Milk Powder Project Report, Making Plan

Introduction to Milk powder Project Report, Manufacturing Business Plan: In the present times, the milk powder manufacturing business is evidently attaining more and more importantly, as this manufacturing is having huge demand in domestic and international markets. Unfortunately, presently, many businesspersons are completely ignorant of the commercial making of milk powder. In several parts of India, there are no manufacturers left locally. Moreover, the demands for the segment are high as the requirement of this raw material is high, and occasionally it is indispensable to import it from other countries.

A guide to Milk powder Project Report, Manufacturing Business Plan in India

Milk powder Manufacturing Business Plan
Milk powder (Image source: pixabay)

Business plan for Milk Powder Manufacturing Business

To start Milk Powder Manufacturing Business, you need to craft a perfect business plan by following the below points:

  • Basis and presumptions
  • Implementation schedule
  • Market potential
  • List of approvals required
  • Raw materials required
  • List of machinery and equipment
  • Manufacturing process
  • Project economics
  • Profitability

Basis and Presumptions of Milk Powder Manufacturing Business

The Milk Powder Manufacturing Project Profile relies on the following assessments:

  • Working hours/shift: 8 hrs.
  • No. of shift/day:1
  • Working days: 300
  • Labor expenses: as per the State Government’s Minimum Wages Act.
  • Rate of interest: 15% per annum
  • Costs of machinery and equipment: Taken based on A particular dealer
  • Value of raw material: As per local market Packing material/others rate (on wholesale rate)
  • Land: owned
  • Building Construction
  • Break-even point will be estimated on a full capacity utilization basis
  • Pay-back time is 5 – 7 years

Implementation schedule of Milk Powder Manufacturing Business

The project implementation schedule of Milk Powder Manufacturing Business

  • Project preparation: 0-1 month
  • Location selection, acquisition of 1-2 months land and land development
  • Loan Sanction: 1-3 months
  • Building construction: 3-4 months
  • Connection of electric supply and water: 4-5 months
  • Obtaining machinery: 5-6 months
  • Electrification & installation:  6-7 months
  • Recruitment of staff and workers: 7-8 months
  • Trial run can be initiated in 8-10 months
  • Commercial production could start from 10-11 months

Market potential of Milk Powder Manufacturing Business

While establishing milk powder production one can feasibly expect future development. You have an extensive possibility to arrange for a full-fledged unit that will provide all types of dairy items. Even in a developing nation such as India, milk powder production is quite a money-gaining business, and about 30-40% marginal profits can be expected. 

Registration, license, and permissions required for starting Milk Powder Manufacturing Business

When you decide to initiate any food processing and production company, you must do the essential registration process for the business and obtain a few of the necessary licenses before you start with the operations. This is also important as several countries follow the stringent guidelines that monitor the food processing industries to avoid the production of low-grade goods/foods which are not appropriate for human consumption.

The below list of licenses is necessary before starting the Milk Powder Making Business in India

  • Firm Registration
  • GST registration which is mandatory
  • Trade license for operations
  • Pollution certificate from State PCB
  • MSME/SSI registration 
  • EPI and ESI registrations
  • Trademark to register your brand 
  • FSSAI registration 
  • IEC code if opted for exporting

Raw materials required to start Milk Powder Manufacturing Business

The main advantage of this milk powder business is that it does not require much capital. It is fortunate that one can use the cheapest milk as raw material. It may have less fat content and the concentrated content of somatic cells.

The place wherein the food product is manufactured should have proper sanitary provisions. Take proper measures to have a sewage and heating, water supply facility, along with electrical wiring, about 380 volts capacity. It is important to accommodate the workshop with system integrated ventilation and the floor and walls could have ceramic tiles. For this, you can have plastic or other stuff that lend itself well against washing and disinfection.

Equipment required for starting Milk Powder Manufacturing business

The freeze-dried milk production requires only one unit. There is a special drying chamber, the machine comprises many units in a single apparatus, a sublimation chamber itself, which is powered by gas or power supply, a pump, a bunker for end products. Powdered milk is directed to a distinct sifter, which is then sent to the packaging apparatus. Few other types of equipment that are essential are fat meters, conveyors, Recuperators, and fans, etc.

