How to start a palm oil processing company?
Palm oil processing machine
1. Find a good location
Since you won’t be selling to consumers directly, it won’t be necessary to site your processing plant near a nearby market. You should be more concerned with being closer to palm plantations or areas with an abundance of palm trees.
However, if you can be situated closer to both the plantations and marketplace; it will be an added advantage for you. Secondly, your location should be free of unnecessary human and animal movements; yet very accessible for vehicles. This is best because there should be high level of hygiene around your plant.
2. Get the necessary equipment
In the past, palm oil was processed in “oil pots” made in the ground. The processing then involved rubbing and squeezing the palm kernel fruits until the oil was extracted. However, this old method is very wasteful, as it leaves some significant amount of oil left on the kernel fruits that could have been converted into more palm oil.
But nowadays, machines are used to process palm oil. This modern method is more hygienic, and it helps to extract all the palm oil on kernel fruits without leaving any quantity to waste. You should also know that most machines for processing palm oil can be imported or fabricated locally at a cheaper rate. Examples of equipments necessary for palm oil processing business.
1.Palm Fruit thresher
3.Palm oil expeller
4.Nut Fiber Separator
5.Palm kernel oil cooking oil machine
6.Palm kernel oil press machine
8.Oil clirification tank
9.Oil filtration tank
3. Setup your processing plant
You may need to seek the services of professionals to help construct the needed infrastructure and also install the processing machines.
4. Hire people to work with you
You will need to hire someone who would operate the palm oil processing machine. If you are planning to have more than one machine, then you would need to hire an operator for each machine. You would also need to hire other employees, such as a security personnel, administrative staff, and so on.
5. Create market awareness
Approach prospective marketers and encourage them to buy from your company. One smart way to retain them for a long term is to offer high quality palm oil at discounted prices. You should also encourage your customers to tell others about your business.
In addition, you can also establish a retail outlet to sell your palm oil. If you decide to go this route, you can create a competitive advantage by branding your gallons and fortifying your palm oil with vitamin A.
Five Challenges of starting a palm oil processing business
(1)It is also management intensive
(2)Getting an optimal location with all the needed amenities is quite difficult.
(3)There is every possibility that your palm oil processing will be situated in a remote area, so as to be close to the source of supply (plantation farms). So you should expect some difficulties transporting the bunches of palm fruits from the farm to the processing plant. The same problem may also be faced when transporting the processed palm oil from the plan to the marketplace.
(4)Because of your remote location, there is every possibility that you won’t have access to power supply. So you would have to provide your own power supply using generators. This will invariably increase your operating cost.
(5)For you to be in steady operation, you will need a consistent supply of raw materials (palm fruits) and this can prove quite a challenge especially during the scarcity period. A good way to tackle this problem is to have your own plantation farm or better still, increase your storage capacity. This will enable have a steady supply of palm oil to sell to your customer during the scarcity period.