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Introduction: What is a Food Processing Business?
Food processing is the transformation of raw ingredients into food, or the production of consumable food from raw materials.
The food processing industry is a large sector in the global economy. It includes any production or manufacturing of food by physical and chemical means, such as cooking, freezing, drying, mixing, or packaging. The industry includes companies that process fruit and vegetables; meat and dairy products; grains and oilseeds; sugar cane; tea leaves and coffee beans; fish and other seafoods.
Food Processing Business are also involved in preserving food by canning or bottling it. Examples include jams, jellies, preserves, canned vegetables (e.g., canned tomatoes), soups (e.g., tomato soup), baby foods (e.g., baby purees), iced drinks (e.g., iced tea)
What is the scope of food processing in India?
India is a country of diverse cultures and traditions, which are reflected in the food habits of its people. The Indian cuisine is not limited to just vegetarian or non-vegetarian dishes, but has a wide range of dishes that include seafood, meat, and poultry. Food processing is an important part of the food industry in India.
Their is vast scope for food processing in India particularly for new products in canned and frozen foods category and there is also greater opportunities in traditional food processing business like:
- Processed dairy products such as butter, cheese, ghee (clarified butter), yoghurt and ice cream;
- Processed fruits and vegetables such as jams and pickles;
- Processed meat products like frozen or canned meat items;
- Processed seafood items like canned tuna fish or crabmeat;
- Processed poultry products like canned chicken soup or canned turkey;
- Processed grains such as corn flakes or breakfast cereals.
What are the Top 10 Most Profitable Food Manufacturing Business in India?
Here is list of Top 10 Most Profitable Food Manufacturing Business in India
1. Start a Bakery Manufacturing Business
Bakery business is a great opportunity for those who love cooking and baking. It is also a good way to make money.
There are many ways to start a bakery business. You can either buy an existing bakery or start your own from scratch. If you want to buy an existing one, it is better to choose one that has been in operation for at least two years and has a stable customer base of at least 50 customers per day.
But if you want to start your own from scratch, it will be more challenging because you need some capital investment for the initial setup like renting or buying a space, purchasing equipment, hiring staffs etc.
Bakery businesses can be started with as little as ₹5 Lakhs. The ingredients required to start a bakery include flour, sugar, eggs, butter or margarine and milk. A bakery can be operated from home or from a commercial location.
In this article, we will talk about how to start a bakery business and what are the benefits of owning one
2. Start a Confectionery manufacturing Business
The confectionery industry has been booming for a while now, and it is not showing any signs of slowing down. It is a multi-crore rupee industry with a lot of room for growth in the coming years. The market size can be estimated to be around $260 billion annually worldwide but in India it is still in nascent stage of about $5 billion in India with massive scope for improvement.
A confectionery business is a business that sells candy, chocolate, or other sweets. It can take many forms, including a store that sells only confections, a company that manufactures and distributes them to retailers, or an online store.
Starting a Confectionery manufacturing Business is easy as it does not require you to buy any expensive machines or tools. All you need is access to raw material, basic level equipment and trained staff. the cost of starting a Confectionery manufacturing Business in India is approx. ₹3 Lakhs.
The article provides information about the confectionery industry and how to start your own confectionery business.
3. Start a Grain Processing Business
Grain processing is a process that converts raw agricultural commodities into usable products. The major products are flour, cornmeal, grits, breakfast cereals and animal feed.
Grain processing is a highly competitive industry with many players in each region. There is good opportunity for small scale grain processing business who can focus on niche markets such as organic and gluten-free grains.
The major challenges for grain processors are high input prices and volatile grain prices. One way to combat these challenges is by investing in more efficient equipment to reduce input costs per unit of output and by hedging against price changes with futures contracts.
Opportunities for the industry include increased demand from emerging markets such as China and India as well as increased demand from new product lines like gluten-free or organic grains.
4. Start an Oilseeds Manufacturing business
Oilseeds manufacturing is an important sector of the Indian economy. India is the second largest producer of oilseeds in the world and the fifth largest exporter of processed oilseeds.
India produces about 18 million tonnes of oilseed annually, out of which 14 million tonnes are consumed domestically and 4 million tonnes are exported.
