Coconut oil Business Ideas: How to Start a Coconut Oil Business

There are different kinds of vegetable oil consumed and used in industrial applications. The edible oils are gotten from either kernel extracts or meat.

The vegetable oils have different compositions such as mono unsaturated fat, and saturated fat content. They also have linolenic acid, oleic acids regarded as polyunsaturated fatty acids.

Edible vegetable oils go through processing to extract the oil. Edible oil is extracted from different sources such as cotton seed, canola, avocado, palm, olive and flax-seed. Other sources are sunflower, cottonseed, coconut, peanut and soybeans.

The edible coconut oil contains a high amount of saturated fat. To start your coconut oil business you have two options.

 You develop a coconut farm and harvest or buy coconuts from farmers. If you want to fast track your business the latter option is the best.

However owning your own coconut plantation eliminates the huge cost of buying the coconut.

Things to Consider Before Launching your Enterprise

There are a few things you need to consider before starting your business. You need adequate funding to buy agricultural land and factory equipment.

Some money goes to labor costs, maintenance and security. Another major issue is learning the oil extraction, production process and business aspect.
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Funding

Secure funds from a commercial bank in your community. You need collateral such as landed property or a building.

Write a business plan and feasibility study to present to your account officer. Things the bankers look out for are previous experience, management structure and profitability.

Register your Business

Register your business as a limited liability company and apply for trade permit. Your produce has to go through standardization and certification.

Join associations and groups related to your enterprise. Find out the local government requirements before starting the enterprise.

Sourcing your Coconut

You need to decide on growing your own coconut or buying from wholesalers or farms. Coconut trees take several years to grow and they are seasonal plants.

The good news is that one tree can produce a large bunch of coconut throughout its life. Source your coconuts from your farm, farmers or wholesalers

The Production Process

Coconut oil is made by using coconut flesh, coconut milk or residues. To get the coconut oil remove the outer shell and wash the fleshy kernel.

Then apply either wet milling or dry milling process. You can extract oil from coconut through the wet or dry process.

 To produce coconut oil press or dissolve the dried copra to get the oil and a protein rich fiber mesh. The drying process is done by using natural sunlight or fire. While the pressing process is achieved through manual manipulation or using a mechanized equipment.

The wet process creates an emulsion of oil and water. Dried copra is not used in wet production rather producers use raw coconuts.

To extract the oil from the emulsion they apply heat through boiling. To avoid getting discolored oil through prolonged boiling modern methods use centrifuges, enzymes salts, acids and electrolysis.

The oil derived from the extraction of copra is of low quality and less nutritious and cheap. However producers using dried copra further refine through bleaching and deodorization. Virgin and extra virgin unrefined coconut oil are of higher quality than dry copra method.

In a nutshell coconut oil production process goes through direct micro expelling, expeller cold press, fermentation or centrifuge methods of extraction.

Refined Oil

The type of oil you produce depends on your companies focus. The production process defines the kind of oil you make.

You can refine through bleaching and deodorizing dried copra or use enzymes. Other methods are fractionation to separate different fatty acids for specific uses.

Or use full or partial hydrogenation to make them more saturate. Your finished products still has  to pass the standard organization safety requirements for edible food.

Study your Competitors

It depends on the type of coconut oil you want to produce. Study your competitors to determine what they produce and marketing strategy.

 Apart from the oil you need an attractive packaging and branding. Coconut oil is used in cooking meals and industrial applications.

The Taste

Coconut oil has different tastes depending on the soil composition, geographical location and type of coconut. Other things that affect the taste of Coconut oil are the farming and extraction method.

Marketing

To sell your product you can network with wholesalers and retailers in you area. Use electronic and print media to reach potential customers.

Sell your product to large restaurants and hotels. Sell online through your website or through paid classified advertisement. Attend flee markets, supply supermarkets, trade shows and large stores.