How To Start Building Materials Business In Nigeria
Thinking about starting a building materials business? Not sure about how to start the business? If so, you’ve come to the right place because we’ve covered everything you need to know about starting a successful building materials business.
The building materials business is one of the top businesses in Nigeria today.
Why? It’s simply because new residential houses, office buildings, shops, schools, and government projects, to name a few, continue to spring up all over Nigeria.
It’s a business with lots of potential customers as no one can erect any structure without buying from them.
Another thing is that building materials are heavy goods, though quite expensive to start up, but honestly, the profits are massive.
The business keeps raking in billions of naira year in and year out.
This is a result of people’s quest for shelter.
Almost everyone in Nigeria wants to own a house.
Lots of real estate investors and developers are currently in Nigeria.
So it’s a business in demand across Nigeria.
Thus, we will be taking you through the step-by-step procedure and how best to launch your building materials business.
Starting A Building Materials Business In Nigeria
These procedures and steps you are about to read will undoubtedly guide you to a successful start-up and growth of your new business.
1. Conduct Market Research
This is actually the very first thing you need to do. Doing market research goes a long way in helping your newly chosen business.
The market research you need to do includes knowing the price range for different materials; finding out about materials that sell more; which ones can make you more profits; the name of materials; where to buy merchandise; best locations; and so on. In fact, market research should be the bedrock of your business.
When you do this before starting your business, you tend to learn a lot from it as you get lots of insights into what the business is about and how you can achieve success.
It’ll also help you choose a particular niche as a starter.
You know, building materials are too much, so choosing a few ones you want to be selling is best, especially if you don’t want to go for an apprenticeship before starting.
As a result, you increase your expertise in that field while also saving money as a start-up.
2. Determine Your Preferred Niche
I believe after you’ve conducted research, you should be able to pick a niche you are comfortable with or one that you think is more profitable.
You must choose because it is impossible for you to sell all building materials in your store; even the big guns in the industry have areas of specialization.
If it’s cement and tiles, you think it could be easier for you or more profitable, go for it.
Like they always say, jack of all trades, master of none.
You need to be known for something, not for everything.
Another thing is that you can’t even stock your shop with all the building materials unless you start with billions, which I know you are not.
So go ahead and pick a niche. Selling 2 to 6 different materials is okay at least.
3. Build A Business Plan
This is exactly why most businesses today fail.
Business plans are the foundation of a successful business.
Proposing a plan includes: how you want to run the business; what you want to be selling; your chosen location; where you hope to see your business in months or years; marketing strategies to outshine competitors and bring massive sales; advertisement marketing; and so on.
Your business plan should be written down on paper and you should endeavor to try to achieve it within your stipulated time.
After the first year in business, create another plan which will entail your desired growth in the next year.
That way, you tend to weigh your growth and profit.
4. Look for Capital
For a business like building construction materials, the amount used in the beginning goes a long way in influencing your profits.
Honestly, it does not require very low capital because buying building construction merchandise is very expensive.
A material like tiles costs up to N6,000 per carton.
A sum of N100,000 may only get you 17 cartons, which is barely enough.
At least you need N800,000 for a starter. No amount invested in this business is too much as the more investment, the bigger the profits.
Another reason you should choose a niche is that the cost of setting up is high, but choosing a niche saves you money and allows you to stock up your shop more.
Let’s do some math here:
Let’s say you bought a bag of cement for N4000 to resell at N4300 per bag. When we factor in other costs such as transportation and tax, buying 100 bags to stock your shop will cost around 420,000.
At least your shop looks more mature and professional.
However, if you choose to be a jack of all trades, your N400,000 would make your store scanty, and no material will be in any reasonable quantity in your store.
You can get your capital from personal savings, loans from the bank, friends, relatives, or even government grants.
All expenses include shop rent, government registration, and building materials.
Just note that you may need close to a million to start or even more.
5. Find An Appropriate Location To Rent/Lease A Shop
After you have gotten the capital to set up the business, the next thing is for you to look for a suitable place to situate your business.
You can either rent an available space or buy land to build your store.
Construction materials take a lot of space, so you need a big shop if you are renting a space.
But, if you are buying, buy bigger plots for possible future expansion.
When choosing a location, you have to be strategic.
Choosing a location because rent is cheap or in a very rural area will do you no good.
You need to be located in a place where it is easy for customers to find you.
