Systems and Technology

Different types of refrigeration systems are utilized in cold storage facilities, depending on the size and complexity of the operation. The choice of refrigeration system can significantly impact the efficiency of the facility. For instance, centralized refrigeration systems are suitable for large operations like supermarkets and warehouses, where a single system serves multiple cold rooms. On the other hand, clip-on refrigeration systems are ideal for simple cold rooms with a single temperature zone. These systems can be mounted on the wall or ceiling of the cold room, providing efficient cooling for smaller-scale operations. Remote condensing systems are another option, where the condensing unit is located outside the cold room, minimizing heat and noise within the storage area ( ColdChainManagement.org ).

Refrigeration technology continues to advance, with innovations aimed at improving energy efficiency and temperature control. The development of advanced control panels allows for precise temperature regulation and monitoring, ensuring that the stored products remain in optimal condition. Additionally, separate cool zones within the cold storage facility can provide flexibility in managing different temperature requirements, further enhancing efficiency and product preservation ( ColdChainManagement.org ).

Proximity and Location

The proximity, access, and location of a cold storage facility can significantly impact operational costs and environmental impact. Choosing a location near production or growing sites can help minimize fuel expenses, reduce the carbon footprint, and streamline the supply chain process. Proximity to transportation hubs and major distribution centers also plays a role in optimizing the efficiency of cold storage operations. By strategically locating facilities, companies can minimize transportation time and costs associated with moving products between different stages of the supply chain, ultimately improving overall efficiency and customer satisfaction ( ColdChainManagement.org ).

Considering temperature control and design considerations, selecting suitable refrigeration systems and technology, and carefully evaluating proximity and location are essential steps in optimizing the efficiency of a cold storage facility. By prioritizing these factors, companies can ensure the proper preservation of perishable products, reduce operational costs, and enhance their competitive edge in the cold storage industry.

Costs and Financial Considerations

Starting a cold storage business involves various costs and financial considerations. Understanding these aspects is essential for developing a comprehensive cold storage business plan that accounts for the necessary investments and ongoing expenses. This section will explore the startup costs, operating costs, and the investment required in refrigerated vehicles.

Startup Costs for Cold Storage Business

The startup costs for a cold storage business can vary depending on the scale of operations and the specific requirements of the facility. On average, starting a small-scale cold storage business in the United States can range from approximately $25,000 to $70,000. This amount typically includes expenses for equipment, rental space, licenses, and permits ( FinModelsLab ).

Operating Costs and Expenses

Operating costs for a cold storage business encompass various ongoing expenses. These costs include electricity, maintenance, labor, and other day-to-day operational requirements. The exact amount can vary based on the size and scale of the facility. On average, the operating costs for a small cold storage business range from $15,000 to $50,000 annually ( FinModelsLab ).

Investment in Refrigerated Vehicles

To maintain the cold chain during transportation, cold storage businesses often need to invest in refrigerated vehicles. The cost of purchasing a refrigerated van can range from $30,000 to $100,000, depending on the size and specifications of the vehicle. The investment in refrigerated vehicles is crucial to ensure the safe transportation of temperature-sensitive goods while maintaining their integrity and quality ( FinModelsLab ).

It’s important to note that construction costs for a cold storage facility can vary significantly based on factors such as location, size, and specific requirements. Urban areas may incur higher costs due to land prices, building codes, and permits. Additionally, proximity to transportation infrastructure like ports, airports, and highways can impact construction costs. The size of the facility is also a crucial factor, with larger facilities generally resulting in higher costs per square foot, although the overall project cost increases accordingly ( LinkedIn ).

When developing a cold storage business plan, it’s important to conduct a thorough analysis of the costs involved and consider potential financial challenges. This includes accounting for startup costs, ongoing operating expenses, and investments in essential equipment such as refrigerated vehicles. By carefully evaluating these financial considerations, businesses can effectively plan for success in the cold storage industry.

Regulatory Compliance and Safety

In the cold storage industry, regulatory compliance and safety are of paramount importance. Industrial cold storage facilities must adhere to regulations that cover various aspects, including safety, security, environmental impact, and sustainability. These regulations are set by government agencies, as well as internal policies and procedures, to ensure efficient operations and mitigate risks ( Ice Cold Consulting ).

Importance of Compliance Audits

Compliance audits are essential processes to ensure that a company complies with applicable laws and regulations. These audits evaluate whether a facility is meeting the required standards in terms of safety, environmental impact, and corporate responsibilities. By conducting regular compliance audits, cold storage businesses can identify areas of non-compliance and take corrective actions to ensure adherence to regulations. Compliance audits help avoid hefty fines and penalties for violations, as well as demonstrate a commitment to maintaining high standards in the industry.

Workplace Safety and Hazard Management

Employers in the cold storage industry have a responsibility to evaluate workplace hazards and implement effective control measures to minimize the risk of injury or illness to workers. Occupational Safety and Health Administration (OSHA) guidelines provide guidance on identifying and mitigating workplace hazards. It is crucial for cold storage facilities to prioritize workplace safety by providing adequate training, implementing safety protocols, and ensuring the proper use of personal protective equipment (PPE). By maintaining a safe working environment, cold storage businesses can protect workers from adverse effects and promote a culture of safety.

Environmental Impact and Hazards

Cold storage facilities may face environmental hazards that can potentially harm the environment and surrounding communities. Hazards such as leaks from equipment or pressure vessels can result in serious consequences. To mitigate these risks, cold storage businesses should implement proper compliance measures and monitoring systems. These measures may include regular inspections, maintenance of equipment, and adherence to environmental regulations. By proactively managing environmental impact and hazards, cold storage facilities can minimize the risk of accidents and contribute to sustainable practices.

In summary, regulatory compliance and safety are crucial aspects of operating a cold storage facility. Compliance audits help ensure adherence to laws and regulations, workplace safety measures protect workers, and environmental impact management minimizes risks to the environment. By prioritizing compliance and safety, cold storage businesses can create a secure and sustainable environment for their operations.

SWOT Analysis of Cold Storage Business

Conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis is an essential step in developing a comprehensive business plan for a cold storage facility. Understanding the internal and external factors that impact the business helps in identifying areas of advantage, areas for improvement, potential growth opportunities, and potential risks. Let’s delve into each aspect of the SWOT analysis for a cold storage business.

The strengths of a cold storage business are the internal factors that provide a competitive advantage and contribute to its success. Some key strengths of a cold storage business may include:

• Proven Expertise: A cold storage business with experienced professionals and a skilled workforce possesses the knowledge and expertise to handle temperature-controlled storage and logistics effectively.
• Infrastructure and Equipment: A well-established cold storage facility equipped with advanced refrigeration systems, temperature monitoring equipment, and backup power generators ensures optimal storage conditions and minimizes the risk of product spoilage.
• Strong Industry Network: Building strong relationships with suppliers, distributors, and customers enables a cold storage business to establish a reliable and extensive network within the cold storage industry.
• Compliance and Safety: Maintaining regulatory compliance and prioritizing workplace safety measures ensures the safe storage and handling of perishable goods, instilling trust in customers and partners.

Identifying weaknesses helps a cold storage business focus on areas that require improvement to enhance its competitive position. Some common weaknesses of a cold storage business may include:

• High Initial Investment: Establishing a cold storage facility involves significant capital investment, including costs for insulation, refrigeration systems, and temperature monitoring equipment, which may pose a challenge for new or smaller businesses.
• Operational Costs: Ongoing operational expenses, including electricity costs, maintenance, and staffing, can impact the profitability of a cold storage business if not carefully managed.
• Energy Consumption: The energy-intensive nature of cold storage operations can lead to higher energy consumption, requiring efficient energy management strategies to minimize costs and environmental impact.

Opportunities

Identifying opportunities allows a cold storage business to capitalize on emerging trends and potential areas for growth. Here are some opportunities for a cold storage business:

• Growing Demand for Cold Storage: The rise of e-commerce and increasing consumer demand for fresh and frozen products present opportunities for cold storage businesses to expand their operations and cater to the evolving needs of the market.
• Technological Advancements: Embracing automation, robotics, and Internet of Things (IoT) integration in cold storage facilities can enhance operational efficiency, reduce costs, and improve overall productivity ( Sunleaf Foods ).
• Sustainability Practices: Implementing eco-friendly solutions, such as energy-efficient refrigeration systems and sustainable packaging, aligns with the growing consumer preference for environmentally conscious businesses ( Sunleaf Foods ).
• Global Market Expansion: Increasing international trade and the demand for cold chain logistics present opportunities for cold storage businesses to expand their services and tap into new markets.

Identifying threats helps a cold storage business anticipate and mitigate potential risks that may impact its operations. Some common threats to a cold storage business include:

• Intense Competition: The cold storage industry is highly competitive, and businesses must differentiate themselves to attract and retain customers.
• Regulatory Changes: Changes in regulations and compliance requirements can impact the operations and cost structure of a cold storage business.
• Market Volatility: Fluctuations in the supply and demand of perishable goods, changes in consumer preferences, and economic downturns can affect the revenue and profitability of a cold storage business.
• Technological Disruptions: Failure to keep up with technological advancements and industry trends may put a cold storage business at a disadvantage.

Understanding the SWOT analysis helps a cold storage business identify its strengths to leverage, weaknesses to address, opportunities to pursue, and threats to mitigate. This analysis forms the foundation for strategic decision-making and developing a robust business plan to navigate the dynamic cold storage industry.

Business Planning for Cold Storage Facility

When starting a cold storage facility, developing a comprehensive business plan is essential. A well-crafted business plan will serve as a roadmap for the business, outlining its goals, strategies, and financial projections. Let’s explore the key components of a business plan for a cold storage facility.

Developing a Business Plan

Developing a business plan for a cold storage facility is a critical step in setting up a successful operation. It allows entrepreneurs to organize every element of their business strategy and provides a clear roadmap for the business’s lifespan ( CanadaStartups ). The business plan should outline the following:

• Business Information: Provide an overview of the cold storage facility, including its location, size, and target market.
• Products/Services Offered: Describe the range of services offered by the facility, such as temperature-controlled storage, distribution, and value-added services.
• Revenue Expectations: Estimate the expected revenues by listing the products or services offered and entering corresponding financial figures. While concrete figures may not be available initially, providing estimates is crucial to understanding the revenue potential of the facility.
• Market Analysis: Conduct a thorough market analysis to understand the industry landscape and competition. This includes assessing the market size, trends, and potential growth opportunities. For more information on the cold storage industry, refer to our article on cold storage industry analysis .
• Competition Overview: Provide a clear explanation of the competitive landscape in the cold storage industry. Identify key competitors and analyze their strengths and weaknesses.

Business Plan Template and Structure

To assist entrepreneurs in creating a comprehensive business plan for a cold storage facility, a business plan template can be used as an interactive tool. This template guides users by asking specific questions about the business, resulting in a professional, informative, and convincing document ( CanadaStartups ). The template typically includes sections such as:

• Executive Summary: Summarize the key points of the business plan, highlighting the facility’s unique value proposition and competitive advantage.
• Company Description: Provide an overview of the cold storage facility, including its mission, vision, and legal structure.
• Market Analysis: Detail the market analysis findings, including the size of the cold storage market, trends, and growth potential. Refer to our article on cold storage market trends for more information.
• Organization and Management: Describe the organizational structure of the facility and provide information about key personnel and their roles.
• Products/Services: Outline the range of services offered by the facility, including storage capacity, temperature control capabilities, and value-added services.
• Marketing and Sales Strategy: Explain the marketing and sales approach, including target customers, pricing strategies, and promotional activities.
• Financial Projections: Present financial projections, including revenue forecasts, expenses, and profitability estimates.

Market Analysis and Revenue Expectations

A crucial aspect of the business plan for a cold storage facility is conducting a thorough market analysis. This analysis helps entrepreneurs understand the business environment, identify potential customers, and assess the competition ( CanadaStartups ). The market analysis should cover:

• Market Size: Determine the size of the cold storage market and identify any growth trends. For more information on the market size, refer to our article on cold storage market size .
• Target Customers: Identify the target customers for the cold storage facility, such as food manufacturers, distributors, or retailers.
• Competition: Analyze the key competitors in the market and assess their strengths, weaknesses, and market share.

Revenue expectations should be estimated based on the products or services offered by the facility. Even if concrete figures may not be available initially, providing estimates is crucial to understanding the revenue potential of the cold storage facility ( CanadaStartups ). By detailing every aspect of the business plan, entrepreneurs can create a solid foundation for their cold storage facility and increase the likelihood of success.

