The frozen food business is becoming more profitable day by day in Nigeria. The rate at its demand has geometrically increased significantly among the middle class. Compared to the rural areas where fresh food is readily available, the story differs from the urban areas. As a result of this reason, frozen food is craved for convenience and ease of preservation.
The cost price of a kilogram of frozen chicken goes at a minimum of N650.00. It can even cost beyond a thousand naira hingeing on the size and location. Meanwhile, this is the reason the business is very profitable.
How to start frozen food business in Nigeria
However, you can not set up a business without considering some things. The frozen food business involves some level of risk and cost consideration. The difficulty of electricity encountered in the country also adds to the cost of running the frozen business. Before you set up the business, you should consider these factors carefully.
But if you can get everything appropriately done, You can count on returning customers and a steady profit. Some normal frozen food stores make around N200,000 per month in profit, while others make much more and others make less.
Starting a frozen food business in Nigeria, there are things you need to put in place. so in this guide you read you need to know about how to start frozen food business in nigeria
Below are some of the rear requirements.
1. Get Guidance
Getting guidance is one of the ways to start a frozen food business in Nigeria. Knowing what you are getting into before jumping into it; you find yourself jumbling things up.
The Number one thing to do when you want to start a frozen food business in Nigeria is to get sufficient knowledge of the industry.
It would be an advantage to get practically trained in the food business and not just from your desk and chair with paper and a pen.
This will assist In shedding more light on things you are to do when starting your frozen foods business, the right source of supply, the equipment you are to get first, what association to join, and many more
2. Have a Business Plan
Usually, every business must have a plan regardless of how small it looks. While planning your business, many things come into play. This is the period you do a detailed feasibility study regarding the industry. Do not be naive about the fact that there is competition. And there are people in the business already, and more will probably come in after you start.
So, your method should be two-fold; one to survive and the other to grow. If the business idea is not clear to you, crave professional advice. Or better still, look for a prevailing progressive person in the same business and make inquiries. Generally, a business plan involves everything needed for the planned business from take-off time until it thrives gradually into a big company.
3. Raise Your Business Capital
This is very crucial, especially if you want a one-person business. Before starting anything like a business venture, there must be money put aside for it. The amount of capital available determines the scale you start from. You can source your start-up capital through multiple means.
Also, remember that certain costs are to be incurred as the business progresses. Apart from the fact that equipment needs to be purchased and the refrigerators need to be stocked with goods, you need money for maintenance and running costs.
4. Decide on Your Product Line
Many food items can be sold frozen, so you choose the ones to start with. Seafood and poultry products happen to be in greater demand than fruits. It is better to start with the more in need before expanding to various types. The importance is to know which products and their types customers in that particular locality would want most. So, if you want to start with fish and chicken, You should be asking yourself what fish species they consume in this area begin with. Also, remember that if you start with maybe fish and poultry food, that means there will be two refrigerators.
The reason is that fish gives an awful smell, and not everybody eats it. Storing it together with chicken will provide you with bad business. It means that those who hate fish because of the smell or other reasons may not be able to buy your chicken.
5. Select Suitable Location
Some businesses grow more in specific locations because of the level of consumption of the product involved. Study the environment where you want to place the company and forecast what the business’s turnover will look like in a year or two.
If the profit is bottomless, reconsider using another location that may be more suitable for your frozen food business. Usually, companies do not make a considerable profit in the first two years of the foundation because of the initial costs incurred. However, if it succeeds, a glimpse of survival will be seen within months.
Therefore, do not be quick to terminate the location of your business because the business isn’t performing the way you expected during the first few months of starting.
6. Register With The Relevant Association
It is a well-known fact that market unions prevail. Almost all business line usually has an association that supervises their affairs. Try to register with a fit body for security reasons and even advice as a new member. It also serves as protection for your business because it keeps you updated on what is happening within your sector.
Some Associations can even give credit facilities or loans to their members of the association. If yours is like that, then you are better off with it. You also need to understand that some associations will become a milking pot for your business, charging you one levy after the other; you find out this before enrolling into any association except if it is compulsory.
7. Build Your Customer Base
As a new business operator, you must determine who your customers are. However, this will also choose the kind of products you will sell. Red meat and poultry food can sell very well in an environment with many growing kids. But where you have many older people, seafood such as lobsters, mussels, crabs, and poultry foods such as meat and eggs will also sell more.
