In few minutes from now, you will sure know the cost of starting a provision shop in Nigeria 2021 and how to go about it.
In recent times, a lot of people in Nigeria have gotten interest into starting a provision shop especially after the lock down.
But one of the most challenging factors about provision shop is the fluctuation of prices of commodities.
As such, it’s takes a good business idea to own a provision shop and excel in it irrespective of the rate of price fluctuation.
That is one of the reasons we have made a good decision to provide this information to guide you on how and what you need to start well and also make a profit.
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Expenses in Opening a Provision Shop.
If you are set to starting a provision shop, then you should kindly take note of the following expenses;
Money for Goods: this is where your daily, weekly and monthly expenses will come from.
You have to preserve a fat some of money for buying your commodities and make sure you buy your commodities base on what customers’ demands.
Expenses on Shop: at the start of the business, you will need to rent a shop for your business and will cost you some capital for the settling of shop rents.
You can start with a mini shop depending on the size of shop you wish to open. But always advise that the shop should be located in a busy and secured area.
Extra Expenses: while budgeting, you must also take note of the extra daily, weekly and monthly expenses like;
- Transportation fare
- Fueling of generator
- Paying of NEPA, Sanitation, etc., fees.
Best Places to Locate A Provision Shop.
If you wish to locate your provision shop in a location that will attract and will be easily seen and patronized, then we recommend you locate your shop at any of;
- Busy areas like marketplaces
- Close to school campuses
- At busy roads
- Motor Parks
- Dormitories and Lounge
- Busy environments, etc.
Meanwhile, other important things like your customer service, price rate, quality of goods will also play an important role on how customers will view and patronize your business.
Profits and Challenges in Provision Business
Starting a provision business in Nigeria is a good, recommendable and profitable but there are some challenges that one may faced along the way.
Without wasting much time, let’s find out some of the profits in starting a provision shop in Nigeria.
Profits in Provision Business
Owning a provision shop is one of the most easiest business in Nigeria to start and make a lot of profit.
A mini provision owner can make between Thirty Thousand Naira (N30,000) to Seventy Thousand Naira (N70,000) monthly profit.
A medium provision owner can make between Seventy Thousand Naira (N70,000) to Two Hundred Thousand Naira (N200,000) monthly profit.
A large scale provision owner can make between Three Hundred Thousand Naira (N300,000) to One Million Naira (N1,000,000) monthly profit.
So if you wish to start a provision shop, then know that a lot of profit is awaiting you.
Challenges in Provision Business
Below are some of the common challenges in starting provision business in Nigeria:
Price Fluctuation: one of the major problem in Nigeria is the fluctuation of prices of commodities.
Prices of goods in Nigeria depends on the on so many economic factors like Government policies, Exchange rate and raw materials/production costs.
Damaging of Perishable Goods: a rough handling of perishable goods may result to damaging of such goods.
Provision shop owners may be exposed to a high risk of damaging goods during rainy season or during cases like fire outbreak, extortion and looting and so on.
Slow/Low Sales: sometimes, a provision business owner may experience low sales.
Much Extra Expenses: the higher your expenses, the lesser the profit you make and the lesser your profit, the higher risk of your business failure.
As such, it’s always advisable to cut down some unnecessary expenses to save your business.
How Much Does it Cost to Start a Provision Shop?
The estimated cost of starting a small scale provision shop is between One Hundred Thousand Naira (N100,000) to Two Hundred and Fifty Thousand Naira (N250,000).
Setting up a medium provision shop in Nigeria will cost between Three Hundred and Fifty Thousand Naira (N350,000) to Seven Hundred Thousand Naira(N700,000).
If you are looking at starting a large provision shop, then you will need between Eight Hundred Thousand Naira (N800,000) to Two Million Naira (N2,000,000) or above.
The major expenses in starting a provision shop in Nigeria is renting a shop and buying of commodities (goods). Apart from that, every other expenses are minor and to some extend, negligible.
At this juncture, we believe this information on the cost of starting a provision shop in Nigeria was helpful.
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