How to Start a Bread Bakery Business in Nigeria.
Bread is one of the top fast food anyone can eat and we eat bread almost every day. Different people from different ethnic group, believe, religion, tradition and even country eat bread.
It is always affordable that anyone could get when they are hungry. When the bread is freshly baked it releases a sweet smell that makes anyone want to have a taste.
Bread bakery business is one of the very lucrative businesses that is kept a secret, did I say a secret? oh! Sorry I mean top-secret.
Just in a few minutes, you will know what the owners of bread bakery business in Nigeria knows and has been keeping a secret from the masses.
Investing in a business with high demand and competition is an assurance of making sales and even profit if you have the right strategy and application.
Here is some question I will like you to ponder over as we read along.
How Many Pieces of Bread Do a bakery Produce in a Day?
Do you know you can earn up to a million naira pure profit with bread bakery business?
How profitable is bread bakery business?
Bread bakery business is very profitable that most investors have decided to make it a secret. It is easy to make millions as pure profit in just a week.
Bread cost about N80.00 ($0.50) to produce the normal standard sliced loaf bread in Nigeria. The baker now sells at the rate of N130.00 to suppliers therefor making N50.00 per bread loaf.
The supplier now sells to a retailer at the cost of N180.00 per bread loaf and he makes his own N50.00 gain.
The chain does not end there the retailer now sell to the final consumers at the rate of N200.00 to N250.00 make a whopping average profit of 50.00 per bread loaf.
A classic regular bread bakery that has a good supply strategy sell over 50,000 bread loaves on a weekly bases.
Remember the baker makes N50.00 per bread loaf, let solve the maths…..
P = profit
P = pure profit
L = loafs
N50 x 50,000L = N2, 500,000.00 p/week
To calculate your pure profit you will have to subtract the running cost of our profit. We should be spending less than N500, 000.00 per week for production.
- Cost of labor and staff upkeep during the week let’s say = N100,000.00
- Cost of maintenance and fuelling of the diesel generator per week should be around = N50,000.00
- Fueling and maintenance of the supply vehicle per week = N100, 000.00. (if we are supplying we are making extra N50 per loaf because the supplier is to make N50/loaf as profit)
- Other emergency and miscellaneous expenses weekly = N50, 000.00.
We actually spent less than half a million in production weekly. Let’s assumed we did spend up to that amount N500, 000. 00 we will still make a weekly pure profit of N2, 000,000.00 nairas.
It is left for you to now tell if bread bakery business if profitable or not. Who can actually think that a baker can be making up to the N2 millionaire on a weekly bases?
Risks involved in bread bakery business.
Just like every profitable business has its own area of risk so also the bread bakery business. Though the risk is not that high you have to be careful because one naira out of your business is lost.
Burnt damage: This is considered as the major risk in bread bakery business and this main happen due to carelessness or overheating.
Normal heat should be applied and a regular check should also be practiced to time to avoid damage due to burning.
Spoilage: This rarely happens where there is a good network of suppliers. We advise you produce according to your suppliers’ capabilities to avoid spoilage.
Some other factors like market competition may prompt this but they are in rare cases.
Price fluctuation: In Nigeria, it is easier for prices to go up than to come down, the price of things coming down is not a risk but for the price of production going up is a risk we would have to look out for.
This happens often as the price of things is not always fixed in the market. Our market experience increases almost three times a year.
Police/soldiers: This is one of the aspects I would not like to talk about because it is annoying to me.
Those at the check-point cause unnecessary delay to our supply team and even coming up with one allegation to make sure the bread got spoilt if you don’t give them bread at their check-point.
Theft: This is a risk we should try to avoid as it has the power to bring down our effort for years. When we talk of theft as a risk we do not only mean a forceful collection of the bread but our working equipment and even money realized after sells.
How to start
It is not difficult to set up a bread bakery business in Nigeria, all you need to do is to follow the following steps.
Get training: This is very important as you know “you don’t learn to shot a gun in the battlefield” knowledge is power, learn all the process of production before setting up your own. This could take some time but I can assure you it is worth it.
If you have the skill you will be able to know what you want how to get ahead in the business.
Prepare a nice business plan: your business plan will distinguish success from failure check out how to prepare a nice business plan here
Choose a marketable location: This is not farming so should not necessarily need to be done far from the human resident. For the sake of marketing and easy consumers reach we advise you set up your bread bakery business in a location that has good road and good market advantage.
Let your land be big enough to carry all equipment and aspect of production.
Build your factory: Now erect a good structure for your business. Build all department for production in your factory. From the raw material store to the production room to the storeroom and the car-pack.
Let your building denote hope for future growth.
Ingredient and raw materials for production.
Flower (major ingredient)
Equipment for production.
Milling machine: This machine is used to mill the mixed flour to a fine texture. It will help keep the mixture smooth and fine.
Baking oven Local or Modem: we advise you use a Modem oven if you are going to a professional bread bakery business. But if your finances are not up to you can make use of the local oven but you have to be careful.
Flour mixer: This is a machine that helps to simplify the mixing process if you don’t have the money to but the mixing machine it can be done manually. It’s just that it will be a little bit stressful.
Slicing Machine: The milled mixture is now sliced based on the amount of bread you will like to produce. Every price with his own slicing N200, N120 or N50.
Baking pans: It is simply the shaping container use for bread bakery business. The mixed flour goes into the pan and takes the container when the bread is baked.
Customized bread wrapper supply: It will be nice to know that branding sells every new product. The market will first see wrapper before having a taste of your bread if your bread is tasty but don’t have a nice wrapper you might not have a good sales.
KVA Generator: This is a requirement for your business, you will need it for the production process.
Supply truck: A supply trunk will help you get into the market. With a very strong supply network, your production rate will increase and that means profit.
Get NAFDAC Approval for your bread bakery business: Read this post to know how to apply for NAFDAC.
You will need the following staff.
Workers: This includes the cleaners, managers and another staff the bread bakery business will need.
Millers: these people will work as the machine, they will do the milling to make the mixed flour smooth.
Drivers: your drivers can also work as your suppliers, they will get raw materials and other things from the market.
Make sure your personality help those around you and speak good of you.
So you now know how easy it is to start a bread bakery business in Nigeria. Don’t just read but put to work everything you read here.