How to start a food processing business in Nigeria
Food processing transforms or converts raw food supplies or ingredients, by physical and chemical means, into consumable food products or other forms.
Food processing typically entails some of the following activities: mincing, macerating, liquefaction, emulsification, cooking (like boiling, broiling, grilling, frying, etc.), pasteurisation, preservation, canning or packaging.
The food processing industry has enormous growth and potential. You should know that there are so many niches within the food processing industry.
If you are interested in starting a food processing business, with the right start-up capital–depending on your location–and the necessary information, you can get started with your food processing business irrespective of your country of residence.
The following are some of the essential steps you will have to consider before taking a plunge into starting your food processing business.
How to start a food processing business in Nigeria
1. Choose your Niche and Conduct a Thorough Research
If you want to start a food processing business, this is probably the first step you must take. The food processing industry has so many niches.
If you do not already know which niche to specialise in, I recommend you carry out general research on the food processing industry and determine the place you want to focus on.
The following are some food processing niches.
– Bread making
– Biscuit making
– Banana wafer making
– Groundnut oil processing
– Coconut oil processing
– Flour processing
– Tomato processing
Once you have decided upon which niche to focus on, go ahead and conduct detailed research on the food processing niche.
You should do well to visit owners of such food processing companies to gather as much knowledge as possible about the industry.
2. Choose Location Carefully
The success of your food processing business largely depends on the location. You should carefully choose your location.
The ideal location is very close to the source of raw materials and all other supplies you would need and very close to your target market.
In addition, you should make sure the location of your food processing business is close as possible to the source of water, electricity, adequate labour, etc.
The land property in your chosen location for your food processing business should be large enough to accommodate spaces that will contain the raw materials, machinery and plant, and processed packages ready to be supplied to customers.
3. Get your Business Registered and Obtain the Necessary License and Permits
Once you have decided to start your food processing business, the next thing is to get your food processing business duly registered.
Choose a fascinating name that is not difficult to pronounce for your food processing business and proceed to the appropriate local agency to get your food processing business registered.
Like other businesses, you will have to obtain a business license for your business and additional relevant licenses and permits.
Ensure you make the necessary inquiries regarding the permits you require for starting your food processing business and ensure you meet the requirements.
You should visit the food and drug regulatory body in your country to make this inquiry.
4. Create a Good Business Plan
Draft out a comprehensive and near-accurate business plan for your food processing business. The importance of a well-written business plan cannot be overemphasised.
Most important is the ability for you to obtain funding and loans from investors and banks, respectively.
Your business plan should detail your offerings, mission goals and objectives, competitors, start-up capital; marketing strategies; and exit strategy.
5. Determine the Source of Funding
Starting a food processing business requires vast start-up capital. You will have to determine the means of obtaining funding for your food processing company.
If you have the capital required to start up your food processing business, then that is fine. Otherwise, you will have to seek assistance from friends, family, and banks.
You would be required to provide your business plan if you decided to seek assistance from investors and banks.
6. Hire Employees and Equipment
Are you serious about starting your food processing business? Go ahead and get the right employees and get the necessary equipment ready for your food processing business.
You should do well to hire experienced employees. I would recommend professional employees as well as inexperienced ones.
This way, you would also save costs.
Purchase and install all the necessary equipment and machinery required for running your food processing business.
You can lease if you cannot purchase some of the equipment at the start.
For instance, if you are operating a tomato processing business, you require some of the following equipment: high-pressure pumps and homogenisers, extractors, evaporators, separators, etc.
Regardless of the equipment you purchase for your food processing business, you must do well to get a good power generating set (primarily if you reside in a city where the power supply is epileptic) and a good source of clean water.
7. Find Suppliers
Find suppliers for your food processing business that will constantly provide clean and healthy raw materials for your food processing business.
Have a list of suppliers for each commodity, so you do not run out of raw materials for your business.
8. Have Good Packaging
To distinguish your products from those of your competitors, you should have great and unique packaging. Packaging goes a long way towards emphasising the difference between good products and great products. Packaging goes a long way towards determining if your products will sell in the market or not.
9. Market and Promote your Products
Determine who your prospective customers would be. Get a list of businesses, wholesalers, and retailers that need the products you offer and reach out to them.
You could offer a special offer to first purchasers and special discounts for vast volumes of purchases.
Also, you cannot go wrong by having a business card, creating a website, and creating an online presence for your food processing business using platforms like Facebook, Twitter, and Instagram.