Starting a Food Manufacturing Business
Starting a Food Manufacturing Business – Spices & Curry Powders
Manufacturing of food products like spice powders or curry powders is a growing industry within the subset of the food manufacturing industry. Spices and curry powders play an important role in enhancing the flavor and taste of the processed foods – making them an essential part of cooking at households and restaurants. India produces almost all the known spices and is the largest exporter of this commodity. Hence, there is tremendous opportunity for setting up a food manufacturing business that caters to domestic demand or export demand. In this article, we look at the process for setting up a food manufacturing business in India.
Spices and Curry Powders
Spices are traded chiefly in an unprocessed form. However, a small yet significant quantity enters international trade as spice powders. Curry powder is a blend or mix of 20 or more spices designed to impact the characteristic flavor of an Indian curry and Indian food. Hence, curry powder is created by blending various spices with the formula being proprietary to each of the manufacturer.
Setting up a Food Manufacturing Unit
A small food manufacturing unit specialising in spices and curry powder can be setup with an investment of about Rs.10 lakhs in equipment and working capital (not taking into consideration the land or building costs). With investment in equipment to the tune of Rs.5 lakhs, a food manufacturing unit can achieve an annual sales of upto Rs.70 lakhs with 60% operating efficiency. On such a sales turnover, a profit after tax of about Rs.2 to 3 lakhs is estimated.
The typical equipment required for setting up a food manufacturing business is as under:
- Multi-mill Pulveriser one side double head 12″ and other side single head 12″
- 10 HP Crompton motor with starter, switch and capacitor
- 12″ disintegrator with stand 36000 1 36,000.00
- Uruli Roaster capacity 15 Kg / batch with electric motor
- Parts of flour mill -motor pulley, belt, rail, foundation bolt and belt guar
- Single head pulverisor
- Bolt oil expeller
- Electronic weighing balance
- Cubical control panel with all components
To operate a small food manufacturing business as stated above, the unit would require about 3 – 5 workers. Most of the workers required would be unskilled labours and the total cost to the business in terms of salary would be about Rs.30,000 to Rs.40,000 per month.
License and Registrations
It is recommended that all food businesses be setup as a private limited company or LLP, so that the liability of the promoters is limited and the business has easy access to bank financing. Hence, its important for the promoters to opt for company registration or LLP registration while starting a food manufacturing business.
All food manufacturing businesses are mandatorily required to obtain FSSAI registration from the Food Safety and Standards Authority of India. Hence, having FSSAI registration as a small food manufacturer is mandatory for all spices or curry powder manufacturers. In addition to FSSAI registration, the food manufacturer can obtain trademark registration, in case the business would have a unique brand name for selling of the food products. Import Export Code or IE Code would be required, if the manufacturer plans for export of products.
Finally, products sold by the food manufacturer would be subject to VAT or GST (on implementation). Hence, VAT or GST registration would be required for the business to stay compliant.
Know more about about starting a spice business in India.