In one of our business idea articles, we shared how you can start a palm oil business in Nigeria. In today’s post, we will be sharing how to start a vegetable oil business. This article is for entrepreneurs who prefer to sell vegetable oil rather than palm oil. Vegetable oil is one of the most important foods in Nigeria. This is because aside from the nutrients it contains it is a very important ingredient when it comes to cooking stable foods in Nigeria.
Although vegetable oil ranges in different types and brands they still contain the same nutrients. As an entrepreneur in Nigeria, you can go into the production of the business or simply the wholesale or retail part of the business. There are also different sets of people and businesses you can sell your vegetable oil to in Nigeria. We will share all these and more later on in the article.
Is Vegetable Oil Business Profitable?
The vegetable oil business is a lucrative business in Nigeria because oil is needed to fry and make soups. Every Nigerian has groundnut oil in their kitchen. Asides from this, groundnut oil contains vitamins and minerals. This is why many Nigerians consume it. If you go into the vegetable oil business you will make good money and your products will not expire because there is a huge demand for vegetable oil in the market. As a producer, you can export your products to other African countries around Nigeria.
Capital Needed to Start Vegetable Oil Business
The capital needed to start a vegetable oil business in Nigeria depends on so many factors. It depends if you want to go into the production of oil or if you want to do wholesale or retail. Either of these options will demand a different capital because of the requirements involved. It cost more to start the production of vegetable oil. The capital runs into millions of naira because you need to install a factory. However, with a capital of #500,000 – #1,000,000 you can start a successful vegetable oil business in Nigeria whether at a wholesale or retail level.
How to Start Vegetable Oil Business in Nigeria
Here is the step-by-step guide to starting a vegetable oil business in Nigeria.
1. Conduct your Market Research
There are so many things you need to know about vegetable oil in Nigeria. For example; you need to know the most requested vegetable oil brand in Nigeria, the sizes people prefer the most, and more. All these you will discover when you carry out your market survey in the area you want to conduct business.
Other questions like which vegetable oil brand gives bonuses, discounts, and more will also be exposed to you. We have written an article on how to conduct a market survey in Nigeria. You should read it for more tips.
2. Write a Business Plan
The next step after conducting your market survey is to write a business plan for the business. Some people think it is not important to write a business plan especially if the business they are planning to go into is not a new business but it is important. If you are investing a huge capital into the business you need to also get a business plan.
There are different ways you can get business plans today. You can buy it online, tell a professional to write for you, or simply write it yourself. Reach out to us if you want us to write for you but if you have the time you can follow our steps on how to write a business plan in Nigeria to write yourself.
3. Register your Business Name
If you want to go into the production or distribution of vegetable oil in Nigeria you will need to register your business. The body CAC is responsible for the registration of all business names in Nigeria. We can help you register your business name if you do not have the time and get your documents delivered to your doorstep.
Just reach out to us via our contact. And if you want to do the registration yourself you should read our post on how to register your business name in Nigeria.
4. Get the Capital Needed
As I have stated above, the capital needed to start a vegetable oil business is high. You have to be ok financially to be able to go into the business. I will not advise you to borrow money as this can drown your business before starting however; you can seek support from family and friends.
There are other ways you can source funds to start your business. Read our post on how to get funding for your business in Nigeria for more information on this.
5. Rent a Shop or Start from Home
To easily store, promote and sell your vegetable oil you need to rent a shop. A shop in the market or in a place where Nigerians pass regularly every day is perfect. With these significant locations, your customers will be able to patronize you easily. And with this, you will not need to spend much on advertising.
After renting your shop you need to buy shipping crates to put them on the floor of your shop before the arrival of your oils. Placing your oils on the shipping crates will preserve your oils for a longer period of time.
6. Order your Vegetable Oil
After renting a shop and putting everything in order. The next step will be for you to buy your vegetable oil. As a buyer, you can buy vegetable oil from a well-known distributor or simply buy from any wholesaler in your area. A delivery truck will be needed to transport your vegetable oil from your buyer to your shop. How much the driver charges depend on the distance, road, cost of logistics, and more.
7. Promoting and Selling your Products
You can use social media to promote your products to increase sales. Websites like Jiji and Jumia are perfect for this. Your products can be sold to market women, households, supermarkets, provision stores, and more. You can write and send business proposals to supermarkets, restaurants, and provisions stores to convince them to patronage.
There are people that use oil to cook that you can also convince to buy vegetable oil from you. Examples are people who will make snacks like puff puff, akara, popcorn, and more to sell. You can convince them to buy from you by giving them discounts.
The oil business is a lucrative business as long as you are properly located and you know how to promote your goods online and offline. As long as you preserve your oil very well you will not encounter losses in the long run.
Image Credit to NairaMetrics.com