Paneer Making Project Report, Business Plan

Paneer Making Project Report, Business Plan


Hello friends, today we are here with a new topic of “Paneer Making Project Report and Business Plan in India”. Making paneer business is a lucrative and profitable venture as start-up. It is classified under the milk processing industry. Paneer has been used in Asian Countries like India, Bangladesh, Afghanistan, Pakistan, etc. Not only in Asia, there are production units for paneer in other countries as well. Paneer is sold in two forms in the Indian market. One is as fresh sale and the other is as packed form. However, fresh paneer will be spoiled early than the packaged form. Any individual could initiate this using a small investment.

A step-by-step-guide to Paneer Making Project Report, Business Plan

Paneer Making Project Report, Business Plan (pic credit: pixabay)

Market potential of Paneer Making business

The largest market for paneer is in South India. Although paneer is famous in almost every part of the country. Paneer is gaining demand because people are practicing a vegetarian diet in present times or non-vegetarians even shift to a vegetarian diet. It is available in different supermarkets, grocery stores, departmental stores, etc. As people prefer to go out and eat in food joints, there is a huge demand for paneer in restaurants and thereby the hotel industries are the main potential clients for your business.

You can check the reports like about 65% of branded paneer is sold by top-notch companies like Amul and Nestle in India. But the intake of paneer in India is growing from 25 to 30% every year. Therefore beginning the paneer business on small scale can be a very smart venture for new entrepreneurs. 

Paneer production unit capacity for starting the business

If you are planning to acquire 500 liters of milk daily, then about 40 kg of paneer can be produced. In this way, about 1 ton of paneer will be generated monthly and annually except 12 metric tons of paneer.

Registration, permissions, and license required to start Paneer Making Business in India

For a small or large scale business registration is important. Ensure you register for the paneer-making business. Get registration for the business name and avail of insurance as well. Some of the registration and licenses are stated below –

  • To run this business, acquire building and business permission that is availed from your local municipality.
  • Being a food product, FSSAI is mandatory, but before that, according to the PFA Act (2010), you must abide few guidelines that are associated with the quality of paneer while you are involved in the production of paneer. For example, the paneer produced must not have 70% moisture with fat content below 50%.
  • It is even recommended to register your business as an MSME unit that can be performed online.
  • Apart from this, it is essential to get BIS certification.
  • Need for a place for the business of making paneer (Place Requirement for Paneer Making Business)
  • For any business, it is necessary to acquire land or area for a small-scale paneer manufacturing unit. About 1000 square feet is enough. The area acquired must be divided into sections for various operations such as processing area, packing material, storeroom for stocks, storage place to keep the finished products, as well as the area for transportation purposes. It is also essential to give provision like water and power supply. While planning for the paneer business, craft the project report for this business, which also guides to have proper analysis and estimate the profit and establish the business in a planned manner.

Raw materials required to start Paneer Making Business

The necessary and major ingredient for starting paneer business is milk and citric acid or sodium hypochlorite. It can be maintained fresh for only 3 days and recommended to store in a freezer. If it is kept at normal temperature, then it is suggested to consume in a day.

Machinery required to start Paneer Making Business

The Semi-Automatic Manufacturing machinery is proven equipment for a successful business. Although modern and technically advanced machinery has several advantages, for instance, good quality, producing more quantity of paneer, enhancing paneer production, and even obtain high-standard paneer. Here we can list some of the essential machinery that can aid you to operate the unit-

  • Aluminum cans to keep and store milk 
  • Motor coolers
  • Precision tank made of stainless steel
  • Weight weighing machine
  • Fat Remover
  • Milk Analyser
  • Boiler for heating milk
  • Labeling machine etc. for labeling
  • Vacuum packing machine
  • Deep freezer

Process of Making Paneer

Preparing paneer is simple, you can start even from home. Here we will explain the simple process of making paneer on a small scale.

  • To begin the production of paneer, milk must be processed primarily. In this step, milk is heated using a milk boiler. Milk is heated for about 60°C to destroy the germs that are capable of causing infections. Also, this step decreases colloidal calcium phosphate solubility. 
  • To isolate water and separate it from the milk, a few drops of citric acid or lemon juice is enough.
  • After that, it is filtered with the muslin cloth, and the water is now extracted.
  • For this purpose, place it under some heavy materials, so that its water because of high pressure will ooze out leaving the paneer.
  • Then weigh the paneer on a suitable weighing machine and then slice as separate pieces, later pack all pieces properly and store them in the freezer.

Packaging of Paneer

Paneer is a perishable product and ensures the packing is done properly. Packaging can only extend the shelf life of the paneer. Commonly, a polythene pouch is used to pack the pieces of paneer. Also, we have a vacuum packing machine for packing purposes. Later, the heat seal process is done and then stored in the cool chamber.

You may also check this: How To Start A Milk Powder Making Business.

Paneer Making Project Report/Economics of Paneer Making Business

Project Cost:

Land and Building: Rs. 2,00,000

Machinery and Equipment: Rs. 3,00,000

Pre-operative Expenses: Rs. 50,000

Total: Rs. 5,50,000

Total Working Capital Rs. 6,00,000 (for three months)

Total Capital Investment: Rs. 11,50,000.

Financial Analysis

Total recurring cost per year: Rs. 24,00,000

Depreciation on building @ 5%: Rs. 10,000

Depreciation on Machinery @ 10%: Rs. 30,000

Depreciation on office equipment @ 20%: Rs. 5,000

Interest on total capital investment @ 14%: Rs. 1,61,000

Total: Rs. 26,06,000.

Turn Over per year

Fresh Paneer 1 Kg:  Rs. 50,00,000.

Net Profit (per year)

= Sales – Cost of production

= Rs. 50,00,000– Rs. 26,06,000

= Rs. 23,94,000.

Rate of Return

ROR= Net profit per year × 100 / Total investment = Rs. 23,94,000 × 100/Rs. 11,50,000 = 208.17%.

In case if you miss this: How To Start A Vegetable Oil Production Business.

Investment required to start Paneer Making Business (From Home or for small scale unit)

When you plan to initiate this business on small scale, then you must invest to acquire some raw materials and other relevant stuff like milk, transportation expenses, citric acid, packaging stuff, power supply, fuel, a paste of cheese, boxes, employees salaries, etc. It would take around Rs. 1 lakh for the mentioned materials. Besides, it will be a bit costly and will require around 1.30 lakh rupees for the machinery and the extra raw materials in bulk and add up Rs. 50,000. Thus, when you plan to operate on a large scale you might have to invest about Rs 2.5 – 3 lakhs.

To start the paneer business, it is important to fix the cost. For this, you have to sell paneer in the market at a rate of about 100 to 150 rupees per kg. Besides, if you can get bookings from restaurants or hotels for a hotel or restaurant and when they ask in bulk you may charge them the wholesale price.

Profit in Paneer Making Business from Home

Currently, we have a huge demand, so you have the huge scope to gain profits in this business. You can gain a minimum of Rs. 1000-1500 daily from the business. Apart from this, if you contact a nearby hotel or restaurant and make an agreement, you can have a continuous income and thus gain profits in high margins.

Conclusion of Paneer Making Project Report

In this way, you can begin a potential business with less capital and obtain a proper business to gain revenue. If you have a good business plan along with Paneer Making Project Report details, you can succeed in this business.


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