Tea Bag Project Report, Manufacturing Plan

Introduction to Tea Bag Project Report, Manufacturing Process and Business Plan: The Tea Bag Manufacturing Business is the easiest Manufacturing Business, where you can earn good profits. It can be initiated with two major components – tea and paper bags. A tea bag is a small, porous bag that is sealed and includes tea leaves and it is used in a hot cup of water to prepare the beverages called tea. A young businessman with appropriate information about tea leaves can plan about starting with a tea bag-making business by moderate investment.

A guide to Tea Bag Project Report, Manufacturing Process and Business Plan

Tea Bag Manufacturing Process
Tea Bag Manufacturing Process (Pic source: pixabay)

Market potential of Tea Bag Manufacturing Business: Tea is a fast-moving customer product after the staple foods like wheat and rice in any country. India is the largest consumer of this item in the world, dominant and shows that 25% of the global tea production, put forth by Associated Chambers of Commerce and Industry of India’s reports.

Business plan for starting Tea Bag Manufacturing

Before starting any business particularly small-scale manufacturing it is important to prepare a business plan. It is always recommended to prepare a tailored project plan based on your budget/ capital and estimated production capacity. The business plan will comprise the marketing strategies, business goal, and mission statement.

For Tea Bags Manufacturing Business, you need to craft a perfect business plan by considering the following points.

  • Industrial Outlook and Business Trends
  • Market demand of the Tea Bags
  • Basis and Presumptions of Tea Bags Manufacturing Business
  • Implementation schedule of Tea Bags Manufacturing Business
  • List of approvals required for starting the business
  • Raw materials and machinery required for starting Tea Bags Manufacturing Business
  • Manufacturing process of Tea Bags
  • Project economics of Tea Bags Manufacturing Business
  • Marketing strategies to promote the product

Basis and Presumptions of Tea Bags Manufacturing Business

The project profile relies on the following assessments:

  • Working hours/shift: 8 hrs.
  • No. of shift/day:1
  • Working days: 300
  • Labor expenses: According to 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 charge: About Rs. 2000 per sq. ft.
  • Break-even point will be estimated on a full capacity utilization basis
  • Pay-back time is 7 years

Implementation schedule of Tea Powder Manufacturing Business

  • Acquisition of premises 1 month
  • Construction (if applicable) 2 months
  • Procurement & installation of Plant & Machinery 2 months
  • Arrangement of Finance 1 month
  • Recruitment of required manpower 1 month
  • Total time required (some activities shall run concurrently) 7 months

List of approvals required for starting Tea Bags Manufacturing Business

Tea Bags is a food product. Hence the business requires various registrations and licenses before

beginning. These requisites are mainly based on the location where you are planning to initiate the

unit. However, it is suggested to contact local small business professionals and tax consultants.

  • Primarily, you must define the management design of your organization. And then as per the
  • design, register your business.
  • Firstly, apply for MSME Udyog Aadhaar which is available as online registration.
  • Then, the important trade license from the local municipality should be applied.
  • The business comes under the food Industry category and requests consent from FSSAI which
  • is also done online.
  • Nowadays it is a must to apply for GST registration.
  • Try to create a current account in any of the nearby banks.
  • Then it is important to apply for the BIS certification. The Bureau of Indian Standards specification for the product is IS 966:1962. The product must also conform to the PFA Act, guidelines.
  • Moreover, it is essential to check the tax liabilities as well for this business.

Below is the quick check list of the approvals required for starting the Tea Bags Manufacturing Business.

  • Register your business identity
  • MSME registration
  • GST registration
  • ROC
  • Get the PAN Card
  • 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 local municipal authority

Raw materials required to start Tea Bag Manufacturing Business

The choice of the type of tea powder in the Tea Bag is the principal aspect to obtain the quality product for consumption in the teabag-making business. Organic Tea, Green tea, Herbal Tea, Assam tea, Mixed Blended tea are the highly famous tea variety typically used to manufacture tea bags.

Usually, one teabag comprises almost 1-4 ounces of tea leaves. Even, one must get quality paper to manufacture tea bags from reliable suppliers. Other basics are packaging stuff such as bags, cardboard packets, and pouches.

Tea Bag Project Report/ Economics of Tea Bags Manufacturing Business in India

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Economics of Tea Bags Manufacturing
Economics of Tea Bags Manufacturing (Pic credit: pixabay)

Land: Rs. 2,00,000

Building: Rs. 2,00,000

Plant and Machinery: Rs. 4,85,000

Furniture, other Misc. Equipments: Rs. 50,000

Other Assets including Preliminary / Preoperative expenses: Rs. 49,000

Margin for Working Capital: Rs. 16,50,000

Total: Rs. 26,34,000.

Means of Finance

Promoter’s contribution: Rs. 6,58,000

Bank Finance: Rs. 19,75,000

Total: Rs. 26,34,000

List of machinery required

Tea Blending Machine: Rs. 1,50,000

Packing and Sealing Machine: Rs. 2,50,000

Material Handling Equipments: Rs. 50,000

Weighing Scale: Rs. 20,000

Misc. Tools: Rs. 15,000

Sub-total of Plant and Machinery: Rs. 4,85,000

Office furniture and Electrification: Rs. 50,000

Sub-total: Rs. 50,000

Preliminary and preoperative: Rs. 49,000

Sub-total Other Assets: Rs. 49,000

Total: Rs. 5,84,000.

Where to sell the Tea Bags

One can go for selling of these Tea Bags locally or may plan for wholesale stores. Even registering with popular B2B websites and B2C websites will advertise your product and induce sales.

The nearby supermarkets, small stores in a shopping center, etc. will also stock your product and promote sales. Try to promote the product over social media to grab the attention of several clients thereby advertising your newly established business. Even though we can see various brands of Tea Bags manufacturers are already in the market, the demand and the uses of the tea bags will overcome any competition against your new product. Thus, one should not get worried about the market. He or she can sell the Tea Bags at the wholesale price in India.

B2B websites: The websites like –

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

Marketing strategies to promote your Tea Bags product

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Marketing of tea bags
Marketing of tea bags (Pic credit: pixabay)

As tea bags are consumed by people one must take precautions while creating brand equity, enhance brand perceptibility, and improve brand usage. One can start selling them locally by initiating a distribution network. Go to few famous retail brands to get some small tenure agreements with your business. In our country, hotels, restaurants, clubs, business houses, hospitality management businesses are the major consumers of teabags.

One has to plan properly for figuring out an innovative design for teabags. Register your product on various e-commerce platforms to tap online consumers. Get prepared to arrange an online website for the teabag-making business. Add some significant facts on the several varieties of tea and their great tastes on your website.


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