The tips to start a successful exporting business in Nigeria, Requirements and Challenges are described in this article by Platinum Times Nigeria.
Exporting is a hugely profitable business you can venture into in Nigeria. One can export a wide variety of commodities from Nigeria.
This is true, especially, because of the significant efforts the Federal Government of Nigeria is making to diversify the country’s economy.
Exporting is another method for boosting the economy of the country. As a result, starting an export trading company in Nigeria is a wise choice.
Questions A Future Exporter From Nigeria May Have Maybe you’ve been thinking about:
- How can I start an export business in Nigeria?
- Which goods am I permitted to export?
- How will the product be packed and sent?
- Someone who can help me?
- What position does the government take on the exporting sector?
Naturally, the questions you ask are necessary. However, you shouldn’t worry about your accomplishments.
In other words, if you take a risk today, your company success is closer than you may imagine.
So stand up and launch an exporting business.
If you read the sections after this one, you’ll be able to succeed in this field.
Nigerian Export Routes for Deliveries of Goods
There are numerous export routes accessible for commodities leaving Nigeria for their final locations, ways in include:
- Sea
- Air
Both air and water can be used to carry your goods. The sea may take many months to reach its destination, depending on the distance.
On the other hand, air travel gets your goods to the country you are shipping them to quite rapidly.
You will require the assistance of forwarding agencies to assist you in sending your things.
The forwarding brokers will assist you in completing the necessary registrations with the relevant authorities prior to your products being delivered to their destination.
For exports, the airport or the port
People are conscious of the harbor’s role as a typical route for exporting products. You can even fly your goods to other countries. There are a few airports in Nigeria that are appropriate for this business.
Make sure you are aware of the differences between Federal and State airports.
For Federal, the bulk of them are international airports, so you should be familiar with them.
Your major objective is to move aviation freight from Nigeria to other countries, thus you need to be familiar with a few airports. Some of them are:
- Ikeja, Lagos’s Murtala Muhammed International Airport.
- Akanu Ibiam International Airport, Enugu
- Mallam Aminu Kano International Airport, Kano
- Nnamdi Azikiwe International Airport, Abuja.
- Port Harcourt International Airport, Rivers State
- Margret Ekpo International Airport, Calabar.
You have the option of using the seaport, which is the traditional approach, to export your goods.
You can export using the seaport in:
- Apapa, Lagos State
- Anambra Seaport
Profitability of Nigerian export businesses
Exporting business is incredibly successful since you only transport your goods to nations where they are necessary depending on the agreed-upon pricing. Additionally, you will charge more for those things than they would locally.
Products You Can Export From Nigeria
You should be aware that the Nigerian Federal Government has regulations governing domestic exports. You must be informed about the products that the government supports. Most of the exportable items from the nation are tied to agriculture.
If you wish to export agricultural products outside of the country, you have success prospects.
However, you are allowed to export non-agricultural products from the country.
The following is a list of items that you can export from Nigeria:
- Orange tube
- Yam
- Cotton
- Plantain
- Cassava
- Charcoal Cotton
- yucca starch
- Fruit liqueur
- Nut of a palm
- Clothes and textiles
- Gallstones Rubber
- Seed for cocoa butter
- Honey Shrimps
- Garlic
- Cocao
- A snail, etc.
Several items that you can export from Nigeria are on the above list. The demand for these products varies depending on the target nation. While some people merely wish to consume these things, others require them for a variety of needs.
For instance, Cocao is in high demand in USA, Germany, France, Malaysia etc. Therefore, if you want to export Cocao, only pick countries where there is demand for it.
Things to take note before starting an Export Business
Before beginning an export business or sending a product abroad, you need be informed of the population’s demand trends in that nation.
You also need to be aware of their requirements for high-quality items if the product you want to export there is in demand.
Different countries have different regulations for items entering their shore. A simple online search will reveal what is meant by a “excellent product.”
