Do you want to start an insecticide production business? If YES, here is a complete guide to starting an insecticide production business with NO money and no experience.
Okay, so we have provided you an in-depth sample insecticide production business plan template. We also took it further by analyzing and drafting a sample insecticide production marketing plan backed up by actionable guerrilla marketing ideas for insecticide production companies. In this article, we will be considering all the requirements for starting an insecticide production business. So put on your entrepreneurial hat and let’s proceed.
Table of Content
- Why Start an Insecticide Production Business?
- Starting an Insecticide Production Business – Market Research and Feasibility Studies
- Starting an Insecticide Production Business – Legal Matters
- Is Professional Certification Needed to Run an Insecticide Production Business?
- Starting an Insecticide Production Business – Technical and Manpower Details
- Starting an Insecticide Production Business – The Marketing Plan
Why Start an Insecticide Production Business?
Are you an aspiring entrepreneur looking for a good and profitable business venture to launch? If you have what it takes to start a business, then you should consider starting an insecticide production company in your city. There are readily available markets for insecticide no matter the part of the world you decided to start your own insecticide production company. This is because every household ensures that they have insecticide in their homes to keep insects at bay.
Although starting a standard insecticide production company can be capital intensive for an entrepreneur that is just starting out, but if you are able to conduct a thorough market research and feasibility studies before launching the business, you are sure going to breakeven before most businesses that are started on the same day, within same location and under similar economic conditions. The bottom line is that economic recession hardly affects the rate of purchase of insecticide especially during the summer.
Basically, what most standard insecticide production companies rely on to increase sales cum revenue generation is robust distribution network within their coverage areas.
So, if you are considering going into the insecticide production business, all you would need are some capital to purchase or lease/rent a suitable production facility and then equip the facility with the needed machines and equipment.
You would also need some additional capital to purchase chemicals and other packaging supplies, pay your employees at least for the first 3 months, and also pay your utility bills. Below is an article that will give you the needed guide to launching your insecticide production business.
Starting an Insecticide Production Business – A Complete Guide
- Industry Overview
Businesses in the pesticide manufacturing industry manufacture household and agricultural pest control chemicals. Industry products include pesticides and agricultural chemical products such as herbicides, insecticides, fungicides, insect repellents, sheep dips, fly sprays and flea powders. It is important to state that companies that manufacture fertilizers are not part of this industry.
If you are a close observer of happenings in the pesticide manufacturing industry, you will notice that over the years, companies have been negatively affected by decreasing demand and the consequent reduction in industry product purchases from the agricultural sector.
In addition, unpredictable input prices have constrained profit margins. So also, the ongoing acceptance of genetically modified (GM) crops combined with lower farmer incomes, especially in recent time, caused revenue instability to increase, with revenue estimated to decline. Going forward, as the global supply glut of seeds and grains continue, crop production will continue to be negatively affected.
The Pesticide Manufacturing industry is a thriving sector of the economy of the united states of America and they generate a whooping sum of billion annually from more than 206 registered and licensed pesticide manufacturing companies scattered all around the United States of America.
The industry is responsible for the employment of over 11,144 people. Experts project the pesticide manufacturing industry to grow at -1.3 percent annual rate within 2012 and 2017. Bayer AG, Dow Chemical, DuPont, Monsanto, and Syngenta are the market leaders in the Pesticide Manufacturing industry; they have the lion market share in the United States of America and in most countries of the world.
A recent report published by IBISWorld shows that as with other components of the chemical manufacturing sector, the Pesticide Manufacturing industry has a high level of capital intensity. Crop protection tends to be technology dependent, which in turn requires a high level of capital resources.
The report also shows that the increasing reliance on new technologies and the need for higher levels of investment in research and development has been one of the underlying reasons for the recent spate of mergers and acquisition activity on the global level. Moreover, the industry requires significant capital costs in the form of facilities and equipment. In 2017, the industry will spend $0.41 on capital for every $1.00 spent on labor.
Some of the factors and incentives that encourage aspiring entrepreneurs to venture into starting an insecticide production company is the fact that the market for pesticide products is pretty huge and not seasonal. That makes it easier for loads of entrepreneur who are interested in the business to come into the industry at any time they desire; the entry barriers are quite affordable and any serious – minded entrepreneur can comfortably raise the startup capital without collecting loans from the bank.
Over and above, the Pesticide Manufacturing industry is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her business as long as you are able to obtain the required chemical handling license. You can chose to start on a small scale producing limited quantities of insecticides or you can chose to start on a large scale with distribution network and several outlets in key cities all around the United States of America.
