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How to Start Indomie Distribution Business in Nigeria

Indomie is one of Nigeria’s most popular fast foods. It is sold in the market as Instant noodles, a precooked and dried block with flavoring powder sometimes with seasoning oil. Children, young adult and even adult eat Indomie. Indomie has gained a massive acceptance in Nigeria as a fast food as many people have learned how to garnish the food with vegetables and proteins.

How to start Indomie Distribution Business in Nigeria

Courtesy: Dufi Prima

Interestingly, this encourages the fast sell and distribution of Indomie noodle. The product is fast penetrating the market, both in rural area and cities; and being enjoy most by the school and pre-school children. Without mincing words, indomie distribution is a profitable business in Nigeria that’s worth venturing into.

So if you intend to start Indomie distribution business, and you do not know how to go about it – this post is for you. This post will expose you to, “how to start Indomie distribution business in Nigeria”. In other words, you reading this article to end will definitely show you how to get started with Indomie distribution business; and ultimately how to become a successful distributor of Indomie.

No time to read the entire article, jump to part you want to read.

Market Overview of Indomie Distribution

Indomie is manufactured by an Indonesian company called Indofood and run by Dufil Prima Foods Plc in Nigeria. Indofood established its Indomie manufacturing facility in Nigeria in 1995. After constant efforts put in by the company through the years, Indomie now enjoys a whopping 74% market share in the Nigerian noodles industry.

The increasingly population and busy schedules of Nigerians has lead to increase demand for fast foods like Indomie. Indomie prepared meal sell fast in busy areas like Lagos, Abuja, Kano, Part- Harcourt, etc. where people just want to eat a delicious meal as quickly as possible and go about their daily activities. In other areas that are not busy, people still enjoy Indomie prepared meal due to its unbeatable taste and different ways of preparing it.

An interesting fact about indomie distributorship is this – If you start Indomie distribution in Nigeria, you don’t need to spend heavily on marketing as Indomie noodle has already established itself as a strong brand as well as a household name. So, you can take advantage of that.

Steps to Start Indomie Distribution Business in Nigeria

The Following are steps to become an Indomie distributor in Nigeria:

  1. Pick a Level of Indomie Distributorship
  2. Raise Capital
  3. Choose a good Location
  4. Get a warehouse
  5. Register your business with CAC
  6. Acquire Indomie Distributor’s Right
  7. Seek key information from established Distributors
  8. Get vehicle
  9. Hire Staff
  10. Get started

Pick a Level of Indomie Distributorship

The number one step is to pick a level of indomie distributorship you want to start with. Indomie Distribution Business comes with two different level of distributorship which you can choose from if you going into the business. The two levels of the distributorship are major and sub-distributors. The two levels are different on the bases of capital investment.

The indomie noodle manufacturing company can only accept you as their major distributor if you can invest huge capital of about N3,000,000.00 that will covers the cost of at least one truck of indomie. And each state in Nigeria can only have 1-3 major distributors.

On the other hand, if you’re going in as a sub-distributor; the capital investment is less about N500,000.00.  And of course, you can locate the business anywhere in Nigeria because there is no restriction on the number of sub-distributors that can exist in a state. But then, you‘ll have to buy only from the major distributors instead of the company. The disadvantage of this is that, you will not get sales commissions, bonuses and other gifts the company offers their major distributors. 

 Raise Capital

The next is to raise capital for the business. Aside the initial capital investment of about N3,000,000.00 as the major distributors and N500,000.00 as the sub distributors, you’ll also need capital to rent a warehouse, purchase truck, and hire marketers and staff. Getting capital for the Indomie distribution business can be quite challenging, just any like any other distribution business in Nigeria.

But, this challenge can be overcome you can source for funds through the following means:

  • Family and relations financial support
  • Friends financial support
  • Partnership – you can partner with someone who is willing to start the business with you. But, care must be taken and memorandum of Understanding (MoU) signed to void misunderstanding which may occur in the near future.
  • Church financial suport – you can write a letter to your church appealing for financial support of your business
  • SME Loan – you can also apply through appropriate channel for SME Loan
  • Philanthropist
  • Corporate body or organization grants
  • Commercial or microfinance banks that provide business loans.

Choose a good Location

After you raise the initial capital investment, the next thing is to choose a good location for the distribution business. Choosing good location is as important as starting the business. The location of the business can either make or mar the business. If you choose a good location, your business will grow faster. On the other hand, if you make a wrong choice of location; your distribution business will likely collapse in near future.