Cold Storage Efficiency for Supply Chain

Efficient cold storage is crucial for maintaining the quality and safety of perishable products throughout the supply chain. Temperature control, coordination in cold chain logistics, and contingency planning are key factors in achieving optimal efficiency.

Importance of Temperature Control

Temperature control plays a critical role in preserving the freshness and quality of perishable products. Failure to maintain the appropriate shipment temperature can result in textural degradation, discoloration, bruising, and microbial growth. It is essential to prioritize temperature integrity throughout the entire supply chain to ensure that products maintain their optimal condition.

To maximize cold storage efficiency, it is important to invest in proper refrigeration systems and technologies. These systems should be equipped with accurate temperature monitoring and control mechanisms to maintain the desired temperature range for different types of products. Regular calibration and maintenance of these systems are crucial to ensure consistent temperature control.

Coordination and Integration in Cold Chain Logistics

Efficient cold chain logistics requires seamless coordination and integration among all parties involved in the supply chain, from farmers and producers to retailers and end consumers. Each step in the supply chain is vital for maintaining the freshness and quality of perishable products.

Coordination begins with proper preparation and conditioning of shipments. This includes ensuring that products are appropriately packaged, labeled, and stored at the correct temperature before transportation. Careful selection of transportation routes is also essential to minimize transit time and maximize cold chain performance.

Integration among different stakeholders is crucial for effective cold chain management. Collaboration and communication between farmers, suppliers, logistics providers, and retailers enable the smooth flow of information and ensure that temperature-sensitive products are handled properly at each stage of the supply chain.

Contingency Planning and Risk Management

Contingency planning is essential to mitigate the risks associated with disruptions in the cold chain. Unexpected events like truck breakdowns or refrigeration unit failures can lead to temperature deviations and jeopardize the safety and quality of perishable products.

Developing comprehensive contingency plans in collaboration with transportation partners is crucial. These plans should outline alternative routes, backup refrigeration options, and response protocols in case of disruptions. Regular training and communication with all stakeholders involved in the cold chain can help ensure that everyone is prepared to handle unexpected situations effectively.

By emphasizing temperature control, coordination, and contingency planning, businesses can enhance the efficiency of their cold storage operations. This not only helps maintain the quality and safety of perishable products but also minimizes waste and ensures customer satisfaction throughout the supply chain.

Future Trends in Cold Storage

As the cold storage industry continues to evolve, several trends are shaping the future of this sector. Keeping up with these trends is essential for cold storage businesses to stay competitive and meet the changing demands of the market. In this section, we will explore three significant trends: automation and robotics, internet of things (IoT) integration, and sustainability practices.

Automation and Robotics

The adoption of automation and robotics in cold storage facilities is on the rise, bringing numerous benefits to the industry. Automated systems can enhance efficiency, reduce operational costs, and improve overall productivity. With the ability to handle repetitive tasks and perform them with precision, robots can streamline processes such as sorting, stacking, and palletizing, leading to increased throughput and reduced labor requirements. Automated guided vehicles (AGVs) and robotic arms are becoming increasingly common sights in modern cold storage warehouses.

By embracing automation and robotics, cold storage businesses can optimize their operations, minimize errors, and improve inventory management. These technological advancements also contribute to enhanced safety measures, as robots can handle heavy and hazardous tasks, reducing the risk of accidents and injuries. Furthermore, automation allows for more accurate temperature control and monitoring, ensuring the preservation of perishable goods.

Internet of Things (IoT) Integration

The integration of Internet of Things (IoT) technology is revolutionizing the cold storage industry. IoT devices embedded with sensors and connectivity capabilities enable real-time monitoring and data collection, providing valuable insights into various aspects of cold storage operations. By connecting temperature sensors, humidity monitors, and other critical parameters to a centralized system, cold storage facilities can ensure optimal storage conditions and quality control of perishable goods.

With IoT integration, cold storage providers can remotely monitor and manage their facilities, receiving alerts and notifications in case of temperature fluctuations or other anomalies. This proactive approach enables timely interventions, reducing the risk of product spoilage and ensuring compliance with regulatory requirements. The ability to access real-time data also facilitates more efficient inventory management, enabling businesses to optimize space utilization and minimize waste.

Sustainability Practices

As sustainability becomes a key concern for businesses across industries, cold storage providers are increasingly focusing on eco-friendly practices. Implementing sustainable solutions not only aligns with environmental goals but also offers long-term economic benefits. Energy-efficient refrigeration systems, solar panels for renewable energy generation, and the use of environmentally friendly refrigerants are some of the practices being adopted in the industry.

By reducing energy consumption and carbon emissions, cold storage facilities can minimize their environmental impact and contribute to a greener future. Sustainable practices also resonate with consumers who prioritize environmentally friendly products and services. By highlighting their commitment to sustainability, cold storage businesses can enhance their brand reputation and attract environmentally conscious customers.

By staying abreast of these future trends, cold storage businesses can position themselves for success in a rapidly evolving industry. Embracing automation and robotics, integrating IoT technology, and implementing sustainable practices will not only improve operational efficiency but also drive growth and meet the increasing demands of the market.

Top Location Choices for Cold Storage Investment

When considering investment in the cold storage industry, it is essential to carefully select the location of your facility. Michigan emerges as a promising destination for cold storage investment in 2024, showcasing significant growth potential within the industry. Let’s explore the benefits and infrastructure offered by Michigan, along with success stories and expansion projects in the region.

Michigan as a Promising Destination

Michigan stands out as an exceptional choice for cold storage investment due to its remarkable progress in the industry. The state actively fosters and assists the cold storage sector through various initiatives, leading to significant growth potential. With a flourishing agribusiness sector, Michigan heavily relies on top-notch cold storage warehouses to handle perishable products efficiently, making effective cold storage management crucial for staying competitive ( LinkedIn ).

Benefits and Infrastructure in Michigan

Michigan offers numerous advantages for businesses operating in the cold storage industry. Here are some key benefits:

Business Climate : Michigan provides a highly advantageous business climate, with a favorable regulatory environment and a strong commitment to supporting cold storage operations.

Infrastructure : The state boasts a comprehensive transportation system, including major highways, railways, and access to international shipping through the Great Lakes. This infrastructure facilitates efficient distribution and transportation of goods.

Tax Incentives : Michigan offers appealing tax incentives, including tax credits and exemptions, to attract and support businesses in the cold storage sector.

Diverse Industry : The state’s diverse industry base, including agriculture, food processing, and manufacturing, creates a robust demand for cold storage facilities. This diversification provides stability and opportunities for growth.

Success Stories and Expansion Projects

Michigan has witnessed notable success stories and expansion projects within the cold storage industry. For example, projects in Wayland and Holland demonstrate the region’s commitment to fostering growth and innovation in the sector. These projects are projected to bring in substantial investments, boost the economy, and create new job opportunities ( LinkedIn ).

FreshOne’s cold storage facility in Michigan exemplifies the state’s commitment to high standards in cold storage management. Equipped with advanced logistics systems and modern technologies, the facility ensures secure and organized storage and management of goods. FreshOne’s facility offers specialized handling and customized solutions to meet diverse business needs ( LinkedIn ).

By choosing Michigan as the location for your cold storage facility, you can leverage the state’s business-friendly environment, strong infrastructure, tax incentives, and a flourishing industry base. These factors position Michigan as an optimal destination for cold storage investment, offering opportunities for growth and success in the industry.

Construction and Layout of Cold Storage Facility

When it comes to constructing a cold storage facility, careful planning and consideration are essential to ensure optimal functionality and efficiency. This section will cover key aspects such as capital investment and cost analysis, maximizing operational efficiency, and zoning and temperature control.

Capital Investment and Cost Analysis

Constructing a cold storage facility involves substantial capital investment. Costs include insulation, refrigeration systems, temperature monitoring equipment, and backup power generators. It is crucial to conduct a comprehensive cost analysis to determine the financial viability and return on investment of the project. Factors such as ongoing operational expenses, including electricity costs, maintenance, and staffing, should be taken into account as well. The cost of building a cold storage facility can vary significantly based on factors such as location, land prices, building codes, and permits. For more information on the cost analysis of cold storage facilities, refer to Scout Cities and LinkedIn .

Maximizing Operational Efficiency

The layout of a cold storage facility plays a crucial role in maximizing operational efficiency. Optimizing the flow of goods, reducing unnecessary movement, and maximizing storage space are key considerations. Utilizing modular racking systems, vertical storage systems, and efficient material handling equipment can help achieve these goals. By carefully planning the layout, you can minimize the time and effort required to retrieve and store products, ultimately reducing operating costs. For insights on maximizing operational efficiency, refer to Scout Cities .

Zoning and Temperature Control

Proper zoning within a cold storage facility is essential for maintaining precise storage conditions. Different products may require specific temperature settings based on their requirements. For example, fresh produce may have different temperature needs compared to frozen goods. By creating separate temperature-controlled zones, you can ensure optimal storage conditions for different products. This zoning can be achieved through the use of insulated walls and doors, as well as advanced temperature monitoring and control systems. For more information on zoning and temperature control in cold storage facilities, refer to Scout Cities .

By carefully considering the capital investment, cost analysis, operational efficiency, and zoning requirements, you can construct a cold storage facility that meets the needs of your business. It is crucial to prioritize the long-term functionality and efficiency of the facility to ensure its success within the competitive cold storage industry.

When considering investment in a cold storage facility, the selection of the right location plays a crucial role in the success of the business. Michigan stands out as a promising destination for cold storage investment in 2024 . The state offers a favorable business climate, strong infrastructure, and various advantages for enterprises operating within the cold storage industry.

Michigan’s strategic location in the Great Lakes region offers several advantages for cold storage businesses. Its proximity to major transportation routes, including highways, railways, and international borders, provides convenient access to markets across North America. This advantageous geographical position enables efficient distribution and reduces transportation costs, making Michigan an ideal choice for cold storage investment.

Michigan boasts a robust infrastructure that supports the cold storage industry. The state’s transportation system includes well-maintained road networks, rail connections, and access to multiple airports and ports. This infrastructure facilitates seamless movement of goods and ensures efficient supply chain operations.

Furthermore, Michigan offers appealing tax incentives and business-friendly policies that attract companies seeking to establish or expand cold storage facilities. The state’s commitment to supporting the industry is evident in its initiatives to streamline regulatory processes and provide assistance for businesses in securing financing and navigating regulatory compliance.

Michigan has witnessed successful cold storage projects and expansions in recent years. These success stories highlight the state’s potential as an ideal location for cold storage investment. Companies have leveraged Michigan’s infrastructure, business-friendly environment, and access to markets to establish and expand their operations successfully.

By choosing Michigan as a location for cold storage investment, businesses can tap into a growing market and benefit from the state’s strategic advantages. The demand for cold chain products is increasing globally, driven by improving quality of life and the rise of developing countries Robin Waite . Michigan’s favorable business climate, infrastructure, and access to transportation networks position it as an optimal destination for cold storage facilities.

When analyzing potential locations for cold storage investment, Michigan offers a compelling combination of benefits, including its strategic location, robust infrastructure, and success stories within the industry. These factors make Michigan an attractive choice for businesses looking to establish or expand cold storage operations.

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How To Start a Cold Storage Business – Complete Guide

• January 19, 2024
• by Next What Business Research Team

Do you want to start a cold storage business? Find here a detailed cold storage business plan sample checklist for your ready reference including cost, investment, machinery, profitability, and subsidy information.

If you are looking for a one-time investment business, then starting cold storage is just perfect for you. Generally, in this business, the initial investment is higher compared to other small businesses. However, this type of business ensures a constant return on a long-term basis.

Cold storage is a profitable business both in developing and developed countries. You will find two different types of cold storage according to the storage facility. One is specific for one product (for example potato) and another is multipurpose. However, multi-purpose cold storage ensures better returns and profitability overall.

What is a Cold Storage Business?

A cold storage business is a specialized enterprise dedicated to providing temperature-controlled storage facilities for a variety of perishable goods. The primary objective is to create an environment that preserves the freshness and quality of items that are sensitive to temperature, such as fruits, vegetables, dairy products, pharmaceuticals, and more.

Key Components of a Cold Storage Business

A) temperature-controlled warehousing.

