How To Start a Profitable Coconut Powder Manufacturing Business

Do you want to know how to start a coconut powder manufacturing business? Do you want to start a desiccated coconut manufacturing business? Here in this article, we provide detailed information on how to start a coconut manufacturing business.

India is the third-largest coconut-producing country in the world. Copra and coconut oil are the two major products of the coconut processing industry. In our country, 60% of the coconut goes for food processing. And the rest 40% generally goes for oil extraction.

Coconut powder is an essential ingredient for the sweets and confectionery industry. Additionally, it has a larger shelf life than raw coconut.

The major coconut-producing states are Kerala, Tamil Nadu, Andhra Pradesh, Karnataka, Orissa, and Maharashtra. So these areas are the ideal locations for starting this project. However, you can start the business from any location where you can source raw coconut easily.

8 Steps to Start Coconut Powder Manufacturing Business

1. Understand the Market

Desiccated coconut is a consumer item. It has a longer shelf life and is convenient to use. Also, it comes with ready-to-use packs with the same freshness as fresh coconut milk. So, the product has a great market demand in both the domestic and international markets. Generally, the bakery and confectionery industries are the major consumers of this product.

Generally, the bakery and confectionery industries are the major consumers of this product. Additionally, the demand for this product is higher in the areas that are not popular for coconut production. With the changing lifestyle, people are looking for more and more value-added and ready-to-use products. Therefore, we can say, that starting a coconut powder manufacturing business is a lucrative venture opportunity for new entrepreneurs.

Read: How to do Market Research

2. Registration & Licenses

Coconut powder is a food item. And the business demands different registrations and licenses before commencing. These requirements hugely depend on the location where you are starting the unit. However, here are the basic requirements. It is advisable to check with a local small business expert and tax consultant.

• First of all, you need to determine the management pattern of your organization. And accordingly, register the business.
• Apply for MSME Udyog Aadhaar online registration.
• Also, apply for the Trade License for the local Municipality.
• The business demands FSSAI registration. You can apply online.
• Apply for GST registration.
• Open a current bank account.
• Apply for the BIS certification. The Bureau of Indian Standards specification for desiccated coconut is IS 966:1962. The product should also conform to the PFA Act, specifications.
• Additionally, check the tax liabilities of this business.

3. Cost to Start Coconut Powder Manufacturing Business

The coconut powder manufacturing business demands a moderate capital investment. The major investment areas are fixed cost and working capital cost. Several aspects demand fixed capital investment in this project. The list includes plant, building, machinery, and other initial costs related to the preparation of project reports and sourcing the technology.

Several aspects demand fixed capital investment in this project. The list includes plant, building, machinery, and other initial costs related to the preparation of project reports and sourcing the technology.

On the other hand, there are certain investments related to the working capital cost. This includes raw materials, staff payments, utility bills, transportation, and marketing expenses.

On average, the cost of starting a small-scale coconut powder-making manufacturing business will be Rs. 20 Lacs to Rs. 25 Lacs.

4. Apply for Funds

You can apply for a loan from your nearby banks or any other financial institution. However, you must have a project report in your hand to apply for the loan. Additionally, you can avail of the subsidy scheme for financial assistance. Under the Technology Mission on Coconut (TMOC), the Coconut Development Board is assisting in setting up of coconut-based value-added industry in India.

Read: Best Credit Cards in India

5. Coconut Powder Manufacturing Plant Setup & Machinery

According to your investment capacity and desired production output, you have to secure a place for the unit. Generally, a 1500 Sq Ft area is sufficient for small-scale production. Additionally, you will need to arrange sufficient electricity and water supply at your factory.

Some of the major required machinery are:

• Cabinet-type hot air dryer with blower, motor, and other accessories
• Disintegrator 12″ size with 10 H.P. Motor and accessories
• Vibratory sifting machine fitted with G.I. wire mesh and 2 H.P motor
• Al Trays
• Platform weighing balance
• Polythene sealing machine
• Other Misc. equipment like LS scrapping Knives, Aluminium vessels, trolleys, etc.
• Working tables LS 0.20
• Laboratory testing equipment etc.

6. Coconut Powder Manufacturing Process

First of all, you have to select good quality coconuts. The selection of the coconut is the most crucial factor in this business. Because the quality of the finished product hugely depends on the quality of the coconut. Fully mature coconuts of about 12 months are the best for the preparation of desiccated coconut.

First of all, you have to store the fully matured nuts with the husk for about one month. Because you need the dry kernels. This also facilitates coconut kernels to get separated from shell walls. The coconuts

Then dehusk the coconuts and remove their shells. Additionally, you have to remove the brown portion of the nuts by scrapping it off. About 10-15% of the kernel goes as paring by this process. You can use these pairings for oil extraction.

Then break the deshelled coconuts into pieces. After that, wash them properly and disintegrate them into powders of various grades. Then dry the powder in a dryer by spreading it out uniformly in
trays. However, you will need to maintain the temperature in the drying chamber at about 180° F. Additionally, you will need to stir the powder frequently to ensure uniform drying.

After drying, cool the powder and segregate it into different sizes. The last step is packing. You must pack the finished item in oil-proof and moisture-proof polyethylene. However, you have to select the packaging quantity according to the retail demand. During the process of manufacturing.

During the manufacturing of coconut powder, you may obtain several byproducts such as coconut shells and husks. However, you can convert these byproducts into value-added items. You can expect 100 kgs of desiccated coconut from 1000 coconuts.

7. Procure Raw Materials

The major materials are coconut nuts. Additionally, you have to procure the packaging consumables for your coconut powder manufacturing business.

8. Where You Can Sell Coconut Powder

Coconut powder comes under the FMCG segment. So, you must consider distributing the product among local retailers and wholesalers. Apart from the contact with the supermarkets and shopping malls to keep your product at their point.

In urban and suburban areas people prefer buying household items from online stores like Grofers, and BigBasket. So, you can sell from those online grocery stores also. Finally, don’t lose the institutional market of your locality. Restaurants, coffee shops, hotels, and clubs are major buyers of this product. So, you can supply them also.

In addition, do not forget to create a website for your coconut powder-making business. Having an online presence is almost mandatory for the success of any business at present.

We hope this detailed guide to starting the coconut powder manufacturing business will help you in making an informed decision.