Oil and Gas17 Comments

Whether it is for industrial or domestic use, engine oil is one of the most consumed products in any given part of the world. Although it has attracted a lot of investors, the opportunity to invest in the business is still beckoning. Apart from the fact that lubricants are FMCG (Fast Moving Consumer Goods), they don’t get spoilt. When it is properly packaged, they do not even soil the cartons or the floor of your warehouse.

Types of Lubricant to Invest in

Are you interested in investing in this engine oil and lubricants business? Before dwelling on the requirements, let us highlight the products and the market.

Motor Engine Oil

This is one of the most consumed lubricants. Depending on the manufacturer and the treatment given, they either come as 5W 30 or 5W 40. Depending on the city you are, the demand is high that sometimes, the supplier find it difficult to meet up, in some other cities however, it is highly competitive. Whatever the case, everyone using a motor vehicle or other things must patronize you, either as individuals or as mechanics.

Since there’s always a schedule by car manufacturers for owners to service their cars consistently, they must change the engine oil when carrying out such services.

Automatic Transmission Fluid

Most cars have gone automatic with their gearing system. Hence the need keeps increasing for them to use automatic transmission oil. Depending on the manufacturer, the specification of the oil is Dexron, Mercon, DW (ZF), etc. This oil is changed too according to the mileage that the manufacturer has specified.

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Although changing of the transmission oil is not as frequent as changing of engine oil, the number of cars that come to the mechanic workshop are so numerous that you will get patronage on a daily basis if you are strategically positioned.

Break and Clutch Fluid

The same manufacturer specification is often used for break and clutch fluid. Most times, they come as Dot 3 and 4, for cars that use manual gearing system. Like the oil mentioned above, the need for individuals and mechanics to buy them is high.

Diesel Engine Oil

Like its petrol counterpart, diesel engine oil is in high demand. Sometimes the demand for diesel engine oil gets more than that of gasoline oil. This is owing to the fact that the engines that use it is not just motor vehicles, but other heavy machines used in the manufacturing sector. Diesel engines usually come with the specifications 15W 40. It is usually thicker because of the heat generated by the engine using it.

Grease

Grease is a type of lubricant that has a very high demand. Individuals, industries and mechanical engineers are always in need of it. It does not matter whether an engine is using fuel or diesel, there is always the need to prevent rust, hence the demand for grease. The most known specification for grease intended for machine is SAE J310.

Oil Treatments

This cannot be categorized as lubricant, but it is often used by mechanical engineers and individuals after they have used engine oil, especially gasoline engines. It is believed that oil treatment helps in cleaning the engine and reduces heat that would have been generated without it. It is okay if you add it to your stock as you start your lubricant business.

Requirements to Start Engine Oil Business

After having a brief knowledge about each of the product, the followings are the other basic requirements for someone willing to invest in sales of lubricants:

1. Get a Warehouse

Depending on the quantity you are willing to buy for a starter, you may need to rent a space secured enough to house your products. This can be compartmentalized so that you can easily reach the specific product or brand that you need. It is important that you secure it physically so that thieves do not cart away your property.

Although most lubricants are in a plastic container, manufacturers put this containers in cartons. Ensure that your warehouse is not susceptible to rain fall. This may damage the cartons, thereby slowing down the sales. The heat generated by the sunlight too should be avoided as this may melt your grease and encourage leakage.

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Be sure to install fire-alarms as you also provide fire extinguishers. A warehouse of lubricants is a no-smoking zone. Ensure that the sign is bold enough and see to its strict compliance on the part of your staff.

2. Survey the Opinion of your Potential Customers

At this stage, it is important that you go to your prospective customers so as to determine what they demand more. This includes automobile mechanics, manufacturing industries using diesel, retailers and even individuals who change their car oil while carrying out the service on their own. The location or the type of vehicle used most will determine the type of lubricants that people demand more.

3. Get Supplying Companies

Oil and gas companies dealing in lubricants are numerous, so the one you will be patronizing is not one. To get the best bargain, it is crucial you go to as many of them as possible. It is difficult for them to give you a ripoff rate as they know that you can detect the next minute thereby making them lose a customer.

4. Get a Truck

Irrespective of the size, a truck will help you in conveying your goods from the factory of the manufacturer to your warehouse and from the warehouse to your various retailers. So it is a necessity for your oil business to succeed. Get a driver who is accountable enough to combine the work of a driver with that of a sales man. This does not rule out the need for one or two sales boys.

