India has a massive consumption of incense sticks, currently standing at about 1,490 tons daily, yet only 760 tons are produced locally, with the remainder being imported from countries like China and Vietnam. From the above figure, we can say that at least 5% of that quantity is used in Assam (about 70 to 75 tons daily).
Understanding Agarbatti
The term "Agarbatti" comes from Hindi and refers to what is commonly known as incense sticks worldwide. We call it dhoop in Assamese. These are thin bamboo sticks, typically 8 to 12 inches long, coated with a fragrant paste made from natural concentrates, such as scented flowers and aromatic woods like sandalwood.
Market Potential
The demand for agarbatti is consistently high, especially during festivals and celebrations. It is used in over 90 countries, and India is the sole manufacturer supplying these sticks globally. This creates a significant opportunity for anyone interested in starting an agarbatti business from home.
Steps to Start an Agarbatti Business
Initial Planning
Starting an agarbatti manufacturing business can be quite profitable. With basic machinery, it is possible to begin production at home. Incense sticks are essential items found in households, religious places, and areas of spiritual significance.
The scale of the business will depend on individual capacity and the production capability of the manufacturing unit. Demand tends to spike during festive seasons, and there are also opportunities for exporting agarbatti to other Asian nations. For instance, India exported over 500 crores worth of incense sticks to countries like Japan and China in 2017 and 2018.
Given the constant foreign demand, exporting could be a lucrative avenue. The technology required is relatively low-grade, which keeps initial investments minimal. Profit margins can be substantial, with potential earnings of around ₹500 for every 100 kg produced.
Licenses Required
To operate an agarbatti business, several licenses may be required, which can vary by state:
- Company Registration: Registering your business is the first step.
- GST Registration: Mandatory for all businesses to obtain a GST number.
- EPF Registration: Necessary if you have more than 20 employees.
- ESI Registration: Required for units with more than 10 employees.
- Trade License: Essential for all businesses, obtainable from local authorities.
- SSI Registration: Optional for Small Scale Industries.
- Pollution Certificate: Required after site inspection by the State Pollution Control Board.
- Factory License: Needed for large-scale manufacturing units.
Raw Materials Needed
The raw materials for making agarbatti are easily available in the Indian market. The primary component is bamboo, which can be sourced at approximately ₹120 per kg. Here’s a list of essential materials:
- Aromatic Ingredients
- Natural Aromatic Oil
- Bamboo Sticks (8-12 inches)
- Packing Materials (airtight)
- Color Powders (various types)
- Fragrance Additives (optional)
Location and Setup
You can start the agarbatti business from home or any accessible location. The required area depends on the number of machines you plan to install.
Equipment Needed
Machines are crucial for manufacturing. Depending on your budget, you can choose from various types, such as:
- Manual Agarbatti Making Machines: Affordable and easy to operate.
- Automatic Machines: High volume production with advanced technology, capable of producing 160-450 sticks per minute.
Funding Options
If you lack the necessary funds for machinery, consider applying for a loan from banks. The government also offers various schemes to promote MSME business.
If you want to learn more about agarbatti/dhoop manufacturing business, we would be glad to guide you. Please contact us using the contact us form on this website.