§1What this business is

Raw betel nuts are dehusked by machine, boiled in tanks, dried, sieved into grades and packed. The model unit takes in 1,000 kg of raw nuts a day and gets 200 kg of finished arecanut (20% recovery). The DPR assumes raw nuts at ₹25 a kg and a sale price of ₹200 a kg.

Capacity: 1,000 kg of raw betel nuts a day in, 200 kg of processed arecanut a day out; 300 working days of 8 hours. Year 1 is for setting up; use is 60% in Year 2, 70% in Year 3 and 80% from Year 4.

§2Is it right for you?

Who it is for

An arecanut grower, FPO or trader in Karnataka, Kerala, Assam or another growing belt.

Who it is not for

Someone outside the growing areas with no link to raw nut suppliers.

Advantages

  • Steady demand for supari across India
  • Machines replace scarce skilled dehusking labour
  • Dried arecanut stores well
  • Low working capital in this model

Drawbacks

  • Only 20% of the raw weight becomes product
  • Prices swing with crop and imports
  • Chewing products face health warnings and state rules

Skills you need

  • Judging maturity and grades of nuts
  • Boiling and drying to the right colour
  • Running the dehusker with little breakage
  • Dealing with mandi traders

Why difficulty 2/5: Simple machines and a known mandi trade, but you must be in a growing area.

§3Market

Who buys

  • Supari wholesalers and mandi traders
  • Pan masala and scented-supari makers
  • Paan shops and grocers

How it sells

  • Sale through arecanut mandis and co-operatives
  • Direct supply to processors
  • Packed 1 kg bags through distributors

Good to know

  • The DPR assumes an average sale price of ₹200 a kg.

§4Raw material & machinery

ItemQtyCost
Decorticator / dehusking machine, 200 kg an hour1₹1.40 lakh
Sifter sieves machine, 500 kg an hour1₹1.12 lakh
Digital weighing machine, 100 kg2₹0.09 lakh
Boiling tank2₹5.00 lakh
Packaging machinery, 2,000 packs an hour1₹6.50 lakh
Miscellaneous1₹0.10 lakh

From: NIFTEM-Thanjavur (IIFPT) PMFME model DPR — Arecanut Processing

  • Raw betel nuts (arecanut)1,000 kg a day, costed at ₹25 a kg
  • Packaging material (1 kg packs)200 packs a day at ₹3.50 each

From: NIFTEM-Thanjavur (IIFPT) PMFME model DPR — Arecanut Processing

§5Licences & registration

  1. Udyam registration
  2. GST registration
  3. FSSAI licence or registration
  4. Legal Metrology registration for packaged goods
  5. Trade licence from the local body

We can do this registration for you

Start it in your state

Pick your state: today’s cost, central + state subsidy, raw material, land and help, on one page.

§6Schemes & subsidies

The DPR is written for PMFME (35% credit-linked subsidy, up to ₹10 lakh, for micro food units). PMEGP is another route for a new unit of this size, and CGTMSE can back the bank loan without collateral.

§7Money

How the investment is worked out: Land development and building ₹3.50 L + plant and machinery ₹14.21 L + other fixed assets ₹2.60 L (utilities ₹0.80 L, furniture ₹0.80 L, pre-operative ₹1.00 L) + working capital margin ₹1.52 L + contingency ₹2.00 L = ₹23.83 lakh.

Working capital: Working capital margin (20%) of ₹1.52 L is in the project cost; working capital need is ₹3.81 L in Year 2, ₹4.53 L in Year 3 and ₹5.23 L in Year 4.

Year not printed on the DPR (the PMFME scheme began in 2020) — check current machinery prices.

How to prepare a loan file

§8Export potential

The DPR gives no export costing; an exporter needs an IEC and registration with the export body before shipping.

§9Risks — where people fail

  • A fall in arecanut prices
  • Rain during harvest spoiling quality
  • Fungal damage in poorly dried nuts
  • Tighter rules on chewing products

§1030 / 60 / 90-day plan

A general plan that applies to any business. A plan for this business will be added after research.

  1. Days 1–30: Visit a working arecanut (supari) processing unit unit, ask 10 buyers about price and quantity, and get quotations from 3 suppliers.
  2. Days 31–60: Udyam and the licences you need (Udyam registration, GST registration), a project report (DPR), and the scheme or loan file.
  3. Days 61–90: Space and machines, trial production, and first deliveries to 10 customers.

§11Who to connect with

§12Watch

There is no episode on this business yet. Shows are coming soon on the Podcast page.

Want to start Arecanut (Supari) Processing Unit?

DPR, loan file or registration — ask us on WhatsApp.

Get a DPR / loan file made

Sources

  1. NIFTEM-Thanjavur (IIFPT) PMFME model DPR — Arecanut Processing

Data review: 6 October 2026. Spotted a mistake? Report it. For information only — not legal or financial advice.