Cement business is one of the lucrative business in Nigeria that few people know about, hardly will you see people thinking about cement business perhaps because of heavy lifting that surrounds cement business, also it is not a white color business, if you are among people that takes their cloth neatness serous, it is not for you and that is a good thing for those thinking of going into it because there will be less competition
Another reason while people don’t go into it is the erroneous believe that you have to have millions of naira before you can start it while you will need millions of naira to start cement distributor business you can start with retailer that require less capital.
Clicking this article means you want to know how to start cement business in Nigeria or you just want to broaden your knowledge, whatever the case be rest assure that we will cover all the detail of cement business in Nigeria including how to become Dangote and Lafarge distributor.
Before we go into the detail I will like you to take note of the following
Why you need to start cement business in Nigeria
Perhaps you are still on the fence contemplating weather to start it or not, the following point will show the reason to start the business now
Cement is and will always be in demand as long as people keep building houses, structure and expanding no matter how high the price people cannot do without it even the already made house and structure will need cement for maintenance.
100 years to this time cement is not going anywhere we will still be using it to build houses.
Shifting from coater to cement
It is now obvious that cement is better than coater in making road. Most of European country and America have already shifted to cement and you know Africa; we are copycat, we are also taking step towards using cement to build our road also according to rumor Dangote keep pestering government to use cement what a win for you if you venture into the business.
It is readily available
You don’t need to go through the process of manufacturing or export anything; as long as you are ready to buy it is available.
Niches of cement business in Nigeria
How to start cement business in Nigeria is not the problem, you need to know the niche where you want to operate according to the capital you have. The niches of cement business are
Distributor niches (Dangote and Lafarge)
Distributor is a niche where big man play, it require a lot of capital to start and also it is the most profitable of all the two niches.
If you choose this niche your job is to buy cement directly from Dangote or Lafarge Company, store it in your warehouse and distribute it to retailer, very simple it just a hold and sell business.
What you need to get ready in a cement distributor niche
Warehousing is very important in cement distributor niche; this is where you will store your cement after purchasing from Cement Company.
It should be spacious and commensurate with the load of cement you want to be buying
You need to buy vehicle which you will use to buy and distribute cement. It is a marketing plus if you use it to distribute cement to your customer because you will charge transportation fee and also use it to draw customer.
You need to get millions of naira ready at least #4 million to #10 million naira
Cement retailing business
This is where small boy dwell lol (just joking) it require little capital and as such little profit. If you choose this niche your job is to buy from cement distributor and sell to final consumer.
You don’t need to buy vehicle in this niche and your warehouse can be shop or a tarpaulin as long as it is a way from rain and water.
How to start cement business in Nigeria
1) Feasibility study
Your first job in achieving your cement business dream is to carry out feasibility study to check if it will be feasible, because I stated above that it is profitable does not mean it will be profitable in all location; you need to check the number of buyer in your location
If the location is pliable by vehicle
Purchasing power of the people in your location
Competitor in your location
Number of traffic coming in that location
All this we let you know if you should continue with the business
Once you are sure that the business will be profitable in your propose location, you r next assignment is to gather knowledge about it like you are doing now, but you still need to take it further.
Look for people that are already making money with cement business and learn the process from them, the learning duration should not take more than two weeks.
It is not like you can’t start with trial and error but I tell you, you will be frustrated and might eventually quit.
3) Business plan
The next is your business plan, write a concise and simple plan of where you want to see your business in the next five years and do not forget to include how to get there.
If you intend to use the plan for loan seek the service of professional if not you can write a single page business plan
Your feasibility study will tell you the best location to choose for your business nevertheless your location should be located in a high traffic area especially if you are staring as a distributor and if you are starting as retailer I will urge you to find a new community that is just gong through the face of development.
5) Register your business
If you are a retailer you can pend this but for distributor you need to register your cement business with corporate affairs commission to prevent future confrontation from the government also you will need business registration number when applying for Dangote or Lafarge distributorship
6) Apply for distributorship
If you are a retailer you can skip this step. Before you will get cement from Dangote and Lafarge you need to register with them and this are the following document you will need
Certificate of company registration
Application letter of distributorship
Bank reference number (scanned)
Passport photograph of the founder/md
Set up your warehouse or shop
There is not many things to know here just make sure your cement is stack on a pallet and it is not close to wall to avoid caking.
I will also advise you to plaster your wall and the floor should be sweep regularly to avoid dust which can cause respiratory disease.
7) Hire worker
You can’t do it alone; you will need people to load and off load cement, people that will help you with recording.
My advice here is to be careful of those you hire make sure they are trust worthy or else they will send you back to village. The best way to hire employee is to ask people that have been in this business, they will surely know one or two people that are looking for work.
If you do your feasibility study well, you will have no problem with marketing. Cement business does not require too much of marketing since those company would have done the bulk of advertisement.
Below are the advertisements medium you can use to make people know about your cement business
It may look small but it is the best medium to showcase your business if you are just starting out. Let it be catchy so that people will be compel to look and share to others.
Since cement distributor or retail business is location based, sign post will work well. Erect it to a junction not far from your location.
This is does not convert well but do not leave it out, create a social media account for your business and post picture of what you are selling. Even if you don’t make a sell it will let people know that you exist
Create a website
All the business is now online you should not be left out. Create a website that will show what you are selling and where they can order it.
The secret of making sale online is to post SEO content on your site that will drive google traffic. You can contact us to help you set up your website and write SEO content that will glue reader to screen.
Challenges of cement business in Nigeria
There is no business without challenges below are the challenges of cement business in Nigeria
1) Rain/ water
If cement is not well store to the extent that water gets on them, they will cake which means loss
Solution is simple keep your cement well, any linkage in warehouse or shop should be sealed
Moving cement from one place to another is a herculean task in Nigeria, there is high probability that you will get into traffic and when you do it can be frustrating and it will also waste your time.
Deliver and buy cent early in the morning or late in the night
This is Nigeria whenever you are delivering or buying cement you should prepare some cash for police if you don’t want a delay.
Deliver and buy cement in the morning or late in the night
4) Employee problem
If you lose guard your employee will steal your money, it is hard to monitor thing in cement business so stay alert, regularly check the record book and any error should be call into order.
Cost of starting cement business in Nigeria
The price of cement fluctuate a lot what you buy it today might be higher tomorrow therefore it will be difficult to cote a certain cost, nevertheless
For distributor you will need between #4 million to #10 million
For retailer you will need between #1 million to #4 million
Is cement business profitable in Nigeria?
Cement business is very profitable, but it profitability is not like crypto lol, it is “small small”, if your niche is retailing you will earn between #200 to #300 per bag of cement
Imagine if you sell 100 bags of cement per day at #200 profits you will get #20,000 per day
If you are in distribution niche you will earn between #300 to #400 per bag of cement and you will sell more compare to retailer
Imagine if you sell 500 bags per day at #300 profits that will be #150,000 per day.
Above is how to start cement business in Nigeria and no doubt you will agree with me that we have done justice to it, the only problem now is you, if you read it without executing, it will be a waste of your time.
It is high time to move out of wantreppreneur and move to startuppeneur.