Do you want to start your own mineral water plant business in India? If yes, then you have come to right place..! In this article, I am sharing step by step process of starting a mineral water plant or packaged dring water plant in India. Demand of packaged drinking water is growing exponentially in small towns and cities in India. This is evergreen business and there is place for everyone who want to step into this opportunity. Investment required in this business depends upon many factors, few of them are given below :-
- The production capacity of the plant
- The place in which plant is being setup
- Transportation cost
- Type of water used as source or feed water and its chemistry
- The type of plant and production capacity per hour – such as bottled, pouches, jar, etc.
There is room for everyone in this business. You can setup small plant with the investment of Rs 15 lakhs or you can go for big plant with high production capacity in 75 lakhs.
Below is a list of important points which I will discuss in this article:-
- Difference between mineral water plant and packaged drinking water plant
- What are the documents and licenses required to run this business in India
- Machinery required for mineral water plant and machinery cost
- How to setup your plant and cost estimation
- Water treatment process
- Packaging and suppy
- Profit margin in this business
- How to grow your business – Further opportunities
Let’s get started –
What is the difference between packaged water and mineral water plant?
Before getting into detailed business plan, you need to understand the difference between packaged drinking water plant and mineral water plant. Many people do not know the differences and get confused at the very beginning of their business venture.
Packaged Drinking Water or Bottled water Plant – In this plant, we process borewell water and we reduce the TDS(Total Dissolved Solid) in borewell water with the help of RO process i.e Reverse Osmosis Process. Packaged drinking water does not contains any minerals.
Mineral Water Plant – In this plant, we use water from natural sources like spring water and mountain water. These waters contain mineral which is beneficial for human consumption. In mineral water plant we process and add minerals to water if required. Minerals found in mineral water are sodium, calcium, magnesium, potassium, etc.
In this article I will share information for setting up of packaged drinking water plant which is also known as bottled drinking water plant.
What type of licenses are required?
The following licenses and documents are required for setting up a bottled water plant in India:
- Small scale industry registration certificate
- AOA and MOA of the business
- ISI certification from Bureau of Indian Standards (BIS)
- Pollution control certificate from local pollution board office
- Feed water test report from laboratory
- Pest control certificate
Steps involved in packaged driking water production
- Identify the source of raw water – This is the first step in which you will decide about the source of water which you will use in the production of packaged drinking water. The source of water could be bore well water, municipal supply or other sources in which treatment is possible.
- Store raw water – The next process is to store raw water in raw water storage tank with the help of the pumping system. The submersible pump could be used in case of bore well water.
- Water treatment system – In the water treatment process, we use chlorine dosing system, water softening process, reverse osmosis (RO), UV sterilization and Ozone disinfection.
- Testing of water – In this process, we test purified water in inhouse water testing laboratory. In the laboratory, water is tested for microbiological and chemical parameters. We will discuss the type of laboratory requirement later in this article.
- Purified water storage (Bottles/Jars/Pouch) – Production machinery is required to blow bottles and store purified water in it. Similarly, machines are available for storage in jars and pouches.
Process Involved in the purification of raw water (Technical Aspects)
- Coagulation process – This is the first step in which we add Alum chemical in raw water to remove impurities. The Alum chemical produces positive charges which stick together with the negative charge of the particles and forms large particles which can be removed easily. After the coagulation process, water is allowed to settle for 1 hour.
- Reverse Osmosis – With the help of RO process we remove dissolved impurities such as salts from water.
- Chlorination of water – This process is used to kill bacterias and other microorganisms with the help of bubbling chlorine gas in chlorination tank.
- Sand filtration – The water is then passed through sand filters to remove undissolved impurities.
- Carbon filtration de-chlorination – After the sand filtration process, we then pass water through carbon filter which removes odor and color. Dechlorification also takes place using carbon filters.
- Packing and bottling – Packing and bottling are done with the help of machines.
Packaged Drinking Water Plant Cost Estimation
|PARTICULARS||QUANTITY||PRICE (in Lakhs)|
|RO Plant – 2000 ltr||1||3.50|
|Alum Treatment Tanks||2||0.70|
|Chlorination Tank (STEEL)||1||0.50|
|Sand Filter & Carbon Filter||1 – 1||0.90|
|UV Disinfectant System||1||0.25|
|Raw water tank||1||0.30|
|Purified water tank||1||0.30|
|Bottling Machine Automatic||1||6|
From the above table, we come to know that cost of machines for starting mineral water plant is around 15 lakhs rupess. Apart from machinery, you will need a proper location for plant installation and some basis furniture.
After the installation of plant, you have make a proper business plan for production of bottled drinking water. That business plan will include following details –
- Salary and wages for staffs
- Working capital per month
- Production target
- Other expensenses in raw materials if any
Production Capacity & Profit Margin Calculation
Total Production of your plant will depend on how many hours you will work i.e number of shifts assuming that 1 shift is of 8 hours. Suppose you will 2 shifts i.e 16 hours. Therefore, you can produce 8000 bottles in 8hrs.
