5 Lucrative Small Businesses to Start in Nigeria for less than N200,000

There are so many businesses you can start in Nigeria for a very little amount of money and you can within a couple of weeks be smiling to the bank. Let me state that I’m not saying you’ll become rich overnight with little stress, I’m merely saying these businesses don’t require much startup capital although they are very challenging and require a lot of attention at least at the initial stages for them to yield the desired results. Overall I’ll say if you find a suitable location and have a solid marketing plan in place you should be able to recoup your investment in less than 4 months and even increase your income two or three folds within 6 months. I’m confident in recommending these businesses because of the existing market trends which show growth.

5 Lucrative small businesses to start in Nigeria 2016

Here’s the list;

Shawarma and small chops

Shawarma is one of the most items on demand in outdoor evening hangouts for young romantics and it’s increasingly gaining prominence among young Nigerians especially in cities like Lagos, Abuja, Port Harcourt and Benin. At some shawarma joints in Abuja I know of more than 60 orders are placed daily at average cost of N1,000 that’s N60,000 from sale of Shawarma only, now think how much sales could come from offering roast fish with chips, suya and drinks.

Startup requirements: a stand for placing your machine, Shawarma machine, condiments and ingredients for preparing your shawarma, drinks, furniture, entertainment system and working capital.

Reselling Palm Oil

Palm oil is one of Nigeria’s best consumed agricultural produce although there are health concerns about the quality of locally processed palm oil and cholesterol levels however if you can prove to your customers that you sell well processed and health friendly palm oil you’re already in business as many middle class consumers are becoming increasingly health conscious.

Startup requirements: N150,000 startup cash to purchase stock, 100 jerry cans of various sizes, capping machine and N30,000 for marketing

Hair and Beauty Salon

Anywhere in Nigeria you find women who earn an income regularly, you’ll always have a way to make money setting up a hair and beauty salon. The trick here is to be better than the average hair and beauty salon, if you make excellent hairdo women will flock around your salon like ants do to sugar.

Home and Office Cleaning

This business works best in top cities with a large number of middle class residents and offices such as Abuja, highbrow parts of Lagos and Port Harcourt. Your main customers would be hotels, schools, law firms, fast food restaurants, banks, IT companies and even private residences. Very few busy people who earn well have the time and energy to carryout basic home and office cleaning when they have plenty of work to deal with, so the demand is for professionals to render this service which is usually outsourced, the good thing is you only need basic cleaning reagents and tools which could cost less than N100,000 in total.  

Freelance Marketing

You can also start a small business as a freelance marketing/sales person approaching businesses with unique and lucrative products to help them find customers for which you get paid a commission for any successful sale made through your referral. For instance you may approach a real estate dealer, a car dealer, electronics shop, Education consultant/foreign school placement agency, hotel or car rental service. You make money by getting people who need these services to contact you for enquiries, when you answer their questions satisfactorily they’ll naturally want to know how they can make payment that is where you hook them up with the actual seller. But make sure you sign a contract with the seller so that you don’t work in vain. With as little as N50,000 you can start this business and what you mostly need is an online presence – website, twitter handle, Whatsapp number, email and thorough knowledge of whatever you want to market.

Thanks for reading my article, I’m Paul Onwueme a professional business plan writer contact me if you need a business plan or business proposal: 0803 206 4106

How to Start and Run a Profitable Car Hire and City wide Cab Service in Nigeria

There is a growing demand for car hire service whether for airport shuttle (pick up and drop off) or intra city car hire by visiting businessmen, executives or tourists within a city such as say Abuja or Lagos which are key destinations for business travellers to Nigeria. The Car hire service can be classified both under transport and tourism sectors of the Nigerian economy because of the very nature the services are delivered and to the target market which are mostly foreigners on visits to Nigeria.

The Market and Opportunity

The market for car hire service is quite huge worth over N7 billion in sales (based on my own research) and is very flexible as you can combine several related ventures with your business enabling you have more than one source of income.  It is hard to compute figures for this market but according to a report monitored on Leadership Newspaper about 5% of Nigerian business travellers use car hire services whereas not less than 360,000 people visit Nigeria annually for business and most of them have a budget to cover their stay while here in Nigeria. Part of that budget would go into airport shuttle service and car hire which many hotels have taken advantage of. Once you arrive in Nigeria as a visitor and have booked a hotel to stay in, naturally you’d enquire about cab services within the city you’re visiting but not all hotels can provide this service and even those who can may charge much or may want to focus on providing core hotel services that they’ll rather outsource the service to more competent companies. That is where you come in as a savvy business person.

