Category: Business/ Consultancy
Supermarket is one of the most lucrative businesses that can thrive anywhere in the world. Succeeding in the business depends on how much resources and time you are willing to put into it. You cannot also overlook location when you want to start a supermarket.
In every town and city people largely depend on supermarkets, opening one is very lucrative and profitable. However supermarket business requires a lot of financing.
If you want to start a supermarket business, you will need to have adequate funding. This is a large scale business that requires huge capital so you need to prepare a business plan.
What you should do first when starting a supermarket
First of all, learn about the customers that you want to provide for. Are they looking for low prices or are they looking for certain food type or goods? Determining the kinds of customers you will cater for can help to limit the capital that you have to spend up front as well as the costs for buying products that you might not need. If you already have a location or area in mind, you might want to send out simple surveys to see what people are looking for and where they might like to see it.
What you need to start a Supermarket in Lagos
The cost of starting up a supermarket varies with size, location and what you have in mind to sell. To have a good supermarket considering the cost of rent and facilities required for your supermarket in Lagos, you will need between N2 million to N4million on the average.
These will include the cost of freezers, décor, generator set, furniture and stocks etc.
On the average you will need about N2 million for a neighborhood mart and about N3.5 to N4 million for a mini mart around Ikeja, Surulere and some other parts of Lagos. For Lagos Island you need between N7-N10 million to start a supermarket.
Rent in Lagos varies from location to size. Most shops along major roads are more expensive than neighborhood shops. But at an average, around Ikeja, Omole and Surulere areas of Lagos, a good shop will go for about N300,000 per year. It will be lot easier if you owned the building, that way you are not worrying about rent.
A good freezer costs between N60,000 and N100,000. You will need at least 2 depending on the size of your shop and the things you intend to sell which includes bottled drinks, both soft and assorted ones, can drinks, etc.
A good generating set that will conveniently carry all the loads in the shop will cost between N70,000 and N100,000.
See costs of generating sets here
Cost of furnishing and other decors in the shop will be up to or more than N100,000
You will need between N500,000 to N1 million to stock up your supermarket.
Don’t forget to register your business with your local authority and pay the yearly fees. You can liaise with your local authority at the Local Government Area where your supermarket is located for their annual fees to avoid them from locking up your shop.
Stocking your supermarket
Where you can get your goods largely depends on your scale, and what you are selling. If you can afford to be a distributor to the manufacturer, good! If not, if you are in Nigeria, you can go to Trade Fair, Balogun, Oke Arin or Lagos Island. Better still, you can import from overseas if you have the required capital.
Running your supermarket
You have to stock more of the fast moving items and less of the slow ones to improve turnover.
You will also have to cover a wide range of goods, people prefer going to shops where they are most likely to get everything they want, rather than moving from stall to stall.
A well-stocked store always attracts more business, it might make sense to partition shop or get a smaller one if starting small.
Lighting your store properly matters a lot, most buyers will like a shop that is bright than a dim or candle lit shop. That is why you need good generating set to provide light; this gives the impression that your business is healthy.
What you can sell in your supermarket
What you can sell in your supermarket is limitless, you can have in your stock Exotic foods, Cosmetics, Organic foods, Drinks (Assorted and soft), Whole foods etc. many supermarkets these days add more goods to their shops more than the regular food goods like underwear, toys, and even jewelries.
It is important to always know what your customers want, stock your supermarket with their wants and always treat them friendly.
Locating your Supermarket
After you have determined the kind of supermarket that your customers want, you can begin to look for possible locations.
Locate your supermarket in a busy place where customers will buy easily. You can also consider packing space and consider having a large building. Ensure that you will not be asked to leave the building any time soon because of your customers. When you leave a particular location, the chances are that you lose more than 90% of your customers.
You can conduct an analysis of the market in your prospective areas before you start. You want to be sure your business is located in a populous and accessible area with high levels of traffic.
People don’t like to drive too far for their food, so keeping stores in central locations is best, though you also don’t want to be somewhere that might cause traffic to become troublesome for locals as well.
Setting up your supermarket
You can demarcate your supermarket with shelves; straight shelves attached to the wall, and U-shaped shelves in the middle of the shop.
Decorate your supermarket gorgeously so that customers are easily attracted to the supermarket. You may light your business shop brightly.
After you have started
Advertise your supermarket so people can easily know about the activities and location of the market. You can advertise through TV, Newspapers, Posters, and Banners and through other public media like internet advertising. Check our Advertising Options.
Hire the personnel necessary for running a supermarket e.g. cashiers, sales attendants etc., depending on your choice.
The bigger the business, the more staff you have. The more staff you have, the more problems you are likely to have.
It depends on your priorities and what you want from your business but in the early years it is essential that the owner works really hard on their business. Keep the staff down to the essential number and don’t just appoint expensive managers to run things for you that you could easily manage yourself.
This is the harder and less pleasant way because it means that you the owner are constantly present and work much longer hours than the rest of the staff. The benefit is that you are aware of any problems that surface and you are able to take care of them right away, so the chance of really big problems become much less. You do not allow the little problems to build up to become big problems. Another benefit is that you do not give people (staff/clients/suppliers) a chance to con you or rip you off.
Supermarkets enjoy some of the most stable revenue streams of all business types because while various consumer tastes and trends fluctuate, the demand for groceries and basic household items are fairly constant. For this reason, starting a supermarket can prove to become a strong and lucrative investment for some time to come.
The whole get rich overnight scheme never applies. This is especially true when starting your own business. You may see a successful growth rate right from the start but often it takes much longer. It takes around 2 years for any business to really get settled and be pretty organized. After those 2 years it may still take many years to grow the company into a huge and successful one.
Take things easy; take things one at a time. Have a plan for the big picture, where you want to end up. For the rest, just do the best you can every day and give it you full focus and effort. Over time you will reach your goals and be where you want to be.
Use your profits to re-invest in the business. Buy better or more equipment, expand, get a better premises if need be.
Remember you are building up your business so that one day in future your profits will be huge.
Source: ACKCITY Enterprises
Supermarket Set-up: Distributors in Lagos
You are done with the building, decoration and shelving of your supermarket. Your next point of call is to stock up your supermarket and you are in need of cheap goods to stock your supermarket. You need a wholesale or distributor to stock your supermarket.
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