Whichever is the case, determine who your customers are and try as much as possible to entice, win, and keep them prospering in the business. It would be best to remember that customers are the engine that keeps your business moving.
8. Properly Plan Your Storage System
You cannot think of opening a frozen food business without putting the storage facilities into consideration; refrigerators and other cooling systems. The hierarchy the individual wants to start on will also determine how many of these facilities you should purchase. Meanwhile, it is advisable to start small so that the initial expenses wouldn’t be too much for you.
In the frozen food business, storage is the ticket. Whether your business will prosper or resolve it depends on how dependable or inefficient your storage facility is. Make you invest in high-quality refrigerators; you can buy brand new ones if possible.
When your seafood and chicken are made frozen like those above, they will stay fresh and healthy until you sell them to consumers.
9. Get an Adequate Power Supply Generator
Electricity problems are one of the main challenges businesses encounter today. You should bear in mind that you are dealing with non-durable goods. Before your start your frozen food business, think of getting a generator set that provides a power supply; otherwise, you will be running at a loss, as some foods may perish when there is no power to preserve them.
Nobody will want to spend their money on rotten food. When buying a generator, go for one that can carry high voltage but is still portable. It is less expensive to manage to generate sets that use petrol than diesel, so go for the former rather than the latter.
10. Build Your Logistics – Home Delivery
This can be a means of enticing more customers to you. Some people like after-sales delivery, and if your business can give that, it is an advantage over your competitors. After-sales delivery could be home delivery of goods bought by your customer. It is worthy of note here that you may not be able to do this for all your customers because of the extra cost you may be incurred in this process.
Therefore, you should do this for customers who purchase in bulk. Selling frozen foods often involves severe delivery systems. You may decide to market your products online and deliver them in freezer trucks, pedal your foods to businesses and homes, or to stores and restaurants where they are needed. Make available a functional telephone number so that your customers can effortlessly reach you through it for any inquiry.
Equipment for the frozen food business
1. Deep Freezer
Get at least two deep freezers for this business, although you can start with one or more 2. You should know that A profound freezer costs between 60,000 to 80,000 Naira.
2. Chairs and tables
Buy chairs and tables for your store. Make sure it is a solid wooden table and some plastic chairs. These would cost you around 6,000 for the table and 1200 per chair(s).
Store/Office space: Rent a shop for your business; this can simultaneously double your office. A shop in some significant cities goes for 5,000 per month and 60,000 per year.
In a situation of a power outage, which is common in Nigeria. Get a big generator to power the freezers. Remember you have to keep the food frozen!
4. Knives, Bowls, and Buckets
These are hand tools or equipment used in handling frozen foods; buy a bunch. It would cost 4000 at most.
5. Fan/ air conditioner
Your shop or store has to be remarkable. There is no need to store frozen foods in a high-temperature environment. A fan is affordable and costs 10,000 Naira. An air conditioner is discretionary, but you should go for it if only you can afford it.
You need to wear aprons and gloves while handling frozen foods. Getting an apron and some gloves would cost you around 6,000 Naira.
7. Wooden boards& Cabinets
The wooden boards are used to cut the frozen meats and fish and cabinets for storage. These would cost you around 8,000 Naira.
HOW MUCH IS NEEDED TO START A FROZEN FOOD BUSINESS
If you are starting small, #200,000 is okay. But if in a more significant way, you will need up to #500,000. You have to purchase two deep freezers, which may cost more than #100,000. The price of a Generator cost starts from #60,000 and above. Then other things will gulp about #200,000.
Types of Frozen Food In Nigeria
Seafood: This includes fish like sardine or Oshawa, croaker, Titus, panel, Etc., and other sea-related foods).
Poultry products: Examples are Chicken wings, whole chicken, chicken laps, Probo, turkey, gizzard, chicken neck, Etc.
Animal-based products: Like red meat, goat meat, inu Iran, hotdogs, getCowskinskin
Vegetables (chopped potatoes, lettuce, Etc.)
Fruit juice & Snails
The frozen food business will make you rich within the shortest possible time if you keep to it. You can open more shops and put people to run them for you. And because you know the amount that can come out from the business, it will be difficult for anybody to cheat you.