Procedure to start Milk Powder Manufacturing Business

First, the milk must be heated to 35-40°C. After that, it is sent to the cleaning stage which includes a system of filters that remove small fibers and other residues. In many instances, milk powder producers get a high quantity of somatic cells. This is because the cows with mastitis are not so rarely milked into the general stream. In this scenario, milk is heated so that products with different organoleptic properties blend together. Proximately after this, it is transferred to the normalizer, where we have the provision to get a product with the optimal fat concentration and cream. 

After this one must perform pasteurization, here the temperatures vary mainly based on its type: When the milk is heated to 65°C for about 30 minutes, then we are denoting as a long-term variety; when it heats up to 95°C for 1 minute – called to as short, and at 98 °C for a few seconds of heating – called as instantaneous.

This process is significant to kill the harmful microflora. Next, the milk is left for cooling cooled, recleaned, and then passed to the sublimation unit, where it is evaporated so that around 40% of the dry matter remains in the mixture. Then the final ingredient is homogenized, that is, to get a consistent composition. Later, the production of skimmed milk powder will be passed to the final stage when it is left for complete drying. Later, the final product will be packed in branded packaging.

Milk Powder Project Report/ Economics of small-scale Milk Powder Manufacturing Business in India

In case if you miss this: 1000 MT Cold Storage Project Report.

Economics of Milk Powder Manufacturing
Economics of Milk Powder Manufacturing

Fixed Capital

a. Land & Building: 600 Sq. ft @ Rs. 10,000 Rented

b. Machinery and Equipment: Rs. 4,25,000

Working Capital

A. Staff and Labour: Rs. 1,72,000

B. Raw material per month: Rs. 1,76,675

C. Utilities per month: Rs. 8,000

D. Other Contingent Expenses per Month: Rs. 1,75,000

Total Working Capital per month = A + B + C + D = 1,72,000 + 1,76,675 + 8,000 + 1,75,000 = Rs. 5,31,675

Total Capital Investment

Fixed capital = Rs. 4,25,000

Working Capital (on 3 months basis) = Rs. 15,95,025

Total = Rs. 20,20,025

Financial analysis of Milk Powder Manufacturing business

a. Cost of Production (Per Year): Rs. 66,24,603

b. Turnover (Per Annum): Rs. 72,00,000

c. Net Profit Per Annum:

Net Profit = Turnover per Year – Cost of Production = 72,00,000 – 66,24,603 = Rs. 5,75,397

d. Net Profit Ratio = (Net Profit per year / Turnover per Year) X 100 = (575397 / 7200000) X 100 = 7%

e. Rate of Return = (Net Profit per year / Total Investment) X 100 = (575397 / 2020025) X 100 = 28.48%.

Break-Even Point (B.E.P)

Interest on investment @ 10%: Rs. 2,02,003

40% of wages and salaries: Rs. 68,800

40% of other expenses (except rent): Rs. 70,000

Rent: Rs. 1,20,000

Total: Rs. 4,60,803

Break- Even Point (B.E.P.) = [Fixed Cost/ (Fixed cost + Profit)] X 100 = 460803/ (460803+575397) X 100 = 460803 / 1036200 X 100 = 44.47 %

Marketing strategies to promote your Milk Powder product

To sell your Milk Powder product, firstLY, you need to register the product online on B2B websites and B2C websites. You can even distribute some samples in the nearby supermarkets, or in the wholesale markets where your product gets well purchased.

B2B websites: The websites like –

  • Alibaba,
  • Indiamart,
  • Tradeindia,
  • ExportsIndia will take the bulk orders for your Milk Powder product.

B2C websites: To sell the products directly to the customer, you may also market in the well-established websites like–

  • Amazon,
  • Snapdeal,
  • Flipkart, etc. 

Try new ideas in the starting and just concentrate on promoting your business. Always remember that your business profits will be raised depending upon the quality you provide to the customers.

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