In India, milk is a basic necessity of every
household. For most people, the mornings are incomplete without a cup of tea or
coffee or a glass of milk. Indians love consuming disease and sweets made from
milk all year round. There is a high demand for milk and milk products
throughout the year. But in festival seasons, the demand for milk is even
higher than on regular days. The milk dairy business in India
contributes to about 4% of the country's GDP. The use of milk in making sweets,
ice-creams, butter, curd, ghee and cheese and many more products is the reason
for its ever-growing demand. The dairy farm business in
India is, therefore, a profitable business idea.
How
to start a milk dairy business in India?
You have to take various steps and consider several
plans before starting a dairy farm for the milk business in
India.
How
to start a dairy farm business in India:
1.
Framing a good dairy business plan
This business plan should give you an idea about
how to start with the milk business in India.
Your business plan should cover the following
points:
a. The
objective and nature of the business, whether you want to sell only milk or
other milk products such as curd, ghee, etc. You should know the objective of
your business, the desired profit and the growth that you want to achieve.
b. Scope
and scale of your business. Deciding the size and scope of your business can
help you estimate the budget and money requirement of setting your dairy
business.
c. Your business
plan shall be framed after considering the requirements and challenges of
owning a milk dairy business.
2.
Research and market study
Before starting your dairy business, it is better
to do some research about the market and other factors:
a. Observe
the needs and preferences of the people living near the business location.
b. The
geographical situations, availability of roads and transport in the local area.
c. The
demand for milk and milk products in that area.
d. What
kind of milk you will sell, cow milk or buffalo milk or both.
e. The
number of cows and buffaloes that you will raise for the dairy business.
f. Whether
people living around the dairy shop prefer milk with fat or fat-free milk.
3.
Purchasing nutritious fodder and availability of water for animals
For the milk business, it is important to provide
nutritious and adequate fodder to milk-producing animals. You should plan the
following carefully:
a. Suppliers
from whom good quality fodder is to be purchased for animals.
b. Supply
and storage of safe drinking water for animals.
c. Quantity
of fodder which is to be purchased and its storage.
4.
Plan for the arrangement of land, shed and waste disposal of animals
It would help if you had a proper arrangement of
land and shed for the animals. These are some important points that you should
consider before starting a dairy business:
a. You
should have adequate land depending on the number of cows and buffaloes to be
owned for the business.
b. There
should be an arrangement of a shed for the animals to keep them safe in all
seasons.
c. If you
are planning for a large scale business, you should also have land to cultivate
crops and fodder for animals.
d. To
maintain hygienic living conditions for the animals, a proper waste disposal
system is also necessary.
5.
Legal formalities, license and permissions
The legal formalities in India vary from state to
state. Some of the compulsory permissions and formalities are:
a. Registration
with the Food Safety and Standard Authority of India (FSSAI) is compulsory to
start a dairy business. You also have to get the Bureau of
Indian Standards (BIS) certification.
b. Registration
in the local veterinary and dairy development department.
c. License
from the Municipal Corporation or local panchayat, based on the place of your
milk business.
6.
Loan and finance from the bank
You can get financial assistance for starting your
dairy farm business in India from banks or NBFCs. The National Bank for
Agriculture and Rural Development (NABARD), under the Dairy Entrepreneurship
Development Scheme (DEDS), provides subsidies on loans taken by farmers for the
dairy business. You can get a subsidy of 33.33% on the loan amount of up to INR
7 Lakhs for the dairy business. You can contact the nearest bank branch
for getting more information about loans and the related formalities.
7.
Marketing of the dairy business
For a profitable start of your milk dairy
business, you need to have a good marketing plan. Your prospective customers
should know about the type of milk and milk products you are going to sell.
There is a high level of competition in this business. It would be best to
promote your business online and offline to gain customers initially and plan
to increase your customer base in the future gradually.
Now that you know about the steps about how to
start a dairy farm in India, let's learn about the cost.
How
much does it cost to start a dairy farm in India?
For starting a dairy business in India,
you have to purchase cows or buffaloes, arrange land and shed for their
shelter. Procuring fodder and water, transportation and storage facilities,
employing labourers, vaccination and medical aids for animals and other
utilities are also necessary costs. Therefore, the cost to start a dairy
business in India depends on the number of animals to be reared and the
size of your business. To start a business with 20 animals, you have to invest
approximately Rs 10-20 Lakhs. Apart from the initial investment, you also
h ave to incur recurring costs on insurance and medical facilities, dairy
equipment, waste management, growing fodder and labour expenses.
Benefits
of the dairy business in India
a. The
demand for milk and milk products is high in all seasons. It is an all-time
active market. Milk is a basic necessity in Indian households, and any other
product cannot substitute the demand for milk. There is also a huge demand for
milk in restaurants, sweet shops, tea shops, and small and big businesses.
b. The dairy
farm business in India does not require employing skilled labour.