The cornerstone of a cold storage business is the provision of warehouses equipped with advanced temperature control systems. These facilities are meticulously designed to maintain specific temperature ranges suited to the requirements of different products.

b) Logistics and Distribution

Cold storage businesses often integrate logistics and distribution services. This involves the efficient transportation of temperature-sensitive goods from producers to the storage facility and, subsequently, to various points in the supply chain.

c) Monitoring and Security Systems

State-of-the-art monitoring systems are essential to ensure that the designated temperatures are consistently maintained. Security measures, including surveillance and access controls, are implemented to safeguard the stored goods.

d) Customized Storage Solutions

The flexibility to cater to diverse products is a hallmark of a successful cold storage business. This includes offering customizable storage solutions to accommodate the unique requirements of different industries.

e) Technology Integration

Embracing technological advancements is crucial. Cold storage businesses leverage cutting-edge technologies such as IoT (Internet of Things) for real-time monitoring, automated systems for inventory management, and energy-efficient solutions to reduce operational costs.

f) Compliance with Regulations

Adherence to local and international regulations governing the storage and transportation of temperature-sensitive goods is paramount. This involves maintaining stringent quality control measures to meet industry standards.

g) Collaboration with Stakeholders

Collaborative partnerships with producers, distributors, and retailers form the backbone of a cold storage business. Establishing a robust network ensures a seamless flow of goods through the supply chain.

h) Energy Efficiency Measures

Given the energy-intensive nature of maintaining low temperatures, cold storage businesses implement energy-efficient practices. This includes utilizing eco-friendly refrigeration systems and exploring sustainable energy sources.

i) Risk Management Strategies

Due to the nature of the goods being stored, effective risk management strategies are imperative. This involves having contingency plans for power outages, equipment failures, and other potential disruptions.

Is Cold Storage a Profitable Business in India?

As per this report , in 2022, the size of the cold chain industry in India was around 16 million U.S. dollars, and it is forecast to reach 36 million dollars in 2027. In 2021, pharmaceutical products took up more than two-thirds of the cold chain storage in India.

The Indian government provides various incentives and subsidies to promote cold storage infrastructure. Profitability Impact: Entrepreneurs can leverage these benefits to enhance their financial viability, making it an attractive proposition.

The frozen food market in India is witnessing a surge, expected to reach USD 1.3 billion by 2024. Besides, cold storages have an important role in reducing the wastage of perishable commodities. In addition, it helps in providing remunerative prices to the growers and to make available farm products to the consumers at competitive and affordable prices. Additionally, changing lifestyles and demand for processed or packaged food are creating the need for cold storage solutions globally.

India is a significant exporter of agricultural produce, with a focus on improving cold chain logistics. Cold storage facilitates the export of quality agricultural products, tapping into global markets and driving revenue.

Benefits of a Cold Storage

Cold storage facilities have become the backbone of various industries, offering a myriad of benefits that span from preserving freshness to enhancing global trade. Let’s delve into the key advantages that make cold storage an invaluable asset:

⇒ Preservation of Freshness

Cold storage maintains low temperatures, slowing down the natural decay of perishable items. This ensures that fruits, vegetables, dairy products, and other sensitive goods retain their freshness for an extended period.

⇒ Prevention of Spoilage

By controlling temperature and humidity, cold storage inhibits the growth of microorganisms that lead to spoilage. This prevention is instrumental in reducing food wastage and ensuring that products reach consumers in optimal condition.

⇒ Extended Shelf Life

The controlled environment provided by cold storage significantly extends the shelf life of products. This is particularly critical for items with a short natural lifespan, allowing businesses to manage inventory effectively.

⇒ Market Accessibility

Cold storage facilities enable producers to store surplus goods during peak seasons and release them strategically to meet market demands throughout the year. This flexibility is essential for sustaining a consistent supply chain.

⇒ Supply Chain Efficiency

Cold storage is a linchpin in the supply chain, especially in agriculture and food processing. It facilitates the storage of bulk produce, ensuring a steady and reliable flow of goods from producers to distributors and, ultimately, to consumers.

⇒ Global Trade Facilitation

In the realm of international trade, cold storage is indispensable. It allows for the transportation and storage of goods that require specific temperature conditions, fostering the seamless movement of products across borders.

⇒ Quality Retention

Sensitive products like pharmaceuticals, chemicals, and vaccines require precise temperature control to maintain their efficacy. Cold storage ensures that these items retain their quality, contributing to public health and safety.

⇒ Diversification of Products

Cold storage empowers businesses to diversify their product offerings. Whether it’s a variety of dairy products or an array of flowers, the ability to store different goods in optimal conditions enhances market competitiveness.

⇒ Reduced Post-Harvest Losses

Agricultural economies benefit significantly from cold storage as it mitigates post-harvest losses. Surplus produce can be stored temporarily, preventing it from perishing before it reaches the market.

⇒ Adaptation to Climate Variability

Cold storage acts as a buffer against unpredictable weather conditions, allowing farmers and distributors to adapt to climate variations. This adaptability is crucial for maintaining a stable supply chain.

12 Steps to Start a Cold Storage Business

1. market research.

Before diving in, conduct thorough market research . Identify the demand for cold storage services in your target location and assess the competition.

2. Create A Business Plan

Starting a cold storage business demands strategic planning and careful implementation. Therefore, crafting a business plan or project report is the most important aspect of starting this business. According to your investment capacity, you will need to decide the business size.

Additionally, you must have financial planning with a projected ROI and payback period. A business plan helps you in numerous ways. It helps in commencing the business properly, getting finance, and ensuring smooth operations.

3. Obtain The Permissions & Licenses

Understand and comply with the legal and regulatory requirements for establishing and operating a cold storage facility. It depends on the specific location where you are starting the business. You need to obtain the necessary licenses and permits from local authorities.

4. Secure A Location

Location plays an important role in this business. Choose a strategic location that is easily accessible and has good connectivity. Proximity to agricultural regions and major transportation routes is advantageous. Additionally, you will need to procure approximately one acre of land for a multi-purpose/multi-commodity cold storage plant of 5000 MT capacity.

5. Cost of Starting a Cold Storage Business

The initial investment is very high in this business. Generally, the investment includes acquiring the land, building construction, obtaining permissions and licensing, and arranging utilities like water, electricity, etc. Additionally, you will need to invest a major startup capital in procuring the cooling machinery. Generally, modern and updated machinery ensures better performance and long-term sustainability.

Apart from the above-mentioned fixed costs, you will need to consider the working capital expenses also. The major considerations are staffing, utility bill payment, and promotional expenses.

The cost and investment will largely depend on the scale of the cold storage unit. However, according to experts, the estimated project cost for setting up 5000 MT Cold Storage may be in the range of Rs. 3 Crore – 4 Crores in Indian Rupees. The cost of land is an additional investment you need to make.

6. Arrange Finance

Cold storage is a capital-intensive business. You must have an investment capacity of 3 to 4 Corers for commencing this business. Generally, you can set up this business with financial help from banks . In addition, check if there are any subsidies or Govt. grants available for this business.

7. Cold Storage Business Subsidy

In India, the National Horticulture Board provides subsidies for cold storage businesses for entrepreneurs. You will need to apply online. There you will need to fill up an online IPA (In-Principle Approval) application Form. Before applying, carefully read and understand the Operational Guidelines of the relevant scheme.

8. Setting Up Your Cold Storage Facility

• Infrastructure: Invest in quality infrastructure with modern refrigeration systems. Ensure that your facility is equipped to handle a variety of products with different temperature requirements.
• Storage Capacity: Determine the scale of your cold storage facility based on market demand. Adequate storage capacity allows you to cater to a larger client base.
• Safety Measures: Implement stringent safety measures to protect stored goods and maintain optimal storage conditions. This includes fire safety systems, security measures, and backup power sources.

Also Read: Best Agriculture Business Ideas with Low Investment

9. Procuring Equipment and Technology

• Refrigeration Units: Invest in energy-efficient refrigeration units that can maintain varied temperature ranges for different products. Regular maintenance is crucial to prevent breakdowns.
• Warehouse Management System (WMS): Implement a robust WMS to track inventory, manage stock rotation, and monitor temperature controls. A well-integrated system enhances operational efficiency.
• Cold Storage Software: Utilize specialized software for cold storage management. This software helps in monitoring temperatures, managing orders, and ensuring compliance with industry standards.
• Inventory Management: Implement a systematic inventory management system to track product movement, expiry dates, and stock levels. This helps in preventing wastage and ensures timely deliveries.
• Quality Control: Establish stringent quality control measures to maintain the integrity of stored products. Regular inspections and adherence to hygiene standards are essential.

10. Fix Pricing

Establish competitive yet profitable pricing for your cold storage services. Consider factors like storage duration, volume, and additional services offered.

11. Staffing

Hire skilled personnel with experience in cold storage operations. Provide training on safety protocols, equipment handling, and hygiene practices.

12. Promote Your Cold Storage Business

Build strong relationships with local farmers, food manufacturers, and distributors. Networking is crucial for securing contracts and establishing your presence in the market. Create a professional website highlighting your services, facilities, and contact information. Utilize digital marketing strategies to reach potential clients.

Explore partnerships with businesses in the supply chain, such as logistics providers and wholesalers. Collaborative efforts can lead to mutually beneficial relationships.

Frequently Asked Questions

What is the primary purpose of a cold storage business in india.

Cold storage businesses play a crucial role in preserving perishable goods, particularly agricultural produce, by maintaining low temperatures. This helps extend the shelf life of products and minimizes post-harvest losses.

How can one secure funding for initiating a cold storage venture?

Entrepreneurs can explore various avenues for funding, including bank loans, government subsidies, and private investments. Government schemes specifically designed for cold storage infrastructure can provide valuable financial assistance.

Are there specific regulatory requirements for establishing a cold storage unit?

Yes, there are regulatory standards and guidelines set by authorities such as the Food Safety and Standards Authority of India ( FSSAI ) and the Ministry of Food Processing Industries. Compliance with these standards is essential for obtaining necessary licenses.

What are the critical considerations for choosing a suitable location for a cold storage facility?

Proximity to agricultural hubs, transportation networks, and markets is crucial. Additionally, accessibility to a stable power supply, water availability, and compliance with environmental regulations are important factors to assess.

How can technology be integrated for operational efficiency in a cold storage business?

Implementing technologies such as temperature monitoring systems, RFID tracking, and automated inventory management can enhance operational efficiency. These technologies not only ensure precise control over storage conditions but also streamline logistical processes.

Are there specific types of products that can be stored in a cold storage unit?

Cold storage facilities cater to a diverse range of products, including fruits, vegetables, dairy products, pharmaceuticals, and more. The versatility of cold storage allows for the preservation of various perishable items.

What are the key challenges faced by entrepreneurs in the cold storage business?

Challenges may include high initial investment costs, operational energy expenses, and the need for stringent quality control. Entrepreneurs should carefully address these challenges to ensure the long-term sustainability of their cold storage venture.

How can one stay updated on advancements in cold storage technologies?

Keeping abreast of industry publications, participating in relevant conferences, and engaging with industry associations can help entrepreneurs stay informed about the latest technologies and best practices in cold storage.

Is there government support available for cold storage businesses in India?

Yes, the Indian government offers various incentives, subsidies, and schemes to encourage the development of cold storage infrastructure. Entrepreneurs can explore these opportunities to reduce financial burdens.

What is the expected return on investment (ROI) for a cold storage business?

The ROI for a cold storage business can vary based on factors such as scale, location, and operational efficiency. Conducting a detailed feasibility study and financial analysis is essential for projecting realistic ROI expectations.

Cold Storage Business Plan Template & Guidebook

If you're looking for a well-crafted cold storage business plan template and guidebook, then you've come to the right place! Our #1 Cold Storage Business Plan Template & Guidebook provides a comprehensive and detailed blueprint of how to get your cold storage business up-and-running. We've taken great care to capture the essentials of this specific industry to ensure that our plan fits your unique business needs. This guidebook provides clear guidance on how to develop a unique strategic plan, organize your resources, and establish goals in order to achieve success.

Get worry-free services and support to launch your business starting at $0 plus state fees.

• How to Start a Profitable Cold Storage Business [11 Steps]
• List of the Best Marketing Ideas For Your Cold Storage Service:

How to Write a Cold Storage Business Plan in 7 Steps:

1. describe the purpose of your cold storage business..

The first step to writing your business plan is to describe the purpose of your cold storage business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.

It also helps to include a vision statement so that readers can understand what type of company you want to build.

Here is an example of a purpose mission statement for a cold storage business:

Our mission at Cold Storage is to provide large scale cold storage solutions to businesses and individuals in need of efficient, reliable, and secure storage of frozen, refrigerated, and dry goods. We are committed to offering high-quality services that meet the needs of our clients while adhering to the highest standards of safety, security, and environmental responsibility.

2. Products & Services Offered by Your Cold Storage Business.

The next step is to outline your products and services for your cold storage business. 

