How to Start a New Business

STARTING A BUSINESS IN INDIA

From a business point of view. India has the people, a strong upper middle class with good disposable income and an ideal location. It is no surprise that international companies are lining up to set up shop in India.

With a population of over a billion people, India is home to almost one-sixth of the world's population. From a marketing point of view, where could one find a better location for business?

How to start a new business – New business opportunities

Opportunities materialize out of ideas that one comes across during the normal course of our daily lives. For a new business the first step would be, to come up with an idea, for a product or a service that can make things easier, and improve quality of life of people. A product or service that people would be willing to pay for.

If you have the will and commitment to succeed, financing nowadays can be arranged to bring your ideas to life. In the words of Earl Nightingale, “Everything begins with an idea”.

Those interested in starting a manufacturing unit/factory in India and looking for products to manufacture should check out the excellent publications that the small scale industries department publishes. One publication that is very helpful for those seeking ideas for a manufacturing business in India are project profile books.

PROJECT PROFILES FOR SETTING UP MANUFACTURING UNIT IN INDIA

Project profiles for various sectors are available from the small scale industry offices and can also be purchased from book stores. The cost for each booklet was Rupees 150 when I last checked at a bookstore in Delhi on April 2007.

Project profile books are available in the following categories and list complete manufacturing plans and cost estimates.

1. Electrical Products

2. Food Products

3. Mechanical Products

4. Metallurgical Products

5. Information Technology

6. Glass & Ceramics

7. Hosiery Products

8. Chemical Products

9. Leather & Sports

books

These books include profiles prepared for small scale industries and show detailed information for some products which can be manufactured in India. Each book has profiles for about 25 different products.

The information provided for each product in these profile books includes:

An introduction to a product that can be manufactured. It identifies the potential users of the product.

The different types of the product that may be available in the market. A summary of Market Potential showing the demand for the product and present state of manufacturing being done for the product in India. The potential market segment that would be expected to use the product and possible customers who could be target for sales of the product.

Small scale manufacturing projects

The project books mentioned in the previous column give the following information:

√ The process of manufacturing the product.

√ Quality controls and standards of the product, if any.

√ Cost of Machinery including names and addresses of
    machinery suppliers.

√ Cost of Raw material including names and addresses
    of suppliers.

√ Amount of space required for setting up factory to
    manufacture the product.

√ Cost of hiring manpower and the number of people
    required.

√ Cost of utilities like hydro, water etc

Financial Analysis includes calculations such as:

√ Cost of production per year

Turnover per year

√ Net Profit per year

√ Net Profit Ration - Return on Investment and Break even points are also calculated to give readers an idea of what they may expect.

While a lot of general information is given in these profiles. I found that the amounts used for items such as cost of labor, rent etc are shown on the low end.

So when calculating consider current costs of labor, rent and utilities. These books are well worth the cost of Rupees 150 (approximately 4 US$) for those interested in starting an industry in India.

Selection of a business project - Tips & Information Guideline

Once you have an idea. The next step probably would be to pass it through a set of stages and think things over to see how practical the idea is.

For example: One can come up with thousands of products to manufacture. However is it cost effective? Or in other words is it feasible to follow through on your idea.

Checklist to consider for project selection:

√ Is the project viable, considering your know how and
    interests?

√ Who would be your clientele

√ Check with experts and conduct a market research
    to confirm viability of project

√ Don’t forget to check out similar products and your
   competition.

√ Research and confirm financing resources.

√ Project profile preparation for final assessment.