The paper bag business is one of the most profitable futuristic business ideas in India and over the world as well due to reduction in the utilization of plastic, and on those days, the best option of plastic bags is the paper bags.
If we talk about India dedicatedly, the demand for paper bags is increasing after the banning of plastic bags.
From the small shops, paper bags are being used in hospitals, malls, grocery stores, export outlets, and gift shops as well.
These are not limited sources where the consumption of the paper bags are on hike, apart from these there are many places and organizations, where people can not sustain the business also without the paper bags.
Selling the paper bags at low cost is as easy as making the paper bags by the paper bag machines, and as another benefit, paper bags are eco-friendly that do not affect the environment.
Future of Paper Bag Business
Paper making business is a very profitable business idea for the future, because it saves the environment, and nowadays and for the upcoming future, there is nothing more important than the environment, right?
Not only India, but many countries’ governments have banned the utilization of the plastic bags to prevent the unbalancing of the environment, and they have introduced the paper bag utilization as the best alternative of plastic bags.
India exports on average $536 Million per year, where the highest export was $1,430 Million in 2017 and the lowest export was $78.37 Million in 1998 [source].
All the countries of Africa have banned the usage of plastic materials along with plastic bag, and they are importing the paper bags from other countries to accomplish the requirement of it.
If you start a paper bag making business idea, you can easily export the paper bags to the other countries clients along with Africa and can generate a huge amount of profit.
Domestic and International Market of Paper Bags
For any business, customers and appropriateness are the must factors for surviving the business.
Luckily, the paper bag making business has a world wide international market along with the domestic market of India.
Many countries over the world have banned the usage of plastic materials including the plastic bags, and they are importing the paper bags from the other countries to fulfill their requirements.
You might be thinking that despite having the production of paper bags, why other countries are importing the paper bags, right?
Because very limited countries are making paper bag making machines, which are India, China and European countries.
At the other end, there are only around 10-12 countries who are making the paper, and India is one of them.
Now, if we talk about Africa, it purchases the paper and machines, both of them from India, or from other countries (mostly it purchases from India), and then runs the paper bag making business.
But at the other end, they can not afford the cost of manpower to make the paper bag, and hence they opt for importing the readymade paper bags made in India, because it is more affordable than making them in their countries.
The reason behind it is that the cost of manpower is too affordable in India than other rich countries
And this is the key point for the Indians that we can provide them with readymade paper bags which provides them with paper bags at affordable rates with our high profit.
At the other end, the paper bag making business has a very wide market in India as well, Because India also has banned the usage of plastic bags.
You can have a lot of customers from B2B sites, where you can list your products with your rates and conditions, and the wholesalers will purchase from you in a bulk lot.
Machinery For Paper Bag Manufacturing Business
You might be thinking about how to make paper bags to start the paper bag manufacturing business, right?
As an answer to this question, you can make a paper bag by the paper bag making machines which come with three varieties.
- Manually Machine
- Semi Automatic Machine
- Fully Automatic Machine
The production efficiency depends on the type of machine, you can choose it according to your paper bag making business plan.
Whether you have a small scale business, medium scale business or a large scale business, and what amount of production you are making of paper bags.
The other machine that you will require is the Printing Machine, which also has three different types.
- Screen Printing Machine
- Offset Printing Machine
- Flexography Printing Machine
Here also the selection of the printing machine depends on the scale of business and your requirement with the budget.
Investment For Paper Bag Making Machine Business Idea
This is a large scale business idea in India which requires a huge amount of investment, which is as below.
The cost of paper bag making machinery is between 5 to 10 lakh rupees which depends on the quality and functionality.
You can choose the best paper bag making machine according to your business model, and if possible, you can take the advice of an expert as well.
The printing machine comes between 1 to 10 lakh which also depends on the quality and functionalities.
You can make a minimum of 7000 pieces from 60kgs of paper roll in 1 hour by using any paper bag making machine.
Raw Materials For Making The Paper Bags
Hence, any physical product is conducted on a very huge scale, i.e. in a massive bulk, here we are going to explore the investment, which you can easily calculate according to your requirements.
There are three raw materials that are too important to start a paper bag making business in India or anywhere else.
- Paper Roll
- Printing Ink
Paper roll is the basic raw material from which the manufacturing of the paper bag occurs, you can use white paper roll, brown paper roll, and butter paper roll as well.
There are several types of paper rolls which you can utilize, differing with the quality of the paper, and the average cost of paper roll is around 25 rupees to 40 rupees per kg, which depends on the quality, GSM, and other aspects of the paper roll.
