In one of our articles, we explained how you can start a mini-importation business in Nigeria with little capital. In today’s article, we want to explain the opposite of the article which is about export, specifically how to start a food export business in Nigeria.
There are many contradictory opinions on this topic. While some think that you need a huge capital to start a business like this, others think the business is not worth it because the business is stressful. We will be looking at all questions in this article and hopefully, answering all.
So if you want to get updated on all this information read the article to the end. Foodstuff business is a profitable business whether you are going into the sales of one foodstuff or different kinds of foodstuff. The business even makes more profit if you are trying to export your foods.
This is because there are many countries that need our type of foods because their farmlands cannot grow these foods or for different reasons.
Is Food Export Business Profitable?
There are many obvious reasons why the food export business is a profitable business in Nigeria. One of the major reasons is the high demand for Nigerian foods in developed countries. These countries are willing to pay more than the Nigerian market just to make sure these foods are available in their country.
In fact, when you are able to build a reputable brand with these buyers, they will be willing to pay in advance just to get regular deliveries. Another reason why the food export business is more lucrative in Nigeria is the fact that buyers will pay you in foreign currencies.
The American dollar is one of the strongest currencies in the world. Imagine being paid with that kind of money that appreciates all the time.
Capital Needed to Start Food Export Business
The capital needed to start food export in Nigeria is not high. As long as you already have a buyer you can simply buy the foods and export them to the required country. To start a food export business in Nigeria you do not also need to be a farmer or manufacturer.
Instead, you can be a middleman by having a reliable farmer that can supply you and get the farm products exported after properly packaging them. With a capital of #500,000, you can start a mini export business in Nigeria.
Foods to Export from Nigeria
Below are the foods you can export from Nigeria to other countries.
1. Cashew nuts
2. Palm oil
3. Cassava flour
4. Sesame leaves
5. Ginger honey
Documents Required to Export Goods from Nigeria
These are the documents you need to export goods from Nigeria.
1. Certificate of origin
2. Insurance certificate
3. Shipping bill
4. Certificate of inspection
5. Export license
6. Commercial receipt
7. Packing list
How to Start Food Export Business in Nigeria
Below are the steps you need to take to start a food export business in Nigeria.
1. Conduct your Market Survey
The first step to start a food export business or any other type of export business in Nigeria is to conduct your market survey. Do not just barge into the business without doing the proper diligence or conducting your findings. There are two basic ways you can conduct surveys for a new or old business.
You can either conduct an oral or written market survey. You can do this yourself by following our guide on how to conduct a market survey or hiring a professional to do this for you. It is very important you know the foodstuff or type of food that is high in demand for export. It is also important you know the required process as regards exporting in Nigeria.
2. Write your Business Plan
The next step is to write your business plan. The business plan contains the structure of your export business and how to make profits from the business despite the fact you are new. Many people ignore the importance of business plans in business. That is why their business fails during the first 3 years of starting.
You can write your business plan yourself by following the laid down step in how to write a business plan in Nigeria or hire us to write it for you. Contact us via firstname.lastname@example.org if you are interested.
3. Get the Capital Required
Capital is needed in this business. You need capital to do many things like register your business, buy goods, logistics, and more. No matter how you conduct the business capital is needed except if you are looking at starting a dropshipping business instead.
As I explained earlier, with a minimum capital of #500,000 you can start a mini-export business in Nigeria especially if you are willing to start small and grow your profits. If you do not have up to this capital and you are passionate about this business, you can look at other options you have to get funding for the business.
If you are serious about this you should read our article on how to get funding for business in Nigeria.
4. Register your Export Business
Registering your export business is important. No buyer from another country will buy products from you if you are not duly registered. Before starting to export your goods you need to register under the Corporate Affairs Commission (CAC) and the National Export Promotion Council of Nigeria.
You will be given a license after registering under these two bodies. Registering your business also gives your buyers assurance that you are legit and reliable. Follow this guide on how to register your business in Nigeria.
5. Choose Products to Export
It is important to know the products that are in high demand for export as this ranges from country to country. Asides from this, you also need to know how to source quality products. Farming products’ quality ranges despite that they are not produced in factories.
To source quality products look for reputable farmers to buy from them. The choice of product you want to export will determine the state from which you will source it.
6. Source for Suppliers of Producers
In the old days before the internet was well known as an exporter you will have to look for buyers by traveling to different countries or the buyers will come to Nigeria to look for you. Today, you can use the Internet to look for customers.
This means that you do not need to leave your home as long as you have data. There are many platforms on social media apps like Facebook where you can get trusted buyers. You can also get buyers on Abenconnect.com an African B2B platform.
7. Pricing your Products
This is a very important factor in running the business. As an exporter, you need to know how to price your products so that you will not make losses. For example; if you have a customer that wants to buy cashew nuts you need to know the quantity of what he or she wants to buy.
After doing this, you need to go back to farmers to know how much they sell their cashew nuts. It is from there you will know how much you are going to add to the cost price to make profits.
8. Get Products Delivered
After products have been ordered from the farm or manufacturer you can then proceed to repackage the products from exporting them. Right after this, the products can be taken to the ports to be exported.
There are many factors to consider in any export business in Nigeria. You need to consider foreign exchange, the international relationship Nigeria has with the country you want to deliver goods to, and the shipping company you want to use.
If you pay attention to all these and you get it right, you will start making good profits from your export business.