SPICE GRINDING & PACKAGING

INTRODUCTION
Spices are essential ingredients adding taste and flavouring in food preparations. India is the
largest producer and consumer of spices with a production of around 36.68 lakh tones. India
is also the largest producer of chilli in world contributing 25% of the total world production.
Indian spices are of the finest quality. Today the demand for it has considerably increased
from all the countries. The project aims at production of ground spices especially chilli in
consumer packs. The project mainly would involve production of chilli powder, tamarind
powder, Jeera powder, Dhania powder and mix spice powder.
ABOUT THE PRODUCT
Powdered spices are convenient to use and also saves time and energy for preparing
different delicious dishes. Besides their everyday use in households, spices are used in
significant quantities in processed foods such as pickles and sauces. It is also very much
useful particularly for the working couples, bachelors, hostels, hotels, restaurants, hospital
and different camps of defense personnel spreading throughout the country.
MARKET POTENTIAL
Spices are integral part of Indian food (India has come to be known as land of spices) both
as a component of daily food items as well as part of pickles, sauces & chutneys etc.. With
changing of life style and especially with changes of food habits and increase of income level,
the use of powdered spices has increased. Of late, the market for ready mix of spices has
grown significantly. Export market for Indian spices is also growing- it was Rs. 2025 crore
during 2000-01.Thus the market is huge with potential for quality producer. Numbers of
brands have appeared in the market such as Sona, MDH, Ashok Masala, Sunrise etc.
besides these, some of local brand are also there in the market. In addition there are
numbers of small units producing powdered spices, both in loose as well as packet formed.
The consumption of spices in a household of five members, in the north eastern region is
estimated at 100 gm. per person per month i.e. 6.0 kg per household per year. Of this share
of, powdered spice may be taken at 50% i.e. 3.0 kg per household per year. In north eastern
states powdered spices are used mainly in urban and semi urban areas and it may be
conservatively assumed that 70% of the urban population uses powdered spices.
SUGGESTED CAPACITY
To assessing the proposed plant capacity due consideration is given on availability of raw
materials, availability of electricity and market. The annual production of 50 tonne is
suggested, the production and product-mix at different capacity utilization per annum will be
as follows:
2nd yr. onwards
Item
Installed
1st yr.
production
production @90%
Capacity
@80%
(TPA)
Turmeric powder
20
16
18
Chilli powder
10
8
9
Jeera powder
5
4
5
Dhania Powder
5
4
5
10
8
9
Mix Powder (dhania,
chilly, pepper, bay leaf &
curry leaf etc.)
Total
50
40
46
Basis:No. of working days

=
=
=
=
=

No. of shifts
One shift
Daily Production

190

25 days per month

300 days per year
1 per day.
8 hours
135 kg. (at 80 Capacity)

INFRASTRUCTURE REQUIRED
The main Infrastructural facilities required are:
Covered shed area (processing hall/storages/office)
Power requirement
Water (required in every working day)

800 sq. ft.

10 kw.
1,500 ltrs.

RAW MATERIALS REQUIRED AND AVAILABILITY

The major raw materials required for this unit are turmeric, chilly, jeera and
dhania etc. Based on an average yields of 95% from ungrounded spices to powdered spices and
annual requirement of raw materials would be about 53 tonne (basis on 100% capacity
utilization).
1.
2.
3.
4.
5.

Turmeric
Chilly
Jeera
Dhania
Mix Powder (dhania, chilly, pepper,
bay leaf & curry leaf etc.)

21.00
10.50
5.25
5.25
11.00
53.00

tonne
tonne
tonne
tonne
tonne
tonne

Capacity wise details of raw-materials & packaging materials are as follows:

Items

Quantity (MT) in the

1st year @ 70%
Quantity

Quantity (MT) in the

2nd year @ 80%

Value
(in Rs.)
2,65,000
2,57,000
4,44,000
1,66,500
4,50,000

Quantity

Value
(in Rs.)
3,03,000
2,94,000
5,04,000
1,89,000
5,14,000

Quantity (MT) in the

3rd year onward @
80%
Quantity
Value
(in Rs.)
18.90
3,41,000
9.45
3,30,000
4.75
5,70,000
4.75
2,14,000
9.90
5,78,000

