Nigerians enter 2017 today with high expectations,
resolutions and top targets.
No one contemplates repeating the mistakes and
missteps of 2016, which was full of confusion and
indecision.
The out-gone year was, perhaps, the most challenging
period in the history of Nigerian businesses because it
was characterised by policy flip-flops and poor market
cohesion.
In spite of 2016 challenges, one word stands tall in
2017: Opportunity.
This year, like other years gone by, presents a number
of opportunities as well as challenges.
Some businesses
are bound to struggle while others will thrive. Some
might die while many would still be birthed. However,
Nigerians are encouraged to tap into a number of
opportunities that abound locally.
Importation is highly
discouraged this year owing to the persisting dollar
crunch and the possibility that the present
administration will put more policies in place to
discourage dollar outflows and import.
Donald Todrin, CEO of Second Wind Consultants, a debt
workout and turnaround consultant firm in the United
States, said in a period of recession many people,
especially business owners, are bound to panic.
“But there’s an alternative to panicking. We are
confronting change, and change is an opportunity for
advances. Now you have the choice to take advantage
of change or allow yourself to be buried by it,” Todrin
said. In its characteristic manner, therefore, BDSUNDAY
has sought out profitable and sustainable businesses
Nigerians can do this year.
Yoghurt production
First on the list of what Nigerians can do this year is
yoghurt production. Yoghurt production is a neglected
area, but statistics show that 98 percent of Nigeria’s
dairy needs, including milk, are imported into Nigeria.
According to Aliko Dangote, president of Dangote
Group, who is also a dairy maker, only 2 percent of the
country’s dairy needs are met by local companies.
Official data show that $1 million worth of milk is
imported into the country every day. With dollar scarcity
and roadblocks to importation in the country, yoghurt
production is a sure bet.
Yoghurt is a healthy source of milk, and capacity to
produce a low-sugar brand for the aged and diabetic as
well as a moderately sugar type for other classes is an
advantage.
Producing yoghurt could cost between N2 million and
N10 million, depending on the type of equipment used
and their sources. Yoghurt production requires major
machinery such as motorised stainless steel mixer,
incubator, pasteuriser, filling machine, UV Lamp,
transfer pumps, PH Meter, shrink wrapper and weighing
machine. Some of the machines are imported into the
country, but many of them are fabricated locally by the
Federal Institute of Industrial Research Oshodi in Lagos
or Projects Development Institute Enugu (PRODA).
Local fabricators can also help.
According to FIIRO, return on investment is 46.1
percent, while return on equity can go as high as 115
percent. Payback period is 34 months and 19 days,
while break-even point is 51.8 percent.
Cashew processing
Next on the list is cashew processing. If you do not
have a cassava farm, get one. However, you can liaise
with a cashew farmer who will supply you with raw
cashew nuts for onward processing.
Export of cashew
is now one big business, as Vietnam, world largest
cashew exporter, is currently experiencing its worst
drought in a century.
Cashew sells like cakes in the United States, India,
Spain and many parts of Europe. Apart from helping to
maintain a healthy heart and bones, cashew also helps
in weight loss.
Cashew nuts are used in producing chemicals, paints,
varnishes, insecticides and fungicides, electrical
conductress, and several types of oil.
Cashew exporters in Nigeria made $250 million in 2015
and $300 million in 2016, according to Tola Faseru,
president, National Cashew Association of Nigeria
(NCAN), who disclosed this to journalists at the Annual
Cashew Logistics meeting held in Lagos recently.
If you wish to process for the local or international
market, then be ready to procure machines such as
boiler, sheller or cracker, dryer, and packaging machine.
Two good things about cashew are that its return on
investment is as high as 55 percent and its payback
time is just 12 months, say experts.
Piggery
Another business to watch in 2017 is piggery. Experts
believe Nigerians are not tapping into the opportunity in
this area because of ignorance and poor perception
about pigs.
Apart from a breeding ground, which should be large
enough, it is easy to start a piggery with N500,000 to
N1 million. To start a piggery, you need healthy piglets,
standard pens, quality feed and three to six workers,
depending on the number of piglets available.
The biggest thing about pigs is that they reproduce in
large numbers. Pigs can go between N15,000 and
N40,000 depending on their size and weight, and one
pig can easily reproduce up to 15 to 20 piglets. This is
its biggest advantage. Secondly, pigs can survive in any
environment.
Pigs are in high demand in China, Japan, India, Mexico,
Canada and many parts of Asia. In 2015, United States
exported pork (pig meat) worth $4 billion; Germany $4
billion; Spain $3 billion, among others.
Adhesive production
Apart from pork, Nigeria is still waiting for someone that
will produce adhesives used by leather shoe and bag
manufacturers. Aba, located in Abia State, has between
50,000 and 100,000 shoe, bag and trunk makers. This
does not include hundreds of thousands of shoe-
makers in Lagos, Kano, Kaduna and Onitsha. Many of
these shoe-makers run to China to buy adhesives
because there is yet no known company that produces
good adhesives to satisfy them right now.
Incidentally, research shows that adhesives can be
produced from cassava (starch), which Nigeria happens
to be the world’s biggest producer.
Chinese adhesives
are not good enough when compared with Dutch,
Spanish or Italian, shoe-makers told BDSUNDAY.
Currently, these shoe-makers cannot even find dollars
to import these adhesives, showing that there is a huge
potential for someone producing adhesives in the
country.
Artisanship
Nigerian middle and the rich classes are looking for
committed artisans and construction workers. Many of
the local artisans are considered not serious enough
and are accused of being unprofessional in their
conduct. This pushes many Nigerian middle and rich
class individuals, including construction companies,
into Ghana, Togo, Cameroon, and other neighbours to
get serious and committed staff when building their
houses.
What this means is that serious-minded Nigerians can
go into this business as consultants, who will now
search out committed Nigerians in rural areas to take
these jobs. This is money-spinning in many African
countries and even Europe and is an opportunity here,
given the attitude of Nigerian artisans.
On the other hand, artisans that are committed to their
work are likely to have more people knocking on their
doors this year, according to Ojere Imere, a
construction expert.
“This is the reality of the situation. It’s not just in
construction. It’s also found in the textile and fashion
industry, in the electrical and electronics,” said Imere in
a telephone interview.
Fruit juice production
The fruit juice production is a honey pot. Fruit juice is
made from orange, pineapple, guava, mango, as well as
additives such as sodium benzoate, sweeteners, and
citric acid, among others.
The rule set by Nigerian authorities is that a fruit juice
should contain 40 percent of natural fruit juice. This
means that if you are producing pineapple juice, ensure
it contains 40 percent of natural pineapple.
The Manufacturers Association of Nigeria (MAN)
estimates that Nigeria imports N165 billion worth of
fruit juice every year.
In a paper presented at a workshop organised by the
Raw Materials Research and Development Council
(RMRDC) in Owerri in April 2016, Frank Jacobs,
president of MAN, said in spite of the high rate of fruit
production and a thriving juice market, the country
imported fruits concentrates.
Apart from production site and generating plant,
someone with N3 million to N10 million can start a
small-scale fruit juice company, depending on the litres
that will be produced, according to feasibility studies.
Machinery needed to start includes juice extractor,
homogeniser, pasteuriser, hydrolyser, filling machine
and holding tank.
One big bang about fruit juice is that if you cannot set
up a production plant, you can get involved in the value
chain by supplying oranges, pineapples, guava and other
fruit to companies like Chi Limited and Coca-Cola,
among others.
Many fruit juice makers in Nigeria go to the extent of
importing fruit to satisfy demand for their products.
Planting oranges, guava and pineapples is the best bet
in this case, say experts.
