Potato Chips Manufacturing Business Planning Guide

Are You Looking For Potato Chips Project Report Manufacturing Business Planning Guide

Are you looking for potato chips project report ? See here a detailed guide on how to get started, including machines, equipment, setup, process, etc.

 Potato chips are one of the most popular eating snack items in India. And anyone can start a small-scale construction project with small capital investment. Additionally, from the same unit, you can also make French fries and banana wafers. This will increase the overall profitability of your unit.

Currently, potato chips are available in various flavors and flavors. The list includes salty, sour, sweet, hot sauce, ketchup, light salty, red hot, etc.

The purpose of preparing this article is to provide a detailed guide on how to start the potato chips manufacturing business. Additionally, the article includes project costs, registration, licensing requirements, machinery, construction processes, raw materials, etc.

Market potential Potato Chips

Potato Chips Market Potential and Opportunities

Potato chips are the most popular salty snack item globally. Additionally, the demand is increasing day by day.  The global potato chips market is expected to grow by a Compound Annual Growth Rate of 4.3% during the 2017-2022 period, which will reach a market value of USD 40.3 billion by 2022.

Many aspects are directly and indirectly responsible for the rapid development of the potato chips market. The reasons include easy affordability and availability, a growing young population, rising disposable income, and changing lifestyles.

Additionally, the introduction of healthy options such as low-sodium and low-fat chips in emerging markets also supports this industry’s development.

Potato chips in pouch packets are the most popular in the market. Also, hotels, caterers, and restaurants are the major institutional buyers of this item. Also, the product has a very high export potential.  Some of the most popular potato chip brands are Lays, Pringles, Uncle Chips, Haldiram, Ruffles, Bingo, Castillo, etc.

Business Plan for Potato Chips Manufacturing

Prepare A Project Report

In starting a business, you must have a business plan or project report. And according to your investment potential, you have to prepare the project report.  Additionally, the project report is an indispensable tool for applying for a bank loan.

 Generally, a project report has two parts.  One is mechanical, and the other is financial.  It is advisable to ask an expert to prepare a business plan document for your proposed unit.

You can get a well prepared report from our website www.projectreportbank.com to get a loan from the bank. Our experts will prepare the report according to your requirements.

Cost of Chips Project

Potato Chips Manufacturing Plant Cost

In general, the cost of the potato chips manufacturing project depends on many aspects. These are volume of production, size of the business, etc.  However, fixed capital includes plant, building, machinery, and other initial expenses.  And working capital costs include raw materials, labor, utilities, etc.

Registration and Licenses for Chips Manufacturing Business
License And Registration Of Potato Chips Making Business

In starting this business, you have to get many registrations and licenses from the Government.  Rights.  First of all, you need to register the business with the ROC.  However, you can also start a mini plant as a proprietary concern or prthnership firm.  Apply for Trade License to Muncipal Corporation / Local Authorites and also apply for Udyam Registration.  Also, you have to get permission from FSSAI.

 This type of production unit does not demand pollution clearance.  However, it is better to take the NOC from the pollution control board of your place.

 You will establish a brand in the market.  Therefore, you can protect the brand name through trademark registration.  Consult with a tax advisor about upcoming compliance liabilities.  You will also have to get GST registration.

Potato Chips Unit Setup

You will need a location for unit operation.  Generally, 800 square feet of space is good enough to start a small scale unit.  However, it depends on the size of the potato business.  Additionally, you will need water and electricity supply.

Carefully select the location of the potato factory.  There are some important aspects to consider before selecting a location for the unit.

 Potato Chips Making Machine

 You can start the unit in two ways. Either as a semi-automatic or as a fully automated base.  However, careful procurement of machinery from reliable suppliers.  Some of the basic machinery requirements are

  •  Potato Washing & Peeling Machine
  •  sewing machine
  •  Food machine
  •  Batch fry
  •  Spice Coating Machine
  •  Sealing machine with inert gas flushing unit
  •  Stainless steel working equipment
  •  Weight of scales, dispensers, and filler
  •  plastic tray

Raw Material for Potato Chips
Raw Material For Potato Chips Making Unit

The major essential raw material is potato.  However, you have to buy potatoes carefully.  You will need to collect large oval-shaped, disease-free, and fully mature potatoes.  Additionally, it should have a minimum number of eyes to reduce losses from trimming.

 Additional essential raw materials are oil, salt, and spices, preservatives, etc.  In addition, you will need to purchase packaging consumables.  For primary packaging, you will need a poly pouch.  Also, for outer packing, you will have to arrange corrugated boxes.

