How to Start a Biodiesel Company

With the growing use of biodiesel in vehicles and unpredictable oil markets, the chance of starting your own biodiesel business is getting brighter by the day. As people get tired of the energy crisis that strikes economies from time to time and turn to alternative energy sources, investment in biodiesel will keep getting more and more rewarding.

Biodiesel fuel is extracted from vegetable oil and it is regarded as a safe source of energy. The market for this fuel is flourishing as it not only used in private vehicles, but also used in railways, aircraft and large generators.


  • 1

    Do some speedy market research

    Starting a biodiesel company without doing a marketing research may cost you dearly as there are so many factors that you will have to take into consideration.

    Factors like the average number of vehicles that run on biodiesel in the area where you plan to set up your business, the competition in the market (number of companies that deal in biodiesel), and of course assessment of your own resources, will play a key role in making or breaking your new business.

    If you are having trouble doing a market research on your own, you can hire a company to do it for you.

  • 2

    Decide what market you will serve

    Biodiesel can be used in multiple ways. There are private vehicles, generators, and even aircrafts that run on biodiesel. You will have to decide what market you want to serve and then make a business according to the decision you have taken.

    Vehicular use of biodiesel has grown lately in countries like the United States and England, and is only bound to increase more.

  • 3

    Retail or wholesale?

    Decide how you will be selling the product - retail or wholesale. If you plan to sell the oil on retail, you won’t have to worry about production and manufacturing process. All you have to do is get in touch with manufacturers and buy oil at rates that are good enough to give you healthy profits.

    However, when it comes to wholesale market, you will have to take several factors into consideration. Pretreated vegetable oil is also sold on wholesales basis. Some wholesalers use their own formula and treat pretreated vegetable oil to give it a new form.

    Make sure you study all the aspects of retail and wholesale market of biodiesel fuel.

  • 4

    Find customers

    In your industry, diesel users should be the first target market. Contact diesel users like truckers and companies that sell diesel-run generators. Get in touch with manufacturers and suppliers of biodiesel-run vehicles.

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