Note importantly the following key points below:
Capital
You’ll need to raise a large amount of money if you want to launch this business. You should gather as much as possible money as you can.
One of the reasons you need a lot of financing is that the items you want to export may be big or cumbersome.
Depending on how much you have, you can export a certain quantity to the target country.
You need to package the exportable good in addition to the money.
The price of this will exceed the cost of local packaging. This is necessary because your goods must be securely packed before being shipped abroad.
Employ Staffs
To carry out your mission, you require assistance. You require the assistance of specific staff to package, produce, and move the goods.
Your employers must have experience in this field.
Advertisement
It is important to market your business, there are many platforms you can use for advertising, example is the social media, this can help take your business around the world
Think about whether there is a need for the product before advertising.
Technology
You need to be active online and find the countries who want your items.
You will require a laptop or a smartphone with strong web browsing capabilities.
Register you organisation
The Corporate Affairs Commission (CAC) in Nigeria is where you register your business name or private limited company, after registration, you can proceed to the Export Promotion Council where you will be given your export license.
This is done to legalize your company and prevent any potential legal problems.
Additionally, doing this can enhance your credibility in the eyes of both buyers and sellers.
Set reasonable prices for your goods
If you don’t want to lose money on your business, you definitely need to learn how to set the proper rates for your goods and services.
You must figure out all costs, conduct market research, analyze how much consumers and merchants are willing to pay, and determine the rate of demand for your product in order to set the appropriate price for it.
Get a business plan
Make a realistic plan for your business so it can succeed.
A formal description of business goals, justifications for why they are doable, and strategies for doing so can be found in a business plan.
In your company strategy, you’ll mention:
- The name of your company
- The items you’ll export
- The manufacturers of these products
- The nation you’re exporting to has business opportunities
- The dangers associated with the exportation industry
Requirements to run an Export Business in Nigeria
The necessary legal prerequisites to launch your exportation business in Nigeria are listed below.
- Get a distinctive business name.
- Register with CAC (corporate affairs commissions).
- An address for your registered office if you’re starting out big. If you are just starting out, a home address will do.
- Become a member of the Nigerian Export Promotion Council (NEXP).
- Registration of form, NXP
- Obtain special licenses and permits for the commodities you are trading in from the target foreign country.
- Make sure your products are not listed as forbidden items.
- Get a tax document.
- Get an insurance cover.
Challenges Associated with Nigerian Export Business
Nigeria’s export industry is quite profitable, but it also faces a fair share of challenges.
The following are some difficulties in founding an export company in Nigeria.
- Many exporters have found themselves in serious legal difficulty because they were not completely aware of the laws and regulations governing business in Nigeria as well as the legal requirements for beginning and operating a firm.
- To export directly, you need a license.
For huge scale, it might require a lot of capital. - There can be a lot of mistrust between importers and exporters at times.
- Few Nigerians’ fraudulent actions have given us a terrible reputation abroad.
- Therefore, obtaining an export contract is typically tough.
- Due to their fear of being taken advantage of, several foreigners find it challenging to conduct business with us.
- Most goods you could desire to export are already forbidden by the government.
- Heavy Taxes and policies.
- Inadequate mentoring is a problem for exporters or those who want to export in Nigeria.
- It’s difficult to obtain an export license and the necessary paperwork.
- Long-term agreements are always broken apart by government policies.
- Expensive and high product pricing.
- You could have to cope with export rules, which could increase your administrative and logistical costs.
- Due to inadequate storage facilities and subpar farming techniques, agricultural products are affected by natural causes such as drought, pests, and diseases.
- Inadequate product change to comply with global standards.
- You risk losing sight of your home markets and current clients if you’re not attentive.
- More distant ties, sometimes hundreds of kilometers away, will fall under your management.
- Issues with loans and finance.
- Sourcing from trustworthy vendors.
- Fluctuations in exchange rates.
With tips given above, I hope you’ve learnt how to successfully begin an Export Business in Nigeria.
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