Quality and Standard for Chips project in India
Potato Chips Manufacturing Process with Flow Chart

First, wash and peel the potatoes thoroughly.  You can manually peel potatoes with a stainless steel knife or use an abrasive potato peeling machine.

 Then wash the peeled potatoes with water spray. Then trim them and keep them in water to prevent browning.  After that, cut them into 0.4 to 0.5 cm thick slices on a slicing machine.  Again place the slices in cold water.

 Whenever the subsequent operation of blanching is significantly delayed, you can place the slices in water containing 0.05% potassium metabisulphite to avoid oxidation.

 Then blanch the slices in boiling water for 3 to 5 minutes and spread them on a tray at the rate of 4.88 kg.  From 7.30 kg.  Per square meter of tray surface.  Scorched chips are subjected to a hydro-extracting machine (centrifugal) to remove excess water and fry at 1900 ° c for 3–4 minutes.  Fried potato wafers are

 Finally, place the fried potato wafers on a sieve to remove excess oil.  After cooling, add other ingredients like salt, spicy mixture as per the required taste.  And finally, pack the potato chips in a polythene bag and seal.

Quality Specification For Potato Chips

During production, you will have to maintain some quality specifications for potato chips.  First of all, you have to maintain the moisture in the chips at 2% maximum.  Additionally, you should use FFA of oil as oleic acid up to 0.1%.

 Oil should have indigo peroxide value.  Finally, potato chips should be free from coliform, salmonella, and streptococci bacteria.

Potato Chips Project Cost Summary

Plant Capacity: 2000 kg per day

Plant and Machinery: Rs 150 Lakh

 Working Capital: Rs 100 Lakh

Total Capital Investment: Rs 250 Lakh

 Return: 39.21% Breakeven: 40.17%

 The actual cost of the project can distract from any assumption changes. You can modify project cost and project capacity according to your requirement.

Profit Of Making Potato Chips

Commercial potato chips manufacturing is a profitable business.  The business ensures a good margin.  However, how much profit you will make depends on many internal and external aspects.

 Gross Profit = Sales Revenue – Cost of Production

 Therefore, if you want to increase the profit margin, you can think about reducing the cost price.  Furthermore, this type of item ensures a better margin if you can also increase sales volume.  Increasing sales volume also reduces transportation costs, infrastructure costs, and manpower costs.

SWOT Analyasis for Potato Chips Project Plan

SWOT Analysis


The potato chips manufacturing business is highly profitable as it remains in demand always. From children to adults, from India to across other nations, everyone is a big fan of potato chips. Moreover, the raw material is also easily available in the market because the potato is easily available in the market. The process of making potato chips is very simple. Potato chips are usually served as appetizers, side dishes, or snacks, so it is demandable. You can invest easily.


For starting the potato chips manufacturing business, you have to do a lot of government registration, which is very hectic and takes a lot of time. The potato chip manufacturing business requires both manmade and machinery capital.


There is a huge market for potato chips, and they can be sold in various retail shops, pawnshops, bus stands, railway stations, roadside eateries, etc. For earning more profit, you can sell potato chips online like Amazon Pantry, Reliance fresh, etc.


To start a potato chips manufacturing business, it isn’t easy to earn a good product image in the market. To make your potato chips manufacturing business name in the market, you have to do a lot of hard work. Sometimes competitors spread false rumors about the quality of the product that you Sell.


How much do I need to start a potato chips business ?

Chips are one of the businesses that you can start with only 5000 shillings.  And this is if you skip the potato peel, potato cutting machine, and chips frying machine for unconventional ways of preparing chips

What is the best-selling chip?

Doritos and Tostitos are the best-selling tortilla chips, Lays and Ruffles are the best-selling Crisps brand. Nutri Grain Bar and Rice Crispy tortilla are the best-selling snack bars, Cheetos and Chesters are the best-selling cheese, and Oreo  And double stuff are the best-selling cookies.


A clear Potato Chips Project report  is crucial for your success as an entrepreneur. Therefore, you wish to contemplate some important, like your initial costs, your target market, and how long it’ll see you interrupt even. Draft a proper Potato Chips Project Report that is also describes your expected income, product and repair lines, expansion plans, and other details of your business. A well-drafted project report will also facilitate you in applying for any bank loan. Therefore, you can get a well draft project report from our website www.projectreportbank.com

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