Do you want to start a camphor making business? If YES, here is a detailed guide on how to start a camphor making business with no money and no experience.
What is Camphor?
Camphor is a white, crystalline substance with a strong scent and pungent taste that is sourced from wood camphor laurel and other related trees of the laurel family. These trees are more readily found in China, India, Mongolia, Japan and Taiwan and a variety of this fragrant evergreen tree is grown in Southern united states like Florida.
Camphor is processed through steam distillation, purification and sublimation of the wood, twigs and bark of the tree. Today, camphor is chemically manufactured from turpentine oil. Modern uses include camphor as a plasticizer for nitrocellulose, as a moth repellent, as an antimicrobial substance, in embalming, and in fireworks.
Solid camphor releases fumes that form a rust-preventative coating, and is therefore put in tool chests to protect tools against rust. The demand for camphor is very encouraging, although you have to note that it is a price sensitive market with less scope for product differentiation.
19 Steps to Starting a Camphor Making Business
1. Understand the Industry
According to industry data, the camphor market is projected to rise at a CAGR of 7.9 percent from 2017 – 2027. Major factors like the massive demand of camphor in making medicine for different type of diseases is expected to propel more industry growth in upcoming years. Owing to its good chemical properties, it has wide range of application in various end user industries such as pharmaceuticals, food, agriculture, chemical among several others.
It is also used for making ointments with vapour for treating cough and chest congestion. Rising demand of camphor for ointments is anticipated to drive the growth of the market. Asia Pacific dominates the global consumption and production of camphor and the trend is anticipated to continue for a foreseeable future.
Pharmaceutical is a major factor driving demand for camphor in Asia Pacific. Asia Pacific is also anticipated to be the fastest growing region during the forecast period. Demand for camphor in North America and Europe is anticipated to grow at a sluggish rate owing to market saturation is several end user industries.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The market for camphor is endless, especially with the growing awareness of its importance and resources. Major end user industries for camphor include pharmaceuticals, food, agriculture and chemical among several others. The massive growth in pharmaceutical industry just like we stated above is among the foremost drivers for the camphor market and the trend is anticipated to continue over a long time.
Camphor is also used in the production of ointments with vapours for treating chest congestion and cough. Increasing demand for ointments used for treating chest congestion is a major factor driving demand for camphor. Small amount of camphor is safe for human consumption and has been approved by several regulatory bodies across the globe, therefore camphor has high acceptance for medicinal uses.
A small amount of camphor or few drops of camphor oil are put with food grains during storage to protect it from germs and insects. This puts the food industry as a very valid and major customer. Starting a camphor manufacturing business needs a lot of dedication and commitment. You have to be clear about your product’s market demand and know the market share of your competitors.
Its very necessary that you research and plan well. You need to choose the kind of camphor product you want to manufacture. Is there a market already available for the niche? What kind of team will you need for your manufacturing unit? What will be the costs and expenses? Will you need financiers for your business or can you do it with your invested capital?
3. Decide Which Niche to Concentrate On
The key to succeeding in any business is finding and choosing a niche. By doing that, you can avoid one of the most common mistakes entrepreneurs make: of going too broad with their store’s products and market appeal. Although this business has no stated niche, it is still advisable that you try to focus on a particular target niche.
The market to target in this business is huge, as everyone has a seed of creativity on them. Camphor is mainly manufactured and sold in three different forms namely:-
Commonly known special aroma oil that is also termed as essential oil. It has a vast variety of uses, both in religious and medicinal grounds. As an essential oil, it boasts of a good number of benefits and is used for treating a number of conditions related to skin and hair. It is also used as a base in many beauty care products.
This is the same ingredient that is in powder form. In this form, it can be used for making camphor tablets at home using cast dye. It is also used for religious purposes especially in Hindu religion.
More or less the most common form of camphor available in the market. Its main use is in religious purposes. It is used as a purifier when praying especially in Hindu religion.
The Level of Competition in the Industry
According to reports, the camphor market is highly fragmented and dominated by regional players due to low capital investment in the market. The industry is characterized by high degree of competition and major players compete on price differentiation. Therefore, camphor is a price sensitive market with less scope for product differentiation.
Camphor is used for medicinal purposes for the treatment of warts, cold sores, haemorrhoids, osteoarthritis, congestion, cough, and skin infections. Generally, in pharmaceutical it is used in the form of oil. It also can be used as antiseptic germicides and others.
These factors are opening a gateway of opportunities for the growth of the camphor market. It is also used in several end user industries such as agriculture, food, chemical, pharmaceutical and others. The growing demand of camphor in pharmaceutical industries is expected to positively impact the growth of camphor market during the forecast period.
