How to Start a Soft Drink Wholesale Business in Nigeria

Soft drink Wholesale business have been on since ages, a lot of soft drink products (soft drink in plastic and bottle) have come and gone. In Nigeria,  beverage and soft drinks like Coca-Cola Classic, Pepsi, Diet-Cola, La Casera, Mountain Dew, Fanta and Sprite are the most fast selling soft drink products. But currently, an American brand of cola, RC Cola soft drink is competing with Coca cola brands and almost on the verge of taking over the soft drink market. Meanwhile, there are still some other newly emerging soft drink producers struggling to penetrate the market.

Soft Drink Wholesale Business in Nigeria

Courtesy: Coca cola Soft Drinks and others

Weather (especially when it is hot), party refreshment, celebrations, loyalty to the brand and the sheer enjoyment of the soft drink are some of things that prompt people to buy soft drinks. In overall, there is huge market for wholesale soft drink business in Nigeria. With the high population in places like Lagos, Kano, Onitsha, Aba etc; you’ll easily make a quick turnover and huge return on your investment. With this in mind, we’ll look at how to start a soft drink wholesale business in Nigeria.

In case, you don’t know what is required of you as a soft drinks wholesaler;

  • You are to buy soft drink directly from producers in large quantities and sells in relatively smaller quantities to sub-distributors, retailers and consumers.
  • You are expected to sell different varieties of soft drinks.
  • You may need to employ a number of sale and marketing agents for distribution of the soft drink.
  • You need a large amount of capital to invest in this business.
  • You may also be required to provide credit facility to your retailers and financial assistance to the producers or manufacturers.

Read: 50 Successful Small Businesses in Nigeria with less capital startup

Let’s get started with how to start a soft drink wholesale business…………..

Step to Start a Soft Drink Wholesale Business

Learn Soft Drink Wholesale Business

The first step towards starting a profitable soft drink wholesale business is to learn the tricks in the trade. That’s to say that you may need to undergo some level of apprenticeship in Soft drink wholesale business for at least 3 -6 months. Attach yourself to already established and trusted soft drink dealer to learn and understand the principles of marketing and how the Channel of Distribution works in wholesale soft drink business. Because, there is large number of competitors to contend with and too many soft drink brands to select from, you need a sound knowledge of soft drink wholesale business. This kind of knowledge is best gotten on the field and not by reading textbooks.

Go for market feasibility study

After you have gotten a sound knowledge of soft drink wholesale business, the next step is to go for a market feasibility study. During your market feasibility study, you’re expected to gather the following information:

  • List of all the soft drink products in the market
  • List of all the Fast selling soft drink products
  • Price of all the soft drinks in the market
  • Highest consumed soft drink brands
  • Demographic distribution of the population that consumes soft drinks.

The knowledge of the above data will help you to make sound decision on the brands of soft drink to distribute or sell.

Register your Business

After your market feasibility study, the next step in starting a soft drink wholesale business is to register your business. While this might seem not to be important, a critical review of all the successful businesses shows that they’re all registered businesses. You business name makes your business unique and give an identity to it.

Most soft drink producers will not like to do business with you if you’re running an unregistered business. Again, you need to register your business for fast approval of your application to become a distributor/wholesaler as well as branding and obtaining loans.

Registering a business in Nigeria is easier and very cheap. To get started, go to the Corporate Affairs Commission (CAC) official platform or visit their branch office in (get a location in Lagos.

Select Category of Soft Drinks to Sell

Considering the large number of companies producing different varieties of both bottle and plastic soft drink, you may have difficulty selecting brands of soft drinks to sell. To get the best varieties of brands of soft drink products to sell or distribute, consider the following:

  • Soft drinks that are in high demand.
  • Soft drinks with affordable price.
  • Soft drinks that young people enjoys. All this information should be gather during your market feasibility study.

If you’re going to site the business in place like Lagos, one notable fact about Lagos is that you will always find the best soft drink depots in Lagos that are ready to do business with you because it’s number one hub of commerce in Nigeria. You can easily find the address of soft drink companies nearest to you online. Check out the list of some of soft drink companies and their addresses.

Get a Store

The most important step in starting a soft drink wholesale business is in getting a store.  Warehouse with a store that has enough space and its location is within the reach of your potential customers is the best option. Renting a shop in a place like Lagos demands a lot of money and it depends on the area you intend to start your business.