Glue is the supplement raw material to make the paper bag, which is required to firm the paper bag, which costs around Rs. 5/kg in the market.
There are also several types of glues which you can use to build the paper bags and it also depends on the quality and other aspects of the glue.
Printing Ink is used to add the design, logo or other printing in the paper bag once it is made, and it also has the different types starting with almost Rs. 5/kg.
You can choose the printing ink according to your requirement and the demand of your client.
Process:- How to Make Paper Bag
It’s too necessary to know how to make a paper bag, because it’s the essential information which you must have as a business owner of the paper bag manufacturing business.
As long as you insert the paper rolls into the paper bag making machines, the process of paper cutting and folding gets started automatically.
After inserting the paper roll into the paper bag making machine, you need to do the setting in the control panel given into the machine, like, the size of the paper bag, and you can set the speed of the cutter according to requirement.
During the process, the glue is applied on the paper according to the given command, and implemented in the sticking process as well, and further, it goes for the printing process.
Printing process is also easy to execute, you just have to design the logo, description, or any content, and it will automatically take place according to the given command.
Here you will just have to set up a size of bag, i.e. which size should the paper be cut with, which is the quality of paper while inserting, and what is the printing content, or logo.
Required Area and Manpower to Set up Paper Bag Business
This is also one of the most profitable manufacturing business ideas in India which can be executed by home as well if you have a dedicated space in your home to run this business.
However, it is quite advisable to start the paper bag making business with availability of separate space beyond your home as it is one type of factory nature business.
You will require at least 3-4 people for the production of paper bags, either you are using the automatic machine or manually machine to operate it.
Profit Ratio of Paper Bags Trading
As a manufacturer of paper bag business, you will be selling in huge quantities, and hence, your profit ratio will also be higher.
According to the current market of paper bag trading business, the profit margin per kg of paper bag bulk is around 10-15 rupees.
Now, calculating with more precision, and if you work for 8 hours per day, and keep the profit margin Rs. 15/kg, and sell them, your average profit margin will be around 7500-8000 rupees per day.
While doing the inventory business, generally we consider the 70% of profit as rotation, then it will be around 5500-6000 rupees per day.
Calculating this amount per month, it will be figured between 1.45 lakh to 1.55 lakh, and it could fluctuate as well.
You can sell the paper bags with this profit margin in the domestic market, if you go for the international market, your profit fluctuates according to the clients.
Some international clients are quality conscious, and some are rate conscious, you can deal with them accordingly.
As a conclusion of profit collection, you can produce 1 kg paper bag in around 35 rupees including all variations and expenses.
If you manufacture the paper bags in a regular way, you can generate a gross profit of around 600 rupees per hour.
Finance For Paper Bag Business
Hence, you came to know that the paper bag production business requires a lot of investment, so you will have to manage the finances first.
If you do not have a sufficient fund, you can go for borrowing from the government like Mudra Loan, and PMEGP loans.
There are also other different ways to collect the investment amount to start this business which you can inquire online as well.
You need to do the deep market research and marketing while and after starting the paper bag production business.
While doing marketing you need to take care that you are promoting your products to the targeted audience, i.e. you are the manufacturer, so you should promote your product to the wholesalers and big retailers.
In order to cover only potential customers, you can choose the way to do the digital marketing which will save your marketing cost and will fetch the maximum customers for your paper bag making business.
Is paper bag making business profitable?
Definitely Yes, it’s one of the most profitable manufacturing business ideas in India, over the planet as well after the world has started the campaign of banning the plastic materials usage.
You will have a very wide market to sell your paper bags, even if you produce 1,00,000 paper bags per day, you would not be able to accomplish the actual need of world.
How can I sell paper bags?
In today’s time, it’s quite easy to sell anything, in regards of selling the paper bags, it depends upon which kind of business of paper bag you are doing.
If you are manufacturer of the paper bags, you can export it, and can sell it by listing on B2B sites for the domestic clients.
Moreover, if you are retail or wholesale trader of paper bag, you can register your business on the ecommerce sites as well, from which you can generate a massive profit as well.
Are paper bags in demand?
Definitely it is in demand, and in fact, demand is more than the supply, nowadays, people are self aware and choosing the paper bags instead of the plastic bag to protect the environment.
In terms of profitability, there is no question about starting, and for the selling aspect, you already have gone through the local and international market of paper bag business.
There is a huge demand for the paper bags in those countries who have banned the plastic bags in order to protect the environment.
The plus point of India is that the manufacturing cost of India is too low than the other countries, and that’s why even if we export paper bags to the outside countries on their rates, we generate a very high profit revenue.