Agarbatti, also known as incense sticks, plays an integral part in the spiritual world of India. Over the years, it has been a common household good and an essential item of every pooja conducted in Indian households. In addition to the religious importance of incense sticks, agarbatti contributes significantly to the world of aromatherapy. Agarbatti is used in resorts, healing centres, therapy clinics, spas, meditation centres and other aromatic institutions.
In recent years, the growth in aromatherapy has led to an increase in demand for agarbatti. Agarbatti making business has become one of the most sought-after business ideas in recent years. Agarbatti making business, which falls under the purview of the small-scale industry, is quite a profitable business idea. Due to the increasing demand for the agarbatti, the agarbatti making business is a great way to start earning profits with minimal investments and machinery.
In this article, we will talk about everything you need to know to start an Agarbatti business in India.
Table of Contents
What Are The Main Investments Of An Agarbatti Business?
As mentioned earlier, Agarbatti business does not involve a higher amount of capital or any sophisticated machinery. You can start your Agarbatti-making business right from the comfort of your own homes. However, let us now list out the significant investments of the Agarbatti-making business. The primary investment for an Agarbatti business include:
- Raw materials to make incense sticks
- Incense stick making machine
- A designated place to manufacture incense sticks
- A warehouse to store finished products (i.e. incense sticks)
- Manpower
These elements mentioned above are considered the primary investment areas for starting an agarbatti making business. However, let’s dive deeper into the different areas of investment for an agarbatti making business.
- Incense Stick Raw Material – The first and foremost investment which acts as a base for your Agarbatti business is to source all the raw materials involved in making the Agarbatti, i.e. incense sticks. Several raw materials are required in making Agarbatti. Let us look at the different raw materials involved in making Agarbatti.
- Charcoal powder or sawdust powder
- Adhesive gum (which is also known as joss or tabu made from the bark of a tree called Litsea Glutinosa)
- White ships
- Essential oils, spices or other masalas for fragrance and odour of Agarbatti
- Bamboo sticks
- Packing material
2. Incense Stick Machinery – The second most crucial aspect of the Agarbatti-making business is the machinery, tools and equipment needed to make the incense sticks. The machinery involved in the Agarbatti business include:
- Weighing balance
- Machine to seal heat
- Metal trays (preferably aluminium)
- Sprayer
- Weighing scale
- Plastic equipment (such as mugs, jugs, buckets, etc.)
The above two components may cost you close to over INR 50,000. However, the number is subject to discretion, and the price of the raw materials can change from one state to another. The prices may influence the tax rate, production costs and other vital aspects prevailing in the particular state.
Now you may ask us what the manpower requirements for starting an Agarbatti business are. At the forefront, we are all aware that an Agarbatti making business does not require any skilled or experienced labour. The manpower requirements for starting an Agarbatti business are pretty straightforward, and they include:
- Skilled or Unskilled Labourers
- Office Staff
- Manufacturing and Distribution Staff
We all know that none of those mentioned above labour requirements needs professional qualifications. Hence, hiring an individual with basic or minimal qualifications works best for your Agarbatti business. The expenditure involved in managing and retaining your labour may approximately fall to over INR 15,000 per individual hired and include additional costs.
What Are The Steps Involved In Launching An Agarbatti Business?
The most important part of the article is how one can get started with an Agarbatti-making business. Well, we are here to tell you how you can set up your own Agarbatti business by following these simple steps.
1. Understanding The Market
If you are an entrepreneur looking to start a business of any kind, you need to invest ample time in understanding the market. Similarly, for your Agarbatti business, you must look into India’s aromatics and incense market and plan your business accordingly. When you undertake market research, you become aware of the present condition of the incense market.
You should additionally be aware of all the direct, indirect and potential competitors for your Agarbatti business in the market. By doing your market research, you can determine your business size and the type of incense sticks you want to manufacture under your brand.
2. Laying Down The Plan
On doing your market research, you will find that there are many similar businesses, and now it’s time for you to lay down your business plan. The business plan is nothing but a report or consolidation of information about the Agarbatti market in India. This business plan will plan out all the elements involved or potentially involved in running your Agarbatti business in India. While preparing the business plan, you must keep in mind the following aspects.
- You must determine the size of your business.
- You must have a clear description of the revenues and expenditures.
- You must also clearly plan out every aspect of your product’s production, manufacturing and distribution.
- You must also include the estimated profits and the market estimation for at least five years from the year of starting your Agarbatti making business.
3. Determining Your Sources of Finance
The next most important step is to scout for investors willing to invest in your Agarbatti business. As we mentioned earlier, the Agarbatti business does not require massive capital. One can quickly start an agarbatti business from scratch with minimum investment or even the cash at hand. However, if you are lucky enough, you can even get your whole business financed right from the beginning. If you start your Agarbatti business on a large scale with an extensive production unit, you might require additional finance. You can reach out to potential investors and pitch your business plan to them.
4. Registering Your Business
Once you have figured out all your sources of income, the next step is to make your business a legal entity. As we had stated earlier, since an Agarbatti making business falls under the Small Scale Industries category, you can register your Agarbatti business as an MSME. It is mandatory to have a ROC to register your Agarbatti business. It would be best to look into the rules and regulations for writing your Agarbatti business in your state.
5. Strategy, Produce, Sell
The last yet most important step is to get your business to the ground. You must have a fixed composition of how you would produce your Agarbatti. This is nothing a percentage-wise breakdown of the making process of your product, i.e. Agarbatti. In addition to that, you should also lay down a strategy on how you would manufacture, produce and sell your products. While planning your strategy, you must consider your marketing and advertising strategy for your product.
The Agarbatti Industry in India has turned out to be one of the country’s quickly growing small scale industries. With the profits it’s expected to make, we are sure that starting an Agarbatti business can help you earn the profits you desire. Get started with your Agarbatti business today! Do you want more ideas to start your own business? Read out article “How To Start a Laundry Business in 2022” to know more.
