Nigerian business mogul, Aliko Dangote
Nigerians enter 2017 today with high expectations, resolutions and
top targets. No one contemplates repeating the mistakes and missteps of
2016, which was full of confusion and indecision.
top targets. No one contemplates repeating the mistakes and missteps of
2016, which was full of confusion and indecision.
The out-gone year was, perhaps, the most challenging period in the
history of Nigerian businesses because it was characterised by policy
flip-flops and poor market cohesion.
history of Nigerian businesses because it was characterised by policy
flip-flops and poor market cohesion.
In spite of 2016 challenges, one word stands tall in 2017: Opportunity.
This year, like other years gone by, presents a number of
opportunities as well as challenges. Some businesses are bound to
struggle while others will thrive. Some might die while many would still
be birthed. However, Nigerians are encouraged to tap into a number of
opportunities that abound locally. Importation is highly discouraged
this year owing to the persisting dollar crunch and the possibility that
the present administration will put more policies in place to
discourage dollar outflows and import.
opportunities as well as challenges. Some businesses are bound to
struggle while others will thrive. Some might die while many would still
be birthed. However, Nigerians are encouraged to tap into a number of
opportunities that abound locally. Importation is highly discouraged
this year owing to the persisting dollar crunch and the possibility that
the present administration will put more policies in place to
discourage dollar outflows and import.
Donald Todrin, CEO of Second Wind Consultants, a debt workout and
turnaround consultant firm in the United States, said in a period of
recession many people, especially business owners, are bound to panic.
turnaround consultant firm in the United States, said in a period of
recession many people, especially business owners, are bound to panic.
“But there’s an alternative to panicking. We are confronting
change, and change is an opportunity for advances. Now you have the
choice to take advantage of change or allow yourself to be buried by
it,” Todrin said. In its characteristic manner, therefore, BDSUNDAY
has sought out profitable and sustainable businesses Nigerians can do
this year.
change, and change is an opportunity for advances. Now you have the
choice to take advantage of change or allow yourself to be buried by
it,” Todrin said. In its characteristic manner, therefore, BDSUNDAY
has sought out profitable and sustainable businesses Nigerians can do
this year.
Yoghurt production
First on the list of what Nigerians can do this year is yoghurt
production. Yoghurt production is a neglected area, but statistics show
that 98 percent of Nigeria’s dairy needs, including milk, are imported
into Nigeria.
production. Yoghurt production is a neglected area, but statistics show
that 98 percent of Nigeria’s dairy needs, including milk, are imported
into Nigeria.
According to Aliko Dangote, president of Dangote Group, who is also
a dairy maker, only 2 percent of the country’s dairy needs are met by
local companies. Official data show that $1 million worth of milk is
imported into the country every day. With dollar scarcity and roadblocks
to importation in the country, yoghurt production is a sure bet.
a dairy maker, only 2 percent of the country’s dairy needs are met by
local companies. Official data show that $1 million worth of milk is
imported into the country every day. With dollar scarcity and roadblocks
to importation in the country, yoghurt production is a sure bet.
Yoghurt is a healthy source of milk, and capacity to produce a
low-sugar brand for the aged and diabetic as well as a moderately sugar
type for other classes is an advantage.
low-sugar brand for the aged and diabetic as well as a moderately sugar
type for other classes is an advantage.
Producing yoghurt could cost between N2 million and N10 million,
depending on the type of equipment used and their sources. Yoghurt
production requires major machinery such as motorised stainless steel
mixer, incubator, pasteuriser, filling machine, UV Lamp, transfer pumps,
PH Meter, shrink wrapper and weighing machine. Some of the machines are
imported into the country, but many of them are fabricated locally by
the Federal Institute of Industrial Research Oshodi in Lagos or Projects
Development Institute Enugu (PRODA). Local fabricators can also help.
depending on the type of equipment used and their sources. Yoghurt
production requires major machinery such as motorised stainless steel
mixer, incubator, pasteuriser, filling machine, UV Lamp, transfer pumps,
PH Meter, shrink wrapper and weighing machine. Some of the machines are
imported into the country, but many of them are fabricated locally by
the Federal Institute of Industrial Research Oshodi in Lagos or Projects
Development Institute Enugu (PRODA). Local fabricators can also help.
