Potato Chips Business – A Beginners Guide

Potato Chips Business.
Potato Chips Business.

Potato Chips Business for Beginners:

The following is all about Potato Chips Business.

Introduction to Potato Chips Business

Potatoes had turned into the all-time most loved snacks of people around the globe today. India is one of the biggest producers of potato. In India, around 12,000,000 tons of potato is grown which is around 4% of the aggregate world production. It is being used as a day to day food item in different vegetable preparations; however, the per capita consumption of potatoes is low. Potato today increasingly find use as chips or wafers as snacks nourishment. It is evaluated that 25% of the potatoes, which is ruined because of various reasons, for example, transportation, type of packing, accessibility of cold storage Capacities during Harvesting Season, excess in the market and so on, could be saved by making different Preserved potato items. Potato wafer and chips are one of such items which have a great potential snack demand giving considerable value addition to potatoes. f you might want to attempt your fortune in this sort of business, then you have to look at the tips which this article will share with you. The principal thing you have to focus your attention into is the business strategy for success as a result of the way that it is the central purpose of your whole business venture. Potato chips are needed to be made in a scientific and under clean conditions.

Potato processing is picking up significantly in India. The increase in demand for prepared snacks in the urban areas and expanding number of fast food outlets in the metros and significantly semi-urban areas is likewise contributing towards this. Any big or small entrepreneur can begin potato processing unit with moderate startup capital investment. Moreover, you can begin potato processing business by producing either any one product or multiple potato processing products. After you complete the process of drafting it in an extremely professional manner, you would already be able to look at other factors which can make or break your business.

Other Potato Processing Products for Potato Chips Business

Potato Flour from Potato Chips Business:
Potato Flour is extensively being used in various food preparations such as snack foods, soups, curries, dals and in other preparations as a thickening agent. Many snack food and fast food giants like McDonalds, Haldiram, Namkeens, and others such as hotels and restaurants use potato flour as one of the main ingredients in processed food products. The main uses include breading, baking ingredient, thickener, and an extender. Potato flour is supplied in bulk to food giants and other fast food places and its demand is much more than the supply in all major metro cities in India and has good export potential in European countries. The manufacturing process is simple while one kilogram of raw potato yields about 200 grams of potato flour or powder.

Potato Starch from Potato Chips Business:
Starch potato varieties are grown for potato starch production, unlike food potatoes. These potato varieties are grown for high starch content containing about 20 to 25% unlike 14% in food potatoes. In quality, potato starch is superior to other cereal starches. Having, granule size in large, high water binding capacity, low lipid content, high solubility, higher swelling volume, less foam building, and no color formation.

Potato starch is used as a main raw ingredient in various industries. The main Uses are as follows:

  • Thickener – sauces, soups, and curries gravy in the food industry.
  • Softening Agent – cakes, bread, biscuits, puddings, and cookies in the bakery industry.
  • Warp Sizing – textiles and cloth for smooth and better feel in the textile industry.
  • Used in Paper and Pharmaceutical Industry.

French Fries from Potato Chips Business:
These are called as golden fingers, chips, finger chips or French fried potatoes which are baton net cut and deep fried potatoes. They are very popular in developed countries prepared either soft or crispy and served hot. In restaurants and fast food joints all over the world, French fries have become a regular part of their menu. This snack food industry is ever growing generating huge income. French fries are an inspiring profitable business for aspiring entrepreneurs. This business can be started at home or any small place with small infrastructure.

Market Potential of Potato Chips Business

The fame of snacks food is developing fast on a daily basis and potato chips and wafers have risen as a potential snack food. Various organized, as well as unorganized units; are already in the market, the main customers of potato snack items are families particularly in urban and semi-urban regions. In addition, hotels, restaurants, canteens, public transport stations, tourist places and so forth. Still, there is a great demand to be met for these items in inside and remote places in various parts of the nation. Some of the main brands, such as Bingos, Uncle Chips, Lays, Tastilo are valued at around Rs. 20.00 to 50.00 for each pack of 100 grams. It should be feasible for small-producing units in small urban areas to offer potato chips at around Rs.180 to 200 per kg in different smaller package sizes and this would enable to penetrate into the market.

Manufacturing Process in Potato Chips Business

Washing: This is the first step in the process when the potatoes arrive at the plant. Potatoes are examined for green edges without blemishes and that is optimum in size and weight is chosen and the defective ones are discarded. The selected potatoes are washed thoroughly from farm dirt. Cleaned potatoes move along a conveyer belt to the next stage.

Peeling: In this stage, the potatoes undergo scrapping the skin off in water. In the rotating drum, the potatoes skin is removed with an emery sandpaper style coating on the bottom while in the rotation. After peeling the potatoes are again washed with cold water.

