This article includes a detailed home-based spice business project sample profile with machinery, cost, manufacturing process, and raw materials. Also, it includes important information about starting a small-scale spice processing business with a small investment.
The spice itself an important industry in India. Our country is the largest producer of several spices including ginger, turmeric, chili, and cumin. Hence, the country earns a good export revenue from the spice industry.
Basically, the spice comes under the FMCG segment. It is an essential cooking item. Apart from making delicious and tasty food spice is an important ingredient in the medicine and processed food industry. It helps in enhancing taste and flavor in producing pickles, sauce, ketchup, chips, wafers, and in the bakery.
A small-scale spice business is easy to start. And you can start in any size depending on your investment capacity and desired business size. Even, you can think about starting with a single product. However, a medium-scale unit with multiple products ensures better revenue and profit.
7 Steps Guide to Start a Spice Business
Step 1 Understand the Different Spice Product
Broadly, you can offer three different types of products in this business. These are whole spice, spice powder, and spices for the specific recipe. Each and every item has its own consumer demand. The people who prefer using the spices in both ways as whole and paste, definitely prefer the whole spices. On the other hand, some people only prefer spice powder.
Some of the popular and widely used spices are Turmeric, Chilli, Cumin, Coriander, Black Pepper, Cardamom, Cloves. However, there is another market for the specific blend of spices for specific recipes. The list includes meat masala, chicken masala, Sabji masala, garam masala, chana masala, meat masala, Kasuri Methi, Pav bhaji masala, chat masala, biryani masala etc. Additionally, the demand for organic spices is also increasing nowadays. However, you must initiate the business according to the taste of your target demographics.
Step 2: Calculate the Investment For Spice Business
According to your business model, you will need to calculate the total investment of your business. Generally, a small-scale operation demands two different types of investment. These are fixed capital cost and working capital cost. Some of the major considerations in fixed capital are the plant, building, machinery, licensing, registrations, etc.
On the other hand, working capital cost includes raw materials, staffing, distribution, marketing, and tax liabilities. If you don’t have your own space, it is advisable to start the business from a rental location. In addition, check if there is any subsidy or grant available from the Govt.
Step 3: Craft the Business Plan or Project Report
Crafting a business plan or project report is a must for this business. Generally, a project report provides you an important series of information regarding the project incorporation. Additionally, it helps to get the finance from the investors or banks.
Apart from the investment calculation, you must have a proper marketing plan. You will need to have a clear conception of the distribution, marketing, and sales promotion strategy. Here we have listed the basic steps for starting this business.
Step 4: Registration & Licensing for Spice Business
Spice is a food item. And food item processing demands several licenses and permissions from the Govt. agencies. However, it hugely depends on the federal law of the state where you are initiating the business.
In India, you must obtain FSSAI permission for the spice business. It is advisable to talk with a small business consultant about the specific licenses and permissions for the manufacturing operation.
Step 5: Machinery for Spice Business
According to the products you want to offer, you will need to procure the right machinery. Some of the major required machines are:
Pouch sealing machine
Weighing scale etc.
Step 6: Raw Materials for Spice Business
The major required raw materials are different types of unground spices. The list includes turmeric, black pepper red chilies, cumin, coriander, etc. In addition, you will need to procure the pouch as the main packaging consumables. Also, you will need to provide corrugated cartons for bulk packaging.
Step 7: Manufacturing Process
The process of manufacture involves cleaning, drying, pulverizing, sieving, and packaging of spices such as chili, pepper, turmeric, coriander, etc. either individually or in combination with other spices. The manufacturing process is very well established and does not involve technicalities.
First of all, clean the unground spices manually to remove impurities like mud and stones. And then wash with water. After drying them in sunlight, they are graded and ground with the help of the grinding machine to convert them into powder form.
If you want to produce a specific mix of spices, then you will need to create the blend. And the final step is the packaging. The storage and proper distribution are important in getting long-term success in the spice business.