Frozen food business in Nigeria is becoming more lucrative by the day. The rising demand for it is further boosted by increasingly busy lifestyle of most Nigerian families, especially the middle class. Unlike in the rural areas where fresh food is readily available, the story is not the same in urban areas and for this reason frozen food is preferred for convenience and ease of preservation.
For instance, a kilogram of frozen chicken goes for a minimum of N600.00. It can even cost above a thousand naira depending on the size and location. That is why the business is very profitable.
However, one cannot just start the business without putting some things into consideration. Frozen food business has some level of risk as well as cost considering. The problem of electricity experienced in the country also add up to the cost of running the business. So in setting up the business, one should consider these factors very carefully.
But if you are able to get everything properly done, you are sure of good patronage and consistent profit. Average standard frozen food store makes N200,000 profit monthly (some make much more than that while some make less) in anyway, it is a good business.
For you to get started in frozen food business in Nigeria, there are things you need to put in place. Below are some of the requirements.
1. Have a Business Plan
Usually every business must have a plan no matter how small it looks. While planning your business , a lot of things come into play. This is the period you do a thorough feasibility study regarding the business. Do not be ignorant of the fact that there is competition. There are people in the business already and more will likely to come in after you start.
So, your strategy should be two-fold; one to survive and the other, to thrive. In case, the business idea is not clear to you, seek professional advise. Or better still, look for an existing progressive person in the same business and make inquiries. Generally, business plan involves all that will be needed for the intended business from take-off time until it grows gradually to a big business.
2. Raise Your Business Capital
This is very essential, especially if you want a one-man business. Before thinking of starting anything like business venture, there must be money set aside for it. The scale you start from is determined by the amount of capital available to you. You can source for your start u p capital through multiple means
Also remember that there are certain costs to be incurred as the business progresses. Apart from the fact that equipment need to be purchased and the refrigerators needs to be stocked with goods, you need money for maintenance and running cost.
You have to put all these into consideration while raising your startup capital. Make enough budget to cover your expenses after setup. It will take at lease three months for you to build your customer base before you starts seeing appreciable profit.
3. Decide on Your Product Line
There are a lot of food items that can be sold frozen, so, you choose the ones to start with. Seafood and poultry products appear to be in greater demand than fruits. It is better to start with the ones that are more in demand before expanding to various types. The essence is to know which products and its type customers in that particular locality prefer most.
For instance if you want to start with fish and chicken, what specie of fish do people in that area consume more. That will give you an idea of which one to start with. Also remember that if you are going to start with maybe fish and poultry food, that means there will be two refrigerators.
Reason being that fish gives an awful smell and not everybody eats it. Storing it together with chicken will give you bad business. It means that those who hates fish because of the smell or for other reasons may not be able to buy your chicken as well.
4. Select Suitable Location
Some business thrive more in certain locations because of the level of consumption of the product involved. Study the environment where you want to situate the business and be able to forecast what the turnover of the business will look like in a year or two.
If the profit is abysmal, then reconsider using another location that may be more suitable for your frozen food business. Usually, businesses do not make huge profit in the first two years of inception because of the initial costs incurred. However, if it is one that will succeed, the glimpse of survival will be seen within months.
Therefore, do not be quick to dismiss the location of your business because the business isn’t performing you expected during the first few months of starting.
5. Register With The Relevant Association
It is a well known fact that market unions exist. Every business line usually has an association that oversees it affairs. As a new entrant, try to register with the appropriate body for security reasons, and even advise. It also serves as a protection for your business, because it keeps you abreast of what is happening within your sector.
Some Associations can even provide credit facilities for their members. If yours is like that, then you are better off with it. You also need to understand that some associate will become a milking pot for your business, charging one levy after the other, you find out this before joining any association except if it is compulsory.
6. Build Your Customer Base
As a new business, determine who your customers are. This will also determine the kind of products to sell. In an environment where there are more growing kids, red meat and poultry food can sell very well. But where you have more of elderly people, seafood and poultry foods will sell more.
Whichever is the case, determine who your customers are and try as much as possible to attract, win and keep them if you must prosper in the business. Remember that customers are the engine that keeps your business running.
7. Properly Plan You Storage System
One cannot talk of opening a frozen food business without thinking of the storage facilities; refrigerators and other cooling systems. The scale the individual wants to start on will also determine how many of these facilities to purchase. But it is advisable to start small so that the initial expenses wouldn’t be too much you.
In frozen food business, storage is the key. Whether your business will prosper or crumble depends on how reliable or inefficient your storage facility is. Make you invest in high quality refrigerators; if possible, you can buy the brand new ones.
When your seafood and chicken is frozen like the ones above, they stay fresh and healthy until you sell to consumers.
8. Get Adequate Power Supply Generator
Electricity problem is one of the major challenges businesses face in the country today. Remember you are dealing with perishable goods and so, as you want to start your business , think of getting a generating set for power supply, otherwise you will be running at a loss, as some of the foods may perish when there is no power to preserve them.
Of course nobody will want to spend his/her money on rotten food. In buying generator, go for one that can carry high voltage but still portable. It less expensive to manage generating sets that uses petrol than diesel, so go for the former than the later.
Equipment: Make a list of all the necessary equipment you will need for a start up. And start buying them in bits. You can get some of those equipment as fairly used or cheaper ones but still new.
9. Build You Logistics – Home Delivery
This can actually be a means of attracting more customers to you. Some people like after sales delivery, and if your business can offer that , it is an edge 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 incur in this process.
It is therefore advisable that you do this for customers that do bulk purchases. Selling frozen foods often involves several 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 functional telephone numbers so that your customers can easily reach you through it for any inquiry.
10. Equipment For Frozen Food Business in Nigeria
- Knives (Big and small)
- Work Fan/air
- Sales person
- Water container
- Cartons of food to be sold
- Wooden boards
- Bowls or buckets
- Waste bin, etc
11. Advantages of Frozen Food in Nigeria
Frozen produce helps to maintain the flavor and nutrients of the food
It is cost effective, because frozen foods keep longer than fresh refrigerated foods because the freezing process suspends enzyme activity that causes the food to rot.
It provides safety for storage, because freezing suspends microbial and fungal activity in the food. As long as the food remains frozen, it is safe.
It provides convenience. Frozen foods give busy people a way to feed themselves and their families with healthy meals in minutes.
Sometimes frozen foods are a better choice than fresh, such as in cases of food outbreaks and when there is a shortage of fresh food.