Starting Your Poultry Farm Business: Plan and Investment Tips

Poultry Farm Business Plan

With an objective to double farmer’s income by FY22, the Government encourages farmers to get involved in alternate livelihood and farming sources. One such complimentary farming activity that can be a boon to the farmer’s income is the poultry farming business. Given our country’s growing demand for poultry products and the government’s favourable policies and credit assistance, poultry farming is emerging as a sound business with a quick return on investment.

What is poultry farming?

Poultry farming implies raising of domesticated birds commercially, to increase the production of eggs and meat. Birds that are raised in farms are usually chicken, turkey, ducks, and geese for food. However, chicken has a universal market where broilers are raised for meat and layers for eggs.

The poultry farming sector, valued at Rs. 80,000 crore, is the fastest-growing section of the agriculture sector clocking 8% to 10% annual growth. It employs nearly 3 million people and contributes nearly 1.2% to the country’s GDP. Although poultry farming is a competitive business, with the right planning and complete knowledge of every aspect, the poultry farming business can be profitable.

How To Start a Poultry Farm in India?

Starting a small poultry farm in India involves careful planning, investment, and management. It is an opportunity for farmers to tap into a growing market for eggs, meat, and other poultry products. Poultry farming is a wide industry with many sub-sections to select from. Here is a list of sections that one can select from:

1. Create a Business Plan

To start a poultry farm in India, you need to follow a series of steps and make some important decisions. Begin by creating a comprehensive business plan that outlines your goals, strategies, and financial projects. This plan will guide you through the startup process and help you secure funding if needed.

2. Select the sector that suits your interest, this includes-

Determine the sector you wish to focus on. It is advisable to start small with a few bird varieties and gradually expand as your business grows. The total list of sectors include:

Meat production (through broilers breeding)
Eggs production (through layers breeding)
Production of poultry feed
Equipment manufacture required in poultry farming
Eggs and meat processing
Chicken hatching
Packaging and marketing of eggs and meat

Depending upon one’s interest and feasibility, the entrepreneur can select more than one section to start the business.

3. Selection of Sector and Birds

Select the type of birds you want to breed and raise in your farm. Initially, it is advisable to select from limited types of broilers and layers for meat and egg production. As the business grows, one can add more variety of birds depending upon the demand and profitability.

Bird Varieties: Start with a few types of chickens, ducks, or turkeys, and gradually expand.

Chicken Categories:

Broilers: Fast-growing chickens primarily raised for meat. They typically reach full maturity in 6 to 8 weeks which allows for quick turnover and returns.

Layers: Hens that are bred specially for high egg or poultry production. They start laying eggs at around 18 weeks of age. They continue to produce eggs consistently for 1-2 years, making them a good choice if you want to focus on egg sales.

Roosters: Guard birds that offer protection and add to the flock’s dynamics. They are not usually raised for meat due to their slower growth compared to broilers.

4. Select the poultry farm location
It is advisable to locate it not too far away from the place of consumption of goods instead of creating a logistic nightmare and increasing the cost of transportation. Finalize the place in advance from where the operations can be managed conveniently. The size and type of farm will determine your land requirements, but there are general considerations to keep in mind. Here are the types of poultry farms based on space:

Free-Range Poultry Farms: These farms need more space, ranging from 12,000 to 36,000 sq ft. Birds are allowed to roam freely, which is ideal for those aiming for organic or premium market positioning.

Semi-Range Poultry Farms: This setup involves keeping birds in coops with access to small paddocks. It requires about 8,000 sq ft. and allows some degree of movement. It balances control and natural behaviour.

Battery Cage Poultry Farms: This system requires 4,000 sq ft. for bird cages and an additional 2,000 sq ft. for other infrastructure needs. This setup restricts bird movement, focusing on high-density production.

Completely Wild Poultry Farms: Birds are raised in a natural, forest-like environment. This requires space of around 44,000 sq ft. This system mimics natural habitats, with birds enjoying freedom but needing careful management of predation and disease.