When you think about the products and services that you offer, it's helpful to ask yourself the following questions:

• What is my business?
• What are the products and/or services that I offer?
• Why am I offering these particular products and/or services?
• How do I differentiate myself from competitors with similar offerings?
• How will I market my products and services?

You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.

3. Build a Creative Marketing Stratgey.

If you don't have a marketing plan for your cold storage business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals. 

A good marketing plan for your cold storage business includes the following elements:

Target market

• Who is your target market?
• What do these customers have in common?
• How many of them are there?
• How can you best reach them with your message or product?

Customer base 

• Who are your current customers? 
• Where did they come from (i.e., referrals)?
• How can their experience with your cold storage business help make them repeat customers, consumers, visitors, subscribers, or advocates for other people in their network or industry who might also benefit from using this service, product, or brand?

Product or service description

• How does it work, what features does it have, and what are its benefits?
• Can anyone use this product or service regardless of age or gender?
• Can anyone visually see themselves using this product or service?
• How will they feel when they do so? If so, how long will the feeling last after purchasing (or trying) the product/service for the first time?

Competitive analysis

• Which companies are competing with yours today (and why)? 
• Which ones may enter into competition with yours tomorrow if they find out about it now through word-of-mouth advertising; social media networks; friends' recommendations; etc.)
• What specific advantages does each competitor offer over yours currently?

Marketing channels

• Which marketing channel do you intend to leverage to attract new customers?
• What is your estimated marketing budget needed?
• What is the projected cost to acquire a new customer?
• How many of your customers do you instead will return?

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4. Write Your Operational Plan.

Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations. 

In it, you should list:

• The equipment and facilities needed
• Who will be involved in the business (employees, contractors)
• Financial requirements for each step
• Milestones & KPIs
• Location of your business
• Zoning & permits required for the business

What equipment, supplies, or permits are needed to run a cold storage business?

Equipment needed to run a Cold Storage business includes cold storage freezers and/or refrigerators, a commercial walk-in cooler, a commercial freezer, and cold storage racking systems for storing frozen or refrigerated goods. Supplies needed include thermometers, plastic wrap and pallets for staging items during loading and unloading. Additionally, a business license is required, along with applicable permits from the local municipality or health department to operate a cold storage business.

5. Management & Organization of Your Cold Storage Business.

The second part of your cold storage business plan is to develop a management and organization section.

This section will cover all of the following:

• How many employees you need in order to run your cold storage business. This should include the roles they will play (for example, one person may be responsible for managing administrative duties while another might be in charge of customer service).
• The structure of your management team. The higher-ups like yourself should be able to delegate tasks through lower-level managers who are directly responsible for their given department (inventory and sales, etc.).
• How you’re going to make sure that everyone on board is doing their job well. You’ll want check-ins with employees regularly so they have time to ask questions or voice concerns if needed; this also gives you time to offer support where necessary while staying informed on how things are going within individual departments too!

6. Cold Storage Business Startup Expenses & Captial Needed.

This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.

Typically, expenses for your business can be broken into a few basic categories:

Startup Costs

Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a cold storage business varies based on many different variables, but below are a few different types of startup costs for a cold storage business.

Running & Operating Costs

Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.

Marketing & Sales Expenses

You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your cold storage business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.

7. Financial Plan & Projections

A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your cold storage business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses. 

Here are some steps you can follow to devise a financial plan for your cold storage business plan:

• Determine your start-up costs: This will include the cost of purchasing or leasing the space where you will operate your business, as well as the cost of buying or leasing any equipment or supplies that you need to start the business.
• Estimate your operating costs: Operating costs will include utilities, such as electricity, gas, and water, as well as labor costs for employees, if any, and the cost of purchasing any materials or supplies that you will need to run your business.
• Project your revenue: To project your revenue, you will need to consider the number of customers you expect to have and the average amount they will spend on each visit. You can use this information to estimate how much money you will make from selling your products or services.
• Estimate your expenses: In addition to your operating costs, you will need to consider other expenses, such as insurance, marketing, and maintenance. You will also need to set aside money for taxes and other fees.
• Create a budget: Once you have estimated your start-up costs, operating costs, revenue, and expenses, you can use this information to create a budget for your business. This will help you to see how much money you will need to start the business, and how much profit you can expect to make.
• Develop a plan for using your profit: Finally, you will need to decide how you will use your profit to grow and sustain your business. This might include investing in new equipment, expanding the business, or saving for a rainy day.

Frequently Asked Questions About Cold Storage Business Plans:

Why do you need a business plan for a cold storage business.

A business plan allows business owners to outline their goals and objectives, as well as identify potential risks and opportunities. It also helps to calculate the estimated financial requirements and establish the budget for the business. Additionally, a business plan can provide potential investors with an overview of the company’s financial forecast and operations. For a cold storage business specifically, a business plan should include an analysis of the existing cold storage market, a detailed description of services provided, and an estimate of start-up and operational costs.

Who should you ask for help with your cold storage business plan?

You should consult experts such as business advisors, accountants, architects and logistics professionals to help create your cold storage business plan. Additionally, engineers can help you assess infrastructure costs, and lawyers can provide advice on zoning and other legal requirements.

Can you write a cold storage business plan yourself?

Writing a business plan for a cold storage business can be a complex process. It requires researching the market to identify potential customers and competitors, developing a detailed financial model, and creating an operating plan that includes strategies for customer acquisition and revenue growth. To successfully write a cold storage business plan, you will need to have some knowledge of the industry and have access to reliable data and expertise in financial modeling. If you are unable to do this yourself, it may be beneficial to hire a professional business planner.

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What is Cold Storage Business – A Layman’s Guide to Get into Cold storage Warehousing Business

In recent years the demand and supply for various products such as fruits, vegetables medicines etc., have drastically increased and this has created an opportunity for the storage and logistics business sector. Especially, the cold storage business has gained a lot of popularity in recent times. If you are also interested in starting a cold storage or looking to use cold storage for your business, then you should definitely take a look at time article

What is a Cold Storage?

A cold storage is an insulated structure where the temperatures are maintained at lower levels such that products that are known to easily perish such as vegetables, fruits, seeds, medicines, and vaccines can withstand for a longer period of time. Storing products in cold storage helps protect the shelf life so that the products can be ready to use even after longer durations.

What is Cold Storage Business and How Does it Work?

Unlike the normal warehouses that you see, a cold storage business comprises a wide variety of storage solutions that enable one to store, pack and transport temperature-sensitive perishable products. This includes large cold storage warehouses, freezer trucks, industrial cool rooms, walk-in cold store, and refrigerated containers. Cold storage business runs by, leasing out a certain amount of space or providing cold chain logistics support to other businesses that require space to store their temperature-sensitive products

Who requires a Cold Storage Warehouse?

A cold storage is an important requirement for various businesses such as Food and Beverage Industry, Pharmaceutical and Biologicals Industry, Fruits and vegetables supply businesses , meat and poultry business, and chemical and hazardous materials, etc., Most of the products that are produced under these categories are known to perish quickly if they are not maintained under a controlled temperature. Hence these businesses usually have an inbuilt cold storage warehouse or lease out third-party cold storage solutions

How Profitable is Starting a Cold Storage Business?

Starting a cold storage business is definitively a lucrative one. Unlike other warehouse leasing businesses, a cold storage business involves use of high-end infrastructure, skilled workers, stringent safety measures, and many more., Due to such things leasing a cold storage or even renting just a pallet can cost around $30 – $ 150 per month. Making it a source of sustainable income for the cold storage warehouse owner

To put it in simply, a cold storage warehouse offers 20-25% more return on income when compared to running a normal warehouse

Moreover, if cold storage is located within the vicinity of large metropolitan cities the rates of leasing such warehouse can be very high

Analyzing the Market Potential of Cold Storage Warehouse

In recent years, the demand for cold storage warehouse has drastically increased. According to a report the cold storage warehouse industry in U.S has experienced a 43% increase in capacity since 2000.

Not just United States, the demand for cold storage has significantly increased in several developing countries too such as India, China, Brazil, and Vietnam

According to a recent report, the global cold storage market is expected to reach USD 427.6 Billion by 2030

What’s more?

There has been a steady increase in big investors turning up to the cold storage business. for example, according to Wall Street Journal, Lineage Logistics, a global leader in the temperature-controlled industry raised $1.9 billion in fundraising to expand its market potential

According to Colliers report, cold storage has recently emerged as one of the lucrative asset classes in Hong Kong. Due to pandemic COVID-19, Hong Kong has seen a 49% increase in the demand for imported frozen food over the last three years.

Why is Cold Storage Business gaining popularity these days?

There are 5 main reasons cold storages are constantly increasing now a days. Here are top 5 reasons

1. Increased consumption of frozen food

Although, frozen foods are not new; their demand has significantly increased in several developing nations like India, China, Vietnam, and Brazil as well as many African countries. With an increase in the consumption of frozen food; the demand for cold storage warehouses as well as other cold storage supply units had increased

2. Population Growth

Growing population means there are more people to feed and to do that food production had to be increased. This means, that any government should not only focus on simply producing food but also try to increase the storage capacity such that it is self-sustained and balances its economy

3. Globalization and e-Commerce Growth

The 21st century is experiencing an enormous globalization. This has created an opportunity for several e-commerce companies to come up with new ideas, especially in the FMCG industry. Due to this there is a steep increase in demand for groceries, ready-to-cook foods, frozen foods, cosmetics nutraceuticals etc., which essentially require cold storage services

4. Urbanization

With globalization, several nations are now opening up trade routes and also welcoming new businesses to establish. This is creating an enormous job opportunity in cities, attracting people from the countryside, and small towns to live in cities – due to this lifestyle habits are changing where the customer has to definitely spend on an item at least once a day that requires cold storage. For example, milk packets, curd, yogurt, soft drinks and beverages, etc.,

5. Demand for Medicines

Several life-saving drugs and vaccines require cold storage to ensure they are safely stored and ready to be sold to the consumer. Moreover, there has been an increase in several diseases due to life style changes and environmental changes; which had created an opportunity to produce several healthcare products and medicines that are imported and exported globally at a staggering rate. This is also another factor due to which cold storage demands are increasing

So, How Does a Cold Storage Functions?

Cold storage is an insulated space designed to maintain a specific temperature for the storage of food, medicines, and chemicals. These temperatures are controlled in an optimum level by using HVAC systems– Heat ventilation air conditioning systems

To understand the functioning of a typical cold storage, you need to know about some basic components that are used to run the cold storage such as…

Also called a coolant or refrigerant is one of the important things in cold storage. Usually, coolant will be in liquid form (mostly anhydrous ammonia). This coolant circulates continuously via tubes, pipes and other components to maintain the optimum temperature in the cold storage

A compressor is a mechanical component that helps to keep the coolant running throughout the system. It does this by compressing the coolant to high pressure and temperature and pumping it into the condenser

The Condenser

A condenser basically cools down the heated coolant by dissipating the heat into the atmosphere by using water spray, fans, and tubes. This leads to changing the state of the coolant from gas to liquid which then flows into the receiver.

The receiver helps in storing the high-pressure liquid coolant condensate that is received from the condenser. This component helps in controlling the pressure of the whole system as well as providing a buffer when more cool air is required

When a load is increased or if the temperature needs to cool down more, the receiver releases the refrigerant into expansion value which controls the pressure, and temperature and also releases the coolant to the separator

This equipment works basically on the principle of centrifugal force. The refrigerant is spun at a high speed, leading to the separation of oil and coolant due to the difference in density. The oil is then collected at the casing of the separator and is returned to back to the compressor. Whereas the coolant continues to flow through the tubes

Like the other components evaporator plays a crucial role in the cooling system. It is also called with other names like freezer and chiller . Here the chilled coolant is flown through series of tubes; simultaneously warm air is circulated through the fins; Due to this contact a cooling environment is created, with the help of fans this cool air is circulated through the cold room

What are different Types of Cold Storages

There are four major types of cold storage according to their usage and functionality.

• Frozen Cold Storage
• Refrigerated Cold storage
• Fresh Produce Cold storage
• Blast Freezers and Chillers
• Air conditioners

Let’s discuss each one of them

Frozen Cold Storage ( -16℃ to -26℃)

These are the highest-grade cold storage that is used to store frozen items that are to be stored at very low temperatures. This includes packaged chicken, peas, sugared fruits, beef, veal, lamb, turkey and fish.

