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How To Start A Dairy Business

by Tandava Krishna

COMPLETE GUIDE ON HOW TO START A DAIRY BUSINESS

Cattles are given special status in our country for they provide us with many dairy products which are essential for us. India is the world’s largest dairy producer but is mainly traditional. The dairy business is locally done in many remote villages in India and has been inherent in our culture. Indian dairy market is one of the largest and fastest-growing industries in the world with the largest consumer and producer of milk and milk products. It is the staple to consume dairy products for almost everyone across the country even after such diversity. Its uses go far beyond the dietary and nutritional values and its consumption is more of a habit without which one cannot imagine a life. They have numerous benefits and because of which it is used in many Hindu rituals. The annual growth in the dairy sector in India is about 4.9 percent.  In India, milk is procured either directly from the farm dairy where locals have cattle and they distribute it or you have pasteurized milk and other dairy products that comes in packets from various dairy plants such as Motherdairy, Amul, Sanchi, etc. Although the chain of dairy production is long, it is the distributors who make it available to us. You are most likely to go to a nearby dairy kiosk or there is a delivery system that provides you with milk at your doorsteps. To make sure their product reaches the customers, companies have their vast distribution channel. Setting up a dairy business which is a lucrative small scale business opportunity in India because it is one of the busiest ones we have.

Let’s have a look at how you can start a dairy business:

Create a Plan 

Decide the size of your dairy business. Decide what will be your reach and your location. If you want just an offline store or you are willing to orders on call? If it is offline, till where will you hand out deliveries and if it is also a delivery store what will be your area of service. Make a plan for what is going to be the size of your dairy business at first. The growth will only follow if you thrive in the market.

Decide on products

There is a huge variety of dairy products in the market. you can always keep other dairy products too such as curd, skimmed milk, cheese, tofu, etc. Apart from a few, not all of these products are demanded as much as others. Do your research and arrange products which are likely to be sold quickly and needed by most of your customers. Do not hoard on product varieties and place your orders carefully. The business will expand and the list can always increase but decide first what is your introductory range and how influential it is and will it get enough attention. Keep in mind that dairy products are perishable and thus you have to make a way to sell them quickly.

Find a delivery system

Your business is connected to your customers via delivery services. Make sure you choose a reliable one. It’s so crucial that it can make or break customer relationships. The delivery service you choose should be prompt in the areas where you operate and should have a strict contract and punctuality regime to follow. A customer will prefer to buy from you only when the service is quick and you are delivering milk or any other dairy item to them early in the morning. So be quick. Have a set area where you are willing to deliver your commodity. Do not be lenient with a boundary as the investment done in this business is very high and the risk is at every step

Use of technology and e-commerce

Since you are ready to hand out deliveries, there should be a medium through which people should be able to place their orders to you. Make sure you have a phone that is always available so if any customer has any complaint or feedback you can cater to them easily. 

Understand the Business

Keep in mind the risk that comes with the dairy business. Dairy items are perishable products and have very strict quality measures. Understand the basics that include the channel which you are going to be part of. What are the sources from where you can get the dealership, how are

Customer Base

Before you think of setting up any business, you keep in mind your target audience. Gather a customer base who will be willing to buy from you and set up your shop in that locality. 

Arrange Finances

Opening any business demands for an initial monetary fund that helps you set up the business, buy/rent the shop, shop for products, and keep some amount aside for any emergency. Thus, arrange your finances keeping in mind the above aspects and be ready to spend first. If you put your best effort, the business will definitely thrive and grow.

License and Permit

To start any business in India, you need to have legal permission sorted beforehand to avoid any hassles with government officials. You’ll need to get yourself registered as a business person, get FSSAI approvals, and get all the documentation handy.

Location and storage space

It is obvious that you will have to rent/ buy a place where you can store your product and display them. Keep in mind that the location of your store matters a lot. A market place with high footfall is always in big demand. You can rent a place in a residential colony where you are likely to do business with the residents on a daily basis. When you are renting a place, be aware of the competition around. Try to locate yourself when there are few dairy shops. 

All the business opportunities involve risks but there are few which are more likely to be profitable for you. The dairy business is one of those. The customers are not getting lesser anytime and almost all of them need milk at their home. Your business will require your full attention and dedication in the beginning but once you are set, you will enjoy its benefits. Enjoy your journey to success and all the best for your new venture!

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