Therefore, the labour expenses in this business are comparatively low.
c. The milk
business involves eco-friendly practices and does not cause harm to the
environment. You do not have to spend huge amounts for complying with the
environmental laws and regulations.
d. The
animal waste can be decomposed in the Biogas plants to produce natural gas and
can also be used as an organic manure for growing crops and fodder for animals.
e. The
demand for milk and milk products rises above the normal levels during the time
of festivals in India. Therefore, you can make an extra profit when the market
is at its peak.
f. Animals
or livestock are the main factor of this business. You can get insurance for
the animals to cover the medical expenses if the animals get infected.
Limitations
of the dairy business in India:
a. The
success and profitability of the milk business depend on the quality and
breed of the cattle. Selecting the best breed of cows and buffaloes for your
business and getting the desired milk production depends on several factors.
b. You
also have to incur costs during the non-lactation period of animals, reducing
your profit margin.
c. Insufficient
and poor quality of fodder for the animals can result in lesser milk production
and cause considerable losses in the milk business.
d. You
have to be extra careful in maintaining a hygienic environment for the animals
to protect them from diseases and infections.
How
to select the best breed for your dairy business?
Before selecting the best breed of cows and
buffaloes for the milk business, you should consider the following factors:
a. Survey
about the type of milk and taste preferred by the people living in the shop's
locality.
b. The
demand for the milk and milk products should also be estimated to select the
breed according to the desired milk yield.
c. The
popular breeds of buffalo are Jaffarabadi, Surti and Murrah. Buffalo milk is
most suitable for tea. It is also good for making ghee and butter, as it is
high in fat.
d. The
demand for cow milk is also very high due to its nutritional properties. Cow
milk is one of the best sources of protein and calcium. Also, it is low in fat
as compared to buffalo milk. The different breeds of the cow for the milk
business in India are Gir, Rathi, Sahiwal, Tharparkar and Red Sindhi.
Other
essential points to consider at the time of starting dairy farm in India:
a. It is
good to have your own land for growing animal fodder and setting up
your dairy business or shop near this land.
b. It is
important to provide good quality fodder in adequate quantities to the cows and
buffaloes. There are various fodders for dairy cattle, such as legume fodder,
cereal fodder, grass fodder and tree fodder.
c. Proper
storage for fodder conservation is necessary to store it with minimum loss of
nutrients.
d. Adequate
space for storing the dairy equipment and milk containers should be there.
e. A water
tank with a storage capacity of 2000 litres of water is needed for a dairy farm
with 20 animals. Also, there should be a borewell facility to ensure a timely
and sufficient supply of water.
f. It is
important to keep the cattle healthy and disease-free. Therefore proper
medication and vaccination of the cows and buffaloes need to be taken care of
from time to time.
g. You
should deliver pure and good quality milk and milk products to the customers.
In the dairy business, cleanliness and hygiene are of utmost importance.
h. The
animals should be kept in an adequate open space. There should be an
arrangement of sheds to protect them from cold weather and rain. In the summer
season, buffaloes require a cooling facility.
Conclusion:
Milk is one of the most consumed commodities in
India. It is a daily requirement in every household. From a small tea shop to a
big restaurant, bakery or sweet shop, milk and milk products are supplied
regularly. For its all-season demand, dairy business in
India is a good option if you have the resources and knowledge about dairy
farming. It is a highly competitive business, and you have to maintain the
quality and regularity of milk supply to enhance your consumer base. In the
initial years, the profit margin can be low due to the investment cost, but the
profit margins can gradually increase.
We hope we have provided valuable tips on how
to start a dairy farm in India.
FAQs
Q: Is there any subsidy scheme on dairy
farm loans?
Ans: Yes,
the National Bank for Agriculture and Rural Development (NABARD) provides a
subsidy of 33.33% on loans taken for dairy business by farmers for an amount of
up to 7 lakh Rupees.
Q: Cow or buffalo, which animal
requires to incur more feeding cost?
Ans: The
feeding cost of buffaloes is less than the cow because the buffaloes can also
be kept on coarse crop residues.
Q: How many cows and buffaloes are
needed to start a dairy business in India?
Ans: At
least 10 to 20 cows and buffaloes are required to start a dairy business
in India.
Q: Do we need skilled labour for dairy
farming?
Ans: No,
the dairy farm business does not require skilled labour. It can be
done with the help of unskilled and semi-skilled labourers.
Q: How much does it cost to start a
dairy farm business in India?
Ans: It
costs approximately 10 to 20 lakhs to start a dairy farm business in
India.
Q: Which are the most common breeds of
cow used in the dairy business in India?
Ans: The
common breeds of cows in the dairy business in India for milk production are
Tharparkar, Sahiwal, Gir and Red Sindhi.
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