The concept of frozen cold storage are the items are maintained at the lowest temperature to ensure they can be stored for longer periods of time without losing their quality

Not just food items, ultra-cold freezers are very important for storing biologics samples especially, Vaccines are stored in this type of cold storage to ensure their effectiveness and safety is not compromised

These types of cold storage uses air blast freezing technique to ensure the products are rapidly cooled in a short span

Refrigerated Cold Storage (-1℃ to  -4℃)

These are cold storage units similar to ultra freezers but with much lesser temperature capacity. Refrigerated cold storage is mainly used to store concentrated fruit juices, buffers used in manufacturing medicines, fresh meats, poultry, and seafood. These freezers are mainly preferred if the stored items need to be used as soon as possible

Fresh Produce Cold Storage ( 0℃ to 8℃)

This type of cold storage is commonly used to store fruits, vegetables, and Milk products. This type of storage doesn’t freeze the products. Instead, they maintain a temperature that can retard the activity of microorganisms

Cold storage units used to store potato’s, chilies and common food grains are mostly stored under this storage temperature

Blast Freezers (-10℃ to -120℃)

The most advanced and costliest equipment for cold storage are blast freezers these are special freezers that can reduce the temperature of the product to extremely low within hours. A blast freezer typically needs to reduce a temperature of +70℃ to -18℃ not more than 240 minutes. These types of freezers are highly used in the life sciences sector.

Air Conditioners (10℃ to 25℃)

These are the most economical freezers used in supermarkets, stores, and shops. They basically do not freeze the product, instead, they just pass a cool breeze to the surroundings. For example, fruits such as bananas, citrus, cucumber, onions and squash are stored and transported under these conditions

Cold Storage Business Plan – Investment, Profit Margin and Resources

Let us look into the business plan to start a cold storage business which covers all the important aspects from Investment to Profit Margin

In general, the business plan for a cold storage is little complicated to understand. Hence, we are trying to put it in simple words without going into too much details. So you can get a basic idea on the topic first

Investment requirement for cold storage

Although cold storage business is usually regarded as high investment business; You still have several ways where you can run this business economically

For example, you can start a small chain of refrigerated trucks logistics business and act as a logistics partner for transporting the products. For this type of business, you need an investment of $100,000 to $200,000

Or, you can work as a supplier for renting mobile cold freezers which are used to store ice cream, fresh produce to supermarkets or stores. For this type of business, you need a capital of $50,000 to $100,000

On other hand, the cost of starting a large cold storage warehouse is something that requires lot of research and groundwork due to the scale of the construction plan, design, equipment, and services it can offer.

For example, a cold storage facility of 15,000 to 25,000 cubic meters needs an investment of Approx $500,000 to $2,500,000 (50 Lakhs to 1.5 Crore) These types of cold storage warehouses are usually very large in size and has high storage capacity and infrastructure

Here are some major factors that influence the investment of cold storage business

Location of the Business

Location plays an important role in the cold storage business, if your business is located within the city, you have a high chance to deliver and run the business quickly and has better chance to acquire new customers

If you are looking to establish a large cold storage warehouse facility especially like storing fruits and vegetables then, you may have to look for a location in countryside where high agricultural activity is observed

If your business is closely associated with shipping industry then you must look for a location near to shipyard so that you can, transport the products easily to the shipping containers

Type of Product Stored

The cold storage business is highly dependent on the products that you store. For example, cold storage that stores vaccines, lifesaving drugs, and blood samples is generally costlier when compared to other types of cold storage such as plants, fruits, vegetables, and dairy products

Basically, your investment goes up if you are storing a product that needs utmost care and is extremely prone to minor fluctuations in temperature (such as Vaccines)

Size of the Cold Storage Facility

Cold storages are available in different sizes, and one must know that size of the cold storage plays a crucial role in deciding the investment as well as calculating the price for leasing.

The calculation of cold storages capacity usually comprises two important things

• Calculate the Actual space of the cold storage
• Weight of the items stored per cubic meter.

Calculation of storage capacity of cold room = Internal volume of cold storage room X Volume utilization factor X Product unit weight

A customer who is looking for a cold storage space usually go through this calculation to get the final price for leasing a space

Different Types of Cold Storage Facilities

Here are different types of cold storage facilities popular throughout the globe

Cold storage containers

Most of the cold storage containers are available in three sizes 10ft , 20ft and 40ft. This type of container are mostly used for cargo shipments and refrigerated storage trailers

Cold storage room

They basically look like a single room encapsulated in an insulation material. They are available in different sizes. These are also commonly called as Walk-in coolers or walk-in chiller

• 20 X 10 X 10 FT
• 10 x 10 x 10 FT
• 6 X 6 X 8 FT

Most of the cold storage rooms have a capacity of 500 Kg to 2 Ton capacity with a 2 – 3 phase power supply and mobile cooling system.

These are common choices for the pharmaceutical industry and supermarket stores

Controlled Atmosphere Cold Store

These are typical large cold storage facilities that you see in countryside, towns or urban outskirts. They are mostly used for storing fruits and vegetables. These are also commonly called chillers.

In CA storage, items are not frozen. Instead, the food items are maintained at a controlled temperature such that they can be stored for long term usage.

Foods such as Chilies, Apples, pears, Kiwis, and processed foods extensively use controlled atmosphere storage units. Moreover, these are highly expensive storage units that require a lot of investment, manpower, logistics operation, and security measures

Frozen Cold Storage Facility

This type of storage facility stores the items at ultra-low temperatures and requires a high amount of energy. They are best used for storing vaccines, pharmaceutical drugs, and Seafood.

A frozen cold storage facility usually stores the items at temperatures ranging from -15℃ to -25℃. At this temperature, any molecular level activity inside the cells is seized and completely slowed down. This ensures the products remain intact without loss of quality

Services Being Offered

The investment of cold storage business highly depends upon the services being offered. A cold storage is capable of offering different services that can increase its value and business. Here are few services that can be offered

• Packing and Labelling services
• Inventory management for the customer
• Direct shipping and receiving

Resources Required for Cold Storage

A full-fledged Cold storage ware houses requires several resources to operate such as

Electricity

Refrigerated warehouses require a high amount of electricity to run the unit efficiently. When compared to normal warehouses, cold storage warehouses consume high amount of electricity. The electricity consumption ranges 40 to 60 Kw-hours per square foot per year. Out of which 70% is utilized by the refrigeration system. Hence one must make sure to set aside budget for power consumption while starting a cold storage facility

In order to maintain the temperature and keep the heat at bay, Cold storage requires a high amount of water. On average a large-sized cold storage can consume around 50,000 to 60,000 gallons per day or even more

Due to such large consumption the cold storage company needs to obtain special permits from governments to utilize the high amounts of water

Inventory Management

Any warehouse to lead a sustainable business needs to have a proper inventory management system in place. It basically helps the warehouse track the space utilization, and movement of products and forecast the supply and demand

There are multiple methods to manage inventory such as using inventory management software tools and adapting to ASRS . Keeping a track of your logistics movement by using a TMS tool

A significant number of workers as well as Technicians are necessary to operate the cold storage efficiently. On average at least 10 – 15 workers are necessary to operate a medium-large scale cold storage facility

Here’s a breakdown of employees basing on their tasks

2 No’s – To Handle office work, computer knowledge, and can operate the Inventory software.

3 No’s  – Janitorial services

3 No’s – Forklift operators

2 No’s – Technicians who can operate and troubleshoot cold storage machinery

Cold Storage Grade Equipment

Not all equipment is suitable for use in cold storage facilities. As the equipment within cold storage is continuously subjected to cold temperatures, they are prone to malfunction. Hence one must ensure equipments used in the facility meets the standards

For example, Toyota has forklifts for cold storge facility which are specially engineered to operate in cold and wet environments

On the other hand, it is common to have a barcode reader or hand-held mobile computer used in cold storage facilities in such cases you should look for a freezer grade hand held mobile computer

Profit Margin in Cold Storage Business – What You Need to Know?

The profit margin in Cold storage business depends on factors such as type of product stored, seasonal demand, storage facility services and market demand.

Usually cold storage business is considered as high investment business due to the number of resources required to start this business. Especially, if we consider large cold storage facilities they require huge amounts of land, workers, logistics services, machinery, water, and power supply. In addition to this, it must undergo a number of government regulations which take time for approval and investment

Construction of a cold storage facility cost 2X than a normal warehouse On average it costs upto $250 to $400 per sq. ft. So, a large Cold storage facility of around 50,000 sqft can cost around $1 to $2 Million

Moreover, the operating costs such as electricity, shipping, and packing considerably cost thousands of dollars every month

So the staggering investment may take at least 3-4 years to get the total ROI

However, the demand and market conditions for the cold storage business are constantly increasing in every part of the world. So, investment should not often look like a burden.

Moreover, there are several methods in the industry to increase the profitability of cold storage. One of them is, that instead of leasing out the entire cold storage to a single customer, the space will be divided into multiple smaller areas and will be leased at a higher price. Plus, the cold storage owner controls the inflow of multiple owners by hiring workers who do the inventory stocking for multiple customers. So the owner also charges for stocking and retrieval on each pallet or box

So How much does a Cold storage cost for storing Goods

The cost for storing the goods also impacts the profitability of cold storage. There are different ways a 3PL warehouse charge such as Pallet storage fees or cost per Square foot.

Most of the 3PLs often charge storage per pallet and is done mostly on monthly bases. However, some companies prefer to calculate daily or weekly basis too

Here’s a typical cost structure for pallet storage pricing

• Pallet Pricing – $20 – $25 Pallet Per month
• Handling charges for receiving or shipping per pallet – $10 – $20
• Value added services – $ 5 – $ 10

On an average a 3PL cold storage warehouse can charge approximately $40 – $60 per pallet per month. Moreover, the prices can vary depending on the region, availability, services, and the product being stored

Safety Measures to be Implemented in Cold Storage Facility

One must ensure the cold storage facility follows safety guidelines for its workers as well as the facility. Here are quick tips to ensure safety standards are in place.

• Ensure the facility follows OSHA’s guidelines.
• Ensure the workers are equipped with PPE.
• Ensure fire safety equipment is monitored periodically.
• Ensure all the refrigeration equipment are monitored periodically.
• Keep safety sign boards.
• Always have a contingency plan
• Ensure Medical support is within reach in case of emergency

The cold storage business is a highly evolving business. There are a lot of opportunities and ideas one can leverage to make profits in this business. On the other hand, it is also a business that requires high investment.

Although a high investment doesn’t mean you will be successful at this business. It requires a thorough market research and a strong mindset to get into this business.

Today every nation requires the need of cold storage to make sure it has enough capacity to store food and medicines. Not only that, several FMCG industries are looking for 3PL Cold storage warehouses to store their products and help in reaching large customers.

1 thought on “What is Cold Storage Business – A Layman’s Guide to Get into Cold storage Warehousing Business”

My brother recently invested in a pharmaceutical company in Melbourne, so he needs a cool room constructed for the medical equipment and supplies that need stable temperatures to preserve their quality. I appreciate you informing us that a controlled atmosphere cold store does not freeze their items but instead keeps them at a controlled temperature so that they can be stored for long-term usage. I’ll keep this in mind while I look for a contractor in Melbourne to hire for cool room designs soon.

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Business Planning for a Cold Storage Facility Building a Public Seafood Processing and Cold Storage Facility

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Cold Storage Warehouse Design: 5 Factors to Consider

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Planning the design for a cold storage warehouse can be incredibly challenging. The primary goal of cold storage is to maintain optimal conditions for perishable items to prevent spoilage, bacterial growth, and a decrease in quality. Therefore, it’s essential to think about things like:

• Temperature control
• Humidity management
• Heat removal
• Material handling
• Energy efficiency

Of course, these things will vary depending on the type of businesses you’ll be working with and what you’ll be storing for them, as different items require different cold storage needs. Below we’ll cover the five most essential cold storage warehouse design factors you’ll want to consider for planning your next move.

The Top 5 Cold Storage Warehouse Design Considerations

The purpose behind cold storage warehouse design is not just to provide an efficient service for businesses with perishable goods. Planning the layout also serves the purpose of maximizing productivity for your benefit because, after all, it is a business.

Therefore, you’ll want to consider the following when mapping out your cold storage warehouse design:

1. The Total Area of the Cold Storage Facility

When it comes to the functionality, efficiency, and cost of cold storage warehouses, the overall square footage is critical. The total area of your cold storage warehouse will be a direct indicator of what it can hold, which includes storage rooms, cooling systems, parking, and administrative offices. 

