The milk processing business is an ease-to-do and convenient business in India. In a country like India, where most of the population is vegetarian, Milk is a significant nutrition source. Milk is one excellent source of calcium and proteins. Milk is a nutrient-rich white fluid that comes from the mammary gland of mammal. It contains around 16 essential nutrients and is a great way to start, refuel, or end your day. Milk then gets converted into a wide array of other products like cheese, ice cream, and butter. Milk is known as the lacteal secretion obtained from healthy animals. It is one of the most popular beverages in India because of its health factor. India is the world’s largest consumer and producer of Milk around the globe. In India, Milk is not only a simple beverage but for dietary and nutritional purposes.
Milk mentioned in mythology. Milk has particular importance in India that goes back to Hindu mythology. It includes the term Samudra Manthan. And it also talks about the churning of the ocean that brought forth the drink of immortality called Amrit.
Milk processing allows milk preservation for months and helps to reduce food-borne illness. It contributes to almost 9.5%of global milk production. Processing of Milk gives small-scale dairy business entrepreneurs higher incomes than selling raw Milk and offers immense opportunities to reach global markets. Milk processing can also aid to deal with seasonal fluctuations in the milk supply. The process of transforming raw Milk into processed Milk and products can bring benefits to the entire community by generating jobs in milk collection, transportation, processing, and sale.
Market Potential of Milk Processing Business in India
Milk is the only item in India, and abroad that is popular enough to be in demand irrespective of any weather. Milk has been and shall always remain in demand by people of all ages. Milk’s best part is that it can be easily transformed into multiple other edible products and consumed in numerous forms. The milk processing business in India may rise at an overall annual growth rate (CAGR) of 20.5% and worth USD 53.17 billion by 2020. Along with the feature of being a profitable business, the milk processing business in India serves as a way of socio-economic development. Private participation has also emerged over the past few years. Both small and big companies enter the dairy industry, attracted by the market’s size and potential. The focus is on its by-product such as butter, cheese, yoghurt, probiotic drinks, etc. They are also trying to bring innovation in the products considering the requirements of the Indian consumers. The factors contributing majorly to the growth of the milk processing business in India are the increasing population, health consciousness among the consumers, schemes, initiatives, etc.
Amid the COVID-19 Pandemic, the demand for a milk variant known as A2 milk has witnessed a massive boost. Thus, opting for an A2 cow milk processing business can be a great option.
Products Chalked Out Of Processed Milk
- Cheese
- Butter
- Yogurt/Curd
- Flavored Milk like buttermilk, sweetened Milk, etc.
- Ghee
- Ice-cream/ cream
- Cottage cheese (popularly known as paneer)
Technical Aspects Involved in Milk Processing Business in India
Appropriate Business Plan-
Entrepreneurs should focus on the business plan at first before executing it. The plan layout helps prepare the company for any unpredictable events and prepares them to accomplish their targets less time and significantly less investment. However, it is the need of the hour to emphasize the plan before setting your business because any small twist and turn can lead your business to uncountable losses and the deterioration of the customers’ health. The efficiency and production of milk processing depend upon the plan concerning the milk processing business in India. Negligence, by any means, can prove to be a disaster for the business entrepreneurs. Hence, starting from essential permits and licenses and registration of the milk processing business in India, every small detail should be given. Business plans often act as a security valve for enterprises.
Download Milk Business Plan PPT
Location of the unit-
The milk processing business in India requires ample space for buildings, future business expansion, parking lot, empty cans, a manufacturing company, packaging unit, etc. About two acres of land is appropriate for milk processing. However, the plant’s location must be closer to the milk-producing area in a product manufacturing unit. The site’s background should have proximity to all the required facilities like road/rail facilities, services, water, electricity, raw materials, social infrastructure, etc. Proper drainage maintenance is a must. The unit can either be an owned one or taken on rent. Apart from all this, special care is needed regarding its workers’ safety and working in a secure area. The building should be well equipped with all the necessary precautions to avoid any mishappening.
Legal entity-
Registration of the milk processing business in India with the registrar of firms or ROC is the first step in starting a milk processing business in India. You can either get it registered as a sole proprietorship or any other form of the company like LLP or Partnership, etc., depending upon the business organization’s capital infused and budget. You must choose the appropriate name and logo for the manufacturing unit and register it in that name.
