Detailed planning is required for setting up a dairy plant. Important factors related to milk procurement, site selection, plant equipment and machinery requirement (including related utilities/services), financial planning, product mix, marketing system etc must be appropriately considered. An attempt has been made to provide a broad guideline on project planning and implementation as well as a basic techno economic feasibility of small, medium and large dairy plants for the benefit of prospective entrepreneurs.

There exists a vast potential to establish mini dairy plants in the interior areas where milk can be processed and conserved in the best possible manner.

Small scale manufacture of indigenous milk products can be done with the help of cost estimates and flow diagrams given below. A unit producing milk products like peda, kheer, shrikhand, paneer and dahi/chhach/lassi will call for an investment ranging between Rs. 20 and 35 lakhs and can be set up in peri-urban areas to meet the local market demand. Specific projects would have to be worked out on the basis of location, current pricing and type of equipment selected. The costs mentioned here are just to give an indication to the prospective entrepreneur.

All the dairy plants in the country are expected to observe GMP at all times. However, there is much variation in the observance of this requirement. The dairy plant should adopt highest standards at the designing stage itself for matters relating to quality. Also, quality is produced on the production floor and not in the quality assurance (QA) laboratory. Thus, QA staff should spend much of their time on the production floor to see and help the production staff observe GMP and SOPs. The dairy must have an established, clear QC system of sampling, testing, release of the product, etc. The QC workforce should own this system.

Dairy plant operations are energy intensive, which demand energy in terms of fuel and electricity. It is desirable to calculate energy consumption value for each operation and to have periodic energy audits. The management at Vidya Dairy measures, records and analyzes the utilities consumption data in monthly meetings. The current month data is compared with that of previous month and previous year for same month. Any variation is discussed and justified with the variation in the processes resulting in their increased or decreased consumption.

The Up-flow Anaerobic Sludge Blanket process (UASB) has been found to be one of the most successful ways for primary treatment of dairy effluent. Apart from energy savings and drastic reduction of BOD/COD load, the biogas generated can be effectively utilised for various heating applications including food preparation and generation of steam.