To run a successful wholesale soft drink business in Lagos, you must get a store that will be used as temporary storage of the soft drink. The store should be

  • Highly secured from thieves.
  • Easily accessible by customers.
  • Be in a busy location, especially by the roadside for quick access.
  • It should be of high hygiene.

The average price of renting a shop in Lagos starts from ₦60,000 and can run into millions. Remember, the price of shops is influenced by location, size, and ease of accessing customers.

You should also ensure that your store is well equipped to take care of the drinks. It should be at the expected temperature. You can also provide refrigerators for customers who may need cold soft drink.

Get a Vehicle for Distribution

Getting the soft drink to your customers is an important strategy that will boost your sales and customer base. Most customers would like to have the cost of transporting the soft drinks taken from their budget. So, get a vehicle! There are some sites to buy a fairly used vehicle in Nigeria. You can try them.

As you get a vehicle, you will also need a driver that will deliver the goods on time to your customers or you can be the driver if you can’t afford the cost. And if you don’t have the money for a vehicle or any other means of transportation. You can hire the services of drivers with trucks that will supply the soft drink to your customers. This will reduce the cost of starting your business.

Raise Capital

Every business requires start-up capital, so is the Soft drink wholesale business. You’ll need to raise capital of not less than ₦700,000 to start a wholesale soft drink business (possibly for one or two brands of soft drinks). The capital requirement depends on the number of brands of soft drinks that you want to start with. Whereby, you don’t have enough or the required capital but you have the interest of starting this business, you can check out our  ways of raising capital to start a business.

Though, you can get the soft drink on credit, most soft drink production companies will still want to be sure that you have enough capital on the ground for your business. It is part of the factors that will be checked during the review of your application for distributorship.

Apply for Wholesale Soft Drink distributorship

After choosing the soft drink that you want to sell, you have to apply to become the distributor at the wholesale level. You can also get your soft drinks from the major distributor close to you since you are going to sell the soft drinks at the wholesale level.

For major distributorship, you must apply to the company directly. Most companies would like to know if you have a registered business, a good store, and enough startup capital before doing business with you.

Employ Staffs

Depending on the size of soft drink wholesale business you want to start, you may need to hire some workers or staffs to help you take care of some sensitive jobs.  For a start, you can hire 2 or 3 staffs that will help take stocks and get supplies to your customers.

But when your soft drink business grows, you may need to employ more staffs to handle some of the running of the business. You’ll definitely need driver(s) and storekeepers. The driver can be assisted by others to load the soft drinks into the vehicle when customers make demands.

Market your Soft Drinks

Finally, customers will seldom come to you until they get to know that you exist and have what they need. Hence, you are expected to market your soft drink wholesale business to the various customers mentioned above.

You can use the following media to market your business;

  • Social Media – You can reach some of your potential customers via social media.
  • Personal Contact – Reach out to retail shops around you and get their contacts. You might discover that many of retailers would want to patronize you if you’re selling a lower price compare to others.
  • Online advertisement – this is great way to spread the words about your business and get the world know about what you do. This in the long run turn out improve your soft wholesale business
  • Printing and distributing of your business card, flyers, and banners – if you have the money, you can design a business card for soft drink business and distribute it to your potential buyers.
  • Good customer service.

Because this business a competitive one, you have employ all necessary marketing strategies available at your disposal to beat your competitor if you want to make money in this business.

Conclusion

With the number of soft drink companies in Lagos and Nigeria general. You can start your own wholesale soft drink business and start making money. But, you need to follow the steps outlined above for a successful start-up of your soft drink business. The opportunity is always open for any interest individual.

There are challenges in this business but you can always overcome if you follow the steps above diligently.

I am sure you are aware that any time people come together for celebration, relaxation and to catch fun; it is most accompanied with soft drinks, this should give you an idea of how profitable soft drink wholesale business is.

How much is required to start soft drink business?

The quantity and the brands of soft drinks you wish to sell on wholesale will determine the amount of capital required to start soft drink wholesale business. but to estimate, apart from the cost of renting a store, with the sum of N700,000 you can start a profitable wholesale soft drink business in Nigeria.

 


Note: In case you want to share your thought with us about soft drink wholesale business, you can use the comment box below. We will get back to you as soon as possible.

 

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