A paper plate business involves manufacturing plates that were made out of paper for serving food. They were considered an economical alternative to plastic plates.
With the ban of single usage plastic by several states as well as in Indian Railways. The demand for eco-friendly products such as paper plates has suddenly increased in India.
If you are looking to capture this moment by starting your own paper plate making business, then this is the right time for you.
Moreover, it is a proven low investment business with a good profit margin.
At the same time, schemes like mudra provides loans up to 10 lakhs for starting this business.
In this article, you will get an overview on how to start a paper plate business in India and the requirements for it.
Table Of ContentsTo start a paper plate business, you need to have some basic amenities such as land, machinery, raw materials, and labor. On top of that, you need a good amount of money to start this business. Most of the people might not have lakhs of rupees initially to buy all those things and many approach banks for loans. To sanction the loan amount, we need to submit a project report. So, all these things are covered in this topic.
You don’t require huge land for starting a paper plate manufacturing business. A room with 250 – 500 sq ft is good enough. This can easily fit your machine and have enough space for storing raw material and cardboard boxes for packing. Land Requirement : 250 – 500 square feet Cost of Rent :- approx. 8000 – 10,000 INR Note:- it is better to choose a place within the radius of markets, shops, hotels, and business for easy transportation and marketing. Also make sure to check important documents, licenses, and permission available for the place you rent.
Electricity is important for running your paper plate making machine. Before you choose a place to start the business, look at whether the location has a good power supply or not. Most paper machines require a voltage of 220-240v to run effectively. Some high-end paper plate machines may even require 440V. So, make sure that the building you choose to set up the manufacturing unit has the required current supply. Also note, frequent power cuts or constant voltage fluctuations can damage your paper machine.
The price of paper material required for manufacturing plates depends on various factors such as GSM, size, type, and quality. These raw materials are available as rolls or sheets. There are different types of raw materials used in making paper plates such as kraft paper, sitting plate, and lamination sheets. Kraft paper is available in a range of 70 GSM to 200 GSM. Sitting plates are available between 70 GSM – 140 GSM. Purchasing sitting plates directly from paper mills is the best option as you will get them for the lowest price. Film paper or lamination paper is used on the sitting plate. There are different types of film designs available in the market. The most popular lamination papers used were Kela Patta , Salpata , Silver, and Gold films . Next is coating material, some paper materials are single sided PE coated and some others are double-sided. A Double-sided PE coated paper costs more than single sided one.
A paper plate machine is the most important requirement for manufacturing process. The price of the machine depends on its capacity, model (automatic or semi-automatic), features (Single Die or Double die), and power consumption. Generally, a basic machine price starts from 40,000 INR. While the normal mid-end model starts from 65,000 – 75,000 INR. A High-end automatic paper plate machine cost you around 1.5 Lakh.
It requires 2-3 workers to run the business decently. You can either put them in a single shift or different shifts. You also don’t have to worry about training them because, the process just need some basic skills to learn. If you can tell them general instructions and show them how to operate the machine, it’s fairly enough.
Lets now get in to submitting a brief project report. Project report is essential for getting a loan from the bank. Basing upon the report you submit. Banks will decide how much loan they can provide for starting a paper plate manufacturing unit. So, you must know every aspect of this report or consult a professional who can guide you in preparing a project report for your business.
In this report, you provide the details about your paper plate manufacturing unit and yourself (founder). Basically, you provide an overview of your company and details about yourself and any experiences in running such type of business in the past and its related documents. The chances of approving your loan will be more if you have a good CIBIL score as well as good networth.
Technical feasibility is the second most important aspect of your project report. Basically, a feasibility report helps you to determine the possibilities of starting your business. In a feasibility report, you will brief the current situation of your business in the market and explain the machinery, raw materials, and resources required for starting this business. And then, explain what is the scope of your business and how you can compete with the market.
A detailed explanation of the manufacturing location, land, or building must be included in your project report. It is important that you check all the necessary amenities such as water connection, proper electrical wiring, and transportation facility are available in the desired location. If you find you are lacking any important amenities, you can approach a professional, and ask them whether you get any finance for the money spent on the construction of such amenities. Also, make sure you have obtained all the necessary documents and permission to set up your business in that area.
You have to present the details of your manufacturing process, what type of raw materials you are going to use, and other details such as the number of days your unit will operate, and its production capacity.
You have to provide the entire financial details of your project such as the amount spent on equipment, raw material, machinery, labor, building, marketing, and other expenses. Overall all such details need to be mentioned in a detailed table-wise manner in order for the banks to properly estimate how much loan they can sanction to you.
