How to Start Your Ayurvedic Manufacturing Unit?

In recent years, Ayurveda has witnessed a remarkable revival, thanks to the growing global preference for natural and holistic healing systems. With India being the birthplace of Ayurveda, it presents a golden opportunity for aspiring entrepreneurs to establish their own Ayurvedic manufacturing unit. But stepping into this industry requires more than just herbal knowledge — it involves legal, technical, and strategic planning. This guide will walk you through everything you need to know to start your Ayurvedic manufacturing unit in India.

How to Start Your Ayurvedic Manufacturing Unit?

1. Understand the Ayurvedic Market Landscape

Before you invest time and money, conduct a thorough market analysis. The Indian Ayurvedic industry is estimated to reach INR 1,45,000 crore by 2027. From immunity boosters to skincare and gut health, consumer demand spans across a wide product range. Some trending categories include:

• Ayurvedic tablets & capsules

• Churnas and powders

• Herbal juices & tonics

• Oils, ointments & cosmetics

• Ayurvedic syrups and kadhas

Knowing what products are in demand and who your target customers are (B2B pharma companies, direct-to-consumer brands, or retail buyers) will help you design a scalable business plan.

2. Decide Your Business Model

There are two main routes to begin your Ayurvedic manufacturing journey:

1. Own Manufacturing Unit

You invest in land, plant, machinery, licenses, and hire technical staff. You have complete control over production, branding, and quality assurance.

2. Third-Party or Contract Manufacturing

You outsource production to a certified Ayurvedic manufacturer. This is a low-investment model to test your product idea before scaling.

If you're planning to start with limited capital, contract manufacturing with trusted firms like Alicanto Biotech can help reduce risk and still give you access to high-quality products.

3. Register Your Company

You need to officially establish your business entity before applying for manufacturing licenses. You can choose among:

• Proprietorship (ideal for small setups)

• Partnership or LLP (for co-founders)

• Private Limited Company (preferred for startups looking to raise funding)

Get your GST Registration, PAN, and Current Account ready as a part of the company setup.

4. Choose a Suitable Location

The manufacturing unit must comply with GMP (Good Manufacturing Practices) guidelines under the Drugs and Cosmetics Act, 1940. Choose a location that:

• Is outside residential areas

• Has adequate water and electricity supply

• Has proper drainage and sanitation

• Meets the minimum area requirement (1200–2000 sq. ft. depending on scale)

States like Himachal Pradesh, Uttarakhand, and Madhya Pradesh offer industrial subsidies for herbal manufacturing units.

5. Apply for Ayush Manufacturing License

Ayurvedic products fall under the regulation of the Ministry of AYUSH. You need to apply for a manufacturing license from the State AYUSH Department. The license types include:

• Ayurvedic Manufacturing License – For manufacturing classical and proprietary medicines.

• Loan License – For those who don’t own manufacturing facilities but want to get products manufactured at a licensed unit.

• Contract/Third-Party License – When you tie-up with an existing manufacturer.

Documents Required:

• Company registration and site plan

• Ownership/lease deed of premises

• List of manufacturing equipment

• Proof of technical staff (BAMS graduate and experienced pharmacist)

• Water quality report

• Product list with formulations

6. Hire Qualified Technical Staff

As per AYUSH norms, your team must include:

• A Production Manager (BAMS or Pharmacy in Ayurveda) with 2–5 years of experience

• A Quality Control Manager

• Skilled workers for blending, packaging, and labelling

• Microbiologist or lab technician (if testing is in-house)

Having the right team ensures that product quality complies with pharmacopeial standards (API/Ayurvedic Pharmacopoeia of India).

7. Procure Machinery and Raw Materials

Based on your product line, procure the required equipment like:

• Pulverizers, Mixers, Sieving machines

• Granulators and Coating machines

• Filling, labelling, and packaging units

• QC and microbiology lab equipment

For raw materials, source certified herbs, oils, and extracts from trusted Ayurvedic raw material suppliers. Maintain proper documentation for traceability and quality audits.

8. Follow Packaging and Labeling Guidelines

According to Rule 161 of the Drugs and Cosmetics Rules, every Ayurvedic product label must include:

• Name of the drug & category (Ayurvedic proprietary/classical)

• Batch number and manufacturing date

• Expiry date and dosage

• Manufacturer’s license number

• List of ingredients in descending order

Also, comply with Legal Metrology rules regarding MRP, barcode, and net quantity.

9. Build Your Brand and Distribution Network

Once manufacturing is ready, focus on brand positioning:

• Design appealing packaging and brand story

• Create a product catalogue with benefits, USPs, and usage

• Develop an online presence via website, marketplaces (Amazon, 1mg, etc.)

• Partner with Ayurvedic doctors, clinics, distributors, and retailers

• Participate in Ayurvedic expos and B2B events

Having an offline + online channel strategy will boost sales and trust.

10. Stay Compliant and Innovate Regularly

After setup, continue regular audits and quality testing. Renew your licenses on time. Explore R&D collaborations with Ayurvedic colleges or research institutions. Launch new formulations based on consumer feedback and health trends (like gut health, diabetes, stress relief, etc.).

You can also consider certifications like:

• GMP Certificate

• ISO 9001:2015

• FSSAI (for nutraceuticals/herbal juices)

• Organic or USDA Certification (for exports)

Final Thoughts

Starting your own Ayurvedic manufacturing unit is both rewarding and impactful — you’re not only building a business, but also contributing to the revival of India’s ancient wellness system. While the process may seem complex at first, breaking it down into clear steps — market research, licensing, staffing, manufacturing, branding, and compliance — can make it achievable and profitable.

If you’re not ready for full-scale manufacturing, you can start with third-party Ayurvedic manufacturing through experienced partners like Alicanto Biotech, and gradually transition to your own unit once your brand scales.

Need Help Starting Your Ayurvedic Brand?
Alicanto Biotech offers end-to-end third-party manufacturing support — from custom formulation to packaging, licensing, and marketing consultation. Partner with us to launch high-quality Ayurvedic products under your own brand!