Looking for more information? Search this blog

Friday, July 17, 2015

How to Spot a profitable business opportunity in Nigeria

I have received hundreds of phone calls, SMS and emails from a lot of Nigerians who want to know what kind of business they should venture into or if a particular business is profitable or not. 

Personally I refrain from answering this question because it’s like asking what kind of business can I do with little or no risk but will make maximum profit from. That kind of questions is almost impossible to answer because I know of businesses where most people are struggling to make a profit and a few others are making a lot of money. 

Look at boutique business for instance where most people are just managing to get by but some other people are making millions of naira every month from it. So should I now recommend boutique business for everybody? Another challenge again is that most businesses are suitable for certain kinds of people and not everybody so I can’t for instance say try this business or don’t do this business when I haven’t assessed your skills, experience and passion for a kind of business. However if you are enterprising enough any business opportunity is the right one once you understand the market and know how to get in. for this reason I’ll share the following tips with would be entrepreneurs looking for profitable business opportunities in Nigeria.

Tips on how to find Profitable business opportunities in Nigeria   
These tips are applicable to some business opportunities but for certain kinds of opportunity you need extra ‘eyes’ to see what most people are not seeing. However these ones are a good start, try them out.

Identify level of demand for a product/service
In a particular place there may be high demand for a product/service which could be as a result of the local demographic. For instance places that attract a lot of women are ideal ground for marketing women oriented products e.g markets, maternity centers, female hostels, churches, beauty salons etc. 
But what drives demand most times is inadequacy and availability so if you have a unique, high quality makeup kit for instance the demand for it would be higher than any other kind of makeup kit hence marketing it in the above listed places would increase demand for it.
Hint: Uniqueness, quality and inadequate supply of a product usually determine level of demand.

Who is the competition and how well off are they?
There may be 10 people selling a certain kind of product in a locality but may be only one of them is making a lot of money selling that product. His/her secret would likely be their approach to selling or delivering the product rather than using ‘jazz’ or other superstitious explanation some people could raise up. If you understand the customer’s real needs and you can find a unique and effective way of delivering that product you have identified a profitable business opportunity.

Identify the challenges in meeting demand
If there is a certain difficulty in getting a product/service to its intended target market, removing it would making it a profitable business opportunity. Is the problem with serving your customer an issue of delivery, promptness, excellent support service or price? Find a solution to this and you have found a profitable business opportunity.

What is the profit margin in the industry?
How much profit will you make on each item of a product or service you sell? If you’re making 100% profit for a shoe that sells for N1000, that means you’re buying the shoe for N500 and if you can sell 10 of those shoes every day that means you’re making N5,000 profit per day for that shoe. If you could sell 100 of those shoes a day that would be N50,000 per day. But this tip works best if there is high demand to go with high profit margin.

What is the entry requirement for that business?
If it’s very difficult to enter the business then it is a highly profitable business. The harder it is for others to come into the business coupled with high demand and high profit margin means there will be little competition and possible overhead costs which is the right opportunity to claim millions or billions of naira as the case may be.

If you have identified a business opportunity and want to approach investors to finance it for you, then getting a professionally written business plan is the way to go and you can have me write for you at a good price too. Call me: 0803 206 4106 for details.