The Car Hire Industry in Nigeria – Regulators, Operators and Associations

The main operators in this business airport shuttle service, car hire and cab services who on behalf of clients provide mobility and convenience to tourists and business travellers within key cities in Nigeria. One of the requirements for anyone intending on doing this business is registration with relevant government regulatory agencies such as Federal Airport Authority of Nigeria (FAAN) for airport shuttle. If you want to operate a cab service you need to be registered with the regulatory state government agency for intra city transport and that varies from state to state within Nigeria. It is also advisable to join the Taxi Drivers and Cab Operators Association within your resident state. Alternatively you may want to instead partner with reliable taxi drivers to provide this service instead of operating a taxi yourself. 

Some Challenges in Car Hire Business

• Armed Robberies and Car theft – there have been reported cases of armed robbers holding car hire and cab operators hostage while they perpetrate their crimes within Abuja for instance. Although these are isolated cases they have a way of preventing the business from running smoothly whenever they occur plus your company's reputation may take a hit if your clients are unlucky to be robbed while using your service.
• Bad Roads - this can affect your efficiency and cause some inconveniences for your clients 
• Uncooperative customers - Some customers are very difficult to work with. They might make unrealistic demands or set unreasonable targets for you to meet.
• Dishonest employees - some may go behind your back by giving out their own numbers instead of the company's number to potential clients and pocket the money they receive from such clients without informing the company.

Startup Costs

• Fairly Used Salon Car (preferably Toyota, Nissan or Peugeout 2008 model or later) – N1,300,000
• Office Space – N400,000
• Furniture – N100,000
• Marketing – N300,000
• Other expenses (including car tracking, insurance, operational costs etc) - N600,000
• Total – N2,700,000

The payback period is less than 1 year depending on how quickly you handle your sales efforts.

Related Business Plans

Car Dealership Sample Business Plan

Car Booth Business Plan in Nigeria

Auto Repair Service Business Plan 

Do you wish to set up a car hire service in Nigeria and need a professionally written plan you can take to the bank or show investors? I can write you such a plan. Just give me a call: 0803 206 4106 or email me: paulonwueme@gmail.com

How to Setup a Profitable Office and Industrial Cleaning Business in Nigeria

The business of providing professional office and industrial cleaning service in Nigeria has been around for decades but only became very popular in the early 2000s because of the growing number of businesses that wanted to operate more efficiently. 

These businesses especially banks, hotels, embassies, hospitals, schools, churches, shopping malls, eateries, law firms, accounting firms and other service based companies realized that it paid them more to outsource the cleaning of their office premises by experts who can do efficient cleaning services thereby providing them more time to do their core business activities.

Office and Industrial Cleaning business is quite a lucrative one to do in Nigeria for various reasons. For instance, it has low capital requirement for starting it. Just like all service oriented businesses all you need is skills, work tools and good work ethic to secure new customers and expand. 

The administrative expenses are quite low since salary, rent and transportation are the major operating expenses taking up to 80% of the total operating costs. You don’t need to worry about inventory, machines or a factory to produce your service. 

Another reason the business is lucrative is the huge pool of available customers. Nearly 60% of medium to large sized business with more than 20 staff is in need of this service especially when that business is in a highly competitive industry and has to become more efficient to succeed. So we should be looking at between 80,000 to 200,000 businesses that already outsource their office cleaning or are in need of the service.  

The Market Opportunity for Office and Industrial Cleaning in Nigeria

No business wants to lose customers or get a bad name for keeping a dirty environment or have to waste man hours trying to keep their premises attractive. So that means the demand for this service is high and here's one reason for this -there are at least 480,000 registered companies operating in Nigeria as of 2014 according to the Federal Inland Revenue Service. 

From my estimate at least 250,000 of these companies are based in Lagos State alone. Abuja has more than 24,000 operating businesses of various sizes. The list goes on, but one thing they all have in common is the need to present an appealing environment to their clients/customers and not to spend precious time and resources off their busy schedules doing so. 

On average the amount payable to office cleaning companies is N40,000 for each employed cleaner/janitor. So if a 300 room hotel for instance decides to outsource its cleaning to a professional commercial cleaning business and require 10 cleaners, that means the hotel would be paying N400,000 per month for their services. The cleaning company may pay each Janitor N25,000 and thus would be making N15,000 on each employed cleaner.

Key Target Market Segments for Nigerian Office and Industrial Cleaning

I have chosen to divide the market segments for this business into two based on the scale at which you wish to operate.

