Paneer Making Business In India Cost, Benefits, Requirements, License | SkillsAndTech

Paneer Making Business In India Cost, Benefits, Requirements, License | SkillsAndTech

Based on the milk processing-based technique, paneer making business in India is a moneymaking business that ensures profitability as well as sustainability throughout all the seasons. The demand for paneer is unmatchable in Asian countries like India, Bangladesh, Afghanistan, and other countries. In addition to this, the demand soars high amid festivals, birthday parties, and events. The popularity of paneer in the north zone of India is known by one and all.

Lately, Western Countries have also joined the league of paneer manufacturing nations. In India, paneer is sold in two forms- fresh & packed. The longevity of packaged paneer is more in comparison with packaged paneer.  Basically, cheese and paneer are known as value-added dairy products. Essentially, paneer is recognized as fresh cheese. Also, it is regarded as cottage cheese.

There is a rapid increase in the numbers of paneer making business enthusiasts as this form of the business ensures sure shot success with an affordability factor attached to it. In rural and urban regions of India, paneer is the pride of every big or small occasion. Folks who fall under the category of pure vegetarian are generally too fond of eating paneer, and thus, they include paneer in their frequent diet regime.

Paneer boosts the energy level in the body. Even a bite of paneer acts as the energy bar. Therefore, veggie lovers must include paneer in their daily diet as it would lead to the fulfilment of the protein requirement of the body. Non-vegetarian people also consume paneer and thereby, leaving room for growth of paneer making business in India.

Paneer Market in India: Latest Updates

  • It is anticipated that the Indian paneer market will register a substantial CAGR of around 13% in the time frame of 2021-2026.
  • The consumption of paneer is on a consistent rise and is increasing up to 30% every year in the Indian market.
  • In 2020, Uttar Pradesh dominated the Indian paneer market.
  • After Uttar Pradesh, Maharashtra and Rajasthan are the two major states having the highest market share.
  • Amul and Nestle are the two leading brands that acquire 65% of the paneer market.
  • The most popular form of paneer is “Chhena”, which is widely embraced by the people residing in Eastern parts of India and Bangladesh.
  • Also, South Indian people utilize paneer in their diverse range of foods.
  • The restaurant and hotel industries are the largest consumers of paneer.

Business Plan

A business plan is an imperative tool for all entrepreneurs, regardless of the scale and nature of their business. It’s a way through which you will be communicating your vision and entire thought process to others. A business plan will comprise an executive summary. It’s a brief summary of the overall plan concerning your business. The plan will also contain in-depth information about your team members, information related to the products or services you wish to offer, a market analysis of the entire industry, your marketing strategy, as well as risk analysis tactics. 

A comprehensive, carefully structured business plan is vital to the success and headway of entrepreneurs and young startup businesses. Only a well-conceived as well as a well-packaged plan, can win the required investment and support for your business idea. It must exhibit about the company or proposed project with utmost accuracy and perfection so that the outcomes of the business will be in your favor in the forthcoming period. 

Benefits of Having a Sound Business Plan

The significant benefits that you will reap from a sound business plan are mentioned below- 

  • A set of values that can assist you in accelerating your business in problematic situations
  • A chance to try a new idea to see if it works out or not
  • A blueprint you may utilize to invest your energy in the right direction and keep your startup business on track
  • A proper analysis of your industry, including opportunities as well as threats
  • A clear and precise statement reflecting the vision and mission of your business 
  • A genuine assessment of the strengths and weaknesses of your company
  • A roadmap for attaining your goals and objectives
  • A proper description of the products and services that you will be offering
  • A portrait of your potential customers 
  • In-depth knowledge about the buying behaviors of your customers 
  • A complete description of your revenues, costs, and projected profits
  • Information about your business model
  •  An action plan that may help you overcome the hurdles in the future course of time

Market Analysis for Paneer Making Business in India

Before jumping into the market and commencing your business, you must conduct a proper market analysis to minimize the risk of losses and setbacks at the initial level. Go for thorough research and then dive into the ocean of paneer making business in India.

A market analysis is a method of accumulating information regarding the current trends and what’s going on within an industry. If you crave to usher your business on the pathway of huge accomplishments, then you must opt for conducting a market analysis. Through market analysis, you would gather knowledge about your potential customers, your competitors in the nearby region, the strengths and vulnerabilities of your competitors, your target market, and other information relevant to your paneer making business in India.

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Penning down a market analysis is something you can’t whip up overnight. You may look at the problems of the past to reduce the risks associated with the future. Also, you must analyze past achievements and your great moves to see what would help you to grow in the future course of time.

