How To Start Cement Business in Nigeria
Generally, building materials such as Cement, Roofing sheets and Rod is a steady moving commodity.This is because shelter is one of the three basic needs of man. Cement is one building material that is heavily used during house and other constructions.
In the case of house construction specifically, Cement is used from start to the finishing. This makes Cement a fast and steady moving commodity.
Investing in Cement sales can be lucrative and profitable when right steps are taken. There are not so many Cement companies and brands in Nigeria, so majority of Nigerians hardly consider brands when buying, rather they look at for good prices.
Just as obtained in other business fields, it is always vital that feasible plans are put in place before one launches a startup.
Cement business is no exception in this regard as potential Cement merchant has to put into place certain plans and work in accordance with his or her capital.
The good thing about Cement business is that it is a commodity sold mostly in bags and so needs little or no apprenticeship.
Also, stock taking in Cement business is easy, so this gives Cement dealer advantage to evaluate sales and performance especially when a sales representative is manning the sales.
In this article, Nigerian Informer will be discussing important tips needed towards running a successful Cement business in Nigeria.
Cement Business Tips
Before venturing into any business, one of the crucial considerations is capital. This is because, capital will determine the level of operations and feasibility of meeting up with the business requirements.
Some businesses are capital intensive and Cement business is one of them. In Nigeria, price of bag of Cement goes for between N2400 to N2700.
This can give you an idea of how capital-intensive Cement business is in Nigeria. Nevertheless, with faith and good work, success is achieved.
Cement business in Nigeria can be operated in two echelons, either as a major distributor or as retailer. These two levels of operations require different capital and commitments.
Cement Major Distributors
Selling of Cement as major distributor has to do with being manufacturer representative. This means you will be standing in for the Cement companies and helping them get their stocks across the market.
This level of Cement trading and sales requires bigger capital and commitment. As a major distributor you need to ready capital capable of buying a minimum of 1 truck of Cement i.e. around 600 bags.
This is because major distributors are supplied to directly by the manufacturers. So, if you aim to start Cement business in a big way, then you should target becoming major distributor.
However, before one can become a major distributor, he or she will have to register with the intended Cement company and meet certain requirements.
Requirements For Cement Major Distributors In Nigeria
Application letter to become a distributor
Bank reference letter
Passport photograph of would be distributor
Certificate of company registration from Corporate Affairs Commission (CAC)
Passport photograph of the Cement company representative
When these requirements are met and application successfully submitted to the company, a feedback will ensue which can be positive (approval) or directive (instructions). When positive, then you can place order and expect supply.
Many Cement dealers attained major distributor level from retailing position. Starting Cement sales as a retailer does not require capital as huge as those of major distributors.
Also, it needs no paper works. What is needed as retailer is finding and getting yourself attached to a major distributor who will be willing to help you grow by giving you supplies as great prices and aids like free transportation for supply.
Things To Consider In Cement Business In Nigeria
Before starting Cement business in Nigeria, there are certain logistics that is required for a successful operation. Some of these considerations are:
It is always advisable to operate and situate Cement business in urban and semi urban areas. This is because, most construction goes on in these parts of Nigeria.
Most people who have need for Cement use in the rural areas, often purchase in urban and semi urban areas and transport it to these rural areas. So, your location also must be strategic too.
Warehouse / Store
Also warehouse to be used for the business should be considered. It must be accessible and motorable.
Also, the warehouse to be used must be a cool and dried one and should not have access to flood or water of any sort.
Truck / Vehicle
Why a Dyna truck or vehicle is important is that it will help bring in extra income. This vehicle will transport Cement to destinations of the buyers and is not free as the buyer pays for the transport. It also gives your customers stress free purchase.
As a Cement dealer, some of your top clients and friends must be building engineers and contractors. Familiarity and friendship with these engineers and contractors will benefit you as a Cement dealer. Also, hold your family and relatives close as they can as well patronize heavily.
How Lucrative is Cement Business in Nigeria
Shelter is one of the basic needs oc man and Cement is one of the major building materials in Nigeria.
It is very lucrative to sell Cement business in Nigeria. It is a steady moving business.
Some retailers in Cement business in Nigeria sells a bag of Cement with around N200 profit.
So, Cement business is a lucrative business in Nigeria.