Start Potato Chips Manufacturing Business: Build a Perfect Potato Chip Business Plan

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Start Potato Chips Manufacturing Business

Looking for information regarding how to start potato chips manufacturing business? You are at the right place. Keep on reading ahead to know more about this startup business idea.

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We all know that potato chips are one of the most popular snack all around the world. Any person can start their small-scale manufacturing project with a small investment.

Additionally, from the same unit, you can choose to produce french fries and banana wafers as well. It will definitely increase your overall profit in the long run.

In the present time, potato chips are available easily in different flavors, and tastes to satisfy the needs of the various customers. The list includes salty, sweet, hot sauce, ketchup, light salted, red hot, etc.

It is quite clear that if you are thinking about starting your own potato chips business, it is not a bad decision at all. The potato chips manufacturing business can be started on a  small scale with very low investment. 

Potatoes are extremely popular and are widely consumed as food all over the world. They are produced by rapid dehydration of potato slices when they are exposed to hot oil.

It’s palatability and crispiness make it the favorite of almost all the age groups. For making these chips, different varieties of potato are used.     

You might already know that the market acceptance of potato chips is necessary to make a variety of chips by adding various types of spices and flavors, or by adding some nutritional coating on the chips. 

It may be sweetened, pungent, or salty depending upon the company which manufactures it. 

There is no doubt a tremendous scope for new startup entrepreneurs in this field if they are  looking for startup business ideas to try this year. 

What is the Market Potential of Potato Chips Manufacturing Business? 

Potato chips are the most popular salted snack item globally. And the demand for them is increasing day by day.

The global potato chips market is expected to grow at a CAGR of 4.3%, during the period 2017-2022, to reach a market value of USD 40.3 billion by 2022. 

There are several aspects which might be directly responsible for the rapid growth of the potato chips market.

The reasons include affordability and availability, increasing young population, growing disposable incomes, and changing lifestyles. The emerging markets are also ready to support the growth of this industry.     

Potato chips in the colorful pouch packets are the most popular in the market. Additionally, hotels, caterers, and restaurants are the major institutional buyers of the item. The product also have a great export potential. Some of the most popular potato chips brands are Uncle Chips, Lay’s, Pringles, Haldiram’s, Ruffles, Bingo etc. 

7-Step Potato Chips Manufacturing Business Plan

brown cookies on white ceramic bowl

The major consumers of potato chips and wafers are families, especially in urban and semi-urban areas of the country.

Hotels, restaurants, canteens, and army establishments also require a good amount of potato chips to fulfil the needs of their clients. 

In the urban areas, the per capital consumption of potato chips is more than the rural ones. Hence, there are good prospects for potato chip units, especially near the areas where potato are grown. 

We are here with 7 steps. By following these, you can easily start potato chips manufacturing business this year 2022. 

Understand the Process before you Start Potato Chips Manufacturing Business

The main steps that you have to follow to start potato chips manufacturing business are given below: 

  • Visual inspection and sorting of potatoes
  • Washing
  • Peeling and trimming
  • Slicing and cutting
  • Washing, sorting, and dewatering
  • Frying
  • Cooling, salting, and packing

Machinery Required to Start Potato Chips Manufacturing Business 

If you wish to manufacture potato chips in the future, you will need certain types of machines, such as:  

  • a Potato peeling machine cap
  • a Slicing machine with an arrangement to adjust the thickness of slice complete with motor etc.
  • Blancher
  • Spin dryer to extract excess moisture
  • Deep fat fryer
  • Electric polythene bag sealing machine
  • Weighing machine

Where to Find Potato Chips Manufacturing Machines?

If you are puzzled as to from where to buy the potato chips manufacturing machine for your business, you can always choose to contact your nearby machinery dealer in your locality. There are also online marketplaces from where you can ask for free quotes.

Please, note that Alibaba is one of the most popular place from where you can get free quotes for the desired machinery.    

What will be the Cost of Potato Chips Making Machines?

It is to note that there are broadly three types of machines available for the commercial making of potato chips.

A fully automatic machine will cost you around $8000-$60,000. A semi-automatic machine will cost you around $2000-15,000.

If you wish to start a home-based potato chips making business, you can go for a manual one. It will cost you only $300-$500. 

Select a Location before you Start Potato Chips Manufacturing Business 

Deciding the location of your business is an important aspect of this process. You must carefully select a location for your potato manufacturing unit near potato growing areas. 

This decision will surely confirm a steady flow of potatoes which is the main raw material in this following business. 

Make your Manufacturing Business Legally Compliant

A very important step for you is to register your business first. In addition, there will be a requirement for specific permits and licenses you will require to run your business without any obstacles. 

You can begin by talking to a local competent professional or local administrative authorities and then produce the required permits.  

Have a Marketing Plan

No business is ever successful without a marketing plan. If turned out to be effective, your marketing plan will help your business in getting discovered. 

Depending on your budget, you can prepare a promotional plan as well. Another important aspect is to fix the distribution strategy.

Some of the popular ways of selling potato chips are through wholesalers, retailers, and opening exclusive storefronts.

You can also promote your business in the online platforms, such as Facebook or YouTube. 

Once, you have created a website, you can sell your products from there. Furthermore, you can have a tie-up with B2C or B2B marketplaces. 

The potato chips manufacturing business is a potentially profitable venture if planned thoroughly and properly.

Some Additional Information regarding how to Start Potato Chips Manufacturing Business

  • The cost of the project will depend upon several aspects. These are production, quantity, business size etc.
  • The fixed capital will consist plant, building, machinery, and other preliminary expenses. 
  • The working capital cost will consist of raw materials, labor, utilities, etc.
  •  An 800 Sq. Ft space will be good enough for starting a small-scale unit. However, it will depend on the business size. Additionally, you will require electricity and a proper water supply.    
  • The plant capacity must be around 2000 kgs per day, the plant and machinery around rupees 137 lakhs, working capital should be around rupees 91 lakhs, and total capital investment around 271 lakhs. 
  • The actual cost of the project may deviate from the change of any of the assumptions. You can modify the project capacity and project cost as per your requirement. 
  • You can totally invest in commercial potato chips manufacturing business as it is very profitable. Your profit will depend upon both internal and external aspects.
  • If you are thinking about ways to increase the profit margin, you can think about reducing the cost price. 
  • Increasing the sales volume ensures reducing transport costs, infrastructure costs, and the manpower costs as well. 

This was our article on how to start potato chips manufacturing business. If you liked our content, make sure to comment down below and share it with your fellows. 

You can also check out our recent article on our website by the heading How to Start Your Own Valet Trash Business

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