As population is increasing worldwide, the demand of the food product is also increasing which can trigger the growth of the camphor market during the forecast period. In contrast, high flammability nature of camphor is anticipated to negatively impact the growth of the dimethyl camphor market.
4. Know Your Major Competitors in the Industry
- Beijing Herbal Health Biotech LLC
- Hunan Nutramax Inc
- Camphor & Allied Products Ltd.
- Taiwan Tekho Camphor Co., Ltd
- Indukern Internacional
- The Ji’An Cedar Fine Chemical Co., Ltd.
- Hiya International
- Saptagir Camphor Ltd.
- Mangalam Organics Limited
According to industry reports, North America is expected to register substantial revenue gains, registering a CAGR of 7.9 percent from 2017 to 2027. Southern American states camphor composition market is likely to grow on account of existence of various personal care and pharmaceutical companies.
Turpentine oil derived from rosin and pine wood industry is also expected to show high penetration for synthetic and natural counterparts, relatively high purchasing power, strong regulatory framework and a high scope for new applications industry.
It is believed that the demand for the product will rise owing to high disposable income, continuing research and an inclination to spend more on health. Note that the Asia Pacific accounted for 34.20 percent of the overall volume share in 2016 and is expected to witness significant growth over the forecast period.
Have it in mind that emerging nations including Malaysia, Indonesia, and rest of Southeast Asia are likely to witness strong economic growth in the near future due to development and a touch of Hindu religion.
5. Decide Whether to Buy a Franchise or Start from Scratch
Buying a camphor manufacturing franchise accords an entrepreneur a better platform to mould creativity into a profitable business. Although franchise opportunities also have their own pros and cons, but as a creative mind coupled with an entrepreneurial spirit, starting and running a camphor manufacturing franchises may be an option worth considering.
There are a lot of franchising opportunities available in the United States, and with so many options available, chances are you can find something that fits perfectly with your favourite business. Don’t forget that buying a franchise involves significant startup investment.
This initial expense may range from a thousand to a few hundred thousand dollars; a lot of entrepreneurs find that the investment is worthwhile. You should also know that camphor manufacturing franchises offer brand recognition that can be very hard to acquire if you start from the scratch.
Buying a franchise also provides you with a turnkey system to work with, that removes the need for costly trial and error. If you choose to go down the Franchise path, it means that you are going for a market that has already been tested, and if people were not buying the product, the company would not have grown to the point of offering franchises.
6. Know the Possible Threats and Challenges You Will Face
Camphor is primarily used for medicinal purposes to treat congestion, cough, and skin infections. Other applications of camphor include food storage and as an insecticide among others. A major portion of the global camphor production is employed for the manufacturing of camphor oil.
Camphor oil is a stimulant to treat and enhance metabolism, digestion and excretion processes. This has created a huge demand which doesn’t seem like dying down anytime soon. Here are few threats you might face when starting your Camphor manufacturing business.
- Performing adequate due diligence
- Choosing your work area
- Registering your business
- Choosing a price model
- Simplifying your marketing plans
- Learning how to make the product
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
You have two advisable options when planning to start a manufacturing business like a camphor manufacturing company- sole proprietorship and the LLC. The sole proprietor business structure just like we all know is a company with a single owner.
Note that this business structure is used by three-quarters of all businesses in the United States. This legal structure keeps the owner in control of the company and has the simplest initial setup. While the limited liability corporation, or LLC, is often formed for partnerships when the business has grown significantly. The advantage of an LLC is more options for growth and tax advantages.
Most business owners in this modern era would rather create an LLC than a sole proprietorship because of liability issues, but then it takes funds to prepare the articles of incorporation. Payment options need to be considered, a bookkeeping system has to be in place, and this all takes additional money that takes away from the funding necessary to purchase the materials to make the products.
8. Choose a Catchy Business Name
- Camphor Dome
- White Unlimited
- Scented camphor
- Acura camphors
- Savvy Camphors
- Telco Camphor
- Sweet Scents
- Lyon Camphors
- NYC Purses
- Smooth camphors
- Luther Camphors
9. Discuss with an Agent to Know the Best Insurance Policies for You
You require adequate insurance coverage when starting any manufacturing business in the United States. Insurance provides protection for a number of risks within a manufacturing business. Most common areas of coverage include Commercial Auto Insurance, Workers Compensation, and General Liability.
It helps protect your business from things like lawsuits, loss of personal and commercial property, and even damage to buildings. Things you will need may include;
- Public and Products Liability
- Stock and Contents for Fire, Burglary and Business Interruption.
- Professional Indemnity (if advice is given for a fee)
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
Within the years, IP has improved in the United States. With technology and innovation ensuring competitiveness in every human endeavour, it has become much harder to remain in control of one’s intellectual property. Intellectual property is not just about protecting one’s new invention but also one’s business slogan or a colour.
