Motorcycle spare parts business has been in existent for decades in this country but still very profitable. Millionaires has been made in this business and are still being made on daily basis. This article will help you see the profit potential in this business as well as assist you with vital knowledge on how to get started.
We have all kinds of Motorcycle around us popularly known as Okada which has been adopted as public transportation means. People prefer to take Okada in order to get to their destinations faster. During the late 1980’s Okada used to be for the few jobless youths but today, the story has changed to include even some university graduates. Countless of Nigerians hustling to make ends meet with Motorcycles of various makes. This has therefore, created huge business opportunity in Motorcycle spare parts business.
Gone are the days when people used to look at patronizing Motorcycles as dangerous mission. The increase in Okada patronage has increased the potential profit in Motorcycle spare parts business.
So starting your own Motorcycle spare parts business is a very good idea as you are almost guaranteed of returns on investments if well positioned and managed.
Investing In Motorcycle Spare Parts Business
Starting a Motorcycle spare parts business is usually in a double folds. Its either you are dealing on brand new spare parts or used spare parts. So, you decide which type to start with.
Some parts dealers specializes in selling on the brand new spare parts while others choose to combine both brand new parts and (tokunbo) used spare parts which is not bad, instead it means more business and more customers for your business.
What You Need To Start A Motorcycle Spare Parts Business
You know that there is money to be made in the business which is the main reason why you want to venture into it in the first place. However, you must understand that there is serious competition in spare parts business. You must be good at your game to break even.
1.You Need Fund
How are you going to fund your motorcycle spare parts business? Do you have enough cash at hand? That is good but if you don’t have enough money, you may consider financing your business through loans from the banks or keying into a credit line from major distributors.
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Joining a cooperative society may also help as they are also easy to access and quick to raise you money for business. Micro finance bank is ideal if you are already in business and need running capital. You can also borrow from friends and family member or team up with partners.
2. Identify Your Competitors
This is usually where it all matters most in motorcycle spare parts business. If you are starting the business in a big way, that usually poses little or no problem as you are sure to have everything in greater quantities at a reduced prices, but if you are starting on a low key, opening a shop in already saturated area may seriously affect your growths in the business.
Some times the only way to survive in such areas and grow with time is to conduct some researches and know what most of the existing stalls overlooks which could be any type of spare parts. Understudy the existing shops to create your niche by specializing on the types spare parts that has been overlooked by them.
3. Good Location Is Important
This works like magic if you get it right. Look for an area with much Okada operators, some times bad roads could be advantageous to your spare parts business because the needs for spare parts never ends in such places.
If you can, open multiple shops within strategic places in the area to capture the market. Sell your parts at good prices to discourage your customers from going far to other places. The most important point here is to have at least 95% of the parts people are looking for, if not all. Knowing the brand of Motorcycles that is prevalent in your location is also very important.
4. Deal On Genuine Spare Parts
Your customer base will further increase if you are dealing only on genuine spare parts. No one like wasting money on fake spare parts. Understand that your customers know the parts more than you no matter how you may try to convince them. They are the users. If they use the parts you sold to them and discovered it did not last as it is supposed, they may not want to patronize you again.
Let them decide what they want and give them just that. Don’t make the mistakes of attracting them with cheaper and inferior quality spare parts. If you do, they will run and you can even get sued if you are known to be selling fake products that results in accidents like shoe brakes for example.
5. Know The Peak Periods
Almost every business in Nigeria has their own peak periods. If you are considering starting your business in the rural area, then know that rainy season is your peak period because parts wears off easily. So, know the parts to stock your shop with as against the ones that would tie your money down for a long time.
6. Get The Necessary Permits
You need to have license because your business entails handling of motor oil which is considered a hazardous substance. So back your self up even if you are in an underdeveloped area because you don’t know who is who.
Insurance cover is also good because no business is risk free, more so you are dealing with what involves movement of people.
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7. Be Professional And Advertise
It is important to be good at all times and conduct your business in a professional manner. As time permits, organize free training and invite Okada people to attend and learn how to be smarter with their Okada operation.
Get flyers to promote your business as you go out on regular basis, always go with your flyers.
Cost And Profit Potential
Motorcycle spare parts business is viable and can be done any where Motorcycles can be found in numbers. If you are looking for a business that can project you as a reputable person within your locality and make your cool cash, think about Motorcycle spare parts because there is money to be made in the business.
You don’t really need much experience to start this business. Most of the needed experiences will be gathered once you start the business.
If you can get a good supplier who would be kind enough to have the selling prices listed for you for a start, you are good to go. The initial costs of starting may be between N750k to N1m with shop rent.
Follow things up adequately and within 8 months to one year, you will be counting in millions. Another secrete to quick growth in the business is to be getting your goods directly from the importers. You should also be ready to start importing yourself when your business grows. Then you can have others coming to you for both retailing and whole sales.
One big and well stocked shop with a packing store will be enough if you are in a busy place. But, if you are in the rural areas, its always good to have between 2 to 3 shops. This will help you secure more customers.
Be wise and run your business professionally. Always pay your workers well. N5-10million profit annually is almost certain in this business. Drop your comment below lets keep the conversation going.