The Food Processing Business in India is growing, and many key players have already established their units here. However, there is immense scope in a food processing unit, and with the right decisions, the business can become profitable. There is an increasing demand for processed foods in the country, and many international players have also shown interest in the food processing sector in India.
Although there are many players in the market, India’s module for demand and supply chain requires more units that can successfully process raw materials into finished goods. Since India is mainly an agricultural country, channelling the procured raw materials and making sure that the country has enough food supply is important.
Food Processing Unit Setup Cost in India
While the cost involved in setting up a food processing unit in India varies depending on the type of edible products, you can ideally start a small unit with an initial investment of about ₹10 lakhs, excluding the cost of land and construction. Additionally, an individual would require an investment of ₹5 lakhs in equipment.
The required raw materials can be found in abundance due to the large agriculture, horticulture, and animal husbandry industries, including fisheries. Also, an individual needs to ascertain the primary and secondary raw materials they will need for the type of food processing units they are getting into. The correct location of the factory should be determined according to where raw materials can be found in abundance and the cost of transportation is lowest.
The required raw materials can be found in abundance due to the large agriculture, horticulture, and animal husbandry industries, including fisheries. Also, an individual needs to ascertain the primary and secondary raw materials they will need for the type of food processing units they are getting into. The correct location of the factory should be determined according to where raw materials can be found in abundance and the cost of transportation is lowest.
How to Start a Food Processing Business in India
Starting a food processing unit in India has been made easier under various schemes offered by the government. Similarly, the government is offering many incentives and fund-raising schemes to ensure the food processing sector is modernised in the country.
However, certain legal requirements include licenses and certification from various government departments. The most important legal requirement is attaining an FSSAI license. The Food Safety and Standards Authority of India provides licensing to food processing units after they meet certain requirements. Without the FSSAI license, any food items produced in the unit cannot be sold in the country. You’ll need to get the water tested and provide the authorities with kitchen layout plans and health certificates of all the employees, along with other documents. Similarly, there are certain procedures that an individual must know before getting into the food processing sector, some of which are stated below.
Business Plan
Planning is an important aspect of running a business successfully. All the search and analysis done during the initial stages must be implemented as the Business Plan. Moreover, you must know the future outcomes of the business plans and ascertain that your food processing unit complies with projected future trends.
Furthermore, the business plan must include the module of running the food processing units. By considering all outcomes, you will make the business profitable.
Funds
Funds play an important role in the effective running of a business. Without proper planning of funds, the company may not be able to grow. Therefore, having an effective funding module is required for any business, including a food processing unit. Funds also have a vital role in further expansions, and a single individual may not be able to raise the necessary funds. Therefore, once the unit is functional, you can look for shareholders and other sources of fundings.
Legalities
Along with having the most necessary FSSAI certificate, a food processing unit must have other documents. For instance, the company name must be registered as a private limited company, LLP, Partnership Firm, or any other format that corresponds to the type of ownership. Similarly, the company needs to have a GST registration certificate and trademark the company’s name.
Finally, a successful food processing business needs to market the products and have a professional team to handle the quality of goods and improve sales. In this way, with all the necessary parameters, one can begin manufacturing food products in India.
