In one of our business idea articles, we gave a step-by-step guide on how you can start a pop cement business in Nigeria. In that post, we explained why the pop cement business is one of the most lucrative businesses in Nigeria.
But we feel that article is incomplete because we did not explain cement business for entrepreneurs that prefer to sell cement instead. So today, we will be explaining how you can start a cement business in Nigeria.
Except you are building container houses in Nigeria it is impossible to build a house today without using cement. Cement is used to make blocks and it is also used to plaster the housing structure after it has been built. The product of this business is what makes it profitable.
In Nigeria today, you can become a cement distributor for any of the major producers of cement in the country like Dangote and BUA or simply become a retailer. It depends on the money available to you to start up.
Is Cement Business Profitable?
Cement business is one of the most lucrative businesses in the building materials business in Nigeria. This is because every bricklayer and real estate developer needs cement. Cement is also used to construct bridges, roads and any other concrete structures.
This means that you cannot go into the cement business and make losses. You will always get patronage if your prices are fair and you sell reliable products.
Capital Needed to Start Cement Business
The cost of starting a cement business is high from any point of view. It is more expensive if you want to be a distributor for a cement production company. To start a cement business in Nigeria you will need a capital of #500,000 – #3,000,000.
The minimum capital is for you if you do not have enough money with you and you feel you can start small then grow the business while the highest capital is for those who want to be a distributor in the business.
How to Start Cement Business in Nigeria (Wholesale or Retail)
Below is the guide on how to start a cement business in Nigeria.
1. Conduct a Market Survey
A market survey is very important no matter how familiar the business idea looks. The only reason why many Nigerians do not do market surveys is the fact that they underestimate how powerful it is. With market research you can go to bed with your two eyes closed but you need to do it the right way.
There are different materials online on how to do a market survey for your product. However, we consider our article as the best among this as it is simple to understand. Here is our guide on how to conduct market research in Nigeria.
2. Write a Business Plan
The second step is to write a business plan for your cement business. You need to know everything about the business without leaving any stone un-turned. Your business plan will inform you on this.
It will inform you of the cement you will need to start as a retailer or distributor, the right location for you, materials needed, and more. You can write a business plan for this business yourself if you follow the steps in our article on how to write a business plan in Nigeria.
But if you feel you do not have the time to write, you should reach out to us through our email address: firstname.lastname@example.org. We can write a business plan for you.
3. Get the Required Capital
Depending on the kind of cement business you want to start you still need to source for your capital. Money is very important in this business because you need it to put things in order before you start.
You need money to get a place where you can be selling your cement, to buy shipping crates, canopy, burglary against theft and more. You can save for this capital if you do not have it at hand or look for other ways you can get funding to start.
We have an article on people or organizations that you can use to get capital for your business. Read our article on how to get funding for your Business in Nigeria for more guidance on this.
4. Register your Business Name
If your cement business is a distribution business, this means your business is considered a big business. You need to register your business name under the Corporate Affairs Commission (CAC). Follow our article on how to register your business name in Nigeria for more tips on this.
You do not need registration with the Standard Organization of Nigeria (SON) as the product has already been verified by the production company.
5. Locate a Selling Point
The location of your cement business should not be hidden. This is because you need people to be aware that such business is in the area. This is why many cement businesses prefer to be near roads preferably bus stops or roundabouts.
At this stage, you need to look for a good spot – a land close to the main road that you can rent monthly or yearly. This place will be used to display your cement. You will need to build a foundation, burglary around the foundation and canopy to protect your cement from rain or water.
6. Buy your Cement Products
After you have gotten your location, you can go ahead to purchase your cement. If you are a distributor and you have paid your distribution fee, your cement will be delivered to you. But if you are a retailer, you will need to buy your cement from a distributor around you.
Depending on the agreement you have with the seller, the products can be delivered and stocked for you.
7. Start Selling Cement
At this stage, you need to start selling your products. You can inform family and friends about your business in case they know people that will need your products.
You can also send proposals to developers and block industries in your locality informing them about what they stand to gain when they patronize you. Make friends with the bricklayers in your community too as they are the first contact with your products.
Cement business is a profitable business in Nigeria. Depending on the area you sell you can make #100 – #400 for each bag you sell. Are there any parts I missed out in this article? Let me know in the comments section below.