Setting up a Paper Cup Manufacturing Business
Choosing to do a manufacturing business can be a little challenging. But, planning to start your career in the field of business can be both exciting and thrillful at the same time. So, how to choose and decide the right type of business to start your career as a budding entrepreneur??
The right way to choose and start doing any business is to understand and gain authentic knowledge.
One of the primary reasons behind opting to do a small-scale manufacturing business is that it nearly employs about 10% of the population of the country. Being one of the major leading industries in the field of innovation and technology, the small-scale business continues to grow exceptionally.
Without having the right information about the type of business, its scope, the target market, and the pricing (investment), one must not start any business. So, let us now understand the idea behind investing, starting, and pursuing to choose a small scale business like Paper Cup Manufacturing Business.
Introduction
Followed by the increase in lifestyle changes and the rising awareness, demand for paper cups has been seen soaring immensely. Therefore, let us focus on the process of doing and starting a paper cup manufacturing business in detail.
Let us now begin by understanding the Paper Cup Manufacturing Business.
Lining and Layers of a Paper Cup
- Usually referred to as disposable cups, Paper cups are made of paper and lined wax to obstruct the liquid from soaking the paper. The paper cups are fabricated by using food-grade paper.
- A food-grade paper is hygienic and efficient to store both hot and cold liquid for a longer time period.
External layer– The external layer of a paper cup (also stated as the outer layer) is composed of a paperboard. This layer imparts insulation properties and withholds the heat. Paperboard functions to keep the drink or beverage hot for as much time as possible made to hold and carry the cup comfortably.
- Cold Drinks– For cold drinks, a single layer is sufficient.
- Hot Drinks– For hot drinks or beverages, it is advised to use double-layered cups as they provide extra heat protection.
Note:-
- Along with the insulating heat, the other sleeve of the cup lets to mix and merge the decorated pattern and the print to develop various designs.
- Intending to ensure making the cup liquid-proof and the food hygiene, the paperboard is laminated with a thin plastic lining.
The Market for Paper Cup Manufacturing
As the business of manufacturing paper cups is a way to reduce exposure to foodborne infection and become more eco-friendly, paper cups are becoming highly popular amongst all. Paper cups remain in high demand in supermarkets, industrial canteens, IT companies, health clubs, educational institutions, food canteens, parties, and restaurants.
Holding a market of mass consumption by being a daily use product, the sale of paper cups constantly remains high in the market. With entrenched demand in the market, the cost of these paper cups can be easily recovered.
Hence, doing the Paper cup manufacturing business can be stated as a profit-earning business. The paper cups can be easily sold in bulk to retailers and traders or directly to potential client and customers via various mediums.
The Idea to Start the Paper Cup Manufacturing Business
A paper cup is a disposable item and has various advantages.
Advantages:-
- Paper cups are idealized to be used to serve at different kinds of gatherings like- marriages, parties, tea & food stalls, functions, etc.
- These paper cups are non-poisonous and harmless. Their shapes and size are presentable and attractive in nature.
If you are planning to opt for Paper Cup Manufacturing Business, then here is a detailed guide covering all you need to know:-
Examine and Study the Market– The paper cup manufacturing business is an extensively growing business. Usually, the demand and supply of paper cups depend on the reach of its utilizing customers. Paper cups are available in different shapes, thickness, and sizes (20 ml to 200 ml). This product has a daily utilization in both urban and rural areas of the country. Depending upon the nature of the beverage/drink and the volume of the raw material used, the thickness of the paper cups varies. Hence, intending to understand the supply of paper cups, you need to examine its demand for each kind of cup deeply. Hence, intending to understand the supply of the product, you need to examine its demand for each kind of cup deeply. You can also evaluate the comprehensive demand in the targeted market area. Doing this will allow you to assess the gap in the demand and supply of paper cups.
Business Plan
Create a Business Plan or a Project Report– Once you have chosen the product, you are required to prepare a business plan. Not only will making a business plan help you in applying for a loan, but it will also allow you to set up your business properly. While making your business plan or the report, you need to create two different segments in it.
These two segments are as follows:-
- Technical Aspect- Under this segment, technical requirements are addressed to complete the project successfully. The components that fall under this segment are: – availability, the performance, and reliability of your product.
- Financial Analysis- This is a process of accessing the business, its budget, project, target market, and other related financial transactions. These transactions are considered to calculate the suitability and performance of the product. These two sectors are interrelated and dependent on each other.
Here is an illustrative financial analysis for the paper cup manufacturing business:-
Cost of Paper Cup Manufacturing Business
Fixed Pricing:-
|
Building Rent and Land |
₹5,000
|
|
Equipment and Machinery |
₹10, 60,000
|
|
Pre-operative Expenses |
₹10,000
|
|
Total pricing |
₹10, 75,000
|
- Arrange your Finance– Once you have calculated your total project cost, you are required to arrange the finance for it. Now, you can either do the investment using your funds (savings), or else you can apply for a project loan. You can always check for a government subsidy for the paper cup manufacturing business. On the other hand, you can also apply for machinery finance depending on the requirement of equipment for your business.
Secure a Location
Setting up a paper cup manufacturing business needs a minimum space of 500 Sq. Ft. This area must be covered with adequate electricity and water. It would be appropriate to establish your business entity in an industrial area and not in any residential areas. In case you want to set up your business in a residential area, then you need to get a written No Objection Certificate (NOC) from the respective association. The requirement of the area depends on the machine operating mode and the size of the unit. That is why it is advisable to contact the machinery supplier before finalizing the things.
Licensing and Registering Process
- Aiming to set up your paper cup manufacturing business, you need to register your entity in agreement with the investment pattern and ownership.
- While choosing to start a business, you need to understand all the characteristics of it and be sure of them.
- If you start your business with small funding, then it is advisable to start as a proprietorship.
- A minimum amount of ₹10 lakh is required to set up this business. This amount covers the purchase of all the required machinery, equipment, and raw materials.
- With the investment of ₹10 lakh, the paper cup manufacturing business can produce more than ₹2.2 crore paper cups. The estimated sales turnover for this amount is nearly over ₹66 lakhs.
- Considering the calculated annual turnover of this business, it is suitable to incorporate a company. When a business entity is registered as a private limited company, it becomes easy for the entrepreneur to acquire a bank loan and run the business smoothly.
- Additionally, for smooth functioning, your business would also require a GST registration.
To Summarize
The paper cup manufacturing business is a great platform for budding entrepreneurs. It is a small-scale business that not only gives a stepping stride but also provides good returns in terms of investment. Being a progressive unit, Aatmnirbhar Sena strives hard to support the small-scale businessman and people with innovative business ideas.
The paper cup manufacturing business also requires a few licenses and registrations such as LLP or Pvt Ltd. company registration.
To establish a business, securing a location is a must. This location should be equipped with sufficient water and power supply. We at Aatmnirbhar Sena support such entrepreneurs by assisting them with the right business plans and authentic reports. Indian government has also introduced many schemes to promote such small scale businesses. Aatmnirbhar Sena always volunteers to support small-scale businesses by providing capital assistance. We also assist the businessman by aiding them with the necessary resources required to help them establish their business.
