There are many businesses you can start with 200k in Nigeria, but the cement business is not one of them.
If you are asking this question, “Can I start a cement business with 200k?” then you’ll get the answer in this article.
I will give you concrete reasons why you cannot start a cement business in Nigeria with 200k.
I will also provide you with how much you need to start this business and the requirements for starting it.
As a successful businesswoman with over 5 years of experience, I know the ins and outs of running a business in Nigeria.
In the end, if 200k is what you have to start a business, you will get my best business suggestions for this amount of money.
Read Also: 37 Hidden Business Opportunities in Nigeria
Can I Start a Cement Business With 200K?
No, you can’t. Starting a cement business with 200,000 Nigerian Naira (NGN) in Nigeria is almost impossible as the capital is insufficient to cover all the necessary expenses.
Expenses like rent, licenses, purchasing the product, and running the business.
Here is why:
1. Shop Rental
For one, the price of housing has been on an upward trend in Nigeria since 2022, and it became much worse in 2023 due to the abysmal rate of inflation.
Very recently, my landlord called me and told me that since I have seen the way the country is, he is obliged to add some money to my rent.
I understood because the price of everything is rising.
Back in 2020/2021, you could get a shop in Nigeria with 100k or 150k. Now, if you want to find a shop, you have to factor in three things:
- Money for legal fees (N50k or more)
- Money for the agent who finds the shop for you (N50k or more)
- Money for the shop (N200k or more)
Coming at this rate, the cost of finding a shop has already eaten up all your capital.
Let’s say you go for a container instead.
You can find an empty piece of land and settle the landlord with as little as 20k or 30k, depending on your location. If you do that, it leaves you with N170k.
But even the smallest container costs nothing less than 100k in our economy today.
With this rate, the 200k you have to start the business with is already gone.
2. Secondly, the Cost of Cement Itself
As of July 2023, the lowest price you can buy a bag of cement in Nigeria is N3600. If you intend to start a cement business with 200k, you can only buy 55 bags.
Yes, 55 bags.
Let’s say a miracle happens, and you manage to find a location where you can showcase your merchandise. And you go out and buy these 55 bags of cement.
With each sale, you make a profit of N200 or less.
But let’s say you make a profit of N200 with each sale. After selling your 55 bags, your profit is N11,000.
While this is a good margin for a business, you can hardly grow with this.
Why? It’ll take days, sometimes weeks for you to sell all your 55 bags.
This profit can only get you 3 more bags. If you add in food and transport, you have no profit.
Besides, you’re not going to go to the cement factory where you buy the cement and carry it with your head.
You will have to pay for the Dangote truck that will bring the cement to your location. And the cost of transport can be pretty high with the price of gas on the rise.
Learn more Current Price of Cement in Nigeria
3. Thirdly, Let’s Not Forget Legal Fees and Licenses
For you to operate as a business owner in Nigeria with peace of mind, you need to have the authority to operate. That’s what the licenses give you: THE AUTHORITY TO OPERATE.
Without registering your business with CAC, you might get harassed while you are sitting in your shop.
In extreme situations, they could even go as far as carrying the bags of cement that you are selling.
Not to worry, the cost of registering your business in Nigeria is affordable. With 20k, you can register your business with CAC. But if you do this, you know that your 200k is already short.
You will also have to pay for sanitation, electricity, etc.
What if You Decide to Go for Credit?
You can meet an established dealer and ask him to supply you with cement.
This road requires dedication and focus. You can agree with this dealer that when you sell, you will pay him back so that you can form a partnership.
While this is a good decision, I’m not going to advise it. Since this is your first foray into the cement business, it’s still going to take some time for you to know your way around.
And if you are going to buy from a dealer who buys from a manufacturer, you’re not going to make much profit.
Running a business will also be extremely difficult if you have someone looking over your shoulder and calling you all the time for his money.
When you are starting a business for the first time and without experience, it is always better to go in there by yourself and get to know the feel of things.
Is this something you can do for a long time? Businesses require determination.
If you want to succeed, you have to be willing to give your all. If things get tough or if things fail to work out, can you deal with it?
After asking these questions, if you still feel that the cement business is something you want to do, then go for it.
But go for it first without credit. When you know your way around, you can then take credit.
How Much Can I Use to Start a Cement Business in Nigeria?
The right amount that you can use to start a cement business in Nigeria is 1 million Naira. If you have 1 million Naira, you can comfortably start a cement business in Nigeria.
