Introduction to the Sachet (Pure) water production business in Nigeria
Water is one of the most important commodity of life. We all need water for several purposes of which includes drinking.
In the past, a creative entrepreneur somewhere in Nigeria wanted to solve the thirst and dehydration problem especially when outdoors,so s/he came up with what we use to call “ice-water”; water wrapped in transparent nylon. Soon people copied the idea and the ultimate aim was defeated. Those who copied saw it as a big way to make plenty Naira and they didn’t care about hygiene. Some fetched and produced ice-water from unclean well water and soon a new problem emerged. The problem of “affordable, yet unfit water for consumption”.
So again, another creative Nigerian entrepreneur came up with a brilliant idea to solve this new problem and so, the sachet water (also known as pure water) idea was born.
Sachet water differed from ice-water in that it is basically water packaged in thicker transparent nylons after undergoing some purification in a controlled laboratory. Sachet (pure) water is in high demand in Nigeria and the return on investment is massive as we shall see below.
Top Reasons why you should start a Sachet (Pure) Water Production Business in Nigeria
- The demand for water is eternal and always. No one can survive without it.
- The growing need for purer and safer drinkable water.
- Huge profit margins and returns because of the high demand for it.
- Jobs will be created for the unemployed directly and indirectly from the business.
Capital requirements for setting up a Sachet (Pure) Water Production Business in Nigeria
If you are looking towards investing in setting up a sachet (pure) water production plant, you will need to raise and set aside between 5,000,000 to 10,000,000 Naira. This capital will be used to rent and setup a space, buy equipment and other things listed below.
How to setup your Sachet/Pure water production factory
- Register your business name or company with C.A.C for as low as 10,000 Naira or as high as 50,000 Naira. This is necessary because this is the name your sachet water will be known for and it will also build trust for your brand among your customers.
- Write your business plan. Your business plan is important because it will help you understand how to run the sachet (pure) water business you are setting up and aids in convincing investors.
- Choose a good location for your production site. Your location should be far from any dumping site and must be free from constant pollution. You can rent or buy a property depending on your budget. A 3 bedroom apartment or a warehouse well demarcated will be great for this.
- Identify a good source of water. In Nigeria, borehole is the commonest, so set aside part of your budget to drill a borehole.
- Buy the necessary equipment listed below. Buy what you can afford for a start and rent the rest till you can buy them. Work within your budget.
- Write and invite NAFDAC for approval. You need NAFDAC approval to be able to get your sachet water approved by the general public. NAFDAC approval for your water business means your water is fit for drinking.
- Hire workers. The first employee you need is a production manager if you are too busy to fill that position, Then hire other workers for processes like packaging, distribution, etc. You can increase your man power as your business grows
Equipment needed for the Sachet/Pure Water Production Business in Nigeria
Here are what you will be needing to kick start your journey as a Sachet (Pure) water business owner:
- Storage Tanks/Reservoirs – For storing water from the borehole.
- Water Treatment Plant/Distillation system – For purification and separation of impurities.
- Automatic sealing machines – To seal the water inside the sachet.
- A Standby Generator – For continuous power supply. 20 – 25 KVA will do.
- A Truck/Van – For distributing your produced sachet water.
1 Year Income Projection on the Pure water production business
A standard Sachet/Pure water factory in the country produces on average about 600 bags in a day per one automatic sealing machine. So if you have more than one sealing machine, you can produce more. On wholesale, 1 bag goes for 80 Naira. If your factory is able to produce for a start 500 bags a day, and you decide to supply at 75 Naira per bag, you would be making:
Monthly – 500 * 75 * 30 = 1,125,000 Naira
One Year – 500 * 75 * 365 = 13,687,500 Naira
So in the first 1 year, you should be able to recoup your investment and start making profits from there on.
Risks and Challenges involved in the Sachet water business
- Capital Intensive: It requires huge amount of money to setup. You need the capital to sink borehole, buy equipment, rent/buy a production site, etc. See how to raise capital.
- Inadequate Power Supply: Due to the epileptic power supply in Nigeria, most of the time, you will end up running generators and buying fuel. This will lead to high overhead costs.
- Obtaining the required license: NAFDAC approval is quite easy to get but when you fail to meet up their requirement like maintaining proper hygienic standard, this might be a hill for you to climb.
- Pollution: To avoid having your water polluted and incurring losses, ensure the entrances to your production room is well guarded and that you are not close to any dump site or smoke source.
How to market your packaged Sachet/Pure Water to consumers
First it is important to identify the target market and consumers of sachet water in Nigeria:
- Sports Vicinity
- Shopping Malls / Supermarkets
- Event Centers
Now let’s see how you can market your finished sachet water to your target market:
- Sell cheaper or offer discounts to those buying in bulk to enable you penetrate the market.
- Organize public awareness stunts to create awareness for your brand.
- Promote for free via social media.
- Talk to retailers and give them for credit to encourage them sell your products
Now that you understand what it takes to setup a sachet/pure water business in Nigeria. Here’s what to do next:
We wish you success as you undertake this business. Let us know of your challenges and successes.