Onion Oil Project Report, Business Plan

Onion Oil Project Report, Manufacturing Business Plan


Onion is one of the essential vegetables consumed widely on daily basis in India. India is the second-largest Onion cultivating country across the globe. Indian onions are famous for their pungent flavor and are because they are available round the year. However, because of poor post-harvest setup and value addition, large quantities of onions get wasted in the supply chain. Hence, processing of onion to different value-added products can recover the losses and offers huge potential for entrepreneurship development at micro, small or medium-scale stages using proper government schemes like PM-Formalization of Micro Food Processing Enterprises Scheme of MoFPI, developed by the Government of India. 

Onion is a crucial crop grown in India and it is an indispensable part of daily meals. Onions have quantity Vitamins A, C, E, Sulfur, and B-complex. It can increase the immune system, fight against infections, regulate blood sugar and help in digestion associated issues, also brighten the skin complexion, save from harmful UV rays and free radicals; exhibit’s anti-bacterial, anti-inflammatory, as well as antiseptic properties that aid to treat fight acne, reduce phlegm and helps in wound healing.

A guide to Onion Oil Project Report, and Manufacturing Business Plan

Onion Oil Project Report, and Manufacturing Business Plan
Onion Oil Project Report, and Manufacturing Business Plan (Pic source: pixabay)

Market demand of Onion Oil Manufacturing Business

The onion-based value-added products for example paste, flakes, powder, or vacuumed packed onion are seen as a daily consumption food item in both villages and cities of India. These products fall into the category of everyday consumed culinary products at home. Therefore, the need for onion paste, flakes powder, are always are predominant across different parts of the country 365 days a year. Dehydrated onion flakes and powder are seen in soups, seasoning, sauces, salad sprinkles, pizza, and other items. Paste also has a great requirement for cooking and other purposes. Vacuum-packed onion for its high shelf life is consumed more.

Business model for Onion Oil Manufacturing Business

Business Modelling is a method of recognizing the best procedure or model for the business, and it is one of the most vital and distinguishing steps of Business Development. Our Business Modelling report will aid you to gain knowledge on the most maintainable, potential, money-making business models for Onion Oil Manufacturing Business, which will ease all important aspects about those models’ stage by stage. The other vital points for Onion Oil Manufacturing Business Modelling Report are summarised below:

  • Size and Potential
  • Target Markets
  • Legal information
  • Expenses and Pricing
  • Furthermore, it will help the potential market identification and will get the knowledge about our customer and how you can plan the selling of the product at reasonable costs.

Business plan for starting Onion Oil Manufacturing Business

A business plan will explain the overall business, its products or services, revenue structure, strategies, workers, financial analysis, operations pattern, and other details that are vital for success. A good business plan will eliminate the hindrance in the course of your business and reduce failure. It serves as a pathway or channel that directs the business.

The improvements in the equipment and processing methodologies have endorsed the supply and growth in the Onion Oil Manufacturing Unit. To achieve this, it is essential to crafting a proper business plan with comprehensive data associated with the production plan, SCM plan, operational plan, sales, and marketing policies, staff salaries, administrative plan, etc.

Our business plan will finally aid in the below aspects:

  • Detailed project report of Onion Oil Manufacturing Business
  • Basis and presumptions for Onion Oil Manufacturing Project
  • Implementation Schedule of Onion Oil Manufacturing Business
  • List of approvals, licenses, and other permissions required for the business
  • Raw materials required for starting Onion Oil Manufacturing Business
  • List of machinery required for starting Onion Oil Manufacturing Business
  • The manufacturing process of Onion Oil
  • Economics of Onion Oil Manufacturing Business

Detailed project report of Onion Oil Manufacturing Business

A comprehensive project plan on Onion Oil Manufacturing Unit is a report which will include all the information on the overall development of the proposed business. DPR will aid an individual to know about all the major aspects involved in the business which in turn aid you to explain the project detailing’s to the capitalists. It includes data associated with Economic Analysis, Financial Analysis, Technical Analysis, demographic analysis, Production, and Technological issues involved in the Onion Oil Manufacturing Unit.

It usually details the below major aspects of the business.