Being along an expressway or major roads in town is strategic due to the influx of people, drivers, and passersby.
Also, a place where new estates are being developed and people are rushing to build houses is also a good thing.
Whichever place you choose, town or city, main road or neighborhood, just make sure it’s where demand is high.
6. Find Suppliers
Find suppliers and negotiate with them. This may require you to travel.
You can get supplies from the manufacturing company directly or go to Onitsha or Lagos to meet with different building materials suppliers and talk and bargain with them.
Once you’ve done that, it will be easier for you to just order by calling, and then they will waybill your goods to you.
So there’s no need for you to travel to those cities to get goods at all again.
Also, make sure your new supplier sells quality and durable products.
7. Stock Up Your Shop
As we said, you can either get it from a local manufacturer or meet suppliers.
You just order from them and they will bring them down to your location.
However, it is important to note that purchasing directly from a manufacturer is frequently more expensive than purchasing from a supplier or distributor.
So you select the option that appears to be more convenient, qualitative, or cost-effective for you.
Your goods will be delivered to your location, but you still have to pay for the transportation for the goods.
One thing that will help you a lot is being mathematical in all your dealings.
That is, knowing which to buy that will earn better profits and also calculating how much it costs to purchase materials, including transport and tax, and how much you can sell that’s profitable to you.
Once you get your construction materials from manufacturers or your supplier.
You should arrange them neatly in your shop and pick out some for a sample display in front of your shop for people to notice what you are selling. It’s very important.
8. Start Selling
As long as your location is strategic enough, selling your construction materials shouldn’t be hard.
In fact, you don’t need many advertisements.
Make sure to put your display samples outside, as it’s very crucial to attract new customers.
If it’s cement you are selling, just put like 5 to 10 bags outside.
That way, everyone will know there is a new cement store around.
8I. Promote What You Sell
This is another key thing. You need to tell people about what you sell.
There are many ways to advertise your business, be it offline or online.
Offline, you can do that by telling people one on one, going to construction sites to tell them, meeting up with real estate investors, partnering with bricklayers and other people involved in building construction, using radio and television adverts, newspapers, etc.
Giving people your business card and having a big sign post outside your shop is also a huge part of advertising.
When it comes to online, there are even many more platforms.
Facebook, Twitter, WhatsApp, Instagram, LinkedIn, and others are there for you.
Just let them know you and what you sell.
That’s the goal. You can also create a business website. That way, you build a presence online.
The more people know you, the more sales for you.
Good customer service is also part of the advertisement and a way you can keep your customers loyal.
How to Promote Your Building Materials Business
There are many ways in which you can grow your building materials business. Some of which include:
When we talk about advertising a business, online advertising shouldn’t be left behind.
The Internet is the biggest space to let people know about what you sell.
There are lists of platforms online you can make use of to promote your building materials business.
Such platforms include Facebook, Instagram, Twitter, What’sapp, and LinkedIn.
It’s even advisable to create your own business website to boost your online presence.
- Develop Long-Term Relationships With New Customers
Starting out new, keeping your new customers should be your top priority.
Building a good relationship with them goes a long way to keep them loyal to you.
They may as well refer more people to you if you do treat them well.
- Sell Varieties Of Building Materials
Selling various building materials will also promote your business.
It makes your shop a one-stop point where they are sure to get all that they need.
Once they know you’ve got all they want to buy, they come directly to you and buy all they need in one spot, thus saving them stress.
- Make Contact With Contractors and Real Estate Professionals
When you connect with these kinds of people, you are bound to get lots of massive orders.
All you have to do is walk up to any of them, ask them for a partnership, and offer to supply them with construction materials at a discounted price.
- Create Sign Posts, business cards, flyers, and Banners
This is also another big way of promoting your business.
Giving people your business cards alone makes your business look professional.
Also, posters, banners, and a big signpost in front of your shop can get people to know you and reach you for business deals as long as you put your contact information on them.
Additional Business Requirements
These other things will add glamour to your new building materials business.
Hire workers: You can’t possibly do all things alone. Get people to help you out with your stuff.
Employ at least two to three people: one salesperson and two offloaders or onloaders.
Get a delivery truck: Buy a delivery truck so that you can deliver your products to the doorsteps of your customers.
It’s also another way of earning money as you charge them for transport. It’s a win-win for both of you.
Get a business website
Print posters and business cards.