Therefore, choose a location away from urban pollution and noise, with good access to basic amenities such as water, feed supply and markets. Proximity to a clean water source is essential for bird health and operational efficiency.

5. Business Registration
It is important to name your poultry farm and register it according to state laws. It also is necessary to create a logo and a website for your business, if you intend to market your products online and supply it to distant places.

6.Required Licences

Operating a poultry farm legally in India involves securing several licences and permits. Having the correct documentation ensures compliance with legal regulations and helps avoid legal issues.

Mandatory Licences:

NOC from Local Authorities: Obtain no objection certificates from the village panchayat, municipality, and pollution control board. This ensures your farm operation comply with local guidelines.

Electricity Permissions: If your farm requires heavy electrical usage, such as for incubation or heating, you will need permission for increased electricity supply.

Groundwater Usage Licence: Required if you plan to use borewell water to ensure responsible use of natural resources.

Optional but Beneficial Licences:

MSME/Udyam Registration: Registering as a Micro, Small, or Medium Enterprise helps you access government benefits, including loans and subsidies.

Trademark Registration: Protects your brand identity by registering your poultry farm logo. This prevents unauthorised use by competitors.

7. Arranging Finances
Poultry business is not a capital intensive business and requires limited capital amount in the beginning. Funds are required for various purposes, including buying/renting land, equipment, hiring staff, birds, raw-material, manage cash-flow, paying salary, etc. There are various ways to secure funds for starting your poultry farm:

Bank Loans: Many banks offer agricultural loans at lower interest rates designed specifically for murgi farm businesses. These loans can cover expenses like land, equipment, feed, and bird procurement.
Government Schemes: Explore government programs that provide financial assistance, subsidies, and grants aimed at promoting poultry farming. Some schemes also offer lower loan interest rates, making them an attractive option. To arrange funds, one can apply for loans from banks and other financial institutions, including government schemes like MUDRA.
Personal Funds and Private Loans: You can consider borrowing from personal savings, family, or friends. While this option is quicker, formal loans often provide more significant financial security and benefits such as tax rebates.

8.Management

Effective farm management is essential to ensure the health, safety, and productivity of your poultry. Good management practices minimise risks and improve overall farm performance.

Bird Health: Providing a balanced diet, clean water, and maintaining proper hygiene is crucial for the birds’ well-being. Regular vaccinations and health checks help prevent common diseases that can cause significant losses.

Staffing: Hiring trained professionals or attending poultry management courses can greatly enhance farm operations. India offers several poultry farming training institutes as the Dr. B.V. Rao Institute of Poultry Management and Technology. This institute provides valuable knowledge on bird care, disease prevention, and farm economics.

Disease Control: Implement biosecurity, including limiting farm access to outsiders. Moreover, sanitise equipment and isolate sick birds to control the spread of infections.

9.Marketing

Marketing your products among the target audience is necessary. Marketing is tricky, and different modes of communication can be employed to create a buzz about your product. A well-thought-out marketing strategy helps you reach potential customers and build a strong brand presence.

Target Market: Identify your primary consumers, whether they are local retailers, restaurants, or direct consumers. Understanding your market helps tailor your marketing efforts.

Digital Presence: Develop a website or use social media platforms to showcase your products. Online marketing helps reach a wider audience and build credibility.

Traditional Advertising: Use local newspapers, flyers, and word-of-mouth marketing to spread awareness about your farm. Partner with local businesses or food suppliers to increase sales.

10.Supply Channels

After marketing, supplying the product to consumers is essential. There are various methods on how you can ensure your products reaches to the target market:

Local Retailers and Vendors: Poultry farmers need connections with nearby grocery stores, retail shops, and market vendors to directly supply fresh poultry products. This helps create a consistent sales channel and builds relationships with local businesses.

