How to Start the Carpets Export Business in India?

. 7 min read
How to Start the Carpets Export Business in India?

What is an import and export business? The export/import market is mainly concerned with the extension of exchange borders, and it encompasses a variety of business models. An individual with the necessary export/import license can sell their imported products to clients abroad, serve as an agent between a local manufacturer and an overseas buyer or vice versa, or purchase goods produced abroad and sell them directly in the native market.

How to start an import-export business?

In recent years, India has seen a significant increase in its export and import of products and services.

There are a few things you need to get sorted before you start promoting your import-export business idea:

1. Business Set-Up

To begin, you must establish a business. It is advised that you first create a sole proprietorship by obtaining a Service Tax or VAT register with an enticing name and logo.

2. PAN Card

If you have obtained the required authorisation, you must obtain a PAN card from the Income Tax Department.

3. Current Account

After receiving a PAN card, you must establish a new bank account for your business with any commercial bank.

4. Import-Export code

This is a critical prerequisite for starting your import and export business. IEC is available in all instances except where products or services are limited or forbidden.

5. Registration cum Membership Certificate

After receiving the IEC, you must receive an RCMC from the relevant Export Promotion Councils to obtain authorisation to import and export, as well as some other profit.

How to start a carpet export business?

In India, the carpet industry is one of the oldest and most famous. India has a long history of carpet weaving, an art that requires a variety of skills and experience. The Indian carpet weaving art has influences from countries such as Persia, China, and Afghanistan. However, this artistry is no longer confined to the villages and towns now. This craft has grown over time, expanding its wings not just domestically but also internationally.

Important things you need to know about carpet manufacturing to set up a business:

1. The manufacturing process

Carpet manufacture consists primarily of the following activities:

  • Buying, stretching, cleaning, and drying the yarn
  • Drawing the pattern on graph paper and memorising it
  • Putting the loom together
  • Weaving the carpet with appropriate yarns
  • Using a hard toothed metal comb, press down in each row
  • Cutting away the fringes left after knotting the woollen thread weft to make the carpet appear sleek and even
  • Cleaning and drying the carpet
  • Packing and wrapping

2. Investment

The investment to set up a carpet export business varies from 10 lakh to 15 lakh.

3. Profit Margin

Profit margins in the carpet manufacturing sector are usually between 20% and 30% in the early stages. Later on, depending on the consistency of the projects, you will earn a higher percentage than in the initial stages.

4. Target Customers

The target customers for your business-

  • Households: The main target customer for your carpet manufacturing business is households. We need carpets to make our rooms decorative.
  • Hotels: Hotels and restaurants need carpets for decorative purposes and to attract customers.
  • Commercial Offices: Now modern offices are using carpets to keep an aesthetic look, especially in conference rooms.
  • Meditation Centres: Carpets are also used in meditation centres to perform floor exercises.
  • Movie Theaters: Multiplexers, movie theatres also use carpets for the audience
  • Exhibitions: The handicraft exhibitions, shows are also your potential customers in the carpet industry

5. Manpower

The manpower required to set up a carpet business is-

  • 5 skilled workers
  • 5 unskilled workers with proper knowledge of machinery.

Now that you know about the carpet manufacturing business, let’s move on to the steps you should follow to start a profitable business and build a strong reputation for yourself:  

6. Business plan

Making a solid business strategy is essential before starting any venture. To begin, you must ascertain the market’s demand for the particular form of carpet and then select the final product. Then you can determine the expense, equipment, and manufacturing operation.

Additionally, do research on the selling price for that particular style of carpet. Finally, carefully consider the kind of carpet you want to make to create a financial overview of the product’s costs and a campaign plan.

7. Market Potential

The global carpet and rug industry has a bright future, with openings in the commercial, non-residential, and transportation sectors. Carpets are textile floor coverings consisting of densely woven yarn. These may be categorised according to:

  • Handmade carpets
  • Manufactured carpets

According to market analysts, the industry has expanded at a 2.6 per cent compound annual growth rate (CAGR) in volume terms between 2018 and 2021.

The primary factors of this market’s growth are the building and transportation industries, as well as a rise in renovation activities. Nowadays, shoppers gravitate toward vibrant colours. Additionally, non-geometric designer carpet and rug designs are gaining prominence. Do a proper survey of the market to understand how to place your business in the market.

8. License

Generally, the carpet manufacturing industry would not need any special licenses. However, you must register your company. Additionally, it is prudent to review the municipal authority’s regulations. It is preferable to be aware of the costs associated with starting a business sooner rather than later. Trade certificate, registration with the MSME Udyog, GST registration, PAN, and Aadhar card are some of the essential documents and licenses you will need to open a carpet manufacturing business. If you want to enter the foreign market, you would undoubtedly need a specialised export-import license.

9. Machinery

At the moment, software-controlled carpet manufacturing devices are available in the market. These machines enable you to create a variety of decorative carpets based on your style. Generally, these devices can manufacture carpets with a width of 17 to 20 meters.

The machine is a circular electronic jacquard carpet machine with eight tone lines. Indeed, these are computer-controlled jacquard machines capable of producing whole secants, absolute terry, circle cutting, and high low loop pile styles.

10. Raw materials

Woolen cotton and silk yarn, as well as dyes and chemicals, are the primary raw materials used for making carpets. Additionally, synthetic fabrics or jute may be used. In general, the raw material requirements vary according to the kind of carpet being manufactured. Once you decide on your type of carpet and its style, accordingly source the right raw materials.

11. Location

The area required to establish a carpet manufacturing industry is approximately 500 square feet. A business’s progress is mostly determined by its position. Numerous factors must be considered to do this. Specifically, the accessibility of the property, the store’s visibility, the working surface, market competitiveness, the rent amount, and the contract terms.

12. Market Strategy

You should advertise your brand on social media platforms. You may also sell the goods through B2B or B2C websites. Distribute model designs of the commodity in local shops, hotels, and shopping centres. It is in high demand in the industry due to its ability to alter one’s perspective.

Conclusion

A carpet is a form of textile floor covering. As such, it serves as both a usable and decorative element. It has a lovely appearance. It is usually made of linen, cotton, or synthetic yarn. Essentially, it is the pattern that renders the carpet so valuable and exquisite. The method of producing a carpet is straightforward. And this company can be started with a small initial investment. Additionally, you can start a small carpet manufacturing unit from your house.

Also read:

1) The Indian Import-Export Scene
2) How Can I Start Spice Export Business In India?
3) How Can You Start An Import Business In India?
4) Types of Direct & Indirect Taxes in India

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FAQs

Q. How much does it cost to start an export business?

Ans. To start an export business in India, at the initial stage, 90,000 to 1 lakh is required.

Q. How do I start an export business from home?

Ans. You need to follow the following steps to start an export business from home:

  • Decide on the products.
  • Construct your website.
  • Maintain an online presence and seek out collaborators.
  • Assemble the paperwork.
  • Determine a form of shipping.

Q. Is the export business profitable?

Ans. Yes, the world is more open than ever before, trading or import-export is booming.

Q. Is the carpet industry profitable?

Ans. The primary factors responsible for this market’s growth are the manufacturing and transportation industry as well as a rise in renovation activities.