To start any business, you need to obtain certain licenses and they depend on various things such as type of business, number of workers, sector, and place of the business. Some of the most common licenses and registrations include company registration, GST, Udyam registration, Shop and Establishment Act licenses, or such things. Depending upon your manufacturing capacity and investment capital. You need to check which one is applicable to you. Generally, most small scale paper plate making business comes under the micro enterprise category in MSME(Udyam). Registering under MSME helps to avail various benefits such as subsidies, taxation, and other schemes. To register your paper plate making business under MSME go to Udyam registration portal
You need to consider several things before investing money on a quality paper plate machine. Because this is the costliest equipment of your business and a onetime purchase. Things to consider before buying a paper plate making machine.
Paper plate machine price starts from 40,000 INR to 180,000 INR. the price of the machine depends on its features and production capacity. Generally, if you have a low requirement and only makes normal paper plates such as 7-inch size or 4-inch bowl type paper plates which are commonly used for serving pani puri or somosa then, you can choose the one within 45,000 price. If you need a high-speed paper plate making machine with advanced features, then you may have to spend a lot of money on it. This type of equipment is best suited for making large thali plates.
In a paper plate making machine, Die is a pressing tool that applies high pressure on the paper material to turn it into a plate. The price of the paper plate machine highly depends upon the no of dies. Machines with Double and Triple die cost more than a single die. More number of dies means more number of plates produced per hour.
The third step in selecting a paper plate machine is to choose whether you need an automatic one or semi automatic one.
In a fully automatic machine, you just need to place the paper roll on dedicated rollers and load the sitting plates in the compartment. Once you switch on the machine it will automatically drag the paper roll and press them on to the sitting plate releasing a fully completed paper plate within no time Cost – 80,000 to 150,000/ INR Best suited for – Already who have existing business with large market supply
In a semi-automatic model, you must load the paper material manually on to the press. Once the pressing is finished you need to take out the paper plate and load the next one Cost – approx. 40,000/- INR Best suited for – This type of machine is good for those who are new to this business, low investment, and a small market network.
Production capacity is the number of plates produced per hour and it varies depending up on the Number of Dies, Size of the plate, Motor power. Some machines can produce 1500 to 2000 pieces per hour. Whereas some machines can produce up to 5000 pieces per hour. Depending upon your budget and demand choose the best one for your business.
Some paper plate machine manufacturers or traders provide buy-back agreement. This means if you are not satisfied with their product or in any circumstances if want to return the machine. the seller will be ready to take it and give back some money. However, keep in mind buy back agreements have certain limitations that you need to be aware of.
The first thing you must consider before starting full-scale manufacturing is to know whether anyone buys from you.
To do so, approach shops, canteens, street vendors, and catering businesses, or such and show some free samples. If they like them you can make a contract and start manufacturing plates accordingly.
You need a good amount of cash to meet your daily and monthly expenses such as traveling, buying raw materials, daily wages, and other miscellaneous things.
So, depending upon your budget, plan your production process.
The production capacity of your machine depends upon the number of plates it can produce per hour.
If your machine capacity is 1500 plates per hour, then it can produce 12,000 paper plates per 8 hours. If it is a double die model, it can double the production to 24,000.
Basing upon market demand, budget, and season plan your production capacity accordingly.
Paper plates are available in different sizes, Quality and Shape. Some are very small and light weight. These are mostly used for serving samosa, pani puri and other snack items. They are mostly available in 4 inch to 7-inch size.
While some other paper plates are thick and durable that can hold the food firmly. These types of plates are generally used for serving thali and tiffins. They are available in 10 to14-inch sizes.
Before you decide to manufacture a certain variety, ask the local vendors whether they would purchase or not. At the same time try to choose the ones that have continuous demand in the market.
Once you have finished manufacturing of paper plates you have to sell them in the market. Paper plates have huge demand almost all over India. So, don’t have to worry about market.
However, keep in mind, selling paper plates is quite a challenging task.
Because there are already several people who do this type of business and they sell at a very low-profit margin and have a large network in the market.
But don’t get depressed. You can do several things to grow your business such as
In paper plates business, profit highly depends on three things Quality, Budget and Marketing power.
Quality is the most essential requirement in this business. if you provide good quality paper plates at a reasonable price you will have better chances of getting more customers.
Sometimes your paper plates might get damaged during transportation or packing. if your paper plates lack the quality the buyer would bargain you to reduce the paper price which you may end up in less profit.
Let’s, look at the Budget, on average It would require approximately 5 Lakh to 10 Lakh INR. to run a paper plate business decently. This includes machinery cost, salaries to workers, current bills, water bills, transportation, registration, marketing, and other extra costs.
If you have a high budget, you can buy expensive automatic machinery in the first place. This will save labor costs as most of the automatic models just need a person to supervise the machine. However, these machines would cost you around 1,25,000 to 180,000 INR and GST plus extra tax.