Wholesale Markets: Partner with wholesale markets where poultry products are sold in bulk. These markets serve as key distribution hubs that can move large quantities quickly. This benefits both small and large-scale poultry farms.
Restaurants and Food Service Businesses: Collaborate with restaurants, hotels, and catering services that need a steady supply of quality poultry. Establishing these connections ensures a regular demand for your products.
Online Grocery Platforms: Explore partnerships with online grocery stores and food delivery apps. These have become popular in the urban areas. This expands your market reach and allows consumers to access products conveniently.

Direct Home Delivery Services: Implement direct-to-consumer delivery options. It can be either independently or through existing delivery services. This approach appeals to customers seeking fresh, farm-direct poultry without visiting physical stores.

Reliable Logistics and Transportation: Ensure that you have a dependable transportation system, including cold storage facilities, to maintain product quality during transit. Efficient logistics help in meeting deadlines and keeping up with market demands.

How much funds are required to start a poultry farm business?

Poultry farming is a capital intensive business, and depending upon the scale and the size of the business you want to start with, the fund requirement can be in the range of ₹ 1.5 lakh to ₹ 10 lakh. The investment for poultry farm required are for various purposes, including:

Cost of birds
Cost of the place on rent
Equipment cost
Staff cost
Poultry feed and other raw material
Marketing, transportation and miscellaneous cost.

After understanding the needs of the entrepreneurs, all financial institutions extend credit facility at competitive rates. An entrepreneur can also apply for the loan from government scheme MUNDRA to start poultry farming business.

Here is the general breakdown regarding the cost of poultry farm:

Small-Scale Farms: Typically require an investment between ₹50,000 and ₹1,50,000. Suitable for those starting with a limited number of birds and basic equipment.

Medium-Scale Farms: Cost around ₹1,50,000 to ₹3,50,000. This allows for more birds, better equipment, and a more structured operation.

Large-Scale Farms: Need a higher investment of ₹7,00,000 to ₹10,00,000. These farms are fully equipped with automated systems and cater to larger markets.

Poultry farming can be profitable within six months, especially if well managed. Besides selling meat and eggs, you can generate additional income from by-products like feathers, manure, and old equipment.

What are the documents required to apply for a loan?

The documents required to avail poultry loan from financial institutions for starting a poultry business are as follows:

Business plan
Correctly filled application form
Identity proof: Aadhar card, PAN card, Driving license, Passport, etc.
Address proof: Voter ID, PAN card, Passport, etc.
Photographs: 2 passport size
Trade license and permits
Rent agreement or land documents

Developing a Poultry Farming Business Plan

Creating a solid business plan is the foundation of a successful poultry business in India. This document serves as your roadmap, guiding you through the complexities of the industry and helping you make informed decisions. A well-crafted plan typically includes several key components, each playing a crucial role in your farm’s success. Here’s how you can develop a comprehensive business plan for a poultry farm in India:

Market Analysis: Conducting a market analysis helps you understand your target audience. It helps you identify potential competitors and gauge the demand for poultry products in your area. This analysis provides insights into current market trends, pricing strategies, and customer preferences. It helps you position your business effectively. It also allows you to determine the most lucrative segments of the market. It includes egg production, broiler chicken , or organic poultry, to tailor your offerings accordingly.

Operations Plan: An operations plan details the daily processes involved in managing your poultry farm. It includes sourcing chicks to feeding, housing, and maintaining the health of the birds. This plan includes everything from land acquisition, designing poultry houses, and securing necessary equipment to hiring skilled labour. It should also outline protocols for managing feed supply, water disposal, and biosecurity measures to prevent disease outbreaks. This would ensure a smooth and efficient operation.

Financial Projections: Financial projections estimate the startup and running costs of your poultry farming business in India. Under this, you need to focus on cost for land purchase, housing construction, feed, labour, healthcare, and other inputs. These projections also forecast expected revenues from selling eggs, meat, or other poultry products. Accurate financial planning helps secure funding from investors or banks. It provides a clear picture of when your farm is likely to break even and start generating poultry farm profit.