According to FIIRO, return on investment is 46.1 percent, while
return on equity can go as high as 115 percent. Payback period is 34
months and 19 days, while break-even point is 51.8 percent.
return on equity can go as high as 115 percent. Payback period is 34
months and 19 days, while break-even point is 51.8 percent.
Cashew processing
Next on the list is cashew processing. If you do not have a cassava
farm, get one. However, you can liaise with a cashew farmer who will
supply you with raw cashew nuts for onward processing. Export of cashew
is now one big business, as Vietnam, world largest cashew exporter, is
currently experiencing its worst drought in a century.
farm, get one. However, you can liaise with a cashew farmer who will
supply you with raw cashew nuts for onward processing. Export of cashew
is now one big business, as Vietnam, world largest cashew exporter, is
currently experiencing its worst drought in a century.
Cashew sells like cakes in the United States, India, Spain and many
parts of Europe. Apart from helping to maintain a healthy heart and
bones, cashew also helps in weight loss.
parts of Europe. Apart from helping to maintain a healthy heart and
bones, cashew also helps in weight loss.
Cashew nuts are used in producing chemicals, paints, varnishes,
insecticides and fungicides, electrical conductress, and several types
of oil.
insecticides and fungicides, electrical conductress, and several types
of oil.
Cashew exporters in Nigeria made $250 million in 2015 and $300
million in 2016, according to Tola Faseru, president, National Cashew
Association of Nigeria (NCAN), who disclosed this to journalists at the
Annual Cashew Logistics meeting held in Lagos recently.
million in 2016, according to Tola Faseru, president, National Cashew
Association of Nigeria (NCAN), who disclosed this to journalists at the
Annual Cashew Logistics meeting held in Lagos recently.
If you wish to process for the local or international market, then
be ready to procure machines such as boiler, sheller or cracker, dryer,
and packaging machine. Two good things about cashew are that its return
on investment is as high as 55 percent and its payback time is just 12
months, say experts.
be ready to procure machines such as boiler, sheller or cracker, dryer,
and packaging machine. Two good things about cashew are that its return
on investment is as high as 55 percent and its payback time is just 12
months, say experts.
Piggery
Another business to watch in 2017 is piggery. Experts believe
Nigerians are not tapping into the opportunity in this area because of
ignorance and poor perception about pigs.
Nigerians are not tapping into the opportunity in this area because of
ignorance and poor perception about pigs.
Apart from a breeding ground, which should be large enough, it is
easy to start a piggery with N500,000 to N1 million. To start a piggery,
you need healthy piglets, standard pens, quality feed and three to six
workers, depending on the number of piglets available.
easy to start a piggery with N500,000 to N1 million. To start a piggery,
you need healthy piglets, standard pens, quality feed and three to six
workers, depending on the number of piglets available.
The biggest thing about pigs is that they reproduce in large
numbers. Pigs can go between N15,000 and N40,000 depending on their size
and weight, and one pig can easily reproduce up to 15 to 20 piglets.
This is its biggest advantage. Secondly, pigs can survive in any
environment.
numbers. Pigs can go between N15,000 and N40,000 depending on their size
and weight, and one pig can easily reproduce up to 15 to 20 piglets.
This is its biggest advantage. Secondly, pigs can survive in any
environment.
Pigs are in high demand in China, Japan, India, Mexico, Canada and
many parts of Asia. In 2015, United States exported pork (pig meat)
worth $4 billion; Germany $4 billion; Spain $3 billion, among others.
many parts of Asia. In 2015, United States exported pork (pig meat)
worth $4 billion; Germany $4 billion; Spain $3 billion, among others.
Adhesive production
Apart from pork, Nigeria is still waiting for someone that will
produce adhesives used by leather shoe and bag manufacturers. Aba,
located in Abia State, has between 50,000 and 100,000 shoe, bag and
trunk makers. This does not include hundreds of thousands of shoe-makers
in Lagos, Kano, Kaduna and Onitsha. Many of these shoe-makers run to
China to buy adhesives because there is yet no known company that
produces good adhesives to satisfy them right now.
produce adhesives used by leather shoe and bag manufacturers. Aba,
located in Abia State, has between 50,000 and 100,000 shoe, bag and
trunk makers. This does not include hundreds of thousands of shoe-makers
in Lagos, Kano, Kaduna and Onitsha. Many of these shoe-makers run to
China to buy adhesives because there is yet no known company that
produces good adhesives to satisfy them right now.