Starting an Insecticide Production Business – Market Research and Feasibility Studies
- Demographics and Psychographics
The people who make use of pesticide products cut across all players in the agriculture industry and households hence the demographic composition for an insecticide production company is all encompassing especially when they are also into the production of other pesticide products.
List of Niche ideas Within the Insecticide Production Business That You Can Specialize in
It is pretty hard to find an insecticide production company producing only insecticide products that are used in homes because it will be difficult for them to maximize profit in the industry. Even though there is no clear-cut niche area in this line of business, but it is common to find a standard insecticide/pesticide production company engage in the manufacturing of all or some of the under listed;
- Manufacturing arsenate insecticides
- Manufacturing botanical insecticides
- Manufacturing chlordane insecticides
- Manufacturing dichlorodiphenyltrichloroethane (DDT) insecticides
- Manufacturing exterminating chemical products (e.g. fungicides, insecticides and pesticides)
- Manufacturing fungicides, including lime-sulfur fungicides
- Manufacturing herbicides
- Manufacturing plant-growth regulators
- Manufacturing sulfur insecticides
The Level of Competition in the Pesticide Manufacturing Industry
The fact that there is stiff competition in the Pesticide Manufacturing industry is not hampering the performance of new entrants as most of them know how to recreate and re-strategize to reach out to or attract more customers even if it is just people and farmers in their immediate community.
List of Well – Known Brands in the Industry
It is the norm that in every industry, there are always brands that perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long while and so are known for that, while others are best known for how they conduct their businesses and the results they have achieved over the years.
These are some of the leading insecticide production companies in the United States of America and in the globe;
- Bayer AG
- Dow Chemical
- Univar Palm Desert
- ATrap U.S.A.
- Envirometrics Systems USA
- Certis USA LLC
- Makhteshim Agan (Israel)
- Nufarm (Australia)
- Sumitomo Chemical (Japan)
- Arysta Lifescience (Japan)
- BASF (Germany)
- Helm Agro US, INC.
- Dow AgroSciences
- United Phosphorus
Starting an insecticide production company is not a difficult business venture but at the same time, it is a business that requires thorough economic and cost analysis – feasibility studies and market survey if you are looking towards making profits in the industry.
Part of what you need to focus on in this line of business is how to build a standard pesticide production plant, getting robust distribution networks, branding and of course how to maintain your machinery and equipment, and take care of your overhead before your business breaks even. Other costs that should be considered during planning and budgeting are supply of chemicals, packaging materials and maintenance costs.
Lastly, in other to play safe with your investment, it is important that you hire the services of experts to help you carry out thorough economic and cost analysis before committing your resources into the business.
Starting Your Insecticide Production Business from Scratch vs Buying a Franchise
If your intention of starting an insecticide production business is to grow beyond one city, if you want to have presence in key cities in the United States and Canada, then starting your insecticide production company from the scratch is your best option.
On the flipside if you just want to start a business with the aim of just making profits and you don’t have the required finance and experience to build the business from scratch, then it will pay you to buy the franchise of a successful brand in the Pesticide Manufacturing industry if you are lucky to come by one.
Please note that most of the big and successful pesticide production companies around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success and of course you can build your own insecticide production company to become a successful brand with your distribution network spreading throughout the length and breadth of the United States of America and other countries of the world if you decide to go into exporting.
Possible Threats and Challenges You Will Face When Starting an Insecticide Production Company
If you decide to go into insecticide production business today, one of the major challenges you are likely going to face is the presence of well – established brands in the Pesticide Manufacturing industry both in the United States of America and other parts of the world. The only way to avoid this challenge is to create your own market.
Some other challenges and threats that you are likely going to face is economic downturn; if the economy is in a bad shape, businesses such as insecticide production companies usually struggle to maintain their old customers or even welcome new customers. So also, unfavorable government policies can hamper the growth of your insecticide production company. There is nothing you can do as regards these threats and challenges other than to stay positive that things will work well for you.
Starting an Insecticide Production Business – Legal Matters
- Best legal entity to use for this type of business
If you have plans to launch an insecticide production business, the legal entity you choose will go a long way to determine how big the business can grow; some insecticide production companies design their business for neighborhood market, some for city wide market, while others for national and international market by exporting and opening chains of distribution networks globally.
You can either choose a general partnership, Limited Liability Company, or even a sole proprietorship for an insecticide production business. Ordinarily, sole proprietorship should have been the ideal business structure for a small-scale insecticide production business especially if you are just starting out with moderate startup capital in a small neighborhood and just into producing limited insecticide and other pesticide products. But people prefer limited liability Company for certain reasons.