Marketing and Sales Strategy: Your marketing and sales strategy outlines how you will promote and sell your poultry products. This can include using social media platforms, collaborating with local vendors, or setting up stalls at farmers’ markets. Highlighting your unique selling points, such as organic or free-range poultry, can attract health-conscious customers. Plus, consider offering home delivering services or supplying directly to restaurants and hotels to expand your market reach.

Risk Management and Contingency Planning: Identifying potential risks, such as disease outbreaks, fluctuating market prices, or extreme weather conditions, is crucial for the sustainability of your poultry farm. Your risk management plan should outline preventive measures, such as maintaining biosecurity, having insurance coverage, and creating a buffer stock of essential supplies. Contingency planning ensures that you are prepared to handle unexpected challenges without significantly impacting your operations or finances.

These key components help build a strong foundation for your poultry farming business. It sets you up for a successful venture that can adapt and thrive in the Indian market.

What are the benefits of the poultry farming business?

As mentioned, poultry farming is a rapidly growing business due to increasing demand for poultry products. Some of the benefits of the business are:

Poultry farming is a high yielding business.
It does not require a lot of capital.
It does not require a lot of space.
Due to the high demand for poultry products, the return on investment can be quick.
It is easy to get a license.
Getting the required credit from financial institutions is not difficult for the poultry farm.
Employment generation, moreover, not highly skilled labour required.
Less maintenance is required.

How to apply for the loan for starting the poultry business?

By following simple steps given underneath, one can avail the loan:

Check the eligibility criteria before applying for a loan
Fill the application form and provide basic details
Submit the loan application along with documents required (for KYC).
Once the application is approved along with verification of documents, the loan amount is transferred to the account of the applicant

Conclusion

Starting a poultry farm in India involves strategic planning, investment, and efficient management. Choosing the right sector, location, and bird varieties can lead to a profitable business. Proper management, obtaining licences, and setting up supply channels are vital for success. Effective marketing and cost management can help achieve quicker profitability while maintaining product quality. With consistent efforts, poultry farming can become a sustainable source of income. To support your financial needs, Lendingkart’s MSME and working capital loans provide quick access to loans. We help you get loans faster at the best interest rate that helps manage your operations and grow your business efficiently.

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poultry farming business plan FAQs:

1. What is the eligibility for starting the poultry farming business?

The individual looking to start the business must have required or necessary training in the poultry business.

2. How much money do I require to open a poultry farm?

The financial requirements for starting a poultry farm vary based on factors like scale, location, and facilities. A well-structured poultry business plan is crucial to estimating costs accurately. It should encompass aspects such as infrastructure, equipment, feed, labor, and marketing. To determine the exact amount needed for your chicken farming business plan or poultry egg farming business plan, consider consulting with industry experts or using financial planning tools.

3. Is it necessary to provide collateral for availing the poultry farming loan?

Yes, it is necessary to provide collateral before getting a loan approved for poultry farming.

4. Is the poultry business good for new entrepreneurs?

Poultry farming is a good business to start with. However, one needs to have experience in poultry farming to be successful.

5. What are the different licenses required to start the poultry business?

The licenses required are:
 NOC from the local-administration where the farm is located.
 NOC from pollution board of the place
 Electrical permission from the local electricity board
 Permission for groundwater from local authorities

6. Is GST registration required for a poultry farm?

Yes, GST registration is necessary for a commercial poultry business.

7. Is poultry business taxable under IT act?

Yes, it is taxable as it does not come under the agriculture income.

8. What is the mandatory distance to be maintained between two poultry farms?

It is necessary to maintain a distance of a minimum of 1km between two poultry farms.

9. What is the mandatory distance to be maintained from human habitation?

5-6 km distance is sufficient and is required to be maintained between farm and residences.

10. Is GST applicable on fresh eggs?

No GST is not applicable to fresh eggs.

11. What are the most important documents required for getting a license?

Some of the documents required are:
 Poultry population
 Poultry farm structure and surroundings
 Hygienic environment
 Water system
 Pest extermination
 Carcass removal
 Feed containers
 Pesticide and medication for poultry birds
 Safety system