Before initiating any market research, you need to ascertain whether the analysis is concerned with internal or external purposes. Internal purposes entail things such as uplifting cash flow or business operations. External purposes revolve around convincing lenders to lend you a business loan. Market analysis is a crucial segment of your business plan for running a small-scale business.

Target market analysis plays a significant role in identifying whom you are targeting. Outline the strengths, weaknesses, opportunities, threats of your existing competitors and determine your advantages and work on transforming your weaknesses into a set of strengths. Don’t put all the extensive research that you’ve done into the trash, as now you should focus on putting your analysis into action.

Licenses and Permits

Entrepreneurs who are running their business on a small, medium or large scale must go for the registration. Thus, if you are willing to commence paneer making business in India, you need to meet the registration requirements and pass the registration process. The registration will render umbrella insurance coverage to your business. Besides this, you must follow all the legitimate steps and acquire the mandatory licenses and permits to run your business without any worry.

Given below are the licenses and permits required for initiating paneer making business anywhere in India-

Registration of Firm:

You may start the small to medium Business either a Proprietorship or Partnership Firm.

If you are starting this Business as One Person Company, then you have to register your firm as a proprietorship.

For Partnership operation, you have to register as a limited liability partnership (LLP) or Pvt. Ltd. Company with
Registrar of Companies (ROC).

GST Registration:

it is mandatory to get the GST number to run the business; you need to apply for the GST registration.

Trade License:

obtain trade license from local authorities

MSME/SSI Registration:

this MSME/SSI Registration will help you to get schemes and facility for the business offers by the state government

BIS certification:

BIS has mentioned the specific quality standard for Business. ISI specification for the

Trade Mark:

you can secure your brand with trademark registration

IEC code: 

IEC code is essential for the export of the product

Safety and Standard Authority of India (FSSAI):

This business is categories under food processing business; therefore, you must have to take the FSSAI license.


state insurance which is an insurance scheme for workers.

ESI Registration:

Employees provident fund is compulsory for the business where more than 20 employees are working.

To comply with the above processes and registration, one might need any legal expert who would help in absolute legal compliance to meet industrial standards. 

Investment Required in Paneer Making Business

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  • If you are gearing up to commence your small scale business with respect to the production of paneer, then you would have to proceed ahead for making the payment of raw materials.
  • The raw materials signify milk, packaging stuff, citric acid, fuel, water, electricity, boxes, and cheese paste.
  • Also, you would have to keep the salaries of employees in consideration for your small scale business.
  • The investment cost may rise and touch the mark close to Rs. 2 lakh.
  • In the case of large scale business, the cost of equipment may cross the figure of Rs. 2.30 lakh.
  • The raw material cost may reach up to Rs. 2 lakh.
  • The overall cost is likely to be around 5 to 6 lakh rupees.
  • Setting the budget is of utmost importance if you are interested in initiating your business.
  • You can start selling the product in the market at the rate of 150 to 200 rupees per kg.
  • Also, you may proceed ahead for fixing the deal with the hotel and restaurant industries.
  • By interacting with established players in the food business, you may expand your paneer making business.

Raw Materials Required for Paneer Making Business

  • Milk is an essential component that is considered as the raw material in the production of paneer. Mixing milk with sodium hypochlorite or citric acid leads to paneer formation.
  • After two to three days of manufacturing, the paneer will lose its freshness, and its quality will keep on deteriorating with each passing day.
  • Thus, it’s important to keep the paneer in the freezer instead of putting it outside at the normal temperature.

Space Required for Running Paneer Making Business

You will need a proper space if you are all set to start a small business. To construct a paneer production unit within a limited budget, you would have to make the arrangement of a place with a minimum area of around 1000 square feet. Besides this, you must have an area for processing, packing, a storeroom for storing purpose, an area to stock the finished product, and an area concerning transportation purpose.

Sufficient space and chambers would create a healthy and encouraging work environment. In order to run your business in a smooth as well as efficient manner, you must have a proper plan concerning the required space to optimize workflow.

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Paneer Making Business: Manufacturing Procedure

Step 1- Firstly, you would have to process the milk for skimming purpose in a cream separator.

Step 2- Then, you would have to heat the skimmed milk to around 60 degrees Celsius.

Step 3- Then, you need to add a few drops of lime extract or even citric acid in different forms to split it.

Step 4- After that, you must filter the coagulated mass via a muslin cloth & filter press when the cake is acquired.

Step 5- You need to slice it in a manual manner to the desired weights, pack it in wax paper, and proceed ahead for storing under refrigerated conditions.


With minimum capital investment engrossed and soaring demand for paneer making business, commencing this dairy-product based business in India ensures a win-win position for paneer production business enthusiasts.

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