Here’s a quick breakdown of the types of spaces you’ll want to plan for when designing your cold storage warehouse:

• Storage capacity: The amount of space you’ll need for actual storage should be the first thing on your mind. You can calculate storage volume by multiplying the total weight of the products you’ll be storing by the storage space required per unit weight. Other factors that will come into play regarding how much storage space is needed per unit weight include the density, packaging, and stacking of all the intended products.
• The handling and processing area: Handling and processing services are typically included in cold storage warehousing, which means you’ll need to factor in how much space this will require. Think about how much space you’ll need for receiving, dispatching, sorting, grading, cleaning, packaging, labeling, machinery, workers, and even transport.
• Cold storage rooms: The quantity of cold storage rooms you’ll be building, in addition to their sizes and required temperatures, will also affect the total area required for your cold storage warehouse. Depending on the type of products you’ll be storing, the conditions required will vary. 
• Loading docks and parking: The size and quantity of the vehicles you’ll be using to load and unload the products to be stored should give you an idea of what your layout should look like regarding the loading dock space. There should be enough space for all of the necessary vehicles owned by both your business and your employees.
• Administrative spaces: You will also need space for offices and administrative duties. The size of these spaces should be proportional to the size of your facility as well as the number of management workers required to ensure that your daily business operations run smoothly.
• Equipment and machinery space: The equipment and machinery you’ll be using, such as compressors, generators, refrigeration systems, forklifts, etc will also require a certain amount of space. So, you’ll need to account for stationary machinery and equipment as well as machinery and equipment that may require storage at the end of the day.
• A utility room: Utility rooms are necessary, and their square footage should account for the overall layout and the machinery used. You’ll need to plan this space with full attention to detail, as utility rooms house critical electrical and plumbing components and backup generators.
• Insulation: Cold storage facilities won’t be much use without insulation to prevent heat transfer and maintain humidity levels. Insulation panels are built directly into the walls, floors, and ceilings of cold storage warehouse rooms, which means you’ll need to account for their thickness and locations when calculating the total area.

2. The Type of Cold Storage Warehousing You’re Building

The purpose behind your cold storage warehouse is also essential to its overall design . There are different types of cold storage facilities to accommodate various temperature requirements and more, so you’ll want to consider the following:

• Products such as freshly harvested produce may require pre-cooling before being transferred to a cold storage room. The optimal storage temperatures for pre-cooled products will range between 0 and 8 degrees Celsius.
• Products stored in cold rooms will require a temperature range between 8 and 14 degrees Celsius. These are the types of products that don’t require freezing but still need to be kept considerably cold to maintain freshness and mitigate bacterial growth, such as dairy products, beverages, and certain types of produce.
• Products like meat, poultry, and seafood often require cold storage rooms that sit between -1 and 8 degrees Celsius. The storage can be long-term or short-term, which means these cold rooms, in particular, require stability regarding energy.
• Storage freezers are ideal for storing frozen foods as they maintain temperatures between -18 and -24 degrees Celsius. Frozen meats, vegetables, seafood, poultry, and ready-to-go meals are commonly kept in storage freezers as they require lower temperatures and longer storage times.
• Blast-freezing chambers range between –35 and -45 degrees Celsius, and they’re used to “blast freeze” fresh products from produce to seafood and store them long-term.

3. The Floor Plan Design

Your floor plan will also be a crucial component in constructing a cold storage facility, as your facility will need to be divided into several rooms in accordance with industry standards. Essentially, you’ll need to ensure that the layout of your floor plan caters to the different storage needs of different items.

Here’s an example using produce:

• Fruits and vegetables, depending on the type, require different temperature and humidity levels. For example, tomatoes require a temperature range between 55°F and 65°F and 85%-90% humidity. Conversely, potatoes require a 45°F-50°F temperature range and 95%-98% humidity. 
• Certain fruits and vegetables also produce ethylene gas, which can cause other fruits and vegetables to spoil quicker. For example, bananas, apples, tomatoes, potatoes, and onions give off ethylene gas. Therefore, they can only be stored with certain types of produce to prevent premature ripening and spoilage. 
• The ethylene gas produced by these fruits and vegetables can also build up in cold storage rooms over time. Therefore, the cold rooms would need to be properly ventilated without allowing that ventilated air to end up in another cold room.
• Fruit and vegetables also require regular cleaning to prevent mold and bacteria growth, which means you’ll likely want to consider smaller rooms for produce storage as they’re easier to clean. They’re also more energy efficient.

4. Heat Removal and Humidity Control

Heat removal and humidity control are two other essential aspects of cold storage warehouse design. The total amount of heat that needs to be removed from your cold storage warehouse will depend on several factors, including:

• The size of your facility
• The products being stored
• The ambient temperature and humidity

All cold storage facilities require the exclusion of heat from a variety of sources, such as:

• The walls of the facility, which must be insulated to prevent heat transfer from outside and inside
• The heat and water vapor that “breathing” produce emits after being picked
• The latent heat that occurs as produce ripens
• The heat that generates from lighting, ventilation systems, and even occupant traffic

Humidity control is also necessary for maintaining the quality and freshness of all types of products and items, including artwork. You’ll want to zero in the relative humidity (RH), which is how much moisture is in the air in your cold storage facility compared to how much moisture that air can maintain at certain temperatures. 

To maintain relative humidity, you’ll likely need various ventilation systems to remove excess moisture from the air and dehumidify it as needed.

5. Temperature Control

Regular temperature control is also crucial when designing your cold storage facility. The overall temperature affects the respiration and metabolic rates of produce and other products like skincare and cosmetic items, which directly determines their shelf life. Additionally, lower temperatures can slow down the aging or ripening process of these items.  

Therefore, you’ll need to have a reliable refrigeration system installed to ensure the right temperatures are maintained at all times for the products you’ll be storing. This includes a reliable monitoring system that allows you to keep an eye on the temperatures within your cold rooms and the rest of your warehouse to ensure efficiency.

Are You Ready to Plan For Your Cold Storage Warehouse Design?

Planning the layout and design for your future cold storage warehouse is a great undertaking. There’s a lot more to consider beyond the above five factors, but that’s what the professionals are here for.

At APX Construction Group, we can help you with everything from design planning to construction and even project management. Get in touch with us today to talk about your warehouse design project needs, and we’ll come up with a plan together!

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Cold Storage Subsidy, Loan, and Business Plan

Table of contents, scope for cold storage in india, need for cold storage, is cold storage a profitable business in india, functions of cold storage, classification of cold storage in india, how to build a cold storage unit, cold storage business plan, loans and subsidy for cold storage business in india, top banks offering cold storage loans, the cost of the cold storage refrigeration system, what is mt in cold storage, what is the temperature of cold storage, why fruits are kept in cold storage, what is the importance of cold storage, what type of food is stored in cold storage, which gas is used in cold storage.

Introduction to c old storage business in India, the cost of building, license, and subsidy

Are you about starting a cold storage business? If yes, here’s a complete guide to building the cold storage business along with subsidy and loans available.

The Cold storage industry is important and essential. The temperature level is maintained low with the help of precision instruments. Cold storage is used to preserve vegetables and fruits. Once they are kept in the Cold storage, and they do not get spoiled even after many months. Cold storage is necessary for extending the shelf life. It is, therefore, necessary that Cold storages are to be constructed in main producing as well as consuming centers. Cold storage construction design and build services need expertise in the intricacies of these very specialized facilities. To help reduce energy consumption and improve facility efficiencies Cold storage freezers should be properly designed and built, and they must integrate the most energy-efficient systems available. In this article we also discussed below topics;

• How do you build a cold storage room
• How many types of cold storage are there
• How does cold storage work
• Steps to start a cold storage business
• Subsidy for the cold storage business
• How cold storage business works in India

A step by step guide to cold storage business subsidy and setup

Cold storage is a one-time investment business, wherein the initial investment required is on the higher side. Though, the returns are higher and are on a long-term basis, as compared to other small businesses. The Cold storage facility is categorized mainly in two types, the first is used for single products and the other is for multiple products. Food items that require Cold storage include fruits and vegetables, poultry and fish products, meat products, and products such as tobacco and beer.

A basic problem that all small and even medium-size farmers face in preserving produce and distributing is a lack of Cold storage facilities in their locality. Though, owing and maintaining cold storage is not within reach of most farmers in India. High Cold storage investment is therefore ruled out for marginal farmers because farm sizes are too small to justify any big investment; it is simply not economical.

The Cold storage business in India is still a long way away in India and not even main production centers enjoy the benefits of Cold storage . The Cold storage business in India has been for a long time neglected and shunned because of the high costs involved and lack of proper infrastructure, but attitude is fast-changing and more businesses are finding it profitable to Cold storage units set up that help farmer to preserve their produce for longer durations. If you are looking for a profitable rural-based agriculture-related activity then Cold storage investment makes sense and it is profitable and holds big opportunities for expansion.

One of the major problems that Indian farmers face in selling their produce is storing and dispatching it at the proper time. Farmers face difficulty in finding Cold storage near their farms or proper cold supply chain to get their products from farm to market in proper conditions and stipulated time frame. When there is excess production, there is a glut in the market and prices come down to unreasonably low levels.

The major consuming areas are big cities and food processing industries that are generally thousands of miles apart. Raw produces are perishables and must be preserved until it is the time ripe for realizing better prices or moving it over long distances. Also, changing lifestyles and demand for processed or packaged food is creating the need for Cold storage solutions globally.

The initial investment is high in this Cold storage business. Generally, the Cold storage business investment includes acquiring the land, building construction, obtaining permissions and licensing, arranging utilities like water, electricity, etc. Also, you will need to invest a major startup capital in procuring the cooling machinery. Usually, modern and updated machinery ensures better performance and long-term sustainability.

Globally, the wastage of vegetables and fruits is huge. Normally, food crop growing countries hold the maximum share in the wastage for fresh foods. Cold storages are essential for extending the shelf life, and maintenance of the quality of the product. Also, Cold storages have an important role in reducing the wastages of perishable commodities. Also, it helps in providing remunerative prices to the growers and to make available farm products to the consumers at competitive and affordable prices.

In case if you miss this: Hydroponic Farming Business Plan, Hydroponic Yield .

Here, we discuss the functions of Cold storage ;

Protect Perishable Food – At room temperature perishable food items such as fish, meat, and milk made products tend to get decayed. Nowadays industries are using blast freezers for the storage of fish and meat. Before making a delivery to final consumers and logistics companies store perishable food items in refrigerators with high storage.

Protect perishable nutrient products – There are various nutrient items such as cold-blooded aquatic vertebrates and flesh of animals that turn into the radioactive product when they are kept in building temperature. At present, there are several Cold storage warehouse logistics that provide blare freezers to the flesh of animals and cold-blooded aquatic vertebrate’s products.

Storage of dairy products – Along with food items, dairy products need proper care or Cold storage. Storage equipment for dairy products needs control of temperature levels.

Storage of food and vegetables – Fruits and vegetables need certain kinds of Cold storage but they do need to be frozen. They just want to be kept at a cool temperature.

• Bulk Cold Stores – Generally for storage of a single commodity, these mostly operate on a seasonal basis e.g., stores for potato, chilies, apples, etc.
• Multipurpose Cold Stores – These stores are designed for storage of a variety of commodities which operate, practically, around the year. The products stored in these types of cold stores are fruits, vegetables, pulses, dry fruits, spices, and milk products.
• Frozen Food Stores – These come with or without processing and freezing facilities for fish, meat, poultry, dairy products, and processed vegetables and fruits. These units have helped the promotion and growth of the frozen foods sector, in the domestic and the export markets. Though, the percentage of foods so processed is extremely low and great potential exists for growth in this category.
• Small Cold Stores – These come with pre-cooling facilities for fresh fruits and vegetables, mostly, for export-oriented items like grapes. The concentration of these units is in Maharashtra but the trend is now picking up in other states like Karnataka, Andhra, and Gujarat.
• Mini Units or Walk-in Cold Stores – These stores are located at hotels, restaurants, malls, and supermarkets.
• Controlled Atmosphere (CA) Stores – These are meant for certain fruits and vegetables like apples, pears, and cherries.
• Ripening Chambers – These are mainly set up for bananas and mangoes.

Steps involved in setting up Cold storage business ;

• Select a promising location and do a market survey on potential produces for which you can provide Cold storage services.
• Choose appropriate land. It must be easily accessible and have proper roads and uninterrupted power supply round the clock.
• Contact Cold storage manufacturers and obtain a firm quote for machinery and erection charges.
• Contact Cold storage construction companies to design the building and infrastructure related to it.
• Based on the quote and the costs involved get investments right. Study the Return on Investment and the time it takes to get the unit up and running profitably. Always give a time frame for gestation.

To start a Cold storage business, the business owner needs to create a detailed business plan that should contain all the business-related information, details regarding products and services to be used, and employee details with full name address.

