Do you know that Incense and Agarbatti making business is one of the most profitable low investment business ideas in India which returns you the high profit.
Incense and Agarbatti are not demanding products only in India, they are highly demanded in the foreign countries as well.
Agarbatti manufacturing business does not require a very high investment if you want to start it on a small scale.
India is exporting Incense sticks and Agarbatti to the foreign countries of around $90 Million per year, in which USA, Nigeria, UK, Malsaiya and UAE are our major clients.
Is Agarbatti Making Business Profitable?
There are many criteria which define the profitability of any business, and it differs with the nature of the business.
The need for incense and agarbatti in India is around 15,000 tons per day, which is very high, and there are very few manufacturers of agarbatti and incense in India.
There is an indication that the incense sticks and agarbatti making business is a very profitable business plan.
Another good news is that before some time, India was importing the major part of raw materials to manufacture the agarbatti and incense, but the government has stopped it and is producing it in India.
As a result of this honorable action from the government, the manufacturing cost of agarbatti has been decreased and profit margin has been increased.
Agarbatti making business can be the best business idea from home for women because it can be run from home by women as well along with performing the routine responsibilities.
Agarbatti Making Patterns
Do you think that you will have to manufacture the agarbatti and incense manually? If so, then let me educate you that it’s not necessary that you have to make the agarbatti manually, there are several types of agarbatti making machines available in the market.
The agarbatti making machines cost is too affordable for a middle class person as well, i.e. it starts from only 20,000 rupees from which you can manufacture 2-3 kg agarbatti sticks per hour.
The recommendable way to manufacture the agarbatti is making agarbatti sticks by the machine instead of handmade.
Types of Agarbatti
You can make various types of agarbatti to make your agarbatti making business scalable, a limited variety of product bounds the customer base in limited bandwidth.
You can make scented agarbatti with different fragrance, different colors, thickness, plain agarbatti, various sized agarbatti.
Raw Material For Agarbatti Making Business
You will need some very basic raw materials to start the agarbatti manufacturing business in India which is as mentioned below.
- Fragrance Perfumes
- Agarbatti Powder
- Agarbatti Making Machine
- Paper Box For Outer Packing
- Plastic Pouch or Envelope For Inner Packing
- DEP Oil
- Tap Cutter Machine
- Weighing Scale
You can buy the agarbatti making machine along with all raw materials from the B2B sites, where you will get the best deal for all the raw materials.
Hence, you are going to start the manufacturing business of agarbatti, then it’s understood that you will be purchasing all the raw materials in bulk, and that’s why you will get the best price for each material as well.
Agarbatti Making Machines
There is a wide range of agarbatti sticks making machines in the market, you need to choose the machine for agarbatti manufacturing according to your business size.
In the beginning time, you will not need to produce more than 10-15 kg agarbatti sticks, so it’s not required for purchasing the too costly agarbatti making machines.
As long as your business becomes scalable, your customer base increases, and you get orders to make more agarbatti sticks which can not be accomplished by the small range machine, then you can upgrade it.
The perfect strategy execution with the time, trend, and demand make your business sustainable which can survive in any condition.
Profit Margin of Agarbatti Making Business
Considering the profit margin of any business is a very important aspect because the role of profit margin in the business is major.
The ratio of profit margin also depends on the quality of the raw materials that you use to make the agarbatti, with your other expenses.
In the premium quality of agarbatti, the raw material cost will be around Rs. 85/Kg, in which you will produce around 980 pieces of agarbatti.
The average cost of perfume is around 700 rs per kg, DEP oil is around 140 rs per kg, Box packing is around 1.30 rs per piece, inner pouch 240 rs per kg, outer pouch Rs. 2/piece.
Here you will get some variance in perfume cost, because you have to dilute the perfume by adding the DEP oil in it, with the ratio of 1:4 of perfume and DEP oil respectively.
Considering the above calculation, you will produce 3400 around agarbatti sticks in 700 rupees.
So, the cost per agarbatti stick is 700 / 3400= 0.20 Rupees.
Generally, the standard packing of an agarbatti box contains 18 agarbatti sticks in 1 pack for 10 rupees selling price.
If we calculate the price of only agarbatti sticks included in one pack, it is 18 X 0.20 = 3.60 Rs. So the cost of 18 sticks is Rs. 3.60 Rs.
The cost of packing box, inner pouch and outer pouch per pack is 3 rupee, so the total cost of 1 complete pack of agarbatti is Rs. 5.60.
Hence, you will run the agarbatti making business, so you will be selling in wholesale, so you need to sell the mega pack of agarbatti sticks of 12 packs, 24 packs, or more.
If we include the other expenses then the total cost of 1 pack could reach up to 8 rupees per pack.
And, one more thing I want to mention is that the quantity of agarbatti sticks in one unit pack varies with the quality.
So, the overall average profit per pack could be 3-4 rupees, which is a very good profit, and you run the agarbatti manufacturing business, so you will be selling in bulk.
In a starting phase, you will not have more customers, but if you work consistently, your consumption will be more than 1500 packs per day, which will generate a profit of around Rs. 7000 per day.
Customer Base For Agarbatti manufacturing Business
Any manufacturing business has a huge base of customers, because they are supposed to export the products in a very huge quantity, right?
But you don’t have to worry, because there is very less competition in agarbatti making business, and that’s why, if you provide the premium quality, you will get the customers very easily.
You can sample your products, which will be for the testing purpose for the merchants, they will analyze the response from the customers, and will give you the big orders regularly.
At the other end, you can list your products on B2B sites like IndiaMart, Trade India, who will be bringing a very huge base of customers for you from across India.
The third source of the customers is very potential, and beneficial, yes, and it is exporting the agarbatti sticks to international customers.
The international market of agarbatti is too wide and too huge having a very low competition in it.
Space For Installing The Agarbatti Making Machine
Starting the agarbatti making business on a small scale, you will not require any dedicated space for making the agarbatti sticks, but as long as your business will scale up, it is advisable to dedicate the space for machine installation and keeping the raw materials as well.
If you have a little bit more investment, it is recommended that you install the machine and keep the raw materials in dedicated space while beginning the agarbatti stick manufacturing business.
You can also invite the local customers to your unit for dealing, which is a very different way for dealing as well.
Marketing Strategies For Agarbatti Sticks Manufacturing Business
According to the current trend of business strategies and business plans, marketing is the mandatory aspect to grow your business quickly.
You can list out your products on B2B and B2C sites, where B2B is Business to Business sites and B2C is the Business to Customer sites.
Running a digital marketing strategy to market your product is one of the best marketing strategies in the current duration.
Google Ads, Facebook ads, and other digital marketing platforms drive too many leads in a very low investment for marketing.
While doing digital marketing, it is advisable that you learn how to run ads on different platforms or you can give a contract to the specialist of digital marketing.
Selecting the wrong audience and location while creating the ads will not make a single rupee profit, and the money placed on ads will be wasted.
Agarbatti Making Business is considered as a common business in India, because people do not have a proper idea about the potential of agarbatti manufacturing business idea.
Once you get just one good deal with an international client, then your agarbatti manufacturing business will grow very fast, because the international trading business returns you very high profit.
So, think big and start with small, and by constant efforts and strategies, convert the minute into a very huge one.