LED stands for light-emitting diode. Currently, LED lights are becoming very popular day by day. LED lights are available in a wide range of colors from 2700K to 6500K which are dark, yellow, mild yellow, and ultra white. Initiating full-scale LED light manufacturing includes a large-scale factory operation with definitely a complex production process. However, any individual can initiate an LED light assembling unit as a small and medium scale manufacturing unit.
The key strength of LED lighting is reduced power consumption. LEDs are available with at the most Lumen efficiency of 110 Lum/Watt compared to 65-80 Lum/Watt of CFL and FTL, 45 Lum/Watt of Mercury vapour, and 75 Lum/Watt of metal halide or 94 Lum/Watt of Sodium Vapour. The operational life of current white LED lamps is 50,000-80,000 burning hours as compared to 5000-10000hrs of CFL and FLT, 18000 hrs of T5 lamp, 5000 hrs of Mercury vapour, 8000 hrs of Metal halide, and 8000 hrs HPSV lamp.
Is LED Light Manufacturing Business Profitable?
Total electricity and maintenance cost during the lifetime of LED bulbs is around 1/10th of that of normal bulbs. LED Home Lights can be designed to consume about 0.6 Watt and are nearly equal in luminance to a 25 watt incandescent light bulb or an 11 Watt CFL lamp- with about 90% saving of energy. If all the lights are replaced with LED lights it will save 50 percent energy and 5 billion units of power every year.
LED Street light with the solar panel is the best solution for minimizing electrical power consumption from hydroelectric power stations so far available. You can spread the huge amount of power from the hydroelectric plant in this manner. Also, this combination is the most energy-efficient and green lighting solution available today. Several states of India undertake LED lighting projects widely. Therefore, it will open up a huge business opportunity for the local LED industry.
With so many advantages and potential applications, LED is sure to succeed in large markets such as India. Thus, LED light manufacturing is a profitable investment opportunity for new entrepreneurs.
Here are the 7 Steps to Start a LED Light Manufacturing Company
1. Learn the Different Types of LED Lights & Applications
There is a wide range of different types of LED bulbs and their applications in everyday life. If you are a beginner, it is advised to select a specific niche and concentrate on making it successful. Some of the popular types and their applications are listed below;
LED Bulbs: Showrooms, Malls, Houses, Offices, Hospitals, Hotels, Restaurants, Rural areas
LED Deco Bulb: Houses, Offices, Hotels, Restaurants, Decoration, Testing Labs
LED Candle Bulb: Houses, Offices, Hotels, Restaurants, Decoration, Testing Labs
LED Tube Light: Showrooms, Offices & Bank, Conference rooms, Malls, Departmental stores & boutiques, Industrial shed, Warehouses, Parking, Houses
LED Spot Lights: Showrooms, Offices, Conference rooms, Malls, Hotels & Restaurants
LED Down Light: Offices, Houses, Malls, Hospitals and laboratories, Hotels &
LED Panel Light: Offices & Conference Rooms, Hotels & Restaurants, Showrooms & Malls, Hospital & Laboratories
LED Hi-Bay Light: Factories, Sheds, Airport Concourse, Exhibitions, Railway sheds, Warehouses
LED Flood Light: Building facades, Architectural lighting, Commercial lighting, Monuments, Wall washing light, Railway marshaling yards, Warehouses
LED Street Light (Solar): Street lightning in cities, towns, and villages
LED Garden Light: Farmhouses, Housing/Hospital compounds, Amusement/ Water
parks, Hotel, Banquet, Marriage lawns, Parks & Gardens, Residential Blocks
LED Solar Lantern: Rural areas houses, Compound light, Camping, Emergency light
2. Create a Business Plan
Starting a LED Light Manufacturing pant will require considerable investment. Hence you might need funds for setting it up. As a result, creating an in-depth business plan document will be essential. It is advised to hire a professional plan consultant experienced in the LED business and get it done by him/ her. Some of the basic chapters that must be included in your LED Light manufacturing plan document are the following:
- Startup and recurring costs
- Name of Your Business
- Industry Analysis
- Customers You are Targetting
- Pricing Plan
- Manpower Hiring Plan
- Marketing Plan
3. Arrange Funds
The cost of starting a LED Light manufacturing business will be in the range of Rs. 5 Cr. to Rs. 10 Cr. If you can arrange the money by yourself, you may not require to pitch for funds from banks or startup investors.
If short in budget, you will have to pitch for funds with financial lenders. Herein, your business plan document will be the most important document as every investor will ask for it first. You can read our article on the best types of business loans for startups to learn more.
4. LED Light Manufacturing Business Registration
First of all, you will need to obtain different registrations and licenses from Government authorities. However, it depends on the manufacturing process and what type of LED light you are producing,
- Company registration with ROC
- Obtain Trade License from Municipal authority
- Udyog Aadhaar MSME Registration
- BIS Certification
- Bureau of Energy Efficiency Certification
- NOC from Pollution Control Board
- GST Registration
5. Procure LED Light Manufacturing Machines & Tools
LED light manufacturing or assembling process is complex. Basic Knowledge and skill are required in starting any type of unit operation. It is difficult to list machinery as a whole. You will need to select machines according to the specific type of LED you want to produce and the raw material. Some of the common machines are
- LED PCB assembly machine
- LED lights assembly machine
- High speed LED mounting machine
- LED chip SMD mounting machine
- Candlelight assembly machine for LED
- LED tube light assembly machine
In starting a LED light manufacturing business, it is advisable to have a detailed project plan or business plan. This will help you in getting information about area requirements, machinery cost, working capital investment, and financial analysis like break-even and ROI.
6. Select a Proper Location
It is most essential to choose a location of your led light manufacturing plant location nearby to the immediate market. It is best to find a location that is near to a city or a town so that transportation costs of procuring and dispatching finished materials are less. The more the distance the more will be logistic costs and that will eat your net profit return.
7. Make a Marketing Plan
It is extremely important to create an efficient network of distributors, wholesalers, and big retailers so that your finished led lights are sold smoothly. In addition, it is a must to create an online presence. Create a website and if possible make an online shop and sell your items online. Also , take appropriate promotional measures so that information about your led bulb items is reached to target customers.
Editorial Staff at NextWhatBusiness is a team of Business Consultants having years of experience in small and medium scale businesses.