Turmeric
14.70
16.80
Chilly
7.35
8.40
Jeera
3.70
4.20
Dhania
3.70
4.20
Mix Powder (dhania,
7.70
8.80
chilly, pepper, bay
leaf & curry leaf etc.)
Packaging Materials 70,000 nos. 1,05,000 80,000 nos. 1,20,000 90,000 nos. 1,35,000
(50/100/200 & 500
gm. size packets)
Total (Rs.)
16,87,500
19,24,000
21,68,000

SUGGESTED LOCATION
Generally urban as well as semi urban areas having the infrastructure of electricity,
transportation, near to raw materials may be considered as viable location of NER including
sikkim for setting up of spice grinding unit.

PRODUCTION PROCESS
1. Raw Spices
Sealing

Cleaning

Packaging

Grinding/Pulverizing

Transportation

8 Marketing.

191

Mixing 5 Filling &

PROJECT ECONOMICS
Total Capital Requirement
The total capital requirement including fixed capital and working capital is estimated at Rs 14.50
lakhs as follows. Of this, the project cost comprising fixed capital and margin money on working
capital is Rs.11.42 lakhs.
A.

Fixed Capital
Land
Land Development Cost

(Rs. in lakhs)
on rent
0.80

Building /Civil works:

i)
ii)
iii)

Work shed 300 sq.ft

Office/Store for R.M./Finished goods 300 sq.ft.
Toilet/Bathroom/Cemented
open space, Drainage facilities
etc.

2.10
2.10

1.00

Plant & Machinery

Misc. Fixed Assets
(Water arrangement/Overhead
reservoir/pump set/power
line connection/water & electrical
fittings/office equipment)
Preliminary & Pre-operative Expenses
Contingency provision
B.

Working Capital:
Raw materials/consumables
Packing materials
Working expenses
Finished goods
Receivable

1.00
1.50

0.50
0.40
9.40

15 days
1 month
1 month
10 days
7 days

Note: Working capital to be financed as

Margin Money
Bank Finance

1.38
0.30
1.00
1.45
0.97
5.10
:
:
:

2.02
3.08
5.10

Means of Finance:
The project cost of Rs.11.60 lakhs may be financed as under:
Promoters Equity(25%)
Term Loan(75%)

:
:

Operating Expenses
The annual operating expenses are estimated as under:
Raw material/consumables
packing materials:
Working expenses
Repair & Maintenance
Administrative overhead
Selling expenses 10% on sales
Depreciation
Interest

:
:
:
:
:
:
:
:

Sales Turnover:
1.
Dhania(coriander)40 Qtls@ Rs.9,000/Qtls
2.
Chilli powder 82 Qtls@ Rs.12,000/Qtls

Rs.
Rs.

192

2.87
8.55
11.42

24.93
2.20
6.27
0.10
0.30
5.00
0.50
1.49
40.79
2.48 lakhs
9.84 lakhs

3.
4.
5.

Haldi(turmeric) 165 Qtls@ Rs.9,000/Qtls

Jeera ( camin seed)
40 Qtls@ Rs.16,000/Qtls
Meat Masala 85 Qtls@ Rs.18,000/Qtls

Rs.10.23 lakhs
Rs. 6.40 lakhs
Rs.15.30 lakhs
Rs.49.99 lakhs
Say Rs. 50.00 lakhs

Profitability:
Based on the sales realization and the operating expenses, the profit would be Rs. 9.21
lakhs per year. This works out to a return on capital investment of 64%. The unit would breakeven at about 36% of the rated capacity.
Break Even Analysis:
A.

(Rs in lakh)

Variable Cost:
Raw materials/Consumables
Packing materials
Utilities
Selling expenses

B.