For starting an Oilseeds manufacturing business yo need a good location. You need to have access to quality raw materials that would be processed into finished products. You also need large enough space to store the finished products and other supplies and equipment that you may use for production.
The cost of setting up an oilseed processing plant which can range from Rs. 5 lakhs to Rs. 5 crore depending on the type and size of machinery required for your particular business model.
The production of oilseeds in India has been increasing steadily in the last few years due to high demand from the domestic market and exports to other countries such as China.
5. Start a Dairy Farm Business in India
Dairy farm business in India is one of the oldest and largest industries in the country. It is a billion dollar industry with some of the biggest dairy companies in India. Dairy processing business in India is a high-growth industry. The estimated growth rate of the industry is around 7% and a market size of over USD $60 billion .
The industry has also been witnessing an increase in demand for milk, cheese, yoghurt and other dairy products in both domestic and international markets, which has led to increased investments by private and foreign players.
The cost of starting a Dairy manufacturing business in India ranges from Rs. 50 Lakhs to Rs. 1 Crore, depending on the size of the factory and location.
Some of the major players operating in this space are Amul (a cooperative), Mother Dairy, Hatsun Agro Product Ltd., Gokul Milk Products Pvt Ltd., Parag Milk Foods Pvt Ltd., GCMMF (Amul), etc.
6. Start a Meat Processing Business in India
India is the fifth largest producer of meat in the world, with an annual production of about 6.3 million tons. India has one of the largest population of living livestock with over 500 million. The meat processing industry in India is a $3.6 billion industry and is growing at a rapid pace with an annual growth rate of 10%.
Most livestock farms are small-scale operations where farmers rear animals for their own consumption or to sell locally. The country’s large population means that there is an abundance of cheap labor to process animal carcasses, which results in affordable prices at markets and supermarkets.
There is immense opportunity for new players in meat processing industry in India as the markets is not as developed as in other western countries. The Indian government has been subsidising and providing various schemes like tax benefits, long term loans, training and export fairs for new meat processing businesses in order to match global standards.
The cost of starting a meat processing business in India is not very high any where between ₹ 4 lakhs to ₹12 lakhs although it can vary depending on the type of meat processed, the scale of operation and the location.
7. Start a Poultry Farming Business in India
The poultry farming industry in India is a fast-growing sector. The poultry processing industry has grown to $30.5 billion dollar industry in India due strong demand, and it is projected to grow at a CAGR of 8%. The global poultry processing market was worth $104 billion in 2012 and is expected to reach $200 billion by 2025.
A Poultry processing business is the process by which poultry meat and eggs are prepared for consumption or commercial use. This includes slaughtering, plucking, defeathering, eviscerating, washing, trimming, cutting up (into pieces), packing (canning or freezing), and labeling.
The cost of starting a poultry processing business in India is not that high. The total cost of setting up a If you are looking to set up a medium-scale farm poultry processing plant, including the land and building costs, is about ₹10 lakhs to ₹ 30Lakhs.
If you are looking to set up a Large-scale poultry farm, it will cost you around ₹ 50 Lakhs to ₹3 crore to get started which includes constructing or renting facilities for housing chickens as well as purchasing equipment.
8. Start a Fish farming business in India
Fish farming is one of the most profitable food business in India, as it has a huge market and growing demand for fish every year. India is one of the leading countries in the world in terms of fish production. In recent years, India has seen tremendous growth in the aquaculture sector. The aquaculture industry has grown at a compound annual growth rate (CAGR) of 12% and is currently valued at $17 billion dollar industry.
Fish farming industry is primarily based on freshwater resources, with an average annual production of17 million metric tons. The country’s major freshwater fish species include carp, catfish, tilapia and pangasius (a type of catfish).
The Indian fish farming industry is mainly concentrated in the coastal states of Kerala, Tamil Nadu, Andhra Pradesh and West Bengal. There are around 5,000 operational units of fish farms in India with an annual production of over 10 lakh tonnes.