On other hand, if you buy a machine with normal cost starting with 60,000 INR and keep 2-3 workers you have to give monthly or hourly wages. So, choose which one is perfect for you.
In the same way, if you have more budget you can buy different raw materials and produce different varieties of paper plates which you can sell it to different types of customers and get good results.
If you are only making a single variety of paper plates with normal quality and selling them with a medium profit margin then you can expect satisfactory results.
The no.one factor for making a successful paper plate business depends on how well you are marketing them. To be frank without marketing you cannot expect good profit.
You need to supply your paper plates to a large network of shops, canteens, hotels and other events to expect good return of investment.
One of the best suggestions is to sell as much as paper plates during Festivals or Marriage seasons. Because the demand for paper plates is especially high during these occasions.
Also, keep in mind, not to completely rely on marketing your paper plates only in famous centers, rather approach other areas too. Because popular centers in the city will have great competition.
So, instead of wasting your time there, you can travel to other places and make new deals.
Also, utilize the festive seasons or marriage seasons effectively. If you can get 10-20 orders for marriage or functions with at least 200 – 300 members capacity, you can easily sell up to 2000 – 6000 paper plates in one go.
Let’s assume a rough estimation of a profit in a paper plates business
Assume if it takes 1.25 rupees to manufacture a 10-inch paper plate of good quality and sell it at a price of 3 rupees. Then, for selling 100 plates you would get 300 rupees. Which means a profit of 175 rupees. This will work if you are selling directly to the customers. However, if you are selling in bulk the price might still go down.
Example of a Profit Estimation
Let’s see an example of paper plate margin estimation which includes details about expenses for a Mid-Sized paper plate making business.
Please keep in mind, this is just a rough estimation for informational purposes please do not use it or take it for granted. We sincerely request you to approach a professional who can guide you in providing a proper estimation report basing upon your requirement
Details and Breakdown of rough estimation
| Details | Values and Amount |
|---|---|
| Type of paper plate material | 10 inches 150 GSM |
| Total no of plates produced per hour | 1500 (5 hours/Day) |
| Production capacity per year | 2,250,000 (for 300 working day) |
| Considering 80% as capacity utilization | 18,00,000 |
| Average price for making and selling each plate | 1.30 INR (18,00,000 x 1.30) |
| Total price of the plates produced per year | 2,340,000 Lakhs INR |
| EXPENSES | |
| Cost of raw materials | 100,000 Lakhs INR (approx.) |
| Transportation costs | 125,000 INR |
| Electricity | 130,000 INR |
| Land and Building advance amount | 30,000 |
| Machinery cost | 300,000 |
| Wages ( 2 workers) | 170,000 |
| Building rent | 150,000 |
| Repair and maintenance costs | 10,000 |
| Marketing | 100,000 |
| Other miscellaneous costs | 50,000 |
| Depreciation 15% | 1,77,000 |
| Total expenses | 1,342,000 |
| Approx. Loan interest | 175,000 |
| Expenses – Total value of plates | 1,517,000 – 2,340,000 |
| Approx. profit amount per year | 8,23,000 INR |
So, from the above rough estimation, a profit of 8,23,000 INR was made per year. But, keep in mind there are several factors that can influence the profit margin.
Apart from marketing and production. External factors such as bandh, strikes, or pandemics like COVID-19 may also influence your business.
FAQ’s on Paper plate business
It is possible to start a small scale paper plate business at home itself. However, you need good amount of space for storing raw materials and machinery. Also, during the manufacturing process a lot of clutter will be accumulated which you have to clean. Top of that make sure proper electricity connection is there for your home. If can manage all such things then you can consider starting at your home itself.
The short answer is Yes, the paper plate business is a profitable one. There are several strong reasons for this.
There is a continuous demand for paper plates in canteens, bakery, street vendors, fast food centers, and hotels.
They were used on several occasions such as marriages, functions, and other events. Most of them occur throughout the year.
They were considered a cheaper option than washing dishes. This not only saves time spent on washing dishes at the same time reduces the labor costs for washing dishes.
The cost of setting up a paper plate company is considerably less.
Keeping all these things in mind it is still a profitable business to start
A semi automatic paper plate machine would start from 40,000 INR. An Automatic paper plate machine would cost around 1,50,000 Lakh INR. The price also varies on a number of dies and plate size. Depending upon the material you are manufacturing and market demand choose the suitable one
With 1 Kg of Raw Material you can make 150 – 300 Paper Plates. The production quantity depends upon the Thickness and size of the paper plates.
Hope you got a basic idea on starting a paper plate making business. We hope this information may help many of the emerging entrepreneurs in India and if possible other countries too. if you have any questions or useful information regarding this business you can comment below.