  • Serves as Project Blueprint
  • Depicts Direction / Road Map
  • Identifies Feasibility
  • Projects Requirements
  • Recognizes Profitability
  • Assists in Decision Making

Basis and presumption for starting Onion Oil Manufacturing Business

  • Number of Working Days in a year: 300 Days
  • Number of Shifts in a day: 1
  • Hours in a Shift: 8 hours
  • Plant Capacity: Consider on Average production capacities of the plant.
  • Raw Material Availability
  • Depreciation: Straight Line Method
  • Manpower: According to project Requirement
  • Rent estimate: On the basis of the current market price of the area.
  • The potential area of Marketing the products: Local market and households.
  • If the project is funded, the term loan would be: 60-80% of the total investment
  • Moratorium Period:  6- 12 months
  • Repayment Period: 5-7 years

Implementation Schedule for Onion Oil Manufacturing Business

Implementation schedule for Onion Oil Manufacturing Project Report can commence production within 1 – 2 months after the approval and first release of term loan.

List of licenses required to start Onion Oil Manufacturing Business in India

To start Onion Oil Manufacturing Business, you need to get the below list of approvals, licenses, permissions, and registrations in India-

  • MSME registration
  • GST registration
  • ROC
  • Registration of firm
  • Shop Act License
  • FSSAI License
  • IEC Code
  • Export License
  • Fire and Safety
  • ESI
  • PF
  • No Objection Certificate from pollution board
  • Trade license from the local municipal authority

Raw materials required for starting Onion Oil Manufacturing Business

In case if you miss this: Mustard Oil Making Project Report.

Raw Onions
Raw Onions (Image source: pixabay)

In the present onion processing method, the plant demands about 350 kg/day, 400 kg/day, and 450 kg/day raw onion at 70, 80, and 90 percent capacity utilization, respectively.

List of machinery required for starting Onion Oil Manufacturing Business

Crusher / Expeller are:

  • Cast parts, plate tubes, forged parts, pipes, bars, shafts, sheets, sections, etc.
  • Electric motors (10 HP), capacitors switches, starters, other electric items
  • Oil, consumables grease, etc.

Manufacturing process of Onion Oil Manufacturing Business

Oil extraction from onion is done using steam distillation. Response surface technique was applied to assess the effects of the ratio of water to raw material, extraction duration, zymolysis temperature, and distillation duration on the yield of onion oil. The maximum extraction yield (1.779%) was acquired in these parameters: The ratio of water to raw material was 1, zymolysis temperature was 36°C, extraction duration was 2.5 hours and distillation period was 2.6 hours. The experimental values matched with the estimated values by the regression model. The chemical composition of extracted onion oil in standard conditions was accessed by the gas chromatography-mass spectrometry technique. The results analyzed that sulfur compounds, such as alkenes, alkanes, sulfide, ester, and alcohol, were the major ingredients in the obtained onion oil.

Onion Oil Project Report / Economics of Onion Oil Manufacturing in India

Onion Oil Project Report – Fixed Capital

  • Land and site development: Rs. 1,00,000
  • Building and civil works: Rs. 5,00,000
  • Plant and machinery:  Rs. 15,27,000
  • Misc. Fixed Assets: Rs. 1,98,000
  • Preliminary and pre-operative expenses: Rs. 2,23,000
  • Contingencies and escalation @ 5%: Rs. 1,16,000
  • Working capital: Rs. 1,15,000
  • Total: Rs. 27,79,000

Onion Oil Project Report – Working Capital

  • Raw Materials: Rs. 88,000
  • Power and Utility: Rs. 10,000
  • Salaries: Rs. 74,000
  • Finished Goods: Rs. 1,34,000
  • Receivables: Rs. 1,49,000
  • Total: Rs. 4,58,000

Onion Oil Project Report – Total cost of Onion Oil Making Business 

Fixed Capital + Working capital = Rs. 27,79,000 + Rs. 4,58,000 = Rs. 32,37,000.

Onion Oil Project Report – Income per annum in Onion Oil Making Business 

Total income/ annum: Rs. 36,25,000.

Onion Oil Project Report – Profitability in Onion Oil Production Unit

Profit = Total cost – Total Income = Rs. 36,25,000 – Rs. 32,37,000 = Rs. 3,88,000.



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