The demand for coconut oil has skyrocketed in recent years due to the increasing knowledge of its numerous health benefits. It is a trendy superfood used in cooking and for its medicinal benefits. It is popular among the old as traditionally, it has been used in almost all Indian homes, especially in southern India. It is now gaining popularity among the young, for it is a favourite ingredient in several popular diets. Coconut oil has a rich flavour and mild aroma and has become popular with the growing demand for plant-based foods. It has several uses. Coconut oil manufacturing is a profitable business opportunity for new entrepreneurs.
Did You Know? If you live in a coconut-growing area, you can start a coconut oil manufacturing business.
Why is Coconut Oil Important?
Coconut oil contains iron and vitamin K, which aid blood clotting, making it an excellent source of vitamins and minerals. It is also high in vitamin E, a powerful antioxidant that protects cells from damage. Coconut oil improves heart health by increasing HDL (high-density lipoprotein) cholesterol levels and improving the body's ability to burn belly fat. It is an excellent skin and hair moisturiser.
Coconut is largely grown in the southern part of the Indian peninsula. In the coastal areas, there are huge plantations, and hence this would be an ideal location to set up a business for the sheer availability of raw materials. With its numerous cosmetic and medicinal applications, refined coconut oil is in high demand in France and Germany.
Coconut oil is used extensively, especially for cooking in India and other Southeast Asian countries. As a result, we can say that coconut oil manufacturing is a profitable business opportunity for new entrepreneurs.
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Steps to Start a Coconut Oil Manufacturing Business in India
The United States is the largest consumer of coconut products, particularly coconut oil and copra, followed by the Netherlands, which is also a major importer. From the Netherlands, these products enter European Union member countries, from which they are distributed to other countries.
1. Things to Consider before Starting Business
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First, determine whether you have an easy way to source raw materials. To make the project viable, you must have abundant raw materials at the plant location.
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A small-scale coconut oil manufacturing plant requires at least 1000 square feet of shade and 3000 square feet of land area to operate.
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Before you begin, you must have a business plan or project report. A project report details the manufacturing technology, machinery requirements, fixed capital investment, and working capital requirements in detail.
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Finally, you must arrange the necessary utilities in the plant, such as electricity and water.
2. Business Registration & License for Coconut Oil Manufacturing
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Register your company with the ROC (Registrar of Companies) based on its ownership and liability structure.
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Then, apply to the local government for a Trade License.
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Obtain MSME Udyog Aadhaar registration. You can submit your application online.
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Obtain GST registration as well
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To sell coconut oil as cooking oil, FSSAI (Food Safety and Standards Authority of India) registration is required
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A factory license is required for large-scale operations.
Finally, apply for BIS (Bureau of Indian Standards) Certification. Different quality standards must be met for each application of coconut oil.
3. Form your Team
During the early stages of development, you will be the sole employee of your company. Later on, you'll need a group of people to help you scale your business. Your team members will be the most suitable partner, employees, or freelancers for your needs. Get skilled people for this business, or you will need to train your employees.
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4. Machines and Raw Materials for the Production of Coconut Oil
A variety of factors influence the requirement for machines. For example, the manufacturing process, raw materials used, output specification, and the owner's investment capacity. Some of the most common machines required for coconut oil production include a Bucket Elevator for Copra Cutter, oil tanks for filtering, volumetric filling apparatus, and a jacketed steam kettle. It is critical to have all equipment ready before beginning coconut oil production. Well-dried copra with less than 6% moisture content is the prime raw material for making coconut oil. The quality of copra significantly impacts the quality of coconut oil.
5. Process Coconut Oil
Step 1: Cut dried copra into small chips in a copra cutter.
Step 2: Place the chips in steam-jacketed kettles and allow them to cook. Cook for 30 minutes at 70°C.
Step 3: Once the copra is cooked continuously, it is put into the expeller and pressed twice. They collect the combined oil from the first and second pressings in a separate tank.
Step 4: Finally, use a filter press to filter the oil and store it in MS tanks.
Step 5: In most cases, you can pack the item in bulk and store it in containers.
6. Study Other Players in the Industry
Manufacturing coconut oil is an ancient business in India; hence it is very critical to know the competitors and the marketing strategies and products they produce. One needs to package and brand their products creatively to increase sales. It is very important to have a USP. For example, people now sell virgin coconut oil, which has a niche market.
7. Marketing
It is very important to build a network to market your product. One should get in touch with the wholesalers and retailers in their area to be able to sell their products. One can sell their products at nearby stores, hotels, and restaurants and contact bigger industries using these products as raw materials. Also, you can create sales funnel sampling and promotion exercises to upgrade your sales.
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Conclusion
The Indian government is eager to grow the country's business sector and coconut oil factory. India aims to provide a wide range of options for starting a business and successfully conducting its operations due to its policies of ease of doing business and capturing business capital globally. The entire procedure is now available online, which makes it more convenient for everyone. In India, the government is assisting the process by digitising business registration. Schemes and initiatives have helped people achieve their dream of owning a business. Coconut oil is in high demand, but there is fierce competition due to a large supply.
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