§1What this business is
Wet-salted cow hides are soaked, limed, unhaired, fleshed, split and vegetable-tanned in a set of pits, then fat-liquored, dried and spray-finished with acrylic and urethane coats that must be rub-fast and easy to wipe clean. Furniture and car-seat makers buy on strict specifications such as strength, colour fastness, flex and abrasion tests. Effluent treatment is part of the project.
Capacity: 30,000 hides a year, equal to 7,50,000 sq ft of upholstery leather.
§2Is it right for you?
Who it is for
A tanner with finishing experience who can meet furniture and automotive specifications.
Who it is not for
Someone without leather-chemistry knowledge or a site cleared for tanning.
Advantages
- Furniture and car-seat makers buy in steady volumes
- Buyers' specifications are clear, so a reliable unit wins repeat orders
- Pit tanning with vegetable extracts uses simple equipment
Drawbacks
- The effluent is toxic — an effluent plant and pollution consent are needed
- Over ₹1 crore is needed, most of it for hides
- Tests for fading, flex and abrasion reject weak batches
Skills you need
- Vegetable tanning and finishing
- Spray finishing with urethane coats
- Physical testing of leather
- Selling to furniture and car-seat makers
Why difficulty 5/5: Polluting process, strict buyer tests and large working capital.
§3Market
Who buys
- Sofa and furniture makers
- Car-seat and automotive interior makers
- Leather goods makers
How it sells
- Supply on buyer specification
- Leather traders in tannery clusters
- Export orders
Good to know
- The profile says a large share of upholstery leather goes to the automotive industry, which buys on specification.
- Tests named include breaking strength, stitch tear, colour fastness, abrasion, cold resistance and flex resistance.
§4Raw material & machinery
| Item | Qty | Cost |
|---|---|---|
| Wooden paddle, vat 8'×7', 10 HP motor | 2 | ₹1,00,000 |
| Wooden drum 8'×6' with 10 HP motor | 2 | ₹2,00,000 |
| Fleshing machine, 1800 mm, 15 HP | 1 | ₹2,50,000 |
| Splitting machine, 1800 mm, 15 HP | 1 | ₹5,00,000 |
| Unhairing machine, 1800 mm, 15 HP | 1 | ₹4,00,000 |
| Hydraulic press, 25 HP | 1 | ₹4,00,000 |
| Spray booth with compressor | 2 | ₹1,00,000 |
| Measuring machine, 1800 mm, 5 HP | 1 | ₹2,00,000 |
| Generator set, 50 kVA | 1 | ₹2,00,000 |
| Testing equipment | LS | ₹60,000 |
| Effluent treatment plant | 1 | ₹3,00,000 |
From: DC-MSME project profile — Upholstery Leather (SISI New Delhi, PMRY series) (2003)
- Wet-salted cow hides2,500 pieces a month at ₹700 each; the profile says they are available locally
- Processing and finishing chemicals (lime, sodium sulphide, vegetable tannin extracts, fat liquor, pigments, acrylic and urethane finishes)₹10 per sq ft — ₹6.25 L a month
From: DC-MSME project profile — Upholstery Leather (SISI New Delhi, PMRY series) (2003)
Suppliers in Building Business Bazaar
Allied Resin Cchemicalsl Ltd · Kolkata →Annapurna Enterprises · Kolhapur →BASF India Ltd · Mumbai →Bayer (India) Ltd · Chennai →Golden Chemicals (P) Ltd · Mumbai →Indogil Chemicals Industries · Mumbai →Jugi Enterprises · Chennai →Kanpur Chemicals (Pvt) Ltd · Kanpur →Leather Chemical and Industries Ltd. · Kolkata →Prototype Development · Chennai →Shalimar Engg. Works · Kolkata →Swastic Chemicals Industries (P) Ltd · Mumbai →
In our raw material database
§5Licences & registration
- Udyam registration
- GST registration
- State Pollution Control Board consent to establish and operate (tanning is Red category)
- Factory licence (the unit employs more than the Factories Act limit)
- Import Export Code (IEC) if you export
§6Schemes & subsidies
- CGTMSECentralActiveNo collateral, up to ₹10 crore
- Stand-Up IndiaCentralClosed₹10 lakh – ₹1 crore loan
The ₹1.09 crore project is above the PMEGP and MUDRA limits; CGTMSE can cover a collateral-free loan, and Stand-Up India (loans of ₹10 L–₹1 crore) fits SC/ST and women founders.
§7Money
How the investment is worked out: Machinery ₹24.00 L + testing equipment ₹60,000 + effluent treatment plant ₹3.00 L + power connection with transformer ₹2.00 L + electrification ₹2.40 L + office equipment ₹50,000 + pre-operative ₹50,000 = fixed capital ₹33.00 L; working capital for 3 months ₹76.35 L. Total ₹1,09,35,000. Building rented.
Working capital: ₹25.45 L a month, mainly 2,500 raw hides at ₹700 each (₹17.50 L) and processing and finishing chemicals (₹6.25 L); 3 months = ₹76.35 L.
Prices from January 2003 — hide, chemical and machinery costs will be much higher now.
§8Export potential
Confirm the HS code in the DGFT ITC(HS) lookup before you export
Export council / board: Council for Leather Exports (CLE)
- Confirm the 8-digit ITC(HS) line with DGFT or your customs broker before shipping.
- You need an Import Export Code (IEC) from DGFT before the first shipment.
§9Risks — where people fail
- Pollution-board action over effluent
- Batches rejected against buyer specifications
- Hide price swings
- Competition from synthetic (PU/PVC) upholstery
§1030 / 60 / 90-day plan
A general plan that applies to any business. A plan for this business will be added after research.
- Days 1–30: Visit a working upholstery leather tanning unit unit, ask 10 buyers about price and quantity, and get quotations from 3 suppliers.
- Days 31–60: Udyam and the licences you need (Udyam registration, GST registration), a project report (DPR), and the scheme or loan file.
- Days 61–90: Space and machines, trial production, and first deliveries to 10 customers.
§11Who to connect with
Associations, clusters and training institutes — the directory is being built. Connect
§12Watch
There is no episode on this business yet. Shows are coming soon on the Podcast page.
Want to start Upholstery Leather Tanning Unit?
DPR, loan file or registration — ask us on WhatsApp.
¶Sources
Data review: 6 October 2026. Spotted a mistake? Report it. For information only — not legal or financial advice.