As a matter of fact, if your intention is to grow the business and have distribution networks spread across the United States of America and other countries of the world via franchising, and then choosing sole proprietor is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.
Catchy Business Name ideas Suitable for an Insecticide Production Company
In reality, when it comes to Choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Usually it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting your own insecticide production business, here are some catchy names that you can choose from;
- Wiper® Insecticide Production Company, LLC
- Anti – Insects® Insecticide Production Company, LLC
- Squash® Pesticide Production Company, Inc.
- Top Grade® Pesticide Production Company, Inc.
- Green Insect® Pesticide Production Company, Inc.
- Taragon™ Pesticide Production Company, Inc.
- Fresh Air© Pesticide Production Company, Inc.
- Framer’s Friend™ Pesticide Production Company, LLC
- Quit Notice© Insecticide Production Company, Inc.
- Killer Squad© Pesticide Production Company, Inc.
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your insecticide production company.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own insecticide production company in the United States of America;
- General insurance
- Health/Medical insurance
- Liability insurance
- Building Insurance
- Workers Compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
Intellectual Property Protection/Trademark
If you are considering starting your own insecticide production company, usually you may not have any need to file for intellectual property protection/trademark.
Is Professional Certification Needed to Run an Insecticide Production Business?
Apart from the results you produce as it relates to producing effective insecticide, professional certification is one of the main reasons why some insecticide production companies stand out. If you want to make an impact in the pesticide manufacturing industry, you should work towards acquiring all the needed certifications in your area of specialization.
You are strongly encouraged to pursue professional certifications; it will go a long way to show your commitment towards the business. Certification validates your competency and shows that you are highly skilled, committed to your career and up-to-date in this competitive market.
These are some of the certifications you can work towards achieving if you want to run your own pesticide production company;
- Chemical Handler’s Certificate
- Professional Certificate of Competency in Chemical Engineering and Plant Design
- Degree or Diploma in Chemical Engineering and related courses
Please note that you can successfully run an insecticide production company in the United States and in most countries of the world without necessarily acquiring professional certifications as long as you have acquired the required chemical handling certificate.
List of Legal Documents You Need to Run an Insecticide Production Company
The essence of having the necessary documentation in place before launching any business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be too long before the long hand of the law catches up with you.
These are some of the basic legal documents that you are expected to have in place if you want to legally run your own insecticide production business in the United States of America;
- Business and liability insurance
- Tax Payer’s ID
- Fire certificate
- Chemical Handlers Certificate
- Certificate of Incorporation
- Business License
- Business Plan
- Non-disclosure Agreement
- Employment Agreement (offer letters)
- Employee’s Handbook
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
- Building License
- Franchise or Trademark License (optional)
Financing Your Insecticide Production Company
It is often said that money is the blood of any business. Raising start-up capital is perhaps one of the major concerns of entrepreneurs; it can be challenging raising capital to launch a business idea. Your idea must be workable and promising for you to secure finance from financial institutions or from angel investors.
The first thing to put in place before sourcing for startup capital for your insecticide business is to draft a detailed business plan. With a good business plan, you can easily convince investors to invest in your business. The truth is that no bank can give you a loan if you don’t have a good and workable business plan. Besides, investors will not take you seriously if you don’t have a business plan on ground before launching out to source for start-up capital.
Here are some of the options you can explore when sourcing for start-up capital for your insecticide production company;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell of shares to interested investors
- Applying for Loan from your Bank
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends
When it comes to choosing a location for an insecticide production company, there are key questions you should answer and key factors that must be considered. You are expected to choose a location that is easily accessible especially as it relates to your distribution network and supply of raw materials et al. Affordability, availability of labor and safety are also some of the factors that you should consider.
Despite the fact that insecticides and other pesticide products are used by households, facility managers and farmers, it is important to choose a location that will give you economy of scales; a location that will give you leverage to favorably compete in the industry as a new entrant and also to make reasonable profits.
It cannot be overemphasized that the location you chose to launch your insecticide production company is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people and businesses with the required purchasing power.
Most importantly, before choosing a location for your insecticide production company, ensure that you first conduct a thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out.
Starting an Insecticide Production Business – Technical and Manpower Details
If you are considering starting an insecticide production company, then you should make plans to build a standard pesticide production plant. A standard pesticide production plant includes chemical mixer, vessels, tanks, and conveyor belt system et al. You are expected to have all these equipment and machines in place and also purchase standard distribution trucks.
