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How to Start Food Processing Company in India

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Introduction: Food Processing

The food industry is booming right now because Indians love to eat. Agriculture and food production provides for the majority of India's revenue in the Indian economy. India is an agrarian economy noted for producing a wide range of organic food products and is the world's sixth-largest grocery and food market country. In India, the food processing industry has grown to become one of the most important. Food processing refers to a variety of procedures and techniques used to change raw food components into food items suitable for cooking, consumption, and storage. It entails a number of steps, such as the basic processing of raw food and then changing it into something fit for ingestion.

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The majority of India's revenue comes from agriculture and food production. Agriculture is the backbone of India's economy, and the country is known for producing a wide range of organic food products. Food processing encompasses a wide range of procedures and techniques for transforming raw food components into prepared foods for cooking, consumption, and storage. It comprises a number of phases, including the basic processing of raw food and then transforming it into something edible. The food industry is changing its consumption patterns as consumer affluence rises. This article will go through how to start a food manufacturing business in India, as well as the documentation needed to create a manufacturing firm and how to register a start-up in India. The most compelling argument to invest in food processing is that it ensures profitable and quick expansion. If you're thinking about starting a food manufacturing business, you should first research how profitable it can be. India has a massive population, with the urban middle class accounting for the vast majority. The boom in the food processing sector is mostly due to changing dietary habits, consumption patterns, low production costs, and food preferences.

How to Start a Food Processing Business?

Starting a food manufacturing company has both advantages and disadvantages. The Indian government has introduced a number of new laws and initiatives to assist entrepreneurs in establishing food processing businesses. An FSSAI license is required to start a food processing firm. However, the following are some of the processes for starting a food processing firm in India:

  • Choose Your Location: -

Before you open your factory, you must first decide where it will be located. It is always a good idea to look for a place that is practicable and has easy access to resources such as raw materials, manpower transportation, electrical sources, and so on. Only these factors, as well as the availability of raw resources in a certain location, can lead to the best location. Consider how perishable the food is, as well as how long it will last. In order to maintain a decent and quality product, these two factors must be considered throughout the year.

  • Choose a Specific Niche: -

Concentrate on one specialization or type of food production. This, however, should be a recipe you're comfortable with. You can produce food spices and other organic combinations, for example. Sticking to this specialty would be advantageous for you because you already know what kind of raw materials and equipment are needed to make spices and mixes.

  • Market Analysis and Research: -

To begin a food manufacturing firm, you must first learn about the industry and select a product that you can create efficiently. You should consider the product's feasibility or its availability in the market while making your choice. Research into the industrial and economic outcomes of today's food processing systems. You may use this to figure out who your competitors are, the size of the market, and current trends.

  • Know all About the Food Business Licenses: -

You must be aware of the required permits in order to start a legitimate food production firm. Make contact with your state's Department of Public Health and inquire about the requirements for opening a food production company. For conducting a retail food business, you may need to obtain a food enterprise license, an FSSAI license, and other business licenses.

  • Get funding: -

Every other firm needs adequate financing and capital to operate. If you don't have enough money, consider crowdfunding or taking a business loan. In addition, funds differ depending on the kind and size of the company. It is always a good idea to have shareholders and investors who can help with the finance of your food business.

  • Choose suppliers: -

You must work with a range of vendors as a restaurateur or owner of a food manufacturing plant. Everything from the POS system to cooking utensils and, of course, food supplies would be included. Make a list of your suppliers' requests, interact with them, figure out your long- and short-term budgets, and then choose your partners. Check to determine whether your suppliers are costing you extra, as this could cut into your profit margins. Check to see if you're a skilled negotiator. Begin your search for wholesalers by looking online or visiting a wholesale retailer's store, a local farmer's market, or other similar locations. A dependable wholesale supplier can help you provide high-quality materials, ensuring your food processing company's success.

  • Hire employees: -

You'll need a lot of people to get your food production firm off the ground. To grow this firm, you'll need to hire cooks, factory workers, cleaners, marketing, sales managers, and HR managers, among other positions. Make sure you hire the correct people who will be able to do a good job. You'll also require backup employees in the event that one of your employees becomes unwell. Candidates with relevant expertise and a proven track record in their field should be hired. Maintaining your brand image can be made easier with the support of a capable team.

  • Advertise Your Business well: -

Before you start working on your food processing facility, make sure you have a solid marketing strategy in place. You can also use digital marketing in addition to offline marketing. Begin by creating a terrific website that is easy to navigate and contains all of the important information about your company. Also, because individuals are continuously exposed to social media, publicize it there. You may ace the marketing game by sharing relevant news and high-quality photographs of your food manufacturing company.

Read Our Blog: How to start a food manufacturing business in India

License and Registration for Food Processing in India

Get an FSSAI Central License!

One of the necessary conditions after registering a business entity is to obtain Government License / Permit. In case you are in the food industry e.g. hawker, itinerant vendor, temporary stallholder; food distributor in any religious or social gathering events except a caterer, or by any way related to manufacturing, transportation, storage, or distribution of food product or tiny food business, one must obtain an FSSAI Registration or FSSAI License before starting operations. Below are the categories in which FSSAI has divided License/Registration based on the turnover limits of the company. Every food company owner, including petty vendors and hawkers, must obtain an FSSAI food license. The Food Safety and Standards Authority of India is abbreviated as FSSAI.

