How to Start a Supermarket Business in Nigeria

A supermarket is a place where the elites, middle, and the low-class visit to shop for their needs. Aside from the beautiful and serene environment, goods are placed in a way that is appealing to choppers.This article will guide you on how to start the business.

Supermarket Business

A supermarket is a large retail shop where all kinds of groceries, household goods, and products are sold. Goods are organised into sections on shelves and aisles in a self-appealing manner for easy identification.

It is a self-service center where customers shop their choice of product, thereafter proceed to the cashier for costing and payment.

The supermarket is becoming the preferred place to shop in Nigeria because it’s seamless and you can find most of the things you need in a place at relatively affordable prices. Also, the flexible payment option is also enticing; you can pay electronically or with cash unlike in the traditional market in Nigeria.

This business is capital intensive, but profitable. The self-service style, where customers can serve themselves until they get to the counter for payment reduces the cost of labour in running the supermarket business.

How to Start a Supermarket Business in Nigeria

Who Can Own a Mini Super Market in Nigeria?

Practically anyone can own and operate a mini super market. A working class person in need of an extra stream of income can own one and employ a sales person to take care of the place while he or she is at work.

An unemployed person can also take this up as a sole means of livelihood if the capital is available. This could be really advantageous because such a person will have ample time to monitor the day to day running of the business and also nurture the growth of the business. Such an owner may or may not need to employ a salesperson.

Expected Challenges when Starting a Supermarket Business

  • As with almost every business in Nigeria, the major challenge is the issue of unstable power supply. A good generator can help to alleviate the situation but this comes with the attendant cost of purchase, fuelling and maintaining the generating plant.
  • Another major challenge facing business owners is lack of security. Over the years, lots of supermarkets have fallen victim to armed robberies, thefts and break-ins.
  • Lastly there are numerous people already involved in the same line of business which means there will be lots of competition for customers.

It will only take a business owner who is innovative, driven, committed and determined to thrive in this very lucrative but challenging line of business.

Things to Consider Before Setting Up a Supermarket in Nigeria

In order to be successful in this business, the following has to be taken into consideration while drawing out a viable business plan.

1. Location

In setting up a business of this nature, the importance of location cannot be over emphasized. In fact apart from finance, it can be regarded as the single most important factor that will determine the success or failure of the business.

The best place to locate a mini super market in Nigeria is along a busy road or junction where your shop will be exposed to a high stream of consumers..

2. Goods to Concentrate On

Although most super markets normally stock a wide range of items, it is advisable to slightly tailor your stock to appeal to the locality where your supermarket is located.

For example, if you are located in a student environment it would pay more to invest in a bit more of stationary like books, pencils, pens, cardboard paper, markers etc., fast selling and easy to cook items like noodles and pasta, maybe a bit more of personal grooming items like deodorants, body sprays, hair products and medium to low end perfumes.

In such environment, it is better to focus on fast moving consumer goods ( FMCG ) because most students are relatively low income earners hence they tend to buy only what they need, and in small quantities.

In general, the nature of goods to be focused on depends largely on the locality where the shop is situated.

Any potential supermarket owner should carry out a small study on the major commodities that are consumed in the area so that they can accurately target the intended market.

3. Shop Size and Layout

The size of the shop basically determines the layout that will be adopted. Being a small or medium scale business, you do not want to get a shop that is bigger than your need as this will cost you more than necessary in rent.
Also you do not want one that is too small else the shop will look disorganized and unappealing to customers.

The first step to picking the right size is to have a very clear picture of what is to be displayed and the scale of the shop. All items on display should be logically arranged in such a way that it is easy for customers to easily locate their desired items. A simple clue is to place like items in the same areas.

4. Business Registration

It is important to make provision for the adequate registration of your business with all the local authorities as well as the Corporate Affairs Commission (CAC). Also ensure that all the applicable taxes and levies are settled.

The reason for this is simply because it would be quite unhealthy for your business to be closed down for even a day not to talk of a permanent closure. Besides, running an unregistered business is seen as engaging in illegal activities.

5. Sourcing of Stock

Have a clear plan on how you will secure a steady flow of stock at an affordable rate, to ensure that your mini supermarket never runs out of items and also secure a good profit margin.

Bulk buying of products is a good way of securing goods at good prices. Efforts should also be made to purchase directly from the manufacturers who usually give discounts and to eliminate the added middle man cost.

Most popular online stores buys their products directly from Aliexpress in China and get it shipped to their supermarkets here in Nigeria. They make serious gains from each items since they are buying very cheap from there.

6. Power Supply

Power is a very important component in the setting up of any mini supermarket because some of the items to be sold such as meat and fruits need to be preserved in freezers, and other items such as drinks also need to be kept cool.

Apart from that, it is important for the supermarket to be kept at a temperature that is convenient and hospitable for customers. The erratic nature of public power supply means that there will be need to purchase a generating set. When going for a generator, there is need to engage a professional to find out the expected electrical load in the supermarket.

This will help the owner to select the right capacity of generator to purchase because the price of generator increases with the capacity.

7. Capital

All the above factors depend solely on available capital. Anyone intending to setup a supermarket business must consider the capital involved and also have a plan to source for it. Below is a breakdown of possible start up requirements for a mini supermarket.

Some of the personnel you need to run a supermarket are;

General Managers

They oversee the smooth running of operations of the entire business, such as staff coordination and managing the facility.

Cashiers/Accountant

These people are always at the counter ready to process sales and receive payment. They must be tech-savvy, smart, and proactive.

Sales Personnel

They move goods from the warehouse, arrange them on the shelves for shoppers. Also, they guide buyers on where to locate items of different kinds.

Security Personnel

Security personnel ensures the safety of lives and property. They direct drivers where to park their cars and guide incoming customers on how to keep their properties.

Warehouse Manager

He/she managers the warehouse and ensure stocks are well taken.

Cleaners

Ensure the cleanliness of the entire buildings at all times

Drivers

Transport goods and services relating to the business.

Some Equipment Needed In The Supermarket Business

Generator

Air conditioner, counting machine, refrigerators, and bulbs need to be constantly working. Hence, standby gen is needed in case of a power outage.

Computer and automated cash register

It gives room for proper accounting and quick issuance of receipt.

Refrigerators

Can be as many as you can afford. It is for storing perishable items, drinks, yoghurt, chocolate, ice- cream e.t.c

Cart/Trolley/ shopping basket

To convey purchased items to the counter for payment.

Surveillance Camera

Depending on the size of your market, you might need to install a surveillance camera in every area. This will reduce the rate of pilfering rampant in stores and shops today

Also, install a good burglary system, to avoid burgling at noon and night.

Conclusion

Now that you have read everything needed to start a supermarket in Nigeria, it’s time to take action to implement the ideas.

we hope this article has been a useful guide for you in starting your supermarket business. If you need the service of a company to prepare a business plan when you want to set up your supermarket, Kikio solutions is a reliable one.

Fisayo James
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