How to Start a Cooking Gas Retail Business in Nigeria
The cooking gas retail business involves buying huge quantities of cooking gas, storing it in tanks, and selling it to individuals that use it for cooking at home as well as industries that require large quantities for fueling their heavy machines.
The cooking gas or natural gas as sometimes referred to is a clear, odorless gas that is used for the domestic purpose of cooking and also a source of energy to industrial machines. The natural gas is a relatively clean energy compared to coal-based electricity and kerosene-fueled cooking.
For this reason, it is the best alternative people can get to source their energy. Hence, the product is now in a high demand. This huge and booming demand for cooking gas in virtually all urban settlements worldwide has created lucrative opportunities for smart entrepreneurs. You can also be one of those smart entrepreneurs by keying into the ever available opportunities in cooking gas retail business to make some good money. This is another good opportunity to launch your own dream business.
However, I need to inform you that the cooking gas is a very volatile product and storing it can connote so much danger. You have to be a very careful person to succeed in this business. In the course of this post, I will be taking you through the most viable steps involved in starting a successful cooking gas retail business. Just stick to the guidelines below:
Tips On Starting a Cooking Gas Retail Business In Nigeria
Learn everything you can about cooking gas retail business
- How is cooking gas measured?
- Where do you buy from?
- What are the common challenges cooking gas retailers face?
- How do you identify quality gas?
- How do you handle your gas cylinders?
- How do you refill a customer’s gas cylinder?
- What are the various types of cooking gas that exists and which is the best?
- What are the factors that affect the market price of cooking gas?
Knowledge is one of the vital keys to success in any business. You need to learn a lot about cooking gas retail business if you need to succeed. Before you think of investing in the cooking gas retail business, you must have answered the above questions convincingly.
If not, I suggest you keep your money for something else, because I know you won’t enjoy losing it. So, you need to invest time learning about this business if you wish to invest in it. You can also try learning from people who have experience in the business already.
A business plan will reveal many important details that you may not have paid attention to in the course of planning for your dream business. A business plan will give you some insight into the feasibility of the business in your locale, the required start-up capital, the costs of running the business, the market and competition, and other very important factors.
This is important for your true understanding of the cooking gas retail business you are going into and also guide your steps.
Find an ideal location
You need to find an ideal location for your cooking gas retail business. When choosing a location, you may have to take into consideration your market. It is important that you locate your business close to where there are many potential customers. It’s a bad idea to locate such a business as cooking gas retailing in a rural area, for instance.
Also, due to the hazardous nature of cooking gas, most federal and state governments have laid-down regulations concerning the site of a cooking gas retailing business. So it is very important that you find out the rules that apply in your state or country regarding property to be used for cooking gas retailing.
You can do well to consult an attorney in this case. This is a legal consideration in siting your cooking gas retailing business.
On the other hand, it can be a good idea to site your cooking gas retail business in an area dominated by medium-income people, high institutions, or entertainment centers such as hotels, restaurants, and fast food outlets.
This is because, people, students inclusive, now enjoy cooking with gas more due to its nature which makes it odorless, smoke-free, fast cooking, and long lasting while remaining cheaper to other energy sources.
Install the needed facilities
Hire professionals to help you install the tanks, electronics, and other equipment and facilities that you will need to conduct your business safely. (Remember, cooking gas could be dangerous)!
After installation, it is important that you check all equipment and facilities and ensure that they have been well-fixed. You must also ensure that there are no leakages or loose fittings.
Make arrangements for transportation
As a retailer, you need to offer incentives to your customers. This can in the form of transporting gas products to customers’ destinations. To do this, you need to either secure a hauling vehicle of your own or lease one if you cannot afford to buy. Due to volatile nature of cooking gas, the safety regulations are always many and rigorous. You need to ensure that your vehicle, purchased or leased, is always in tip-top condition and also meet the requirements for vehicles hauling such products.
Handle the legal aspect
In this business, you will need to get a standard service contract drafted by your attorney. You need to get your state’s regulatory agency to approve this document. Send a copy to the agency to get their approval. After the approval, send the approval letter with your financial statement to the utility company you would be doing business with. Send this alongside any other document that may be so required, most times it’s a bank statement to prove your financial credibility and readiness for the business in question.
You have to have it in mind that cooking gas retail business is a capital-intensive one. By implication, a hazard can make you go broke for life. You invest too much to ignore in this business.
For safety and caution sakes, get an insurance policy, mostly for fire accidents. The product is so volatile and inflammable that it can go up in flames at any point in time.
Start operations and marketing
The last set of things you have to do for a start is launching and advertising your cooking gas retail business. To attract customers, you can adopt aggressive marketing strategies and offer attractive discounts. Promise customers reward for referring new customers, and you would attract many customers within a short period. This works really well.
Additional tips for running a cooking gas retail business
- Do understand that cooking gas is a hazardous gas that could cause a fire outbreak if not well handled. It’s important that you handle cooking gas and all equipment with caution.Allowing smokers and open flame in and around your business location can cause fire incident. Keep them off.
- Ensure to always respond promptly to any correspondence from your state or country’s regulatory agency, as failure to do so may attract huge fines or cost you your license.
- To ensure that you remain compliant with current laws, always keep in touch with your attorney.
- Do remember that the price of gas fluctuates alongside those of other household cooking commodities such as kerosene and coal. To stay in touch with current prices and trends, stay in touch with your suppliers as they will always notify you of current trends and price changes.
4 Challenges of Starting a Cooking Gas Retail Business
You will be dealing with an inflammable product
The Gas retail business is a very hazardous and dangerous one. This is because of the product involved- Gas. Gas is highly inflammable and susceptible to explosions thereby resulting in deaths, injuries, or loss of property. So, you need to always be in line with the safety standards. Placing fire extinguishers in strategic places in your store can also help abort potential fires.
You are exposed to health hazards
While trying to refill your gas tanks and those of the customers, you are bound to inhale at least a minimal dose of gas. Though at a go this may not affect your health in any way, over time, these small doses can pose a health challenge. To protect yourself from this danger, you can get yourself gas masks and wear them when refilling.
The price of gas changes constantly
Price of gas does rise and fall on regular bases. You can prepare for this price fluctuation by staying abreast of the market and happenings within.
Your sales is highly dependent on the economic situation of your region
The need for your product should be a vital reason for locating a cooking gas retail business. Do not site your business where your product is not a business. You need to site your cooking gas retail business in an area where the people use cooking gas and need for a regular supply of the product such as a place with hotels, fast foods, higher institutions etc.; not in places where the indigenes use more of firewood and kerosene stove.