Are you looking for how to build Cold storage ? Here is a step-by-step process to start Cold storage business ;

Step 1) Finalizing Location

Location plays a vital role in business. For Cold storage businesses , it must be kept as close as possible to producing farms or consumer centers. Approximately, once acre of land is required for a multi-storage or multi-commodity Cold storage facility with a capacity of about 5000 metric tonnes.

Step 2) Equipment Selection

During summers as the heat is immense, equipment to be used must be cautiously selected and installed to manage heavy loads and power cuts. There are the following factors to be considered before finalizing on equipment for Cold storage business, such as equipment’s age, and light, fan, and product load, the heat produced from stored products, ceiling, wall, and floor, etc.

Step 3) Maintenance and Cleaning

Maintenance of the Cold storage plant holds equal importance and should be checked regularly like temperature, humidity level, and preserved produce. Timely servicing or cleaning of containers, trays, and storage bins is necessary.

Step 4) Promotion and Target Audience

The success of a Cold storage business relies on the effective implementation of marketing strategies and advertising campaigns. In the initial, as well as the later stages of business, an entrepreneur must target various market segments, including traders, wholesalers, marketers, promoters, retail markets, and warehouse companies, supermarkets in rural and urban areas. For further increase in sales and profit, business owners can approach retailers, business growers, producers, distributors, and exporters, etc.

Step 5) Arranging Funds

Arranging finance is one of the difficult tasks, as the Cold storage business requires substantial capital investment. Managing total investment for Cold storage business from the hard-earned savings is not a viable option, neither is it recommended as savings are used to meet urgent financial requirements or cash crunch situations.

Entrepreneurs who want to start a Cold storage business can opt for business loans offered by several financial institutions. They can check and compare numerous loan deals obtainable in the financial market and choose the best loan deal that suits their business requirements.

You may also check this: Dall Mill Project Report, Dall Mill Cost, Subsidy .

The Cold storage business is a capital-intensive business. You must have an investment capacity of about 3 to 4 crores for commencing this business. Generally, you can set up this Cold storage business with financial help from banks. Also, check if there is any subsidy or Govt. grants are available for this business in your District or State. In India, the National Horticulture Board provides financial assistance for this Cold storage business for the entrepreneurs. To set up multi-commodity Cold storage of about 10,000 tonnes capacity, investment of around Rs 20 crore is needed with a payback period of 6–7 years.

India is offering Financial Assistance for the Establishment of Cold storage Chain. These integrated Cold storage chains from the farms to the consumer ensures the safety and also the preservation of the food products. The government offers a grant-in-aid ranging from 35% to 50% of the total cost of plant and machinery installation along with pre-cooling, weighing, sorting, grading, waxing facilities at farm level, multi-product or multi-temperature Cold storage, packing facility, blast freezers, and the technical civil work depending on the location. Cold storage business can be done with an 80% loan from a nationalized bank. If the land is rented, the loan available is 90% of the total rental cost of Cold storage.

Cold storage loan is a type of agricultural loan that is available to farmers, individuals, and groups of individuals who run the business of Cold storage. Then, this loan is used to set up Cold storages or for expanding the existing business of Cold storages.

Eligibility criteria for cold storage loan;

Following are the eligibility criteria laid out for those who would like to avail this loan:

• Individuals/Group of Individuals
• Cooperatives/Companies/Proprietary/Partnership concerns
• Banks check the reputation of the promoters of such business.
• Capacity storage should not exceed more than 5000 Metric Tonnes.
• If it is an existing facility, it should be in a running condition and must be a profitable business for the last 3 years.
• Accounts must have been maintained as per rules.
• For new projects, the feasibility study must be submitted to the bank for assessment.

Some of the banks that offer Cold storage Loans are SBI, NABARD, Corporation Bank, Union Bank of India, Canara Bank, Vijaya Bank, and IDBI Bank.

Setting up of cold chain is assisted by APEDA (Agricultural and Processed Food Products Export Development Authority) as a part of a strategy to develop the industries relating to the scheduled products for export. And, the Scale of assistance as 40% subsidy subject to a limit of Rs 75 lakhs for cold chain projects with mechanized handling system.

The cost of Cold storage Refrigeration System with capacity 5 MT to 5000 MT is approximately Rs 25 Lakh/ Piece

Cold storage investment cost

The investment cost includes acquiring the land, building construction, obtaining permissions and licensing, arranging utilities like water, electricity, etc. Additionally, you will have to invest the main startup capital in procuring the cooling machinery. Normally, modern and updated machinery ensures better performance and long-term sustainability. Apart from the above-mentioned fixed costs, you will want to consider the working capital expenses also. The main considerations are staffing, utility bill payment, and promotional expenses.

The cost and investment will mainly depend on the scale of the Cold storage unit . Though, according to experts, the estimated project cost for setting up 5000 MT Cold storage may be in the range of Rs. 3 Crore – 4 Crores in Indian Rupees.

Benefits of a cold storage room

• Cold storages help prevent products from degradation. Cold storages work on the principle of refrigeration. Cold storages are used to store fruits and vegetables and keep them fresh for a specific period. They are used to reduce the post-harvest losses of economic productivity.
• A Cold storage plant is a great place to store fruits and vegetables, as well as other products, as they prolong life and also help prevent spoilage of foods.
• Cold storage rooms are temperature adjustable; they can be used for different functions by adjusting the temperature. These units are airtight, they will help to protect products from extreme temperature and weather changes that will happen outside of the unit.
• A Cold storage room can keep fruits and vegetables at the correct temperature while controlling the moisture level to help extend the life of the fresh produce longer until it can be used and this will help to minimize waste and save money.

You may be interested in this: Rice Mill Subsidy, Loan, Permission, License, Schemes .

Commonly asked questions about the cold storage business

MT in Cold storage means per metric ton of product, based on the maximum amount of product that can be stored in each chamber. This is necessary for the rapid cooling of the produce.

Keep foods 4°C or colder, the safe temperature for refrigerated storage. Keep these factors in mind when storing fresh meats, poultry, and also produce all carcass meats should be unwrapped and hung so that air can circulate them.

Cold storage is the main method for extending the life of fruits. Apples and pears quickly soften and become mealy in texture when kept at ambient temperature levels. To keep the quality longer than one week, the fruit must be kept in refrigeration.

Cold rooms are important because they help to prolong the shelf life of fresh goods. They are effective in reducing the amount of waste and in lengthening the timeframe for marketing these foods.

The good thing about Cold storage units is that it is capable to keep any type of food in the optimal temperature level where it won’t perish or get decomposed fast. Meat, fish, vegetables, and fruits are best put on the fridge after having groceries.

For large Cold storage facilities, ammonia has the refrigerant of choice. Because it produces the greatest net refrigerating effect and the lowest BHP/TR (brake horsepower per ton of refrigeration) of any industrial refrigerant.

That’s all folks, you may use the same information for cost and subsidy of 100 mt cold storage in India, the cost and subsidy of 500 mt food cold storage, the cost and subsidy of 1000 mt cold storage, the cost and subsidy of 2000 mt agriculture cold storage, etc.. In case if you are interested in this: How to Make Money from Organic Farming Business .

15 COMMENTS

I had a land of 75000 sq feet in Digha , West Bengal beside fish jety. The land has 100 feet front. Drainage canel is back side (with in 10 ft). Want to build a cold storage . Want to know step by step process and guidance ( paid consultation also wellcome). Also need investors for the project.

I will assist you in this regard and also may help to prepare project finance to bank

Hello Paul-ji, I have enjoyed reading your very informative article on stating a cold storage business and I would like to engage. I am based in Kenya.

I want to open a 1000MT capacity cold storage in kota(Raj). Land area is 2000 sq. Meter. Need assistance

Nice information. Will cold storage is a profitable business

Hello, I’m planning to setup a cold storage facility in Nagpur, Maharashtra; and I need some consultation (paid) in this regards. I already have a good size plot in Industrial area with all the basic amenities. I would appreciate If anybody can help me. Thanks!!

hello, i habe a 2000sqft area in mumbai, can i start a cold storage in it. is it a profitable business?

I am having 2000 ft area near gurgaon and want to start cold storage business and can you provide all the details related to it?

I want to know the detail about the cold store business setup and total cost and profit for it. and guidance about the process for loans.

I have come to know from reliable source that you are providing Machinery and other support for cold storage . I am going to set up 2 cold storage ( Fruit & Vegetable) each will be 150MT . If you share your machinery cost of the complete solution of that particular project , I will be grateful to you.

I want to know cold storag business? How can i proceed ? Help me

Hello Sir I am Intrested in opening a Cold Storage for Red Chillies & potatoes & Kabuli Chana & Soyabeen & Onion. In Khandwa [MP]. I Would need your Complete Assistance in opening This Cold Storage. Awaiting for Reply.

Can I get details to set up cold storage, I have 20000-30000 sq ft land road touch near Jnpt road , Thanks Sandeep

I want civil dezine for 6mt cold storage

I have 35000 sqft land in industrial area ,planning to open cold storage please provide some guidance

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Cold storage global market report 2023.

Major players in the cold storage market are Americold Logistics LLC, Cloverleaf Cold Storage, Burris Logistics, Tippmann Group, VersaCold Logistics Services, Henningsen Cold Storage, Kloosterboer, Lineage Logistics Holdings, United States Cold Storage, NewCold, Nichirei Corporation, Agro Merchants Group, Nordic Logistics, Conestoga Cold Storage, Hanson Logistics, DHL International GmbH, XPO Logistics Inc.

New York, April 18, 2023 (GLOBE NEWSWIRE) -- Reportlinker.com announces the release of the report "Cold Storage Global Market Report 2023" - https://www.reportlinker.com/p06319516/?utm_source=GNW , GEODIS, NFI Industries, Penske Logistics Inc., Confederation Freezers, Seafrigo, Trenton Cold Storage, Merchants Terminal Corporation, and Stockhabo. The global cold storage market is expected to grow from $141.39 billion in 2022 to $161.92 billion in 2023 at a compound annual growth rate (CAGR) of 14.5%. The Russia-Ukraine war disrupted the chances of global economic recovery from the COVID-19 pandemic, at least in the short term. The war between these two countries has led to economic sanctions on multiple countries, a surge in commodity prices, and supply chain disruptions, causing inflation across goods and services and affecting many markets across the globe. The cold storage market is expected to grow to $303.22 billion in 2027 at a compound annual growth rate (CAGR) of 17.0%. The cold storage market consists of sales of compressor, condenser, evaporator and throttle valve, and other auxiliary parts.Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods. Cold storage refers to a place or a building where perishable products are stored or kept at low temperatures for preservation. These are designed with properties that can keep food items in optimum conditions, and these properties can be adjusted according to what has been stored. North America was the largest region in the cold storage market in 2022.Asia-Pacific is expected to be the fastest growing region in the forecast period. The regions covered in the cold storage market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa. The main types of cold storage are private, semi-private, and public.Private and semi-private products refer to cold storage that is owned or operated by the company that produces or owns the products kept in the warehouse used for storing purposes. The various construction types include bulk storage, production stores, and ports, and involve several temperature forms, such as frozen and chilled. It is used in storing fruits and vegetables, dairy, fish, meat, and seafood, processed foods, pharmaceuticals, and other applications. The rising perishable products are expected to propel the growth of the cold storage market going forward.Perishable products are those that easily deteriorate and have a short life span, which includes products such as fruits and vegetables, dairy products, pharmaceuticals, and others. The growing trade of perishables compels the cold storage market to provide better quality products to serve their customers. For instance, according to a report published by the Food and Agricultural Organization of the United Nations in 2021, global milk production reached 906 million tonnes in 2020, which has risen approximately 0.2% from 2019. Another article by the Food and Agricultural Organization of the United Nations and the Organization for Economic Co-operation and Development, an intergovernmental organization of 38 member countries, said that total meat production in 2020 is approximately 134 megatons, which is 1.2% more than in 2019. Therefore, the rise in the trade of perishables will increase the demand for cold storage. Advancements in technologies are a key trend gaining popularity in the cold storage market.Major companies operating in the cold storage market are using new technologies such as automation in warehouses, taller warehouses with temperature control, and others to sustain their position in the market. For instance, in May 2021, Vertical Cold Storage, a US-based temperature-controlled and dry storage facility provider, unveiled its new cold storage facility, Vertical Cold facilities. The Vertical Cold Facilities contain the most reliable automation in the industry along with cost-effective refrigeration facilities that use green practices and improve performance through decision-making technology. For instance, in August 2022, Lineage Logistics LLC, a US-based warehousing and logistics management company, acquired Cold Storage Nelson Limited for an undisclosed amount.This acquisition would expand Lineage’s presence in the Asia-Pacific region by using New Zealand, a significant exporter of primary products. Customers in New Zealand will benefit from CSN’s facilities as well as Lineage’s technology and innovation as they negotiate the country’s and the world’s rising supply chain demands. Cold Storage Nelson Limited is a New Zealand-based cold storage business. The countries covered in the cold storage market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA. The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified). The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products. The cold storage market research report is one of a series of new reports that provides cold storage market statistics, including cold storage industry global market size, regional shares, competitors with a cold storage market share, detailed cold storage market segments, market trends and opportunities, and any further data you may need to thrive in the cold storage industry. This cold storage market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry. Read the full report: https://www.reportlinker.com/p06319516/?utm_source=GNW About Reportlinker ReportLinker is an award-winning market research solution. Reportlinker finds and organizes the latest industry data so you get all the market research you need - instantly, in one place. __________________________

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Moscow myrtle, moscow mountain view, moscow rodeo, north pullman, downtown pullman, south pullman, warner avenue, have questions about storage.