The cost of setting up a fish farm in India, can vary depending on factors like location, size and type of operation but generally it ranges between ₹2.5 lakh to ₹10 lakhs for small-scale operations which are less than one acre (0.4 hectares) and ₹1.2 crore to ₹ 5 crore for large-scale operations which are more than 10 acres (4 hectares).
9. Start a Fruits Manufacturing business in India
The Fruits Manufacturing industry in India is one of the most competitive industries. The market is fragmented with many small firms competing with larger ones. It is primarily comprised of the production of canned, frozen and dried fruits, fruit juices and fruit spreads.
India is one of the world’s largest producer of fruits and vegetables. The country produces a wide variety of fruits, vegetables, and other horticultural products. The total market value of India’s fruit processing industry is estimated to be around US$ 15 billion.
The Indian Fruits Manufacturing Industry is one of the most important industries in India. It contributes about 5% to the total GDP of the country and employs about 2.5 million people directly or indirectly who are engaged in various activities such as agricultural farming, harvesting, post-harvest handling, transportation, storage and marketing.
The cost of starting a fruit manufacturing business in India varies greatly due to various factors like land, labour, size and scale of operation. But generally it would require a capital of ₹10 lakh to ₹50 lakhs for small scale fruit processing business. And ₹2 crore to ₹ 10 crore for large-scale business which can process around 2 to 5 tonnes of fruits per annum.
There is ton of opportunities for new Fruits Processing Industry in India primarily in the canned or frozen fruits category as which unlike the west the trends is slowly and steadily gaining momentum in India.
10. Start a Vegetable Processing Business in India
Vegetables are an important part of India’s staple diet and there has been a significant increase in the demand for vegetables in India in recent years. The vegetable processing industry in India has been growing at a CAGR of 6.2% from 2017-2022 and is expected to grow at the same rate during the forecast period.
Vegetable processing is the process of converting raw vegetables into a processed form. This process may be necessary for some vegetables, such as potatoes, that are not good to eat raw. Vegetables that are typically processed include carrots, onions, tomatoes, cauliflower, ginger, garlic, cucumbers and cabbage etc.
The vegetable manufacturing industry in India includes production of canned and frozen vegetables, packaged salads, pickles, juices, purees and other products. Vegetable manufacturing companies import raw materials such as tomato, carrot, other vegetables to produce processed products like pulp, ready to cook vegetables, boiled veggies etc.
The cost of starting a Vegetable processing business in India varies according to the type of business one wants to start. The average capital investment is around ₹7.5 Lakhs to ₹12Lakhs depending on the cost of equipment and machinery needed for processing vegetables
Above was the list of the 10 most promising and highly profitable food business in India that you can start right away. If you are interested in starting a food manufacturing business in India, then read the article below to gain more insight.
How to Start a Food Manufacturing Business in India| 8 Solid points you must read before Starting a Food Processing Business.
But, Thats not It! We have compiled a List of some of the other popular and upcoming Food processing business to start in India.
11. Start Breakfast Cereals Manufacturing Business
Breakfast cereals are a very popular breakfast food, and there is a huge demand for this product. This is because the cereal provides the consumer with many important nutrients such as fiber, protein, and essential vitamins. The breakfast cereal manufacturing business is one of the most successful industries in the world.
The breakfast cereal industry is a $13 billion dollar business in the United States. It is a lucrative industry with low barriers to entry.
How to Start a Breakfast Cereals Business in India | 10 Important points you must read now before you start your Cereal business.
12. Start Flour Mill Manufacturing Business
India is the second-largest producer of wheat in the world after China. Wheat is grown in many states including Punjab, Haryana, Uttar Pradesh and Madhya Pradesh.
Flour manufacturing in India has grown significantly over the years. The Indian flour industry has a total turnover of more than Rs 8,000 crores annually and exports about Rs 400 crores of its production to different parts of the world.
The Indian flour industry has undergone major changes over the past few years due to a number of factors like increasing demand for quality flour from countries like China and Middle east and growing use of wheat as raw material for bio-diesel production in Europe.
13. Start Honey Making Business
The Honey making business is a booming industry with the potential to generate significant revenue. The Indian honey market was estimated at $500 million with a growth rate of 7% per year.
