Are you thinking of starting soft drinks business in Nigeria and you want to make profits from it?
This complete article is for you. It is the perfect step by step guide that will teach you how you can start your own soft drink business.
What are Soft Drinks?
Soft drinks are non-alcoholic drinks containing sugar and colours that we drink to relax anywhere. This could be at home, work, at parties, or even in traffic.
Soft drinks are carbonated drinks containing gas and carbohydrate. There are different brands of soft drinks with different colours as we go in this article I will list these popular brands.
So what is with soft drinks?
Why do Nigerians love them?
If they do, is soft drinks business profitable? Can you go into the business as a retailer or distributor (soft drinks distribution business)? If you can, how can you start?
Yes, Nigerians love soft drinks. In fact, it is like oxygen to them for many reasons. One is the fact that Nigeria naturally has hot weather conditions and during these times these drinks are used to cool the body temperature.
Asides from this, the sugar drink also becomes a source of energy after it has been drunk make the average Nigerian to be able to do more work even after he or she seems tired.
Is Soft Drinks Business Profitable?
Yes, soft drinks business is profitable whether you are starting the business as a soft drinks distributor or as a soft drink retailer in Nigeria.
The drinks industry is so big that despite the fact that many Nigerian entrepreneurs are going into it, everybody is still making their individual profits.
There is hardly a Nigerian party or owambe, and concerts that you will not see soft drinks been shared to be consumed.
Another reason why soft drinks business is so profitable is that the drinks are consumed at home and can be drank anywhere too.
Nigerians drink soft drinks. It is part of their lives whether in traffic or at home or at parties, Nigerians like to use soft drinks to relax.
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List of Soft Drinks in Nigeria
There are different types of soft drink brands in Nigeria asides from them been packaged in glass bottles, plastic bottles (pet bottles), and cans but the most common ones are:
- Coca-cola (Coke)
- Mountain dew
- Big Cola
Drink Business Ideas
There 2 major types of soft drink businesses in Nigeria. These are:
Soft Drinks Distribution Business
Soft drinks distribution business in Nigeria is a drinks business where you sell soft drinks as a distributor to other soft drinks buyers preferably retailers. This could be to party organizers, schools and churches.
Soft drinks distribution business usually requires a huge capital you to start. To be a distributor for any soft drinks company in Nigeria you have to have millions of Naira as your capital.
Soft Drinks Retailing Business
Soft drinks retailing Business in Nigeria is a soft drink business where you buy drinks from soft drink distributors or soft drink companies to sell directly to consumers in small quantities.
This kind of soft drink business does not require a big capital. It just demands some marketing and management skills.
Capital Needed to Start Soft Drinks Business
The capital needed to start a soft drinks business depends on the kind of soft drinks business you want to start.
From what I have mentioned above, if you want to start a soft drinks distributor business in Nigeria you will need a capital of #2,000,000 and if you want to start soft drinks retailing business in Nigeria you will need a capital of about #5,000 – #50,000.
The capital needed to start the drinks business also depends on the equipment available to you to start. If you have the equipment you will need the capital just to buy soft drinks.
How to start soft drinks business in Nigeria, the step by step guide.
1. Decide Kind of Soft Drink Business
Yes, the first step to start a soft drink business in Nigeria is to first decide the kind of soft drinks business you want to start. Do you want to go into the business as a distributor or as a retailer?
You need to decide and of cause, this decision will be based on the capital at your disposal.
If you do not have the capital start probably because you are broke, you can ask for financial support from your family and friends or simply save ahead of the business.
2. Rent a Shop or Container
After getting the capital you will need to start the drink business, the next step is to rent a shop or container where you put the drinks and sell.
How much you have, how much you can afford, how big do you want to start plays a role in whether you will be renting a shop or container.
Your location also plays a role in which of these you will be going for.
But my advice will be that you rent a container if you are going into the business as a distributor and rent a shop if you are going into the business as a retailer.
When you are renting this shop or container make sure the money you are spending is not more than 30% – 40% of your initial capital.
3. Buy Necessary Equipment Needed
The equipment needed to start soft drinks business in Nigeria cannot be ignored especially if you are planning to sell cold drinks. The kind of soft drinks business is under the soft drinks retailing business.
The equipment you will need to start cold drinks business is majorly refrigerators and generators but there are other equipment needed to make the business comfortable for you and your staff.
For the refrigerators and freezers if you cannot afford the new ones you can go for simply the tokunbo or fairly-used ones. They will last you for 2 to 3 years pending the time you will be able to afford new refrigerators for your drinks business.
Another thing I forgot to talk about when I was talking about renting a shop is that you should make sure there is constant power at the location you choose for your shop.
This is to make sure you do not spend too much on putting on your gen to chill your drinks.
4. Register as a Distributor
Registering as a distributor is very important if you want to be a distributor for these soft drinks companies. Doing this makes them know you and trust you.
It also comes with many other benefits like they been able to sell drinks on credit to you, selling drinks to you at the lowest prices, financial support which means they will be able to borrow you money to expand your drinks business when you want to, and much more.
Being a soft drink distributor puts you at the top of the drinks business after the soft drinks manufacturers.
Another thing you should also put in mind is that registering as a distributor to some of these soft drinks companies is not free. This is where the #2,000,000 needed as a capital I mentioned earlier comes into play.
5. Selling Soft Drinks
When it comes to selling your drinks you have to open your mind to many opportunities around you. You can start first by telling your family and friends about your soft drinks business and selling to them.
Also, you can sell drinks to people who sell in traffic or simply employ some guys that will sell for you and pay them on Commission bases. Another thing you should not forget to always do is to take stock of your drinks.
Always have a book or jotter where you write down the drinks you have sold and the ones still remaining in your shop. Also, another importance of your proper accounts is to keep you alert about the drinks business for example; knowing when to re-order for drinks.
6. Increasing Profits in Soft Drinks Business
There are different ways you can increase profits in your soft drinks business many of these I will be mentioning below.
Sell Drinks Online
I bet you never knew that you can sell your soft drink online. Yes, you can. With e-commerce websites like Konga, Jumia, and Jiji you can sell your soft drinks online without meeting your customers and get paid.
Sell Drinks to Parties
Yes, another way you can improve the profits in your soft drinks business is to sell your soft drinks to party organizers. Since they buy in bulk, you will make your profits in bulk.
Sell Soft Drinks in Traffic
You can also sell your soft drinks in traffic by getting guys that will sell it for you and pay them based on commission.
Depending on the number of soft drinks or crates of drinks you sell you can make as much as #1,000 – #5,000 as profit per day whether as a distributor or retailer.
7. Risks in Soft Drinks Business
There are few risks you can encounter in a soft drink business in Nigeria. Some of these risks are:
- Loss of drinks due to falling or mishandling of drinks
- Drinks could expire in the shop. This will inquire losses if you do not pay attention.
- Drinks been stolen buy workers. There are times when your drinks will be stolen. You can monitor this closely by always doing your stock.
- Drinks been bought by customers on debt and customers not paying the debt as of when due.
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Just like any other business in Nigeria, soft drinks business has its own risk so you really need to take your time to know if you really want to start the business.
Asides from this, the business is a lucrative business if you are always present and always prepare the accounts related to the business.
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