How this MBA mushroom entrepreneur clocks Rs90 lakh annual turnover

After completing his MBA, Arun Sharma's next logical step would have been to take up a corporate job offer and move out of his home in Kathua, Jammu and Kashmir. Instead, he chose to stay with his family and became a coordinator at a local NGO working with underprivileged children and women.

To make the women financially independent, the government was offering a training programme on button mushroom farming in Kathua. “I had no prior knowledge of mushroom cultivation but I attended that programme as a coordinator and it opened up a new world for me,” he says.

Arun learned about procuring mushroom seeds (spawns), their growth in a dark room, and possible sales channels. “I was always drawn towards entrepreneurship. On a trial basis, I bought 100 ready mushroom bags from a local supplier. They cost me Rs9,000 at Rs90 per bag,” he says.

The ready bags contain mushroom substrate with spawns and require hygienic growth conditions with right humidity and temperature. “The results were good and after about two months, I sold mushrooms worth Rs16,000 from that small room,” he says.

The mushrooming of an idea

Encouraged by the results, he increased the number of bags in the room and continued to work at the NGO. “After three years, in 2014, I felt the market demand for mushrooms was rising and it would be profitable to expand the scale. So I quit my job and started full-time mushroom farming from an old building near my house. I paid rent for that unit,” Arun says.

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Mushroom farming can be done seasonally, or throughout the year using air conditioning to maintain optimal temperature and humidity for growth. “Since selling the produce was not a challenge due to high demand and I had gained experience over three to four years, I decided to expand,” he says.

The next year, in 2015, Arun took a bank loan of Rs7 lakh and pooled his savings of Rs3 lakh to build an all-season unit with air conditioning. 

“I set up the unit over 1,000 sq ft next to my house and installed two ACs of 1.5 tonnes each. I also created a small packaging room that could also be used for cultivation,” he says.

Arun began procuring mushroom seeds or spawns from ICAR-Directorate of Mushroom Research (DMR), Solan, and a local supplier. 

This 1,000 sq ft unit could hold 1,000 bags stacked vertically. 

“We took three harvests, resulting in 3000 bags annually that gave 60 quintal (6,000kg) of mushrooms. The annual income was around Rs 8 to Rs 9 lakh as mushrooms were sold at Rs 130 to Rs150 per kg at that time,” Arun says.

“In 2017, we expanded the facility that could give us 15,000 to 16,000 bags (around 32,000 kg) annually, resulting in revenues of Rs 32 lakh,” the mushroom entrepreneur adds.

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The business of mushroom compost

By 2019, Arun realised that making mushroom compost on a large scale was a profitable proposition. 

Compost is the base for the growth of mushrooms. It is prepared using wheat straw, chicken manure and gypsum. Chicken manure is an easily available source of nitrogen and other nutrients, essential for good mushroom growth. 

“We have set up a facility over 5,000 sq ft. For mushroom compost, our output is 50,000 bags per year. We sell it at Rs90 per kg, resulting in Rs45 lakh of annual revenues,” Arun explains. 

Large-scale mushroom production and marketing

In 2020, he set up a fully insulated PUF panel building with two rooms and a capacity of 2400 bags per lot. PUF panels have three layers made of galvanized steel sheets. PUF panels are an essential component of the pre-fabricated construction industry. As they are antioxidant and antimicrobial, PUF panels are a good option for mushroom cultivation facilities. 

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“The temperature in each room is lowered from 24 °C to 13 °C as the mushrooms grow,” Arun explains.

“We keep four lots in a year, resulting in annual production of 35 tonnes (35,000 kg) and revenues of around Rs40 lakh to Rs45 lakh,” he says. The total area under mushroom production is 5500 sq ft.

After deducting costs for electricity, labour, seeds, compost and packaging material, the profit is Rs25 lakh per annum.

Arun has four permanent employees and works with 15 other workers on a need basis.  He sells mushrooms in Kathua, Jammu and Pathankot while the compost bags are supplied throughout Jammu and Kashmir and also Ladakh.

He currently trains other farmers on a small scale and plans to expand the unit to set up a training facility for learners. Arun advises aspiring mushroom entrepreneurs to prioritize understanding the market demand before commencing production. "The key to successful mushroom entrepreneurship is in securing ready buyers due to the product's short shelf life. Waiting until after production to find a market is too late," he emphasizes.

(Rashmi Pratap is a Mumbai-based journalist specialising in business, financial, and socio-economic reporting)

Also Read: This MBA mushroom farmer earns Rs5 lakh a month from just a 1400 sq ft unit

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