Axess Self Storage Company owns and operates seven different facilities located in North Idaho, and now three new locations in Washington!  We offer a variety of options and price points for our customers. You can choose from a fully automated, top of the line facility to your more basic facility, but no matter your choice you can count on quality management.

As a small-town local company, we strive to be the front-runner in the storage industry. With one look at our facilities, managers, and products, you will see that we are meeting those expectations.  Axess Self-Storage implements state-of-the-art technology that includes rigid controls which limit access to our facilities. We do not cut corners and we do our very best - going that extra mile - to make sure our customers' experience goes above and beyond that of the local competition.. We assure that, when you choose to store your items with us, you are in good hands.

Our Facility Features

What size do you need, 5'x5' walk-in closet, view next size.

This size unit yields 25 square feet of space. Although these 5x5 units are small, they are an excellent size to store all of your extra items, like garden tools, seasonal items, office supplies, or your miscellaneous boxes.

See What Customers Are Saying

I'm not sure if he was at this location, but I talked with Cody for switching to a bigger unit in a hurry and he was super nice/professional. Thank you, much appreciated! We've also been renting from Axess for a few years now, with no problems.

I'm not sure if he was at this location, but I talked with Cody for switching to a bigger unit in a hurry and he was super nice/professional. Thank yo...

Very friendly staff and the units are very nice.

Rented a 10'x20' unit, but discovered I needed to upgrade to a 10'x30' unit (downsizing from a 4BR, 2000sf house). Rented the larger unit online and the...

Rented a 10'x20' unit, but discovered I needed to upgrade to a 10'x30' unit (downsizing from a 4BR, 2000sf house). Rented the larger unit online and...

This is a very secure place to have storage there's tons of cameras gated entry and exit fairprice when you type in your keypad code it reads your name which I thought was pretty cool so they definitely know who comes who goes and how much if something were to happen there I would feel very secure that the perpetrator wouldn't get away

This is a very secure place to have storage there's tons of cameras gated entry and exit fairprice when you type in your keypad code it reads your nam...

The facility on Myrtle St is newly built and very well maintained! Compared to rates for other storage companies in the area, Axess Self Storage is reasonably priced - especially considering that there is always fantastic customer service. I took comfort in knowing that there is a keypad gate entry, and a number of security cameras. Overall, a great place to store your belongings!

The facility on Myrtle St is newly built and very well maintained! Compared to rates for other storage companies in the area, Axess Self Storage is re...

A++ These guys go the extra mile! We were moving a friend that had just had a baby and couldn’t get access to the shed. They answered after hours and let us move her to a closer , more accessible unit over the phone! Second experience was today when I went to inquire about costs of storage. I need somewhere to store my business supplies and same deal. I received great service from the start. I moved into a smaller unit and saw that I needed a bigger one and they did it all by computer. Prices are good and units are great. Definitely recommend this place!

A++ These guys go the extra mile! We were moving a friend that had just had a baby and couldn’t get access to the shed. They answered after hours an...

Great storage unit and great management.

Management was fantastic to work with! They answered all my questions quick and are so friendly.

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OCI Moscow Central- Storage Units

Storage in moscow, id 83843.

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War latest: Ukraine destroys Russian bridge in Kursk region; Putin's forces capture territory in Donetsk

Moscow's forces have captured parts of Donetsk amid Ukrainian strikes in the region. Meanwhile, Ukraine has destroyed a bridge over a river in the Kursk region, Russian state news reports. Listen to a Daily podcast on how Ukraine broke through Vladimir Putin's "red line" as you scroll.

Friday 16 August 2024 22:52, UK

• Putin's forces capture territory in Donetsk - amid Ukrainian strikes on region
• Ukraine destroys Russian bridge in Kursk region - report
• Kyiv hints at plan behind invasion of Russian towns
• Ukraine's invasion bringing world to 'brink of a third world war' claims Russian MP
• 'We could lose': Russian state TV commentators gloomy over Kursk
• Michael Clarke : Pokrovsk in real trouble as Russian troops advance
• Listen to the Daily above and tap here to follow wherever you get your podcasts

That's all our live coverage on the war in Ukraine for now. 

We'll be back tomorrow with all the latest updates. 

Before we go, here's a reminder of today's key events: 

• An ally of Vladimir Putin - parliamentary deputy Mikail Sheremet - warned that Ukraine's invasion of Kursk had put the world "on the brink of a third world war";
• An anti-Putin group of Russians fighting on behalf of Ukraine urged Russian soldiers in Kursk to surrender and fight with Kyiv's army;
• Russian forces took control of the village of Serhiivka in Ukraine's eastern Donetsk region, according to the Russian defence ministry;
• A bridge over the River Seym in Kursk was destroyed in a Ukrainian attack, Russian state media reported, citing security officials;
• Ukrainian air force commander Mykola Oleschuk later shared a clip showing the moment a bridge in Kursk was hit, saying Ukrainian pilots had struck "enemy strongholds" and supply routes in the region. 

Nine people linked to the late Putin critic Alexei Navalny have been added to Russia's list of "terrorists and extremists", the news agency AFP has reported. 

It said those placed on the list include:

• Mr Navalny's former spokeswoman Kira Yarmysh
• His lawyers Olga Mikhailova and Alexander Fedulov
• The chair of Navalny's Anti-Corruption Foundation Maria Pevchikh
• Opposition journalist Antonina Kravtsova
• Activist Olga Komleva
• Dmitry Nizovtsev, a host on Navalny's YouTube channel
• The YouTube channel's producer Nina Volokhonskaya
• Alexei Malyarevsky, a software programmer jailed for seven years for donating to Navalny's Anti-Corruption Foundation

The names were included on the website of the Russian financial monitoring service Rosfinmonitoring. 

The service is responsible to tackling the financing of people and groups that Russia has deemed as "terrorists" or involved in "extremist activity" and is able to freeze the bank accounts of those listed.

On X, Kyra Yarmysh claimed one of her accounts had been blocked within three hours of being added to the list. 

Mr Navalny died in February while serving a prison term in an Arctic penal colony. 

Russia's prison authorities said the 47-year-old died after a walk, but his wife, Yulia Navalnaya, has accused investigators of trying to cover up his murder. 

Riding armoured vehicles and playing with dogs, Ukrainian troops are still firmly on the Russian border. 

Reuters has captured photos of them in Sumy - the area where they launched their surprise invasion of Russia's Kursk region last week. 

Since then, they've taken land and pushed on with their offensive, capturing the town of Sudzha yesterday and advancing up to 3km (1.8 miles) today, according to their commander-in-chief Oleksandr Syrskyi. 

Five villages in Russia's Belgorod will be evacuated due to ongoing Ukrainian attacks, the region's governor has said. 

Writing on Telegram, Vyacheslav Gladkov said entry to the areas would not be allowed.

"From August 19, we are closing entry to five settlements in the region, resettling residents and helping to remove property," he said. 

Yesterday, Russia's Emergencies Ministry declared a "federal level" state of emergency in the Belgorod due to ongoing Ukrainian attacks. 

A regional-level state of emergency had been declared earlier in the week, and the change in status suggested a worsening situation in the region. 

A Ukrainian lion with "shellshock" is being driven 1,400 miles to start a new life in the UK.

Yuna has psychological issues and coordination problems after debris landed near her enclosure in January, according to a Kent animal sanctuary.

Yuna and male lion Rori - who's also said to be traumatised following a "massive attack" on Kyiv - are the first of five lions being rescued.

Read the full story here ...

Footage has emerged of the moment a bridge in Kursk was destroyed. 

Ukrainian air force commander Mykola Oleschuk shared the clip on Telegram, saying forces had taken part in "combat operations" in the Russian region.

He said Ukrainian pilots had hit "enemy strongholds", equipment, logistic centres and supply routes with the "high precision strikes". 

"Thank you to the pilots and everyone who ensures the combat work of aviation," he added. 

It comes after Russian state media reported a key bridge over the River Seym in the area had been destroyed by Ukraine. 

The destruction had made civilian evacuations harder, TASS news agency reported, citing Russian security officials. 

A man has admitted to being a member of Russia's Wagner Group but claimed he was only "pretending" to be involved.

Piotr Kucharski pleaded guilty to membership of a proscribed organisation between 15 September and 28 October 2023 at the Old Bailey today. 

As he entered his plea, the 49-year-old said: "Guilty that I was pretending that I was a member of the organisation."

Dan Pawson-Pounds, prosecuting, said: "There is no evidence that Mr Kucharski actually travelled to the location he claimed to have gone to, or engaged in the activities relating to the Wagner Group, so that is why the charge has been framed in the way it has."

Simon Gledhill, defending, said: "In short, he told people, and gave the impression that, he was a member of the group rather than being an actual member."

Kucharski listed his address as Watford, Hertfordshire, but he said after the hearing that he was from Poland.

He was convicted and served a 15-year sentence for armed robbery in Poland, the court was told.

He remains on conditional bail.

Who are the Wagner Group?

The group was proscribed as a terrorist organisation in September 2023, making it a criminal offence to belong to or support the group in the UK.

The group became a focus of the war in Ukraine in 2022, with its recruits helping Russia in the battle of Bakhmut - one of the bloodiest of the conflict. 

Its former leader, Yevgeny Prigozhin, later organised a march on Moscow in an attempt to oust senior Russian military leaders over the treatment of his mercenaries and the handling of war. 

But, his attempted mutiny failed. He was later exiled by Vladimir Putin and died in a plane crash a short time later.

Three police officers have been injured in a drone attack in the Mykolaiv region, Ukraine's national police has said. 

In a post on Telegram, the force said the officers were in the southern Ukrainian area to document the aftermath of previous Russian attacks when a drone hit their car. 

It said they all received "explosive injuries" and were undergoing treatment. 

It also shared images purporting to show the damaged vehicle. 

Russia has summoned Italy's ambassador in Moscow after journalists entered the Kursk region. 

The Russian foreign ministry said the official had been summoned over an "illegal border crossing" by a team of correspondents from Italian state broadcaster RAI. 

It said the team had reported from Ukrainian-held parts of Kursk earlier this week. 

"A strong protest was expressed to the ambassador in connection with the actions of the film crew of the Italian state television and radio company "RAI", which illegally entered the territory of the Russian Federation to cover the criminal terrorist attack of Ukrainian militants in the Kursk region," it said on Telegram. 

"In gross violation of Russian legislation and elementary rules of journalistic ethics, the Italian correspondents used their stay in our country to whitewash the propaganda support for the crimes of the Kyiv regime." 

It said the actions of the journalists fell under Russia's criminal code and authorities were taking steps to "establish the circumstances of the crime". 

On Tuesday 6 August, Ukrainian forces launched their invasion of Russia's Kursk region. 

The offensive came as a shock, with Russian officials scrambling to respond as troops and armour poured across the border. 

The Ukrainian operation has been taking place under tight secrecy, with participating forces reportedly only told about it a day before it began.

Since then, fighting has continued and Ukraine has been able to advance further into the region. 

Yesterday, Volodymyr Zelenskyy said his troops had captured the largest Russian town to date - an area called Sudzha. 

Now, Ukraine's military has released footage purporting to show day one of the Kursk offensive. 

In the clip, a Ukrainian tank fires at the Sudzha border crossing terminal.

At least three Russian soldiers are seen signalling their surrender before a larger group exit the rubble of the terminal.

An even larger group of Russian prisoners are seen walking towards Ukrainian territory.

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