The food manufacturing sector represents a lucrative opportunity in India. Given that India is primarily an agrarian economy, it is recognized for producing a wide range of organic food products.
A significant portion of the country’s revenue is derived from food production and agriculture. The potential for demand, diversification, and expansion within the food manufacturing industry is substantial. This sector has established itself as one of the foremost industries in India.
Food processing encompasses a variety of techniques and operations that convert raw food materials into consumable products suitable for storage and cooking. This process includes numerous stages, starting from the initial preparation of raw ingredients to their transformation into ready-to-eat items.
Things Required For Starting a Food Manufacturing Business
When you have decided to start a food manufacturing business in India, you require the following seven things to run your business:
Determine the Business Framework:
To initiate a food manufacturing enterprise in India, the foremost step is to determine and establish an appropriate business structure. This could take the form of a One Person Company (OPC), a partnership firm, a Limited Liability Partnership (LLP), or a private limited company. The choice of business structure should be influenced by the scale of operations and the management approach you intend to adopt.
Once the business structure has been established, it is essential to obtain the necessary registration for your company or firm from the Registrar of Companies or the Registrar of Firms, as applicable. This registration is crucial for securing funding and ensuring that your business operates within the legal framework.
Analyse the Market:
Prior to launching a food manufacturing enterprise, it is essential to conduct thorough market research to identify the most suitable product for production.This involves analyzing the economic and industrial performance of existing food processing units. When selecting a food product, it is important to consider its market availability and viability, as this will aid in assessing competition, current trends, and the overall market size.
Organize the allocation of financial resources.:
Every enterprise requires adequate capital and funding to establish and sustain its operations. There are various avenues available for securing financial resources for your business. Options include crowdfunding or obtaining a business loan from financial institutions if your capital is insufficient. Additionally, you may consider raising funds from family and friends.
Engaging with venture capitalists or angel investors is another viable option for securing funding for your food business. Furthermore, you can explore government programs that offer support to agro-industries, such as the Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) and the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), among others.
Determine the Site Location:
It is essential to determine the site for the manufacturing facility. It is advisable to choose a location that is situated outside the urban area, as manufacturing units typically necessitate extensive space. However, it is crucial to ensure that this site is in proximity to essential resources in order to minimize logistics expenses.
The chosen location should provide easy access to a skilled workforce, transportation infrastructure, raw materials, and power sources. Additionally, it should be conveniently located near the market where the products will be sold.
Get FSSAI/Food License:
It is essential for individuals engaged in the food industry to secure an FSSAI registration or license. According to the Food Safety and Standards Act of 2006 (FSS Act), all proprietors of food manufacturing enterprises in India are required to obtain an FSSAI registration or license. There are three categories of FSSAI registration available. The specific type of registration you must pursue is determined by the annual size and turnover of your food manufacturing business.
If your business has an annual turnover of less than Rs.12 lakh, you are required to apply for an FSSAI Basic Registration. For businesses with an annual turnover exceeding Rs.12 lakh but less than Rs.20 crore, a State FSSAI License is necessary. In cases where the annual turnover surpasses Rs.20 crore, a Central FSSAI License must be obtained.
Obtain Additional Required Licenses.:
It is essential to secure various mandatory licenses and registrations for your food manufacturing business prior to commencing operations. A No Objection Certificate (NOC) from the fire department is necessary for your establishment. Additionally, a water testing certificate from an accredited agency is required, as water is a critical component in the preparation of food products.
Registration under the Shop and Establishment Act is obligatory, as all commercial entities must obtain this registration. Furthermore, it is necessary to acquire pollution clearance from the relevant State Pollution Control Board (SPCB), given that the food manufacturing sector is classified as a polluting industry by both the Central Pollution Control Board (CPCB) and the SPCB.
If you intend to export your food products, obtaining an Import Export Code (IEC) is mandatory. Additionally, GST registration is required. For those selling food items under a specific brand, trademark registration is advisable to safeguard your branded products from competitors.
Staff, Goods, Equipments & Suppliers:
To conclude, once you have secured all necessary licenses and registrations, selected a suitable location, and arranged for funding, the next step is to acquire the essential equipment and recruit staff to operate your food processing enterprise. Given that food manufacturing entails transforming raw materials into consumable products, a diverse range of equipment and machinery will be required for the processing of food items.
The specific equipment and machinery needed will depend on the type of food products being manufactured. Nevertheless, most food processing businesses typically require equipment for cleaning, grading, peeling, blending, and sorting food. Furthermore, machinery for packaging and labeling the processed food items is also essential for sale or consumption.
A competent workforce is crucial for the successful operation of your business. It is important to hire individuals for various roles, including factory workers, chefs, marketing personnel, sales managers, cleaners, and human resources managers.
Once your food processing facility is operational, it is vital to implement an effective marketing strategy. A well-structured marketing approach will facilitate the growth of your business. Consider creating a website that includes all pertinent information about your operations, ensuring that both consumers and suppliers are informed about your manufacturing unit. Additionally, utilizing social media platforms such as Instagram and Facebook to showcase your food products can help attract more customers and suppliers.
For guidance or filing assistance:
Call SONASIS ECOM INDIA PVT. LTD.
MOB. +91 6206213630
An FSSAI License is a certification granted by the Food Safety and Standards Authority of India (FSSAI) to food enterprises.This license is compulsory and signifies adherence to food safety regulations, thereby ensuring that consumers receive safe and hygienic food products.
All operators in the food business, encompassing manufacturers, distributors, retailers, and importers, are required to secure an FSSAI License. This certification is obligatory for enterprises with a turnover that surpasses 12 lakhs.
The FSSAI provides three categories of licenses that correspond to the size and type of the business:
1. Basic FSSAI Registration
2. State License
3. Central License
The necessary documentation comprises identification verification, proof of residence, a food safety management plan, and evidence of ownership or lease of the premises.
The duration of validity for an FSSAI License depends on the specific type of License issued, with terms ranging from 1 to 5 years. It is essential for the Food Business Operator to submit a renewal application at least thirty days prior to the expiration of the existing license.
No, It is essential to secure an FSSAI License prior to initiating any activities related to the food business.
The typical processing duration for an FSSAI License application ranges from 30 to 60 days, contingent upon the type of license and the completeness of the submitted documentation.
Yes, Conducting a food business without obtaining an FSSAI License may result in penalties, fines, and the possibility of business shutdown.