Incidentally, research shows that adhesives can be produced from
cassava (starch), which Nigeria happens to be the world’s biggest
producer. Chinese adhesives are not good enough when compared with
Dutch, Spanish or Italian, shoe-makers told BDSUNDAY. Currently, these
shoe-makers cannot even find dollars to import these adhesives, showing
that there is a huge potential for someone producing adhesives in the
country.
cassava (starch), which Nigeria happens to be the world’s biggest
producer. Chinese adhesives are not good enough when compared with
Dutch, Spanish or Italian, shoe-makers told BDSUNDAY. Currently, these
shoe-makers cannot even find dollars to import these adhesives, showing
that there is a huge potential for someone producing adhesives in the
country.
Artisanship
Nigerian middle and the rich classes are looking for committed
artisans and construction workers. Many of the local artisans are
considered not serious enough and are accused of being unprofessional in
their conduct. This pushes many Nigerian middle and rich class
individuals, including construction companies, into Ghana, Togo,
Cameroon, and other neighbours to get serious and committed staff when
building their houses.
artisans and construction workers. Many of the local artisans are
considered not serious enough and are accused of being unprofessional in
their conduct. This pushes many Nigerian middle and rich class
individuals, including construction companies, into Ghana, Togo,
Cameroon, and other neighbours to get serious and committed staff when
building their houses.
What this means is that serious-minded Nigerians can go into this
business as consultants, who will now search out committed Nigerians in
rural areas to take these jobs. This is money-spinning in many African
countries and even Europe and is an opportunity here, given the attitude
of Nigerian artisans.
business as consultants, who will now search out committed Nigerians in
rural areas to take these jobs. This is money-spinning in many African
countries and even Europe and is an opportunity here, given the attitude
of Nigerian artisans.
On the other hand, artisans that are committed to their work are
likely to have more people knocking on their doors this year, according
to Ojere Imere, a construction expert.
likely to have more people knocking on their doors this year, according
to Ojere Imere, a construction expert.
“This is the reality of the situation. It’s not just in
construction. It’s also found in the textile and fashion industry, in
the electrical and electronics,” said Imere in a telephone interview.
construction. It’s also found in the textile and fashion industry, in
the electrical and electronics,” said Imere in a telephone interview.
Fruit juice production
The fruit juice production is a honey pot. Fruit juice is made from
orange, pineapple, guava, mango, as well as additives such as sodium
benzoate, sweeteners, and citric acid, among others.
orange, pineapple, guava, mango, as well as additives such as sodium
benzoate, sweeteners, and citric acid, among others.
The rule set by Nigerian authorities is that a fruit juice should
contain 40 percent of natural fruit juice. This means that if you are
producing pineapple juice, ensure it contains 40 percent of natural
pineapple.
contain 40 percent of natural fruit juice. This means that if you are
producing pineapple juice, ensure it contains 40 percent of natural
pineapple.
The Manufacturers Association of Nigeria (MAN) estimates that Nigeria imports N165 billion worth of fruit juice every year.
In a paper presented at a workshop organised by the Raw Materials
Research and Development Council (RMRDC) in Owerri in April 2016, Frank
Jacobs, president of MAN, said in spite of the high rate of fruit
production and a thriving juice market, the country imported fruits
concentrates.
Research and Development Council (RMRDC) in Owerri in April 2016, Frank
Jacobs, president of MAN, said in spite of the high rate of fruit
production and a thriving juice market, the country imported fruits
concentrates.
Apart from production site and generating plant, someone with N3
million to N10 million can start a small-scale fruit juice company,
depending on the litres that will be produced, according to feasibility
studies.
million to N10 million can start a small-scale fruit juice company,
depending on the litres that will be produced, according to feasibility
studies.
Machinery needed to start includes juice extractor, homogeniser, pasteuriser, hydrolyser, filling machine and holding tank.
One big bang about fruit juice is that if you cannot set up a
production plant, you can get involved in the value chain by supplying
oranges, pineapples, guava and other fruit to companies like Chi Limited
and Coca-Cola, among others.
production plant, you can get involved in the value chain by supplying
oranges, pineapples, guava and other fruit to companies like Chi Limited
and Coca-Cola, among others.
Many fruit juice makers in Nigeria go to the extent of importing
fruit to satisfy demand for their products. Planting oranges, guava and
pineapples is the best bet in this case, say experts.
fruit to satisfy demand for their products. Planting oranges, guava and
pineapples is the best bet in this case, say experts.
