How to Start a Dairy Farm Business in India | Step by Step Guide

India ranks first in milk production in the world. According to the data of 2021-22, India produces 24.64% of the total milk production in the world. There has been a 58% increase in milk production in India in the last 9 years.

Here are the Top milk producing states :

• Rajasthan (15.05%)
• Uttar Pradesh (14.93%)
• Madhya Pradesh (8.6%)
• Gujarat (7.56%)
• Andhra Pradesh (6.97%)

If a dairy business is handled with new techniques, there is a lot of potential in this business. Because there is a demand for milk all over the world and this demand has always been there and will always be there. If you also want to start your dairy farm business, then in this article we will give you the ultimate guide on how to start a dairy farm business in India.

1) Plan Your Business

First of all, you will have to do market research for your dairy farm business and along with that you will also have to set objectives and strategy. With the help of which you can get ahead of your competitors. If your base is not strong then when your business grows a little you will face a lot of problems.

2) Access location and resources

If you want to start this business on a large scale, then you will need more land. If you want to start with less investment, then you will have to start the work with land only which can accommodate your 6 to 8 buffaloes and cows. Provide a shed for those cows and buffaloes and access water and nutrition for them.

You also have to get those animals vaccinated from time to time. Along with this, you will also have to install some necessary equipment which will help you in milk production and processing.

3) Arrange Capital

You can arrange capital in two ways. If you have your capital then you can invest it in your business otherwise you can arrange capital by taking a loan. But in this, you have to keep in mind that when you borrow capital, you will have to compare its interest with your return on investment. If your return on investment is more than the interest payment, then that capital will be beneficial for you.

4) Complete Legal Requirements

To start a dairy business, you will have to get registered with the local Veterinary and Dairy Development Department.

Required License and Authorisation :

# FSSAI License

# BIS Certificate

BIS IS 11799: 1968 (R2002) – For Cattle housing in rural areas

BIS IS 11942: 1986 (R2002) – For Gaushalas and other organised milk producers

BIS IS 11942: 1986 (Reaffirmed 2004) – For a loose housing system for animals

5) Take Advantage of Government Initiatives

The government is also promoting the dairy business a lot and has also launched some initiatives which will give a boost to your dairy business. These are :

• Rashtriya Gokul Mission
• National Programme for Dairy Development (NPDD)
• Dairy Entrepreneurship Development Schemes

6) Establish Distribution Channel

You have to define distribution channels to reach your customers. There are two types of distribution channels: Direct/ Zero level channels and Indirect channels.

Direct Channel :

In this distribution channel, the seller or manufacturer sells its products directly to the customer without any intermediate.

Benefits of Adopting Direct Channel

• Saves third-party distribution costs.
• Better relationship with Customers.
• Control over distribution.

Disadvantages of Direct Channel

• Increase in distribution workload.
• Didn’t get the benefit of Wide coverage.

Indirect Channel :

When a seller or manufacturer takes the help of a middleman to deliver its products to the customer, we call it an indirect channel.

Benefits of Adopting Indirect Channel

• Wide Coverage.
• Less Distribution workload.

Disadvantages of Indirect Channel

• No control over Distribution.
• It may take longer Delivery time.
• Reduce Profits.

7) Monitor Performance

The quality of milk and its production metrics will have to be monitored. Along with this, constant feedback from the customer is also important so that if something is lacking then you can improve it. With time, you will have to expand your dairy farm and increase its production capacity. And try to increase your reach by using both traditional marketing and digital marketing.

Also Read: Best Digital Marketing Agencies in Gurgaon

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