Foodstuff business in Nigeria is a highly lucrative business just like the provision store. The business is also known as raw food business. It is a quick-to-start type of business. Foodstuffs like beans, rice, garri, grayfish, etc are fast selling food items but must be preserved properly to avoid spoilage and lost of capital. Most successful business men in Nigeria like Aliko Dangote and Oji Uzo Kalu started out with foodstuffs business.
Buying and selling of foodstuff can be done in store or open space near residential areas, open market places and can even be taken online. It is business every serious business-minded individual can start. The amount you have or your capital will determine your level of entry into the business. If you have huge capital like ten million naira, you can start the foodstuff business on a wholesale or distributor level. But with small amount of capital, you can only buy from wholesalers and sell to retailers and consumers.
To succeed in foodstuff business, you need to engage yourself in apprenticeship training with a reputable or successful foodstuff businessmen or women for 6 – 12 months. This will help to expose you to the hidden secrets of the business and also enable you to handle large supplies when they start coming.
This was how Aliko Dangote, the richest man in Nigeria and Ojiruzo Kalu did during their days of their humble being. Kalu was passionate about buying and selling that when he was expelled out of school, he borrowed money from his mother to start palm oil business. He will buy form the eastern part of Nigeria and sell it in the north. Today he is one of the most successful business men in Nigeria. One the other hand, Aliko Dangote discovered his passion for buying and selling while in school. He first started by buying and selling sweets to his mates and also helping his uncle “Dantata” in his shop to sell foodstuffs. He took his time to understand the business while assisting his uncle in his business. He later borrowed money from his uncle to start his own food stuff business and now he is the richest man not only in Nigeria but in Africa.
Table of Contents
So if you’re passionate about foodstuff business, follow the below steps to start it:
Step to Start Foodstuff Business in Nigeria
Get Capital for your Foodstuff store
To get started with foodstuff business, the first thing to do is to get capital for the business. It is best to self-fund the business rather than borrowing money to fund the business. But if you must borrow money, ensure you borrow from a reliable source or money lender you know will not disturb you on daily basis. Some months ago, I showed you how to source fund to start a business, if you like you can check that out.
Foodstuff business or raw food business does not require any specific amount as start up capital. But on a low scale, you can start a foodstuff business in Nigeria with a capital of N500, 000 – N1000,000. On a medium scale level, you’ll need like N2,000, 000 – N5,000, 000 and then on large scale N10, 000, 000 and above. We’re often times sceptical in discussing capital requirement for any business. This is because the amount of capital you’ll need to start foodstuff business for instance in the rural area will never be the same amount you require to start the same foodstuff business in the urban area. And even within two nearby cities or town, the capital requirement for starting the foodstuff business will never be the same. So the best solution is to go out there (within your location) to sort out the prices of food items.
Do Market Survey
The next step to take to start a profitable foodstuff business is to do market survey. Aside the information we shared on this article, you’ll still need you to do your own market findings as regards food stuff business. This is very important because the rate of food items in market changes every day and you can’t rely on old price of items. Again, the price of things varies from one location to another. We always encourage our reader to do their own marketing findings on any business we share on our website. So while we try to show you everything you need to start profitable foodstuff business, do your own market research and get acquitted with the current trending in the market
Rent a Shop/Warehouse
Another important step to take when starting foodstuff business is renting a good shop. Renting a good shop is very essential as you cannot afford to risk your goods to things that can easily get them spoil or damage. If you’re going into a wholesale foodstuff business, it is best you rent a warehouse instead of a shop. The large space will give you the opportunity to buy bulk foodstuff items without fear of spoilage. And you should ensure the shop is protected from pest and rodents that can destroy many of the foodstuff and also sun which can cause deterioration of the foodstuffs. Things to take into consideration when Renting Shop for foodstuff business include:
- Good location: the location of the business has to do with where you situate your foodstuff business. It has to be strategic area within a dense residential vicinity or dense populated open market. A good location is necessary because it has a lot do with how customers can locate your business, easily. Your shop should be a strategic location, a point where thousands of your anticipated customers will pass every day.
- Money for Shop Rent: after getting a good location, you should also consider how much you’ll pay for the first few months. This money is most times taken from your capital and to make it logical, it must not pass more than 15% – 35% of your capital. For instance, if the capital you have set aside for your foodstuff business is N1.5M this means that the money for the yearly rent for your shop must not exceed N350K.
- Shop Space: does the shop have enough space? Can it contain bulk foodstuff now and able to contain more foodstuff in the nearby future when the business starts growing?
Buy your Foodstuff in Bulk
It is actually impossible to sell all different types of foodstuff unless you are sure that you can really handle every part of it. Even the business mogul like Dangote did not go into the sale of all types of foodstuff when he started. He started with few foodstuffs. So, you can start by buying few foodstuffs in bulk. Buy from a manufacturer or wholesaler so that you will be sure you’re buying at the lowest price. If buy the foodstuff in bulk, you can be sure of big profit margin after sales.
Stock your store
When stocking your foodstuff store you need to be extra careful because the way you place your foodstuff will determine how long it will last for you before it will get spoil. When you store the foodstuff very well in your shop, it will last long and you will sell them in good condition.
Before storing or stocking of your shop, you should make sure that the floor is dry enough. Do not place the foodstuff on bare floor and count it while packing it to make sure none was missing during transport.
At this stage, you need to tell your friends, family and neighbours about your new business so that they can start patronizing you from the day you start. As a way of introducing your foodstuff business to the people, you can do “an open business ceremony”. Again, to gain more potential customers; you can carry out price slash on food items as against your competitors. For example, if one bottle of red oil is sold at N800 by other sellers, you can start selling at the rate N750 per bottle. This will attract more customers to your shop.
And because your shop is strategically located, you’ll start selling immediately.
List of Food Items to Sell in Nigeria:
- Garri (white and yellow)
- Oil (Red and Groundnut)
- Seasoning cubes
Is Foodstuff business Profitable
Yes! If you go into raw food business in Nigeria directly or indirectly you are going to make big profit whether you start in small or large scale. But the more money you invest in the business, the bigger the profit you’ll be making. You cannot compare the profit of someone that invest N400,000 foodstuff business with someone started with N1,000,000 (one Million). Obviously, the person that start with N1M will make more profits than the person that started with N400,000. But you start either small or big . Don’t be pushed to start big if you can’t afford it. Go and start with whatever you have and grow the business.
Foodstuff business is one of the good businesses we have in Nigeria but you have to position yourself properly to enable your business to grow. And to grow your business you have to continuously re-invest your profit. And to avoid damage cause by rodents and pests ensure you close every holes in your shop both on the floors and on the walls so that rodents will not gain no entrance into your shop