The total area under beekeeping in India is about 8 lakh hectares with an average yield of around 1 tonne per hectare. India’s annual production of honey has been estimated at about 75 thousand tonnes from over 3 lakh beehives.
The average cost of starting a beekeeping business is low around ₹3.5 Lakhs to ₹5 Lakhs. There are some exceptions one can also start with initial investment of around ₹50000 to ₹1.5 Lakhs
14. Start Asofoetida or Hing Making Business
Asafoetida is the dried resin obtained from the plant species Ferula assa-foetida, which is native to the eastern Mediterranean region. It has been used in Indian cooking for Hundreds of years. It is a pungent spice that works as an anti-flatulent agent and a digestive aid. It also has antibacterial properties and can be used to treat intestinal infections. The plant is native to Afghanistan, Iran, and Kashmir.
A good way to start an Asafoetida processing business is to buy asafoetida in bulk and process it into powder form. Once you have processed it, you can sell it in small packets.
The average cost of starting a Asafoetida business in India is approximately ₹ 5 Lakhs.
15. Start a Chips and Wafer Manufacturing Business in India
Potato chips are a popular snack in India. The chips manufacturing industry in India is growing rapidly, with the potato chips market accounting for around 3% of the global market share. India is the world’s second-largest producer of potato chips and the third-largest exporter which produces about 20 million tonnes per year.
The potato chips manufacturing industry in India has been growing at an annual rate of 20% over the past decade. The industry is expected to grow at a steady pace with a CAGR of 14% during the forecast period.
The cost of starting a potato chips Manufacturing Business in India is reasonable. The cost for setting up a small potato chips factory could ranges from Rs. 2Lakh to Rs. 5 Lakh. While the cost of setting up a large scale potato chips manufacturing factory with automatic production and packaging machinery and other high level of sophistication can cost up to Rs. 5 crores
16. Starting a Jam Manufacturing Business
Jam manufacturing is a traditional business in India. It is one of the most profitable food businesses around. The process of jam manufacturing is not complicated and can be done by anyone.
Jam is a popular food item in India and many small scale jam manufacturing business have emerged with their unique brands. This is because of the high demand for jams and jellies in the country due to strong demand from both urban and semi-urban areas of India.
The cost of starting a Fruit jam manufacturing business will be around 10lakhs to 50lakhs depending on the scale of business.
17. Start a Spices Manufacturing Business
India is the world’s largest producer of spices and has an annual production of about 1.5 million tonnes. The Indian spice trade is worth about US$2 billion annually, with exports accounting for approximately 70% of that figure. Spices are widely used not only as food additives but also in cosmetics, pharmaceuticals, perfumes and incense.
The cost of starting a small Spices Manufacturing Business in India can vary from Rs.5-8 lakhs where as a very large production facility with potential for overseas exports can cost from INR 1 Crore to INR 5 Crores, depending on the size of the company and its location.
18. Starting a Noodle and Pasta Manufacturing Business
India is one of the fastest growing economies in the world. With a population of over 1.3 billion people, it has a lot of potential for growth. One industry that could do well in India is noodles and pasta making. Noodles are popular food choice in India, and they are easy to make with little to no cooking skills required.
In India, the noodle and pasta market is still at a nascent stage with only around 2% penetration. The noodle and pasta market in India has huge potential as it is expected to grow at a CAGR of over 20%.
The cost of starting a noodle and pasta manufacturing business in India is about ₹3 Lakhs to ₹6 Lakhs. The raw materials required for this business are not expensive and can be sourced locally as well. For instance, wheat flour, salt, water and oil are the main raw materials used in making noodles.
19. Start Packaged Drinking Water or Mineral water Business
Packaged Drinking water is a product which is highly profitable food business and has a huge market in India. The demand for packaged drinking water is increasing day by day due to high demand from both urban as well semi-urban and rural areas of India.
Starting a Packaged drinking water or Mineral water is a highly profitable food business in India. The industry has grown at a healthy pace of 15% over the last five years and is expected to grow at an even faster rate in the coming years.
The cost of starting a packaged drinking water manufacturing business in India ranges from Rs. ₹10 lakhs to Rs. ₹1 crore, depending on the scale of production and other factors such as location, raw material availability, etc.
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