This way, you can start and scale your business from there.
If you cannot build a business with 1 million Naira, you’re not going to do it with 10 million Naira.
As always, the trick to starting and succeeding in a business remains the same:
- Find a shop in a good location.
- Create a business plan that contains how you intend to market your product, how you intend to sell, your price, what sets you apart from your competitors, and how you intend to hire people when the time comes.
- Before starting any business, it’s important that you conduct market research. This will help you carve out a unique selling point that will bring customers to you.
Why 1 million Naira, you may ask? Well…
Here are some requirements for starting a cement business in Nigeria:
- A warehouse
- A means of transport for transporting your bags of cement
- The ability to learn from people already in the business (this may cost some money)
- Advertising campaigns to put your business in front of potential customers
- Certificate of Company Registration from the Corporate Affairs Commission
- Application letter to become a distributor
- Scanned copy of the Bank reference letter
- Passport photograph of the company’s proprietor/MD
- Passport photograph of the company’s representative
And, of course, start-up capital.
What Business Can I Start With 200K in Nigeria?
There are several simple businesses you can start with 200k in Nigeria, such as:
One business you can start with 200k in Nigeria is the e-commerce business. All you have to do is look for in-demand products from cheap marketplaces like made-in-china.com.
Once you find something that works for you, you can ship them to Nigeria. You can then link up with courier services to help you market your products.
If you have a car, even better. Courier services charge very cheap rates, sometimes as low as N1k within your town’s metropolis.
Event Planning and Decoration
With 200k, you can help people plan their events and make money for themselves. But this business requires you to put all your fears aside because you will have to deal with people 24/7.
Unlike the cement business where all you have to do is buy cement and sell, event planning requires you to manage time, coordinate events, and handle various responsibilities.
However, with proper planning and dedication, you can make a lot of money in this business.
Many event planners in Nigeria are making as much as N500k a month by helping people handle their occasions like birthdays, weddings, or corporate gatherings.
Printing and Graphics Design
Graphic design is a lucrative business you can start with 200k in Nigeria today. With just a laptop, you can provide graphic design services to clients.
There are several platforms online where you can design flyers, banners, posters, and more for free. You can improve your skills and charge higher fees as you gain experience.
This business has great potential for profitability.
Snail farming is another good business venture you can start with 200k in Nigeria.
You can run this business in the village while also working on other income-generating activities in town.
To start a commercial snail business, you will need an investment of approximately 140,000 Naira for a snail pen and seed snails.
Depending on the size and season, mature snails can fetch between 250 Naira and 800 Naira in the market.
With 200k, you can purchase and set up the necessary infrastructure for running a poultry farm in Nigeria.
This includes a chicken coop, feeding and watering equipment, and an initial stock of chicks or hens.
By focusing on a specific poultry niche, such as egg production or broiler farming, you can streamline your operations and maximize profits.
With proper management and care, you can rapidly grow your flock and generate a steady income from the sale of eggs or meat.
Before You Go…
Starting a cement business in Nigeria with an investment of 200k Naira is not feasible due to the high costs involved.
However, there are other viable business options that you can consider with your 200k Naira.
Mini importation, event planning, graphics design, and snail farming are some examples of businesses that can be started with a smaller capital.
These businesses have the potential for profitability and growth in the Nigerian market.
Remember, thorough research, careful planning, and dedication are essential for any business venture.
So, explore the available options, evaluate your interests and skills, and take the leap into entrepreneurship with confidence.
Don’t let the limitations discourage you; instead, use them as motivation to find the right business opportunity that suits your budget and aspirations.
Here’s a list of articles I’ve written that may be able to help you start a business in Nigeria:
- How to Start a Jollof Rice Business in Nigeria that Makes 15K Daily
- How to Start a fast food business in Nigeria 2023 (Earn ₦10k Daily )
- How to Start a Food Supply Business in Nigeria and Make Money Fast
- Start a Succesful Restaurant Business in Nigeria in (9) Easy Steps
- How to Start an Ice Fish Business in Nigeria: A Comprehensive Guide
- 12 Super Tips for Starting a Popcorn Business in Nigeria
- 13 Vital Tips on How to Start a Beauty Product Business in Nigeria
- How to Start Keke Spare Parts Business in Nigeria (Tips for Success.)
- How to start a wallpaper business in Nigeria (The Complete Guide)