Permits & Licenses-
- NOC from the fire department
- GST registration
- MSME registration
- Trade License
- FSSAI food license
- BIS standards
- Special permission from PCB
- MMPO registration with the Commissioner, Dairy Development, concerned state, or the authority.
- Insurance policy
- License from Factory inspector for installation of the boiler
FSSAI Role in Milk Processing Business in India
The food control safety measure is required to bridge the gap between safe food and adulterated food. The food industry needs more flexible standards and efficient in producing and marketing food, thus ultimately serving the consumers with a protective sheet. FSSAI’s role in food quality is essential for smooth functioning. Maintaining the food quality standards to ensure safety and satisfaction to every consumer is every Food/beverage business entrepreneur’s aim. India’s food safety and standards authority (FSSAI Registration) play a significant role in controlling and maintaining the safety procedures. FSSAI ensures that all the safety standards complied before floating the milk products out for sale.
- Source of Financing – Good business plan is merely a drafted letter not put in transit. Milk processing units come under the MSMEs sector. Milk processing units are financed by any commercial banks (scheduled ones), Regional Rural Banks, and other Cooperative Banks. Important terms and conditions of financing need to be discussed in detail while borrowing money from these institutions. The entrepreneurs of these units can approach any financing bank for borrowing money. It is mandatory to take a bank loan to avail of various schemes/regulations of government. Therefore, the entrepreneurs who are desirous of availing subsidy should also adhere to the means of finance. Apart from taking loans, there are other ways to arrange for finances like crowdfunding, angel investor, etc.
- PLANTS & MACHINERIES
- Milk pasteurizer
- Dairy processing plant & unit
- Homogenizer machine
- Plunger Pumps
- Storage and packing section
- Refrigeration section
- Storage tank
- MAJOR UTILITIES
- Transport vehicles
- Water
- Steam
- Fuel
- Compressed Air
- Electricity
- Raw Material – The primary raw material is Milk. The availability of some other inputs, such as packing materials, disinfectants, etc., should also be considered.
- The cost of the project – A total of 258.24 lakhs is required to start the milk processing business.
- Manufacturing process – It involves a few necessary steps for milk processing Business in India: Raw material into a dump tank, the next step is filtration/ clarification. The next step is cooling and storage, after which it is preheated and standardized. After standardization, processing takes place depending upon the product one is willing to produce like ghee, cream, curd, etc.; this means that a different process is for all the products.
- Marketing criteria – There are a plethora of measures by which you can sell your milk/milk processed products. One may opt for online portals and choose to put it on an e-commerce website or sell it directly. However, most of these entrepreneurs are opting for online selling their products in the current scenario because it is cost and time-efficient. BigBasket, amazon pantry, milk basket, etc. have proved to be some popular brands for listing the milk products. You may also choose to sell it directly to dairy booths, stores, agencies, etc. Apart from this, you may also put your products on your website.
Government Schemes
- MUDRA scheme– Under this scheme, the agency is set up to refinance and develop micro units across the country. It extends funding to the non-corporate small business sector.
- Aatmnirbhar Bharat Abhiyan– Under this scheme, free collateral loans are bestowed upon MSMEs to carry on business efficiently.
- Coir Vikas Yojna– This scheme encourages various activities like skill development, upgradation, and modernization of industries, and promoting domestic and export markets.
- Marketing promotion schemes-To develop domestic markets and promotion of new market access initiatives.
- Entrepreneurship and skill development program– It is to nurture youth’s talent by enlightening them on various industrial activity aspects required for setting up small industries.
Conclusion
As the second-largest contributor next to agricultural products, milk and milk products plays a vital role in the country’s economy. The milk processing business in India is one of the most promising industries in the current time. Milk processing business in India is a potential sub-sector for the generation of income and employment; 75-80 percent of farm families of small farmers, marginal farmers, and landless laborers are employed in this sub-sector. Dairy generates employment with the least unit cost of jobs. The Indian dairy sector has registered a spectacular growth rate of five percent per annum during the last three decades. As a result, India emerges as the world’s largest producer of Milk.