Some of the factors you need to consider when choosing location are:

  • Accessibility of the location to your potential customers and of course, the company’s truck
  • Nearness to market
  • Availability of marketers
  • Busyness of the area
  • Security

Get a Warehouse 

Warehouse is necessary because the product will not be store outside. If you leave those cartons of Indomie outside, they’ll get damage by the rain, rodents, pests etc.   And that’s why before the company gives you distributor’s right, they will first, inspect your warehouse. On other words, your warehouse is prerequisite to get distributor’s right.

A warehouse for the distribution business should:

  • Be big enough to accommodate all your goods
  • Not be vulnerable to burglary
  • Be protected from rodents and pests
  • Not have opening or leaking roof

But for the sub-distributors, you don’t need a warehouse. All you need is a store big enough to hold your goods.  To avoid loss and damage of your goods, ensure the store is well protected.

Register your business with CAC

Registering your indomie wholesale business has so many advantages. If you register your business name:

  • Customers will regard your business as reputable
  • It will attract  business partnership
  • Government establishment can easily request supply from you
  • It hasten your distributor’s right approval
  • Can apply for loan

The authority in charge of registering enterprises and businesses in Nigeria is Corporate Affairs Commission (CAC). The procedure for the business name registration is on the CAC website. But, if you don’t want to make costly mistake by doing the registration yourself, you can hire the service of a lawyer.

Acquire Indomie Distributor’s Right

Acquiring Indomie distributor’s right is what gives you the right to distribute Indiomie instant noodles. So once you get the required capital investment ready, go to Dufil Prima Foods Plc at No. 38, Eric Moore Road, Surulere, Lagos, Nigeria to acquire indomie distributor’s right. Or visit Dufi Prima Food website to contact the company.

The procedure is, when you get to Dufi Prima Food corporate office at Surulere Lagos:

  • Tell them of your interest to be their distributor and the state you want to distribute in – if you getting into the business as a major distributor
  • Fill and complete the distributor’s right form they will give you
  • Wait for them to inspect your warehouse – that is to say, they expect you to get your warehouse ready.

If you meet their distributorship requirement after inspection, they’ll approve your distributor’s right.

Seek key information from established Distributors

Before you jump in with both legs into business, it is important you seek key information from established major-distributors. Doing this will help you avoid costly mistakes while your business grows faster. You can reach them via telephone call, email or whatsapp messaging.

If you’re going in as a sub-distributor, you have to get in touch with major-distributors in your region. You collect their contact information and addresses as you’ll likely buy goods from them. Those major distributors may also help to connect you to retailers who may be interested in buying from you.

Buy Van or Pickup truck for the distribution business

As a distributor, you’ll need a van or pickup truck to deliver goods to your customers. Though some customers may come with their vehicle to pick up their items from your warehouse, you still need to get your own vehicle to transport goods to others that will ask you to deliver to them.

If you can’t afford to buy a van or pickup truck when starting, you can try the following:

  • Buy a van and pay on installment 
  • Rent a van
  • Partner with someone who owns a van or pickup truck. So that,  when you start getting a stable cash-inflow from the business; you can then buy your own van or pickup truck.

Hire workers

Hiring of workers to assist you in this business is very vital, as you will be hauling hundreds of Indomie cartons into vehicles every day.  This will be too overwhelming for only you to handle. So, you’ll need to hire workers.

The number of workers you’ll hire depends on how large your business is and your capital. If you don’t have enough capital, you can start with 2- 5 workers including a driver and sale representative. But when you’re such a major distributor who orders 2- 5 trailers of indomie cartons, you’ll need nothing less than 10 workers including drivers.

Get Started

The final step is to get started. This is most difficult step in this business.  Once you receive your distributor’s right approval, buy or hire a van and employ workers; you get started! Never be afraid to start. Start and learn on the field.

How Profitable is Indomie Distribution Business in Nigeria?

Indomie distribution business is a profitable. The profit is in the sales volume. The more sales you make, the bigger the profit. Take for instance, you sell 2000 cartons of Indomie weekly at a profit of N100 per carton, that’s 2000 x N100 which gives N200,000 profit. Imagine, being in this business for 5 years.

It is estimated that 50 million Nigerians consume Indomie out of a total population of over 206 million. That is a large number, and you can have your piece of the pie as an Indomie distributor in Nigeria.

 

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