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How to Start an Agribusiness from Scratch

Agriculture has been playing vital role in India’s economy. Article mention a step by step guide for starting an agribusiness.

Chintu Das
A Tractor In The Field
A Tractor In The Field

Agriculture has long been a crucial element of India's economy, with more than half of rural households totally reliant on it for survival. India has vast swathes of fertile land and ideal climatic conditions for the growth of a wide range of agricultural products. In addition, the government has taken numerous actions to ensure the sector's long-term viability.

The rising demand for feed, fodder, and bio-fertilizers; the expanding scope of biotechnology applications; the opportunities for secondary and tertiary food processing; the rising demand for export; and India's abundant livestock and forest resources all point to a huge potential for agribusiness in the country. 

Agribusiness in India is at a decision point, undergoing a massive upheaval. Over the next decade, it is expected that the agricultural chain, equipment, and structure will be modernized, as well as higher productivity, significant investment, and greater exports. As a result of rising awareness of the need to improve agriculture, agriculture as a sector and related businesses are receiving more and more attention, and agribusiness stands out as a valuable business opportunity.


Farming and farming-related commercial operations are included in the agribusiness sector. It includes all of the steps involved in getting agricultural products to markets, such as production, processing, and distribution. Agribusiness includes crop production, distribution, agrochemicals, fodder, breeding, agricultural equipment, seed supply, raw and processed food and fiber commodities, storage, transportation, packing, soil testing, marketing, and retail sales, among other things.

If you want to start a business in agriculture, the first step is to identify what type of product or service you want to focus on. This method is only possible if you have a strong grip on your company's objectives, strategy, and resources. You can consider going into the sector even if you're not an expert on equipment, products, grains, soil, seeds, or plants; nonetheless, you'll need to start with suitable industry expertise, a solid business plan, and the right team.

Here is a step-by-step guide to help you: 

Research into the market 

You must undertake considerable research about the specific market you intend to enter before deciding on a concept, product, or service. It will help you decide whether to continue at the entry-level or not. In this process, you must clearly answer the following questions:

- What is the market's current potential? 

- What does the market's future hold? 

- What are the issues that consumers are dealing with? 

- What are the issues that your rivals are having? 

- What are the stumbling blocks? 

- In this market, how do you view yourself? 

- How difficult or simple are the legal requirements? 

- Is your company going to be local, regional, national, or international? 

When you have all of the information, assess the situation and search for a window of opportunity. Always be on the lookout for useful and trustworthy information and resources. 

Developing a Business Plan 

One of the most crucial parts of a company is its business strategy. It is the common thread that binds the entire organization. Simply said, it's a formal document that lays out the company's goals and how they plan to achieve them. A marketing, financial, and operational strategy are all part of it. A well-thought-out strategy will help you achieve your goals. As a result, plan ahead of time!

Here are some of the topics that will be discussed: - 

- What distinguishes you from the competition? 

- What is your plan of action? (Operational, Marketing, and Business) 

- What are your plans for structuring and managing your company? 

- How much does it cost to start a business? 

- What are the ongoing costs and expenses (daily, monthly, and annually)? 

- How are you going to get the money? 

- What are the markets that are being targeted? 

- How many people do you think you'll need at first? 

- Analyse your competitors 

- Analysis of S.W.O.T (Strengths. Weaknesses. Opportunities. Threats.) 

- A financial forecast for 1000 days (covering the expenses and expected revenue)

Make financial arrangements 

Given the fact that food consumption is only likely to increase in the future, agribusiness has the inherent advantage of always having a consumer. Many agribusinesses begin as sole proprietorships before seeking outside finance to expand. Investors prefer to invest in firms that are in the pre-growth or growth stages, thus agribusinesses must have a few years of experience and a track record of success.

Bank loans, crowdfunding, incubators or accelerators, winning awards, micro-finance, and more options are available. However, these options are dependent on the company's strategy and a variety of other factors.

Know the Rules and Regulations 

The sector is governed by laws and regulations enacted by both the federal and state governments. Price setting, distribution agreements, personnel management, and advertising, among other considerations, all play a role. It is vital that you understand these principles before you begin. Some of the regulations that govern India's agribusinesses, either directly or indirectly, are as follows:

- Sick Industrial Companies (Special provision) Act, 1985 

- Environment Protection Act, 1986 

- Consumer Protection Act, 1986 

- Taxation laws covering Corporate tax, indirect taxes like Excise, Customs, Sales tax and Wealth tax) 

- Trade and Merchandise Marks Act, 1958 

- Monopolies and Restrictive Trade Practices Act, 1969 

- The water (Prevention and Control of Pollution) Act, 1974 

- The Air (Prevention and Control of Pollution ) Act, 1981 

- Indian Contract Act, 1872 

- Factories Act, 1948 

- Minimum Wages Act, 1948 

- The Companies Act, 1956 

Get licenses and register your business 

The different types of company registrations are proprietorship, partnership, limited liability partnership, private limited company, and public limited company.

The four basic steps in the company registration procedure are obtaining a Digital Signature Certificate (DSC), obtaining a Director Identification Number (DIN), filing an "e-Form" or "New user registration," and incorporating the firm.

There are a variety of law firms and individuals who can help you with the process. You can also do it yourself at the Registrar of Companies.

In order to get started, you'll need to obtain all necessary licences as well as register. Depending on the segment you enter, you'll require different licences. In most cases, the same legal firms that help you with registration also help you get licences. There are also companies that specialize in assisting in the acquisition of the same. You can also complete the process entirely on your own by visiting the Indian government's website.

Final Preparations 

Only after you've accomplished the above stages should you proceed to finalise your plans, such as purchasing or leasing land/office space, office stationery, machinery (if any), equipment, and so on. This is also the time to plan and implement any corporate alliances or partnerships that are required.

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