24.93
2.20
1.25
5.00
33.38

Semi-Variable Cost:
Wages & Salaries
Repair & Maintenance
Administrative overhead
Depreciation
Interest

C.
D.
E.

5.02
0.10
0.30
0.50
1.49
7.41
50.00
16.62
36%

Sales Realization
Contribution
Break-Even Point B/D x 80%

Highlights:
The major highlights of the project are as follows:
Total Capital requirement
Promoters contribution
Annual Sales realization
Annual Operating Expenses
Annual Profit
Return on sales
Break-even point
No. of person employed
Machinery & Equipment:
The main equipment required are
i)
Spice Grinding Machine
24 Vartical stone,complete set
ii)
Electric Motor 15 h.p.
1400 RPM with Starter
iii)
Power Capacitor 6 KVAR
iv)
V. Belt,Pulley
v)
Line shaft, rubber pulley
bearing and block etc
vi)
Rubber belt,foundation boltand
weighing scales etc.
accessories

14.50 lakhs
2.87 lakhs
50.00 lakhs
40.79 lakhs
9.21 lakhs

2 sets.

23,000

:
:
:

1 no.
1 no.
2 set.

32,000
1,600
10,000

2 set.

5,500

L.S.

Add.: Taxes,duties, fright, insurance, packing,

Loading and unloading etc. @15%

193

Rs.
Rs.
Rs.
Rs.
Rs.
18%
36%
9

15,000
87,100
13,000
1,00,100
Say Rs.1.00 Lakh

Raw Materials/Consumable (Annually):

Item
Quantity
Dhania(coriander)
Chilli powder
Haldi(turmeric)
Jeera ( camin seed)
Meat Masala(Mixed)

Packaging materials
Item
100 gm. poly bag
200 gm. poly bag
50 gm. poly bag
500 gm. poly bag

Manpower:
Category
Manager cum skilled worker
Un-skilled worker
Store cum Accountant
Sales personnel

Rates(Rs.)

42MT
84MT
168 MT
42MT
88 MT

4,000/MT
4,200/MT
4,500/MT
8,000/MT
10,000/MT
Total Rs.

Quantity(nos.)

Rates(Rs.)

1.00 lakh
0.75 lakh
1.25 lakh
0.50 lakh

0.50 each
0.75 each
0.50 each
1.00 each
Total Rs.

No.of
Person
1
4
1
3

Annual Requirement
(Rs in lakh)
1.68
3.53
7.56
3.36
8.80
24.93

Annual Requirement
(Rs in lakh)
0.50
0.57
0.63
0.50
2.20

Salary per person

per month(Rs)
6000
3000
5000
5000
Total Manpower Cost

Monthly Requirement
(Rs)
6000
12000
5000
15000
38,000

Salary Bill Rs 4.56 Lakhs + Benefits @ 10% annually i.e. Rs 0.46

Total Annual Salary Bill : Rs 5.02 Lakh.
Utilities
Power for Machinery:
General Lighting:

d)

b)

15 H.P.
2 H.P
--- ----------17 H.P.
--------------

Electricity Bill:
17 H.P. X 0.746 KW X 6 Hrs. X 300 days X Rs. 5.50
Hence, annual Electric bill
Water Charge = 5000 Ltrs. per day(L.S.)

ADDRESSES OF MACHINERY SUPPLIERS/MANUFACTURERS

1.

2.

3.

4.

M/S Archana Machinery Stores

M.S. Road, Fency Bazer,
Guwahati-781 001
M/S Shew Machinery Store.
A.T. Road,
Guwahati-781 001
M/S Process Machinery & Equipments Pvt. Ltd.
8A, Shyamapaprasad Mukherjee Road.
Kolkata-700 025
M/S Bengal Metal Works.
69A, Serpentine Lane,
Kolkata-700 014.

194

Rs. 1.15 lakh

Rs. 0.10 lakh

FORMAT

(A Introduction.
(B. About the Product
(C. Market Potential
(D. Suggested Capacity
(E. Infrastructure requirement
a. Covered Area
b. Utilities
(F. Raw Materials and its availability
(G. Suggested Location
(H. Production process(step wise)
(I. Project Economics
a. Capital Cost.
b. Working Capital requirement
c. Cost of Production & Profitability
d. Turn Over
e. Sources of Finance
f. Plant & Machineries
g. Cost of Raw Materials & Consumables
h. Cost of Utilities & Overhead
i. Manpower requirement & wage bill
j. Profit Sales ratio
k. Rate of Returns
l. Break Even Point
Addresses of machinery suppliers/manufacturers

195