Profit Margin Calculation –
Now we will calcute yearly profit in this business:-
- Daily production is 8000 bottles i.e yearly production will be 8000 X 365 = 2920000 Bottles
- No. Of crates – assuming one crate has 12 bottles – 2920000/12 = 24333 crates yearly
- Selling price of one crate will be – Rs 80 per crate
- Total turnover – 80 x 24333 = Rs 1 Crore 94 lakhs
- Total profit = Turnover – cost of production
Now you have to calculate the cost of production of 24333 crates. The cost of production will include salary to staff, raw materials expenses, electricity usage, laboratory expenses and other expenses.
The cost of production of 24333 crates of packaged drinking water will come around 12 lakhs monthly. So annual cost of production will be 1 crore 44 Lakhs
Total profit = 1 crore 94 lakhs – 1 crore 44 lakhs = 50 lakhs Annually
Branding and Marketing
As the demand of packaged drinking water is increasing rapidly, you have to capture the market and start promoting your brand as soon you start production. Include marketing expenses in your business plan and use it accordingly.
Mineral Water Plant Cost: How can one calculate this
Mineral Water Plant Cost is unarguably the first consideration which comes to the minds of entrepreneurs, who wish to setup their plants. Though an entrepreneur is driven by the sense of Opportunity in this field, his further decision starts or stops here.
Is Mineral Water Plant Cost Calculation Important?
- Yes. The First Reason :
Most of the People ask us this question
“What is Mineral Water Plant Cost” still remains the most asked question to us. Almost every businessman, whether he wishes to run a local jar business, or wants to start a Multi state level franchise business; he definitely asks this question. Furthermore, we too, feel that it is the fundamental consideration, even before the profitability.
2. Reason No.2 :
Knowing our “OK” Investment Zone
The “OK” Investment Zone for every entrepreneur is different. If you are a 1st generation entrepreneur, you may consider to go slow and steady, going from small to middle, and then large. On the contrary, if you belong to an existing business family, you might think of starting big from the beginning. In both of these cases, the Investment is different from each other. Hence the Investment Cap as well. For someone, 5 Crores will look as a massive investment, to other even 50 Lakhs, or the matter of fact, even 5 lakhs also may be challenging for someone.
3. Reason No. 3:
Just Machinery Cost is not the Mineral Water Plant Cost
Many times, participants from our Live Training Sessions, get frustrated after a special session we conduct on Comparison of Various Plant Models. In this session, we compare 2000 LPH, 5000 LPH & just the jars Model Head to Head with the complete R.O.I. based calculations. There the less informed entrepreneurs get surprised by the amount of money involved in this business.
4. Reason No.4:
You need to also consider the other costs
The other costs include land and building, other utility costs, operational cost, cost of capital and other costs. Under the session we mentioned above, we lay down a special focus on this and train you on the aspects of drilling down to your exact initial investment even before you go to your chartered accountant who prepares your project report.
5. Reason No.5:
Cost vs Investment Generally, entrepreneurs ask us questions like “how much mineral water plant cost for 20 Ltr Jar Plant” or “How much Money is required for a 1 Ltr Bottle Plant“. By this means the initial investment required. He doesn’t much bother about other things. And this is okay when your dream is vague and not properly defined.
So, how do I arrive at Mineral Water Plant Investment?
First of all, please understand, that there is no fixed cost for a Mineral Water Plant. It differs from every entrepreneur. With the selection of his own Product Mix.The Product Mix and daily production you have planned in mind, will give you the various costs involved. Once this is done, you can present the statements to the Chartered Accountant, who will prepare the projections and guide you on how much will be your R.O.I. As mentioned, in our Live Training, we do conduct the processes to decide your product mix and also detailed training on considering every cost component. So that, you arrive at your Investment to make the venture profitable.
Steps to get the exact Mineral Water Plant Cost & Investment:-
1. Carry on a Local Market Survey(Or International depends upon your vision). Market Survey is a critical thing. You can do it with your own way; or can get it done from Expert Practitioners in the field. It again depends upon what is your lookout.
2. Decide Whatyou will be producing and How much, this is your product mix. This can be had from the Market Survey. We do conduct a session on this during our Live Training.
3. Present the calculation to the machinery vendors, get their quotes. Once your Product Mix is ready, you can reverse calculate the machinery specifications from that. We conduct an activity exercise during our training to do this yourself.
4. Decide the Shed Size, Outer Area you will require, to get the cost of construction. Once you receive machinery dimensions; you can arrive at floor space (With reference to the B.I.S. norms on this).
5. Decide other resources cost such as Electricity, Water and add to the cost.
6. Total them out, this is your Mineral Water Plant Cost, the initial project cost.