Within the subset of food manufacturing, the manufacture of spice powders or curry powders is a growing industry. It is essential for households and restaurants to use spices and curry powders to enhance the taste and flavor of processed foods. Spices are produced almost exclusively in India and it is the largest exporter of this commodity in the world. Therefore, domestic and export demand offer a tremendous opportunity for food manufacturing businesses. We look at how to establish a food manufacturing business in India in this article.
Curry powders and spices
It is mainly unprocessed spices that are traded. Spice powders, however, account for a small but significant portion of international trade. Indian curries and Indian foods are characterized by the unique flavor of curry powder, which is a blend of 20 or more spices. Each manufacturer develops his/her own proprietary formula for creating curry powder by blending various spices.
Setting up a Food Manufacturing Unit
Investing about Rs.10 lakhs in equipment and working capital can enable a small food manufacturer to set up shop with a specialization in spices and curry powder.
An operating efficiency of 60% can result in annual sales of up to Rs.70 lakhs for a food manufacturing unit with an investment of Rs.5 lakhs. An estimated profit after tax on such a sales turnover would be approximately Rs.2 to 3 lakhs.
Food manufacturing businesses typically require the following equipment:
- Two 12 inch double heads on one side of the multi-mill pulveriser and one 12 inch single
- The other head
- With starter, switch, and capacitor, a Crompton motor with 10 horsepower
- With stand, 12″ disintegrator $36,000 – $36,000.00
- With electric motor, Uruli Roaster has a batch capacity of 15 kg
- Motor pulley, belt, rail, foundation bolt, and belt guard of a flour mill
- An individual pulverizer
- Extraction of bolt oil
- Weighing balance with electronic technology
- Components of the cube control panel
As stated above, about 3 – 5 people would be required to operate a small food manufacturing business. It is estimated that the business would require most of its workers to be unskilled, and that salaries would cost between Rs.30,000 and Rs.40,000 per month.
Registrations and licenses
To limit the liability of promoters and to have easy access to bank financing, all food businesses should be incorporated or formed as LLPs. In order to start a food manufacturing business, promoters must register their businesses as companies or limited liability partnerships.
Obtaining food licence online is mandatory for all food manufacturing businesses in India. All spice and curry powder manufacturers must be registered with FSSAI as small food manufacturers. For food manufacturers with a unique brand name for selling their products, they can also obtain trademark registration in addition to FSSAI registration. A manufacturer planning to export products would need an Import Export Code or IE Code.
As a final step, food manufacturers would be required to charge VAT or GST on products they sell. To remain compliant, the business would need to register for VAT or GST.