Some Of The Building Materials To Sell
Iron doors, gates, and windows
Wooden doors and windows
Some Key Factors To Note
Here are some recommendations that can also propel your business to success if taken seriously.
1. Working With Quality Distributors:
When you sell quality products, you build a reputation for your business.
Existing customers will refer new customers to you as long as they believe your products are quality.
So, try to purchase your product from a reputable dealer who sells long-lasting and high-quality goods.
2. Offer Discounts: Offering discounts to your customers can also help your business grow.
offer good customer service.
Buy more of a product when demand for it is high and less when demand is low.
How Lucrative Is Building Materials Business?
As we reiterated in the previous paragraphs, every single day a structure is being completed or inaugurated somewhere.
Hundreds of estates and luxurious neighborhoods are being developed yearly, and almost everyone wants to own a house and bear the “landlord” title.
Thus, the building materials business is today one of the biggest businesses in Nigeria, raking in billions of naira.
The great thing about this business is that customers are numerous, so you don’t need to worry about customers.
Carpenters, bricklayers, engineers, electricians, plumbers, tilers, etc will all patronize you daily.
Construction material business people make lots of money because the profits are high.
How Much Is Needed To Start A Building Materials Business?
After reading this post to this level, I’m sure what’s pondering in your mind right now are questions like: “How much can I start the building materials business with?” Is it expensive to start the business?
Well, a building materials business is a big business and not some sort of petty trade, as it requires you to invest lots of money.
If you truly want to maximize your profits in the business, you must have reasonable start-up capital.
In fact, it’s the more invested, the more profits.
If you start with relatively low capital, it will be really hard for you to thrive, especially with current inflation and a dwindling economy ravaging the country.
The only way you can start small is by choosing only a few products to sell.
That way you can start low, but you might still need funds to grow the business.
Based on my calculations and findings, starting low requires up to N400,000 for a starter, while for you to start as an average building material business person, you need up to N800,000. Seriously, if you have more to invest, no amount is too big.
The expenses you incur are many too. You have to pay for the rent of big shop space, delivery, shop materials, and the goods themselves.
But you can minimize spending depending on your location.
The cost of renting a store differs as it is cheaper in rural or developing areas and expensive in developed cities.
So your location determines how much you can start with.
The sum mentioned by us is one you can start within a semi-urban or developing area, so bear in mind that you will spend more if you are setting it up in big cities like Lagos, Abuja, Port Harcourt, or Enugu.
Building Materials Business Ideas
There are lots of business opportunities in the building materials business that you can take up. Some of these include:
1. Building Equipment Business
You can actually sell building equipment together with your materials.
This way, you can earn more by meeting more demands.
You can sell building equipment such as wheelbarrows, building knives, hammers, chisels, diggers, shovels, meter rules, sand filters, nails, and so on.
- Paint Sales
This is another lucrative opportunity in the building materials business.
You sell house paints and painting materials.
If you also have painting skills, that’s a plus for you.
When they buy from you, you tell them you also offer painting services.
- Iron Windows and Doors
You don’t have to sell all the materials. You can also sell iron doors, gates, and windows.
The demand for these is high as houses are not completely built without the three.
- Building Materials Delivery
Another great idea in the building materials business is the delivery of building materials.
To start this, you need to purchase a vehicle.
When customers buy building materials from sellers, you help them convey them to their destinations at a price.
If you are into business, you can also add this to your service and earn extra cash from it.
Nigeria’s Biggest Building Materials Market
It might also interest you to know the biggest building materials market in Nigeria.
You can get your supplies from them.
Based on my research, the biggest building materials market in Nigeria is in Ogidi, Anambra state.
There you can find different distributors to buy supplies from.
If you have great business acumen, the building materials business is here for you and can propel you to the real business world in Nigeria.
One of the major things that distinguish the business from other businesses is that it’s not seasonal.
The real estate industry is booming, with schools, offices, shops, and industrial structures being built on a daily basis.
As a result, there are numerous opportunities for you in the business.
To stand out in this business, you need to sell quality, offer good customer service, offer discounts, and sell at normal market prices.
Make sure to site your spot in a strategic location.
A location being strategic simply means the demand is high there.
Developing areas and cities where rapid development and structures are being erected are actually the best.
We believe with this guide you’ve learned a lot about the business.
So all you need to do is follow this guide step-by-step in order to operate a successful building materials business. Goodluck👍