But note that these property rights no longer protect just a trade secret, but also preserve one’s monetary gain. Creating and designing a product is hard work – the achievements of training, experience and the creative process.
The more reason it should be protected at all cost. Imitation is not a very funny form of flattery; it’s a potential drain on your gross income and your ability to support yourself. Always seek the help of a lawyer who is experienced in this field to help you understand the necessary ways to protect yourself.
11. Get the Necessary Professional Certification
Noteworthy, you do not need any specific certification to run your camphor manufacturing business. Although obtaining a professional certification helps you stay up to date on industry trends, enhance education and boost careers.
Professional certification shows your customers, employees and even prospective customers how serious you are with your high standards. Although this industry lacks a specified professional certification, you can gain general manufacturers professional certifications to set yourself apart in this industry.
- Quality Engineer certification
- Certified automation personnel
- Certified production technician
- Certified Manufacturing Engineering Certification
12. Get the Necessary Legal Documents You Need to Operate
In the United States, your need to acquire the required permits and licenses from both your state and county to run your business without breaking the law. You need to get advice on tax structures and insurance. You will need it for future purposes. You will need business documentation. Note that the exact permits and licenses you need will vary depending on where you wish to start your company.
For instance, in Harris County you can start a camphor manufacturing business with an assumed name certificate (DBA), sales tax permit and a tax resale certificate. To find out what you need to get your camphor manufacturing business started, contact your local small business development centre or Small Business Administration office or you can speak to an attorney.
13. Raise the Needed Startup Capital
In this business especially to a successful level, funds are needed critically in two areas; Fixed cost including space and machines, and working capital which includes raw material, wages, transportation etc. It is advisable you take time to prepare a project report or business plan before starting this business.
You can apply for loan from banks and financial institutions. In that case, owners credibility and at least 25 percent investment as owners allocation on total project cost is required. Other ways of getting funding may include…
- Personal savings
- Bank overdraft
- angel investor
14. Choose a Suitable Location for your Business
To start and maintain your manufacturing company, you will need a location with easy availability of skilled labour, transportation, commercial electricity and water resources. You will need to arrange specific space for manufacturing operation, raw material storage, finished goods store, admin section.
You also have to choose a suitable location for your business. You might want to go for a cheap area to begin. Don’t forget that you will need ample space and good infrastructures, especially if you are going medium to large scale. The location you choose must have a link to potential customers.
Another thing you should consider are the additional taxes imposed by the government in a specific area. Electricity and power resources are a must have in your manufacturing facility. Space for warehouses, storage areas for raw materials, quality assurance and quality control checks areas are also very important.
A storage area for finished products after quality assurance is also needed. Your team will also have to be loyal and trustworthy. You have to employ and select a team that is efficient and has the right skills and experience for your camphor manufacturing business.
Camphor is sold in a variety of places, and which venue you choose mainly depends on how much money you have to start your camphor manufacturing company. In this modern technological era, the easiest camphor selling venues include markets, e-commerce stores, online websites, and online marketplaces.
Understand that most camphor manufacturing companies started with a smaller venue, waited until their camphor manufacturing company became established and then moved out into a more organised business location. You should consider selling your camphor through different venues to earn more.
15. Hire Employees for your Technical and Manpower Needs
When considering starting a camphor manufacturing business, be sure to have the necessary skills and knowledge needed to produce your product. You can take classes and trainings to understand more in the field. You also need to have some managerial skills.
In a small scale business, you cannot appoint staff for every department like accounts, marketing, supervising and others. You may need to take the responsibilities of different jobs. You will also need to hire both skilled and unskilled employees to kick start your business.
Indeed skilled workers will save you a great deal in the cost of training newbie’s. They will also bring in their loads of experience which they must have gathered from previous employers and at the same time train your newbie’s on the job. The overall investment in this business may depend on which scale you want to get started with.
In small scale the business may not need much investment if you don’t have to buy premises or rent it. If rented then you have to include the cost of its rental. Raw materials can be purchased in bulk as well as in less quantity. It may only cost a few thousands if purchased in smaller quantity.
Today there are a number of manufacturers who make fully automated camphor making machines. There is special slot in the machine in which the camphor in powder form is filled. The final product is manufactured by the machine as camphor tablets or even camphor cups.
When using this fully automated camphor machine, you have the convenience of selecting the moulds in various size including small, medium or big for manufacturing tablets. The size of the dye used in casting tablets can be adjusted according to desired size as per your placed order.
