Building

How to Start Cement Business in Nigeria

Would you like to start a cement business in Nigeria? Are you interested in buying and selling of cement products? Or are you aspiring to be a major distributor for cement producers in Nigeria? If your answer is “YES” to any or all of the above questions, then you will need to pay close attention to this article as I take you through how to start and run your own cement business that will generate millions of Naira for you on a daily, weekly or monthly basis.

Nigeria is among the countries that are blessed with several minerals, most especially limestone; which is the major raw material in the production of cement.

The limestone was available in the south western part of the country mostly in Ajaokuta which makes Nigeria one of the leading producers of cement.

Read Source: Price of Cement in Nigeria Today

How to Start Cement Business in Nigeria
Cement Business in Nigeria – Photo Source: https://www.businessplan.com.ng

There is high demand for cement products in Nigeria as there is consistent construction going on in every hook and cranny of the country which bring need to build a family house, school, hospital, hotel, mosque, road , church, bridge, shop e.t.c. Hence, starting a cement business in Nigeria will most definitely give good returns on investment and bringing huge profits.

Factors to Consider Before Starting a Cement Business in Nigeria:

Write a Good and Standard Business Plan

The first step in settling of any business in a standard manner is to conceptualize your idea into paper which will include your detailed feasibility study.

The standard business plan should include capital that you will use to start the cement business, selecting good location that is nearest to market, storage, specific advantages and disadvantages surround the cement business, availability of raw materials needed and plan out all operation that will be carried out in a cement business and so on.

Capital

This is the backbone of any business in the world, and without it there is nothing called business. For a retailer that wish to be selling cement to the final consumer will need minimum capital to cater for 60 bags of cement which will be explained explicit below.

Read Source: Dangote’s Obajana Cement Plant, Kogi State Nigeria

Storage Facilities

This is also a germane factor in starting a cement business because whenever cement is exposed to air or water it will become hard like a cake which will eventually destroy the cement. So, as a distributor of cement, you will need a warehouse or cargo container in which you will be preserving your cement before selling it to retailer or final consumer. The storage facility must be adequately protected from rainfall and excessive sunlight.

Transportation

This is one of the factors to consider in starting cement business in Nigeria, there must be a vehicle to convey the cement product to your consumer and you can even charge an extra fee to deliver it at doorstep.

Advertising Your Business

This is the last factor to consider in this section and it becomes a germane factor if you didn’t promote your business by advertising it or going into construction sites and propose to supply cement to them.

Find a unique selling point and create good communication with several building contractors which will give them the opportunity to patronize you.

Those are factors to consider before starting a cement business in Nigeria and if all was dealt with, definitely the huge money will be smiling in your account as profit.

Read Also: Cost of Building Materials in Nigeria

How to Become a Major Distributor

There are several cement producing factory in Nigeria which always welcoming major distributors from all the part of the country. There is high demand for cement products in Nigeria as there is consistent construction going on in every hook and cranny of the nation. These are the steps to follow in becoming a major distributor:

Corporate Affairs Commission Registration

Before you can become a major distributor of any major cement producer in Nigeria, you must register your business entity at the Corporate Affairs Commission (CAC) of Nigeria.

This is to show how credible your business is and how your business was backed legally. To start the process of registration with CAC, it takes up to 2-4 weeks to get the company certificate from any corporate Affairs Commission offices all over the country.

Opening of a Corporate Bank Account

This is the next step after registered your company with Corporate Affairs Commission the opening of a corporate bank account can be done in any Nigeria’s commercial bank with your company name but before that, you will have to visit EFCC’s Special Control Unit against Money Laundering (SCUMIL) to get clearance.

Read Also: 4 Factors Affecting Cost of Building Construction in Nigeria

This clearance will ensure that you did not register your business in order to engage in money laundering or any financial fraud. After the clearance, you will proceed to Federal Inland Revenue office in the country to obtain Tax Identification Number (TIN) for your business. This indicate that you are ready to be paying your tax whenever it due.

After collecting all this documents( SCUMIL clearance, TIN) then proceed to any bank of your choice with your company certificate, passport photograph, identification card ( International passport, National ID card, Voters card, Driver licence) to open a corporate account for your business.

Obtain Reference Letter from the Bank

After you have opened a corporate bank account, you will need to fund the account with the starting capital for your cement business and the bank will issue reference letter to your company which will shows that there is a banking relationship between your company and the bank.

Proceed to Cement Producing Factory

After collecting all the above documents then proceed to any of your choice in the cement factory (Dangote, Lafarge, Elephant e.t.c) in which you will be required to submit the following documents:

  • Certificate of company registration from Corporate Affairs Commission
  • Bank reference letter
  • Application letter to become a major distributor
  • Passport photography of company’s representative

There is no levy for registration but the minimum cement you can order is one trailer which is equivalent to six hundred (600) bags.

This article has taken you through ways and steps to take in starting a cement business either in large scale or small scale with high profit after committing a little capital. Thanks

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Lawal Ibrahim Oyegbade

Lawal Ibrahim Oyegbade is a Content Developer at InfoGuideNIgeria.com. InfoGuide Nigeria is a team of Resource Persons and Consultants led by Ifiokobong Ibanga. Page maintained by Ifiokobong Ibanga. If you need a personal assistance on this topic, kindly contact us.

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