The FSSAI license is of 3 types:

FSSAI Registration / License applications can be submitted either offline or online. The food company owner must submit an application to the Licensing Authority together with the required fees to receive the license offline. However, the Food Licensing and Registration System (FLRS) site, which was developed by the FSSAI, can be utilized for online license/registration. The food business operator receives an FSSAI license number after completing the registration process.

Get a Trade License/ Eating House License!

Under the Municipal Corporation rules of the separate States in India, food businesses are normally awarded a Trade License as an 'Eating House.' By submitting an application to the relevant municipality, any food business operator can get a trade license. Most trade licenses issued in most states are valid for one year and must be renewed each year with the payment of yearly fees. If you plan to open multiple stores, each one must have a valid trade license from the local government.

Liquor license (only for alcoholic beverages)

If you plan to offer alcohol alongside your cuisine, you'll need a liquor license as well. It is illegal and banned to sell or distribute alcohol without a valid liquor license. You can apply for approval to sell and distribute alcohol through the State Excise Department. There are numerous types of alcohol licenses available, depending on whether you are a five-star hotel, a bar, or a pub, or if you are selling imported booze, foreign brands, or Indian-made foreign liquor. To receive the license, you will need identification, proof of address, a letter of authorization from the fire department, a letter of authorization from the municipal corporation, and any additional documents requested by the State Department.

Get a Fire Department NOC!

A NOC from the concerned fire department is required as well before starting the business. The applicant should apply through an application accompanying necessary documents like- building plans, building model, and certificate from the architect. A questionnaire related to compliance with fire safety rules and regulations shall also be filled out by the applicant. An inspection of the premises will be carried out by the fire department officials after the verification of the documents.

Shops and Establishment Registration

Every owner of a store or commercial institution with more than 10 employees must register with the state labor department. This procedure has recently been moved online. You may find the application process and information on how to receive the license at the following links to the websites of various major state labor departments.

  • Delhi
  • Karnataka
  • Telangana
  • West Bengal
  • Orissa
  • Andhra Pradesh

This shop and establishment registration is specifically valid for up to 5 years and after 5 years, that registration shall be renewed.  There is some states in India that issue the shop and establishment registration with the lifetime validity on payment of renewal fees.

Pollution clearance

Pollution clearance (Consent to Establish/Consent to Operate) is necessary from the appropriate SPCB (state pollution control board) because the food manufacturing sector is deemed a polluting industry by the CPCB (central pollution control board) and SPCBs. A category-specific license is necessary depending on the type and volume of the business operation. The majority of textile manufacturing industries are classified as red or orange.

Income tax

Every firm, including the food industry, must have a PAN and TAN in the name of the company or the individual (in the case of a sole proprietorship) in whose name the transactions will be conducted. The Income Tax Department issues PAN and TAN, two ten-digit alphanumeric numbers. Every individual that deducts or collects tax at the source is required to apply for a TAN. According to recent amendments, AADHAR can now be used in place of PAN for filing IT returns, however, PAN is still required for payments over Rs 50,000.

GST (Goods and services tax)

GST (Goods and Services Tax) (Goods and Service Tax) with the implementation of GST on July 1, 2017, the VAT and Service Tax regimes came to an end. If you have a turnover of Rs.20 lakhs (Rs. 10 lakhs for North-Eastern states and the Special Category States) under the GST regime, you must pay tax. Every GST-required firm must register and get a GSTIN (a unique Goods and Services Tax Identification Number).

Health Trade License

A health trade license allows a company to sell any products or services that directly affect public health. A food establishment having this license from the Municipal Corporation has been certified as meeting cleanliness and safety criteria. A Health Trade license is issued by the Municipal Corporation or the State's Department of Health, depending on where the business is located.

Signage License

A signage license is required for a food establishment to market itself by displaying any words, signs, or images. In India, your food business must apply for a signage license to publicly display signs outside its business premises by filing an application with the local municipal body.

Take Water Testing & an Organic Testing Certificate

The most important factor is the quality of the things you sell. The water and substances you use must be of excellent quality if you want to manufacture high-grade products.

Food inspection labs and water testing facilities can assist you in evaluating the components. Obtain quality credentials as needed and, if possible, establish trust with your customers. Whether you're making refined sugar or juice tetra packs, make sure they're free of chemical and microbial contaminants.

FSSAI

If you are into food business with revenue below 20 Lakhs, you must obtain an FSSAI Registration before starting operations. Corpseed can help you to obtain FSSAI registration for your business. Money back guarantee. Get free consulting.

FSSAI State

If you are into food business with revenue above 20 Lakhs, you must obtain an FSSAI License before starting operations. Corpseed can help you to obtain FSSAI state license for your business. Guaranteed satisfaction or your money back.

FSSAI Central

FSSAI Central License PAN India in no time. In case you want to import/export or sell your products on an E-Commerce Website, you must obtain an FSSAI Central License. Team Corpseed will help you to obtain FSSAI central license.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not corpseed, and have not been evaluated by corpseed for accuracy, completeness, or changes in the law.

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Author
Surbhit Sharma
I have worked for many internet blog pages and news portals. currently, I am working as a content writer for Corpseed Pvt. Ltd. I like to write blogs and articles in the field of different services.