Is Tissue Paper Business Profitable in India

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Is the tissue paper business profitable in India? 

The short answer is yes, if you do it the right way. 

Tissue paper has now become an everyday necessity for homes, offices, restaurants, and hotels.

It would be a great option to start a tissue paper business since the market is going up steadily and offers an excellent opportunity to make a profit.

In this guide, I will take you through the important considerations of starting a tissue paper business like market demand, startup capital, production, and how you can strategize marketing. 

Finally, you will see a very clear roadmap to venture into the small-scale tissue paper manufacturing market. 

Profit Margins and Financial Projections

The tissue paper business in India, can garner a healthy profit margin of 15-20% for wholesale sales and around 20-25% for retail ones. 

A constant stream of bulk orders would ensure a revenue of about ₹8 lakh for the month that would translate to gross profit margin of ₹1.2-1.6 lakh. Profits through the retail route may also be as high as ₹2 lakh for the month. 

The figures show that the tissue paper industry does indeed make profits in India and can yield good returns if approached properly.

Why Tissue Paper? Understanding the Demand

The more people become conscious about their health, the more tissue paper has become an indispensable item in our lives. 

It has numerous applications, isn’t it? 

From using it at home to wiping hands while offering food at a café or to ensure hygiene in offices. 

That is not a trend but it is rather a part of life itself. This will ensure the market for any budding businessman is constant and will be a sure-shot investment. 

Market Scope: How Big Is the Opportunity? 

In terms of size, India is likely to contribute in a major way to tissue paper markets that are predicted to rise from $91 billion in 2024 to $155 billion by 2032. 

The Indian tissue paper industry has extended its reach to new consumers from homes and cinemas to hotels and hospitals. 

A possible plan for new entrants is to buy tissue paper from local manufacturers or even directly import and sell it to hotels, supermarkets, or corporate offices at extremely competitive prices. In the process, you would gather customers and build a reputation in the market without having operated on a profit-making basis in your first year of operations. Once you’ve established a customer base you could start your own manufacturing unit. The selling price can be the same, but with the correct setting, there will always be a profit.  

Benefits of Starting a Tissue Paper Business

Some of the main advantages of beginning a tissue paper business are as follows: 

Reliable Demand: Tissue paper is an everyday product whose continuous demand arises from people and businesses.

Potential for Profits: You can enjoy healthy profit margins if approached in the right manner.

Scalability: You can begin small and grow as the demand increases.

These are some reasons for tissue paper, the best among other business ideas that any entrepreneur wanting to start a business in the future may opt for.

Write Your Business Plan

A good business plan will form the foundation for your success. 

Take time to sit down with people in the tissue paper industry and learn from their experiences. Conducting a competitor analysis can be helpful in understanding what customers need, the setup costs, and what is realistic profit expectations. 

Talking to a business expert may be helpful, especially in the specifics of the tissue paper market in India. 

Selecting Your Business Location

For small-scale tissue paper production, an area of around 1,000 to 1,200 square feet would be needed. This area can include space for the machines, a small office, and raw and finished products.

The location also has to be accessible in regard to simple facilities, like water supply, electricity, and waste disposal.

Investment Requirements

You can start with a unit of basic tissue paper at an investment of around ₹7-8 lakh if you already own the space. 

For larger operations, you would require an investment closer to ₹20 lakh or more. Regarding finance, you can find loan options. One of them is available under the Pradhan Mantri Mudra Yojana.

You will need tissue paper automatic cutting fold machinery that automatically cuts folds; this usually costs around ₹5 lakh to produce 500 pieces per minute. 

Packing and sealing machinery should be considered as add-ons to your main buy. When buying machinery it is wise to ask the supplier if they train one on how to handle the machine and take care of it. 

They can come in very handy, particularly when a new buyer just opened their operations. It is not a labour-intensive business because it uses most of the heavy machinery for most of the work. 

With efficient machines, you can operate with a small team – usually just 2 to 5 people with basic training. 

Raw Material Procurement

The biggest raw material for napkin paper production is recycled paper rolls. The price can be between ₹55 to ₹100 per kilogram based on the quality of the same. Quality forms the base of how different your tissue paper will look in the market. 

Look up for suppliers on B2B websites such as IndiaMART, Alibaba, or TradeIndia. Maintaining good relations with suppliers is bound to help you achieve a consistent low-cost supply of raw materials. 

Legal Requirements and Registrations

To lawfully start a business in India, you need to register an enterprise. The most common ones are either a sole proprietorship or a one-person company. The other vital registration procedures are: 

• A GST number
• PAN and TAN for tax purposes
• Udyog Aadhaar is helpful in the case of small businesses
• No Objection Certificate or NOC from the state’s Pollution Control Department where your location is.

Marketing Your Tissue Paper Business

Marketing is essential because it makes your product known and gives you loyal customers. Here are some of the effective ways of marketing.

Local Market First: Start selling around the hotels, restaurants, and offices where tissue paper is more frequently used.

Wholesale and Retail Mix: Sells both wholesale and retail to get different types of customers and ensures that at least you get some fixed sales.

Listing with Online Marketplaces: Avail the Amazon, Flipkart, and IndiaMART to sell your product online.

Strong Connections with Suppliers: Locate proper suppliers so that you can get right raw material for your final product

Use logistics partners and get an arrangement wherein reaching to retail houses or hotels may get easier for distribution. Monitor sale, collect feedback from customers often, this helps in improving your final product and revising prices from time to time. 

Final Thoughts

Starting a tissue paper business in India presents a great opportunity for the entry of a high demand, steady market. One can establish a profitable business of small-scale tissue paper manufacture with the right location and machinery and a proper business plan.

If you wish to learn more on the process of building and growing a small business, try our guide on actionable growth strategies for small businesses in India. This should help you to get more advice for a solid start-up and expansion in your niche area.