Office and Small Scale commercial Cleaning Opportunities

• Restaurants including fast food, fine dining restaurants etc
• Small Hospitals/clinics
• Retail stores e.g Supermarkets, boutiques, electronic shops, car showrooms etc
• Offices e.g NGOs, Travel agencies, ICT companies,   
• Petrol Stations
• Residential buildings within an estate
• And many more

Industrial Cleaning and large scale commercial cleaning

• Airports
• Multi Storey Buildings (shopping malls, government office buildings etc)
• Factories
• Warehouses
• Event Venues
• Government owned hospitals
• Public Schools
• Big Churches
• Banks
• Telecomm operators’ offices
• Multinational companies
• Embassies
• And many more

Startup Requirements for Industrial Cleaning/Janitorial Service in Nigeria
Item	Cost
Basic Cleaning tools (Mop Buckets, Mop sticks, wipers, brooms)	N10,000
Initial Cleaning Supplies such as detergents, cleaning reagents etc	N5,000
Specialized cleaning equipment such as Vacuum cleaner, fumigation equipment,	N70,000
Rent	N600,000
Initial 6 months operating expenses (marketing, utility bills, levies etc)	N840,000
Registration and Legal expenses	N80,000
Office Supplies (stationery, cleaning supplies etc)	N60,000
Furniture
Contingency (other expenses you may not have planned for e.g emergencies, accidents	N300,000
Insurance	N120,000
Total	N2,075,000

Break Even and Payback Period for office cleaning

You can breakeven within the first 6 months if you can meet your sales target. That depends on the scale at which you’re operating though whereas payback is between 18 months to 3 years again depending on how well you manage the business and how much sales you can generate.

Do you wish to start an office cleaning business in Nigeria? I can write you a bankable business plan you can show to investors or banks to raise startup/seed capital. Just give me a call: 0803 206 4106 or email me: paulonwueme@gmail.com

How to Start Commercial Pounded Yam Production for Exports

Nigerian Business Opportunity: Pounded Yam Production and Processing for Exports to Africans Abroad

Pounded Yam is one of Nigeria’s best loved staples and even Nigerians living abroad love to enjoy this meal with a variety of local soups. Nigerians abroad are not left out in fact they are the biggest fans of local Nigerian delicacies as they don’t mind spending more to enjoy our local delicacies even while abroad. Nigerians in the diaspora have a strong emotional attachment to their motherland and miss their country and all the memories they have. The main ingredient for making commercial pounded yam flour is yam which is abundant in Nigeria grown in most of the southern and middle belt states of Nigeria. Pounded Yam can be eaten with Egusi, Ogbonno, bitter leaf soup, vegetable soup, okra and many other local soups.

The Opportunity (Local and International demand)

According to the International Institute for Tropical Agriculture (IITA, Ibadan) in a 2001 food consumption survey among Nigerian households, Yam is one of the most widely consumed staple after maize, cassava and rice although one of the most expensive. It is a major source of energy in diet of Nigerian families, doesn’t spoil quickly and also occupies a very symbolic position socio-culturally among diverse ethnic groups in Nigeria with the New Yam festival serving as a standard for assessing farming seasons and crop yield. All this points to the fact that there is high demand for it locally, however the international market is where the opportunity seems even greater and there are various reasons for this such as;

·         Low competition (Only two companies as of 2014 are into this business and they haven’t adequately captured the market).

·         High demand (Over 17 million Nigerians live abroad in over 40 countries in Europe, Asia, North America and Africa). The highest demand is from Nigerians in Holland, China, India, US, UK, Spain and South Africa.

·         High profit Margin (Up to 100% profit margin from sales)

Target Market Analysis

Total Population of Nigerians in Main Market Regions 2014 estimates is put at 10,850,000. Sources for these figures are; the deputy Nigerian Ambassador to the United States at a conference for promoting investment in Nigeria mentioned that at least 5 million Nigerians live in the US in 2013. The Guardian Newspaper on 16^th November 2014 reported the US, UK, South Africa, Europe and Asia as Nigeria’s leading overseas destinations with the US accounting for 31% followed by Europe at 21% and  South Africa with 5%. 

                                                                                                                                                   

Market Region	United States	United Kingdom	South Africa	China	Dubai	West Africa
Estimated Population	5,000,000+	3,000,000+	900,000+	850,000+	800,000+	300,000+

Sources: Nigerian Embassy in New York, Guardian Newspaper, Chinatravelguide.com, National Population Commission

·         With these figures we estimate the potential market size to be NB: I estimate 1$ = N200

Market	10,850,000
Total market Population	1,758,000
Monthly Spending Pool	$2,500
Average Household Monthly Income	$5,000
Disposable Income on Edibles	$250
Households	875,000
Estimated Potential Market Value	$32,200,000 (N6.44 billion) in sales

Startup Requirements

This business isn’t easy to start up because of the capital required to set it up which is N49,490,000 and would be used to acquire such things as machinery, rent warehouse, working capital, purchase delivery van and other expenses which are available in a detailed business plan.

Conclusion

This business is a cash cow and anyone looking to go into it should consider the challenges and threats which may cause the business to fail. The business is highly profitable but if you lack required marketing, operational and managerial knowledge you won’t be able to exploit this opportunity fully.

Need a comprehensive business plan on commercial pounded yam production or any other business plan for that matter? Give me a call: 0803 206 4106 and I’ll hook you up with a reliable business plan you can take to the bank.