Although you can get the above listed equipment and machines as fairly used, but it is advisable to go for new and latest machines and equipment that can serve you for a long time most especially if you have the money to make the purchase. Even if you don’t have the required amount, you can enter into an agreement with the suppliers of such machines and equipment and spread the payment over a period of time.
As regards acquiring a facility, if you have the required finance, it is to your advantage to acquire a property or lease a facility to be used for your insecticide production plant; it usually gives you the freedom to design the facility the way you want to it to be and install safety gadgets as you desire. But if you are low on cash, then you don’t have any option other than to rent a facility.
When it comes to creating a workforce structure for a standard insecticide production company, then you should look towards getting qualified and competent people to fill the following roles; Chief Executive Officer (Owner), Plant Manager, Chemical Engineer, Quality Control Officer, Human Resources and Admin Manager, Merchandise Manager, Sales and Marketing Manager, Accountants/Cashiers, Production Workers/Machine Operators, Distribution Truck drivers and Cleaners.
Over and above, you will need a minimum of 15 – 20 staff members to successfully run a small scale but standard insecticide production company.
The Business Services Process Involved in Insecticide Production
The production process of pesticide involves at least three separate activities. The active ingredient is first synthesized in a chemical plant, then formulated in the same place or sent to a formulator, who prepares the chemical either in liquid or powdered form.
After this process, the pesticide is then sent to the farmer or another certified applicator who dilutes it before applying it to the field. We are not ruling out the fact that quality control is enforced at every stage of the production process.
It is important to state that an insecticide production company may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated insecticide production company process is not cast on stone.
Starting an Insecticide Production Business – The Marketing Plan
- Marketing ideas and strategies
Running a business requires that you should be proactive when it comes to marketing your goods or services. If you choose to launch an insecticide production company, then you must go all out to employ strategies that will help you attract customers or else you will likely struggle with the business because there are well – known brands that determine the market direction for the industry.
People and organizations will make use of your insecticide and other pesticide products if they know that they are going to get the best as it relates to taking care of insects and of course value for their money.
Your marketing strategy should center on quality, efficiency and pricing, and above all excellent customer service. The truth is that if you are able to put the above stated in place, you won’t struggle to retain your old customers and at the same time win over new customers.
Businesses these days are aware of the power of the internet and which is why they will do all they can to maximize the internet to market their services or products. In other words, a larger percentage of your marketing efforts should be directed at internet users.
These are some of the marketing ideas and strategies that you can adopt for your insecticide production company;
- Introduce your insecticide production company by sending introductory letters alongside your brochure to farmers, households, facility managers and other key stake holders throughout the city where your insecticide production company is located and distributed
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across, so that those on the social media or those who read blogs will know what insecticide to purchase within your location
- Create a basic website for your business so as to give your business an online presence
- Directly market your products
- Engage in roadshows in targeted communities from time to time to promote your insecticide
- Join local insecticide production company associations for industry trends and tips
- Provide discount days for your customers
- Advertise your business in community based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of Word of mouth marketing (referrals)
Strategies to Boost Your Insecticide Business Brand Awareness and Create Your Corporate Identity
If you are in business and you are not deliberate about boosting you brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portrays your business to be. One of the secret of larger corporations is that they are willing to spend fortunes year in and year out to boost their brand awareness and to continue to communicate their corporate identity the way they want people to perceive them to be.
If your intention of starting an insecticide production company is to grow the business beyond the city where you are going to be operating from to become a national and international brand by opening chains of distribution network and exporting your products, then you must be ready to spend money on the promotion and advertisement of your brand.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand awareness and create a corporate identity for your insecticide production company;
- Place adverts on both print (newspapers and agriculture magazines) and electronic media platforms
- Sponsor relevant community based events/programs
- Leverage on the internet and social media platforms like Instagram, Facebook, Twitter, YouTube, Google + et al to promote your insecticide production company
- Install your billboards in strategic locations all around your city or state
- Engage in roadshows from time to time in targeted neighborhoods to create awareness of your insecticide production company
- Distribute your fliers and handbills in target areas
- Contact farmers, households, facility management and other key stake holders throughout the city where your insecticide production company is located informing them about your insecticide production company and the products you sell
- List your insecticide production company in local directories/yellow pages
- Advertise your insecticide production company in your official website and employ strategies that will help you pull traffic to the site
- Position your Flexi Banners at strategic positions in the location where insecticide production company is located
- Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are branded with your company logo