The price of the machine depends on the capacity of the machine and the number of tablets it can manufacture in one feed. To make Camphor tablets you only need to purchase one main raw material – Camphor powder. The rates may also vary depending on the place and zones within the country. Equipment and raw materials will include;
- Multi Punch Tablet Machine
- Wax wrapping machine
- Weighing Balance
- Hand Tools
- Sales Tax, Freight & Insurance
- Camphor Powder
- Packaging Material
The Services Delivery Process of the Business
Camphor is a crystalline and translucent terpene ketone with a pleasant odour. Camphor is predominantly produced from distillation of wood and bark of the camphor tree. Physical properties of camphor differ depending on the origin, species and growing conditions of the tree.
Camphor is generally whitish or has light shades of different colours including grey and olive among others. Camphor can be synthetically produced by synthesis of turpentine oil derived from rosin and pine wood among others. Depending on the end user industry, camphor is supplied in the form of powder, oil or as tablets.
If you want to set up your Camphor making business then you have to learn the right way to make it. A small tablet machine is very light weight and small size. It can be installed on top of any table in your house. If you are manufacturing camphor in small scale then you don’t need to purchase a very expensive machine.
Once the machine is installed on the table top, you need to ensure that it is tightly gripped to the base or on a stand. As the machine is attached to external motor, it is advisable you take precautions to absorb shock or vibration. The machine needs an electric socket connection. You can now get started with manufacturing camphor tablets.
First you have to heat the camphor powder so it loses its moisture. Then you stuff the camphor powder in the machine to its full capacity. Switch the motor on. Recent machines are automated and will automatically fill the cast dye. The cast will mould the camphor powder in the form of a solid tablet. This process is fast so you may not need much time to manufacture few hundred tablets in a day.
Now the tables can be packed for dispatch. When packing you need to remember that camphor is an alcohol soluble base product. You may also be mandated to make the packing packets depending on the local market requirements. You can pack camphor in small packets having three tablets to over 50 in one packet. Big sized tablets usually are sold for much higher price. On the packet you have to print the price and number of tablets included.
When working with the machine, you have to ensure that you wear your protective gears. This includes rubber gloves and slippers. The machine is connected to electric supply so you have to take your precautions. Also you are using a chemical base for manufacturing tablets, you need to ensure you don’t ingest it. As the product is highly flammable, you have to ensure that you stay away from the source of fire.
From the business perspective, camphor is in great demand throughout the country. There are not many market risks that you need to be aware of. The risk involved would be when manufacturing, packing or transporting. Always ensure it is well packed in air tight plastic bag or container as it may vaporize very fast. You also have to ensure that it does not come in contact with moisture in the air or else it may start vaporizing immediately.
16. Write a Marketing Plan Packed with ideas & Strategies
A marketing plan is a very unique document that strategically explains what you want to achieve in your business, at a given time and with the needed financial incentives to achieve the objectives and strategies of the business. It also examines the current situation of the business, performs its analysis, studies the competition; create strategies and action programs to be implemented.
Note that the well detailed promotional strategies outlines in the marketing plan could determine the success or failure of your business. Ways to market your camphor manufacturing business may include
- Using satisfied customers testimonies
- Creating an attractive website
- Using marketing materials
- Business networking and partnership
- Leveraging social media platforms and traditional advertising strategies
17. Develop Iron-clad Competitive Strategies to Help You Win
You need to understand that this industry is filled with tough competitors. It’s advisable that you get tutored by someone who has been in the industry and understands how it works for you to survive the competition. Have it in mind that no matter how competitive this industry is, you have the ability deduce a means of outshining your competitors. These means may include…
- Satisfy your customers
- Choice of Location
- Join professional organizations
- Maintain a good supply chain
- Have a detailed business plan
- Work with a graphic designer to create a website
- Knowing and identify your competitors
18. Brainstorm Possible Ways to Retain Clients & Customers
Indeed this business can be started with a small start budget and be grown into a very large business. The ever rising demand for good camphor creates an opportunity for the innovative startup which even you without a degree can start.
A small scale camphor manufacturing business can be a great way for you to make extra money or even a full time income. So to start and run a Camphor manufacturing business successfully, there are a lot of things you should consider, which includes how to retain your customers.
- Stay safe and legal
- Choose suitable vendors
- Give out free samples
- Simplifying your marketing plans
- Target specific customers
- Give them safety tips
- Surprise them
- Reward loyalty
- Let your creativity sell you
19. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
You need to understand that the very first step in branding your camphor manufacturing business is to make a name for yourself. The strategy you need to implement also depends on the quantity of your manufacturing. You can try and contact small and big dealers within your local network, or even place advertisements in local newspapers and online websites.
- Gain industry expertise
- Patronize local dealers
- Sell online
- Use keywords and hashtags to your advantage
- Let your name and logo be creative
- Print out business cards