Slicing: In this process, the peeled potatoes pass through a revolving impaler or presser that cuts them into thin slices. Slicing of shapes can be done depending on the blades, straight blades cut them into regular chips, rippled blades produce ridged chips, sally blade produces potato sticks, and ruffle blades produce the marcel cut. The cut slices move on the conveyor belt for another cold water wash to remove starch.

Frying and Salting: The starch free slices are sorted and dewatered by passing under air jets which remove excess water. The dried slices then move into troughs filled with oil that is maintained at 170° to 190° C. Paddles gently lets the frying slices pushed along and tumbled onto another conveyor belt. Salt is sprinkled on the hot potato slices at the rate of0.8 kg for 45 kg chips. The salted chips then pass through a drum filled with desired powdered seasonings for flavor.

Cooling and Sorting: Now the ready chips are passed on a wire mesh belt as they move along the mesh conveyor belt, excess oil is drained off while cooling the chips. Burnt potato chips and those that are air puffed are removed manually.

Packaging in Potato Chips Business: This is the final stage in potato chips making. The chips are passed through a packaging machine with a pre-set weigh scale that measures the chips weight in batches for packing. The chips released in bags for packing are moved to sealing machine which seals both top and bottom parts of bags simultaneously. The pouches or bags are sealed airtight which prevents from breaking. The sealed bags are collected manually and packed in carton boxes.

Freshly Made Potato Chips.
Freshly Made Potato Chips.

Quality Control in Potato Chips Business

Throughout the manufacturing process, on an hourly basis or on prescribed time format taste samples are conducted. The tasters look for flavor, salt, seasoning, moisture, and color of the chips. At every stage, care is taken to decrease the chances of chips getting broken. Manufacturing plants have taken various measures to decrease such chances by adjusting the height for chips falling from one conveyor belt to fryer to another belt. Mesh conveyor belts are used to remove small slices before they reach fryer stage.

  • Moisture in chips must be more than 2%.
  • F.A of oil used as oleic acid must not be more than 0.1%.
  • Value of Peroxide in oil must be Nil.
  • Chips must be free from bacteria such as salmonella, streptococci, and coliforms.

Byproducts in Potato Chips Business

Discarded potatoes, broken chips, undersize chips, and peelings are collected as animal feed and sent to farms. Starch is collected at the chips rinsing stage and sold to starch processor units. Even the byproducts will add more income in potato chip production.

Economics of Potato Chips Business

Land and Construction Cost of the Plant for Potato Chips Business:
Setting up a potato chip business unit requires about 1500 sq. ft land and some cost in setting it up. Below table gives various details.

S.NoDescriptionSq. feet
1Processing area750
2Raw material storeroom250
3Finished product storeroom100
4Administration Office100
6Q.C Laboratory100
7Miscellaneous storeroom100

Machinery and Equipment Cost in Potato Chips Business:

SlDescriptionRs. lakhs
1Washing and peeling machine1.20
2Slicing machine0.70
3Dewatering machine0.35
4Batch fryer – 2 nos @ 50,000/-1.00
5Salting and spice coating machine1.25
6Automatic pouch packing machine2.50
7Laboratory Equipment0.75
8Miscellaneous equipment (trays, weigh scales, polythene sheets, knives, tubs, steel working tools, etc.)0.50

Project Cost of Potato Chips Business:

SlDescriptionRs. lakhs
1LandOn lease
2Plant machinery and equipment8.50
3Cost of power connection0.35
4Cost of electrification1.00
5Cost of machinery spares0.20
6Cost of office equipment0.25
7Deposits if any0.25
8Company formation expenses0.10
9Gestation period expenses0.50
10Sales tax registration expenses0.10
12Working capital margin money1.00

Raw Material per Month in Potato Chips Business:

SlDescriptionQtyRate / kgValue
(Rs)(Rs. lakhs)
3Salt and spices, preservatives, etc.,24Rs30.000.01
4Packaging Material – poly pouches25000 nos1.500.38
5Carton boxes600 nos20.000.12

 Turnover per Annum in Potato Chips Business:

SlItemQty Rate/unit



Rs. lakhs

1Potato chips15000 kgs30045.00

Conclusion of Potato Chips Business

Indian market includes both Indian and MNCs snack food Industry products. It is watched the Indian snack food market is continually rising and the request is consistently expanding with a turnover about more than 300 million dollars in early 2000s and is assessed to be in a couple of billions by now. Those ventures producing awesome taste, quality, and hygiene are in great demand and growing at a pace of around 20 to 25%. Based on customer inclinations many branded chips are doing great business. A new entrepreneur can make a great impact by coming up with great flavors and hygienic potato chip products into the market. Today’s consumers want to spend more on eating because of the way of lifestyle along with an expanded media exposure have a considerable share of voice and space in the market and will have the capacity to survive.

Read here more about Tomato Sauce Making Business.

Read here about Potato Cultivation.



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