5. Create Awareness

The same group of people you went to for survey will constitute your market. They are automobile mechanics, manufacturing industries using diesel, retailers and individuals. Penetrate the market by slightly reducing the rate even if the profit recorded is not commensurate with what is obtainable locally. Eventually, you can increase the price as you gain their loyalty.

Prospects, Profit in Engine Oil Supply

Lubricant is a profitable business. This is because it is a fast moving consumer goods. On the average, depending on your economy, you can reap 10% profit of the amount invested. So when you invest N8,000,000, you can expect to get N500,000 – N1,000,000 as profit.

SEE ALSO: How To Participate In The Oil And Gas Industry In Nigeria

Since this is an FMCG business, it is possible to turn over N500,000 two times before the month runs out. This can get better, the longer you stay in the business, the aggressive your marketers are, the higher your turnover.

Budget

  • Initial investment on stock – N2,250,000
  • Warehouse ( Guesstimate depending on your locality) N1,700,000
  • Fairly Used Mini Truck – N2,500,000
  • Initial Salary for 5 staff – N500,00
  • Awareness and Survey – N400,000
  • Miscellaneous – N400,000
  • Total N8,000,000

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17 Comments

  • Rachael December 29, 2014

    hello sir, i really appreciate this information. and i wish to really know more about this business, i mean the disadvantages. and i wish to start very little than getting a truck and staff. what do i do. i am currently in lagos. thanks

    Reply

  • samson January 19, 2015

    hi dear great thanks to you for this piece of information if we have more people like you in our nation I'm sure Nigeria will transform faster, I need more of this piece of information and a good site in lagos were to possibly start from thanks

    Reply

  • Chethan May 11, 2016

    Interested please mail me back

    Reply

  • chioma May 11, 2016

    pls what is the cost of importing a 20ft container, which country is the best to import from.

    Reply

  • Choice April 9, 2017

    Thanks a lot for this enlightenment. I would love to talk to you .Kindly wasapp or sms me on 08075806848 so I call have ur number to call u back.

    Reply

  • WAYOH Fred October 19, 2017

    I’m already in the business but not standard I need more enlightment

    Reply

    • Richmond July 17, 2020

      Pls wayoh Fred, contact me Blesed Richmond Enterprises on 07037401121,i really need to talk with you.

      Reply

  • Mary November 15, 2017

    I live in akwa ibom state, (eket). I am interested in the business.
    Can we talk on whattsapp?.

    Reply

  • Victor audu April 6, 2018

    I do I sell my drum and 25liter keg lubricants fast.
    I started the business in Lagos in January and am finding it very hard to move my products. I deal in the drum, kegs and grease product alone

    Reply

  • Hammed April 16, 2018

    a very good 1 dear, hope to get started soon enough, but u did not mention where how d products can b obtain from, want to get started soon. I leave Abuja

    Reply

  • Godwin Attah Ayegba February 18, 2019

    hello sir, i really appreciate this information. and i wish to really know more about this business, i mean the disadvantages. and i wish to start very little than getting a truck and staff. what do i do? i am currently in Rivers State (Eleme), the following is my whatsapp number (08186455488) thanks.

    Reply

  • Charles Omoregbe April 11, 2019

    My Question :if I want to start in smaller trading scale, eg like buying Lubricants in small Quantities Drum measurements and re-package
    And Sell, is it possible, where do i buy from, where do i start from. Pls I need details
    Charles 07086651296

    Reply

  • Adekunle June 1, 2019

    Hello sir ,am so thankful to you for this enlightenment and am.very interested, pls my plan is to venture into this business but in a little way first via with kegs and drum probably just need more information on the budget ,and where to get the product from the manufacturer. Will appreciate that if we can chat on WhatsApp 07034514997.

    Reply

  • Clara July 16, 2019

    For more trusted lubricant and how to start call 08027079585

    Reply

  • fred austin November 19, 2019

    Thanks for the information. I Will like to go for the business. I really need more of your help. 07081882084

    Reply

  • Victor Dickson June 1, 2020

    Thanks for the information, I will like to start this business, I am interested, pls I need more details. Victor from Rivers State 08108820075.

    Reply

  • Muhass July 15, 2020

    Hello I am from maiduguri borno state I am really interested in starting this business please I need more enlightenment

    Reply

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