Sachet Water (Pure Water as it is popularly called in Nigeria) is one of the products out there that is in high demand. Hundreds of millions of sachets are consumed everyday, and the demand of Pure Water supply is always on the rise as the population keeps increasing. Go to any major city in Nigerian, you'll see how the streets are littered with empty sachets of pure water which is the testimony to the quantity that is consumed everyday.
A smart investor knows that the best product to deal on is the product in high demand, that automatically placed pure water production business "Investors Choice" any time. The demand doesn't seems to go down very soon as it has become the most credible alternative means of getting anything close to clean drinkable water for the average Nigerian. Therefore, how do you cash in on the demand of sachet water to make money for yourself?
The business of pure water production is quite simple, and here I'm going to run down the step by step guide "How to Start Pure Water Business in Nigeria" without much stress. In water business just like every other business, the number one priority should be service to humanity then, the money will come naturally. Like any other consumables, life is involved so try and put everything in place properly. Here are the things needed to get started:
1. Get a place of business - You need to acquire a property or rent a place, getting your own property and developing it is the most desirable option as that will save you cost in the long run.
2. Register your business name - The name your water products will be known for. Branding is very important in business, so in addition to your business name, design a very professional logo for your product because perception is the best sales man. Make your brand stands out among others!
3. Sink a Borehole - The most common source of water for commercial drinking water production like sachet water and bottled water is borehole, let there be borehole within your premises for constant water supply to your pure water production factory.
4. Install Overhead Tanks - This will serves as reservoir to supply water to the distillation system, it has to be overhead to ensure proper pressure to be able to pump down the distillation chamber.
5. Install Distillation System - This could just be a micro filters and cup filters depending on your start up capacity, but if you can afford it, then you go for more comprehensive distillation system. Otherwise, use Purification process known as Ultra Violet sterilization bulbs process. After distillation, you need to take your product (the resultant water) to the laboratory for results.
6. Get NAFDAC Approved - NAFDAC Is the agency that supervise foods and drugs in Nigeria, you need their approval to carry out business that involved consumable products of which water is one of them.
7. Acquire Automatic Sealing Machine - Automatic sealing machine cost between N400,000 to a Million Naira. Go for the ones that seals or produces about 40 sachets per minute.
8. Employ Staffs - You will need minimum of five persons to work in your factory for a start then increase with time as the demand may be.
9. Distribution Mechanism - Buy truck for your distribution of rent but renting can be expensive and disappointing most of the times. My recommendation is that you buy your own truck if you can afford it at the beginning.
10. Get Power Generation - You know the situation of power supply in Nigeria, except if things changes tomorrow. If not, you will need a standby power generating set, and 25KVA will be just perfect for the job.
With all these in place, you are good to go! For a start up and depending on what you already have like land and other things, you may need up to five million naira for a start up in order to get the sealing machines, nylon and other materials, and pay for labour for about some months before it begin to yield profits. Your cost could be higher if you are also paying for rent and hiring trucks.
Assuming you have only one Automatic sealing machine that produces your sachet water and you can afford to have only one delivery van that distribute your products. one automatic machine (at 100% utilization) Capacity: 40 sachets per minute i.e. 2,400 sachets in 1hour Which is equivalent to 120bags in 1 hour.
Let’s conclude that; On the average, you produce 100 bags in 1hour, and assuming you was able to work for 4hours in a day. i.e. one machine producing 400 bags of pure water in a day. (sincerely, an average sachet water factory in Nigeria today produces between 700 bags to 800 bags per machine in a day) so it all depends on you.
Still based on our assumption of 400 bags in a day and a bag is being sold between N70 and N80. So let’s also assume N70 per bag; 400 bags x N70 per bag = N28, 000 per day. N28, 000 x 28 working days in a month = N784, 000 per month. Wait and see; N784, 000 x 12 months in a year, = N9, 408,000
Here are some other reasons to invest in this business:
* Government has failed to provide the basic drinking water need of every household in Nigeria. So, everyone make provision for themselves and buying pure sachet water is one of the most reasonable option.
* The more the population increases, the more the need for people to drink water, and the more the demand for the product of sachet water.
* There is not going to be a day, people will stop drinking water. In fact, it is one of the most essential consumable product and the most consumed natural resources on earth.
* Sachet water currently has no close or partially close substitute in Nigeria where the majorities are poor to depend on bottled water which is more expensive.
* One can never run out of customers to supply to. The more the producers, the more the consumers of sachet water.
* The popularity of sachet water is growing on alarming rates even in towns and villages across Nigeria.
* At five naira for a sachet, pure water is very cheap and affordable to buy even by the poorest man on earth.
* It is a major source of revenue for the government, so the government is even encouraging more producers.
* There is really no distinction between the consumers, it is widely acceptable to the rich and the poor, and is used for events and parties.
* Consumption of sachet water is not restricted by any law or religious belief unlike alcohol or some other drinking products and has no side effects.
* The set up requires little start-up capital compared to other factories. with five to 10 million naira, you are go to go and the return is guaranteed.
* There is ready made market for the product. All you need is just produce, it is one of the product out there that requires no much marketing to get the product accepted as it is already accepted by nature.
* The payback period for the investment into the business is less than six months. It's one business you confidently get loan to do start with 100% assurance that the business would pay.
* The return on Investment (ROI) is more than 50% and it is subject to increase on expansion of the business.
* It requires little or no periodical acquisition of raw materials for production; water is a free gift of nature.
Read: How to Start Pure Water Business in Nigeria
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