How To Start Coconut Powder Making Business In India Cost, Profit, Business Plan, Requirements | SkillsAndTech
Ever noticed a coconut vendor slicing the coconuts while you are casually sipping on its juice by the side of the road, of how can that diced coconut be processed into something you can use for your hair, in desserts, in that Thai cuisine you were trying to experiment with or even in your cosmetic products?
Well, that giant green ball of a fruit is capable of exactly doing that. India is the 3rd largest producer of coconut aka copra with Kerala, tamilnadu, Andhra Pradesh, Karnataka, Odisha and Maharashtra being the major producing units.
A coconut yields numerous end product like the coconut oil accounting for 75% of the coconut product market share followed by coconut water with 20.3% and last but growing use of coconut in coconut powder/ flour
And since the GenZ and youth population are in the realisation stage of the numerous health benefits, availability and applications of coconut powder, that’s exactly you are going to cater to.
Sometimes money does grow on trees after all
Table of Contents
Market potential and uses
A coconut powder is made from dried coconut solids ground into a very fine powder which is light and airy and is an intermediary product for baking
The market for a coconut powder is vast because of the growing health and baking needs of the consumers. Moreover its benefits in terms of the following has also expanded its markets :
- Gluten free
- High fibre level
- Containing Lauric acid
- Promotes healthy digestion
- Contains proteins
- Low in carbohydrates
The potential for coconut powder can be defined in terms of its types and uses
On the basis of types of coconut powder
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- Desiccated coconut powder
- Coconut milk powder
- Coconut skimmed milk powder
- Spray dried coconut milk powder
- Low fat coconut powder
On the basis of uses of coconut powder
- Used in baking cakes, biscuits and cookies
- Used in Asian cuisine
- Used as a topping
- Used as replacement for wheat flour
- Used in beverages like smoothies and milkshakes
Licenses required
The licenses required to run a coconut powder making business is
- FSSAI certificate
- GST registration
- Factory license
- Trade license
- MSME registration
Investment required
The investment required to run this business would be between ₹ 15 lakhs-₹ 20 lakhs
Profits made
The profits made from this coconut powder making business are ₹ 8 lakhs per year
Target consumers
The target consumers for this coconut powder making business are as follows
- Bakeries: The bakeries require coconut powder for making coconut flavoured biscuits and cookies and also use as a replacement for wheat flour in baking cakes for health conscious consumers
- Cafés : These make use of coconut powder for the purpose of innovating flavoured health-friendly smoothies and milkshake and as an element in croissants, puffs, desserts etc
- Restaurants: The restaurants make use of coconut powder especially those dealing in Asian cuisine as an important ingredient in making curries, rice, platters etc to meet the Multi-cuisine needs of consumers
- Cupcake/dessert shops: These make use of coconut powder for the purpose of producing seasonal coconut flavoured cupcakes, muffins etc and also use it as a topping
- Retail and supermarket arenas: These make use of coconut powder packets, sachets, bottles to meet the seasonal baking needs of the households
Area required
The are required to set up this coconut powder making business unit is 1500sq ft – 2000 sq ft
Raw materials required
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The raw materials required to run this business is
- Coconuts
- Milk
- Sugar
- Coconut husk
- Boxes
- Packets
Machinery required
The machinery required to run this coconut powder making business would be:
- Cabinet type hot air dryer with blower
- Disintegrator 12” size with 10 HP motor
- Vibratory sifting machine with GI wire mesh and 2 HP motors
- Platform weighing machine
- Polythene sealing machine
Manpower required
The manpower required to set up your business would be
- 1-supervisor
- 1-chemist
- 1-production manager
- 2-skilled workers
- 10-skilled workers
Moreover ample training to these workers in terms of the following must also be provided with
- Equipment usage
- Machine handling
- Safety and precautions
Business model and growth
The business model of a coconut powder making business can be defined using these 4 variants
- Value proposition: The value which this business is likely to get to you is
- Largely available raw materials ensuring quality and benefit of bulk purchase
- Specific target audience ensuring only focused marketing strategy
Target consumers
The target consumers for this business are as follows
- Bakeries
- Coffee houses
- Cupcake shops
- Hotels and restaurants
- Retail stores
- Supermarket chains
- Competitor review: The competition to your coconut powder making business is not aggressive so few key competitors are
- Cocomi
- Caribbean
- Fiesta
- Renuka
- Cocos
- Qbb
Marketing strategy
The marketing strategy that can be implemented for your coconut powder making business are
- Print media: blogs and articles justifying your manufacturing and extraction process and research claims
- Sales promotion: bulk and trade discounts, cash discounts
Growth
The coconut powder making business has witnessed and has the potential for the following growth prospects
- Firstly, the coconut products majorly including the coconut powder is expected to grow at a CAGR of 17.8 % by 2025
- More than ever now the baking experiments among the GenZ and millennials have been increasing because of westernisation and horizon expansion desires
Profit margin
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The profit margin which this coconut powder making business is likely to yield to you is 10%-20%
- Suggestions
Why don’t you look at that recipe of baking yummy coconut cookies while we give you a closure as to why you should be taking up this business opportunity
- Firstly, with an increasing health awareness, diet and physique consciousness among the consumers and benefits of low fat, gluten free from coconut powder are likely to yield massive sales
- Secondly, because of Indian being the 3rd largest producer of coconuts your business can also generate some foreign demand because of the quality benefits that will come along in your coconut powder
- Lastly, the profit margin and rate of return of this business is very reasonable.
