Many of us are always looking for new lucrative ideas on how to start our own business, but not many future business owners know that palm oil production business in Nigeria is actually one of the most lucrative things you can do nowadays.
Palm oil is a thick liquid made from palm kernels that have dozens of possible users and is, therefore, a very popular product in Nigeria. Find out how to start your own palm oil business!
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1. Why palm oil?
Palm oil may be not the first thing that jumps to mind whenever you think of a business idea, but, in fact, palm oil production is one of the few businesses that will eventually give you more than 100% ROI. After you start producing palm oil, there are many ways for you to make money:
- Food industry, which widely uses palm oil for cooking and making food products
- Drug industry, where palm oil is used as the base oil for various supplements
- Health and beauty industry, which puts palm oil in many cosmetics and self-care goods
- Pet food industry, where palm oil is an essential component of dry pet food
Additionally, you can export palm oil to international countries – the demand for palm oil is currently at an all-time high, which means you’ll never struggle without customers.
2. Palm oil business plan
Like any business, palm oil production requires a solid business plan that serves as a basis for your business and a guarantee that it won’t fail. In your business plan, you need to outline the details of your enterprise, starting with the purpose and information on how you’ll start the business.
Decide how big you want your business to eventually become and whether you want a full-cycle oil production company, or simply want to buy palm kernels from farmers and do the rest of the work. Think about how your business will be different from the existing palm oil companies and what its strong sides will be.
Next, you’ll need to establish your business structure and your staff based on the type of business you intend to run. A small production business can get away with up to 20 workers, which includes CEO, factory workers, accountants, managers, drivers, and sales assistants.
One more essential thing a palm oil processing business plan should include is a SWOT analysis – a listing of your business’s Strength, Weaknesses, Opportunities, and Threats. A SWOT analysis will help you make better projections about your business’s future and potential income.
3. Palm oil processing steps
Once your business plan is completed, you’re ready to start the production. Here are the rest of the steps you will need to make.
- Buy a piece of land to grow your palms in. Since it may take nearly 5 years for the palms to grow, and you may not have that much time, you can buy an existing palm plantation from another business.
- Get the necessary equipment for a palm oil business in Nigeria – most importantly, milling machines. Alternatively, you can purchase ready palm product from farmers if you don’t intend to create your own farm.
- Sell the product. You can do it yourself if your business is still small, or you can hire professional sales assistants who will find distribution channels for palm oil. You can also buy palm oil from farmers and smaller businesses in bulk and resell it in high quantities.
Even though every palm oil business is different, this is a general outline of starting a palm oil production in Nigeria that you can successfully use to start your own enterprise.
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