How to Establish a Supermarket Business in Nigeria or Africa – A Quick Guide

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Image Credit – istockphoto.com

A supermarket is a large retail shop where household marchandise and food items are sold. In a supermarket, goods are arranged and organised in aisles and shelves for easy identification during shopping and it is usually operated in a self service basis, whereby customers on their own pick the products they want in their shopping baskets, after which they take the selected items to the cashier for costing and payment.

Why Customers Prefer Buying From Supermarkets

Many people patronize supermarkets for several reasons, which includes:

1.  Buying  most or all the items you want under one roof.

2.  Buying some special brands of items you might not easily see at the local market.

3. Making your purchases at a secured environment.

4. Making your purchases at a conducive environment, under air conditioners, unlike the regular market where you may have to shop under the scorching sun.

5. Being able to buy and make payments using electronic means like the point of sale, POS machine.

Items That Can Be Sold in a Supermarket

There are various items that can be sold in a supermarket. There include but not limited to the following:

1. Cosmetics

2. Stationery

3. Candies

4. Clothes

5. Shoes and slippers, singlets, pants

6. Canned food

7. Phone and accessories

8. Beverages

9. Drinks

10. Baby food and baby care products including diapers

11. Sanitary products like soaps, detergents, tissue papers, softeners, sanitary pads

12.Frozen food

13.medicines and first aid items

14. Cooking utensils and dishware

15. Tabloids, newspapers, magazines and books

16. Eggs and Diary products

17. Tooth brushes and tooth paste

18.Diet products and supplements

19. Flowers and decoration products

20. Snacks etc

Vitals Steps to Take in Setting Up Your Own Supermarket

Here are the vital steps you should take to set up your own supermarket:

1. Develop your business plan and model  – Before starting out, you should determine the size and mode of operation of your supermarket. You might decide to start-up a small-scale supermarket with plans to expand into a large one with time.

You need to also determine your marketing strategy and plan, your source of capital, your business structure ( partnership or sole proprietorship ).

Your business plan should also contain your feasibility study of the business, your staffing plan, sales and income forecasts and your assessment of the strengths, weaknesses, opportunities and threats of the business. It actually gets you prepared for what lies ahead as you venture into the business.

2. Get the required funds – Depending on the size of the supermarket and the location you plan to set it up, you will need adequate funding. In Nigeria a medium size supermarket can cost between #5M to #10M  ( $13850 to $27700 ) to set up, while a large-scale supermarket could cost above #10M to set up.

Read Also:  How To Start Your Own Catering Business In Nigeria

However, you can set up a mini-supermaket and grow it over time to large supermarket. A mini-supermaket will cost between #1M to #5 M ( $2770 to $13850 ) Better still, if you still can’t get the required funds for a mini-supermaket, you can set up a grocery store in your neighbourhood which should cost about #500k to 1M  ($1385 to $2770) depending on the size and location.

There are various ways you can secure funding for your business. Use the method that best suits to you.

3. Get the right location – You should get a good location to site your business. This is key to getting the more number of customers. The business should be centrally located to allow for easy access to your customers.

If you can buy a land and erect your own building, that would be great. However, if you cannot, then you can rent a building. If you are building yourself, you have to ensure that your building plan takes into consideration the various compartments and structures necessary for the business. If you rent a place, you might have to repaint the walls and possibly make some partitions using ply board within the building  ( if not available ) for a cash point.

4. Map out and set up the shelves – In a supermarket, items are properly arranged in shelves for easy identification and purchase. Set out the products shelves properly. You will have better sales if goods are attractively and properly arranged with their price tags in their respective shelves categories.

Label your shelves, so that customers can easily know where to get the items they need easily. For instance, there can be shelve for baby food, diapers, toiletries, medicines, beverages, drinks etc

Image Credit : lifo.gr

5. Get good power supply – You need constant lighting in the building so as to allow for easy location of commodities by customers.

If there is no reliable power supply in your country, you will have to get an alternative source of power, like a power generating set. The capacity of the generating set you should get will be determined by the amount of load in terms of electrical appliances that you will be using in the supermarket.

6. Equip the supermarket In addition to painting and decorating the supermarket, you will also need to install good air conditioners, Point of Sale Machine, shopping baskets and shopping carts/trolleys, refrigerators for storage of some perishable food items.

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4. Meet and network with commodities manufacturers/ suppliers/whole sales/distributors – Getting good suppliers that can sell products to you at cheaper prices is vital step to making good profits.

Reach out to importers, producers , manufacturers and when it is  not possible to meet the producers, then link up with the wholesalers and main distributors.

As I said, the goal is to get high quality goods for your supermarket at the lowest cost possible, so as to maximize profits.

5. Employ competent personnel –  The number of staff you should hire depends on the size of the supermarket. For a start, a small or medium scale supermarket will need a sales attendant and a cashier and a security personnel while you will be the general manager. However, a larger supermarket will have other staff which includes:

– Cashiers and accountants

– Security personnel

– Sales attendants

– Cleaners

– Warehouse  manager

– General manager

– Drivers

6. Ensure adequate security – This is very important. You need to ensure the adequate security for the business, else your supermarket might be burgled. You should always be security conscious.

During the day, pilfers may attempt to steal items from your store while pretending to be customers. You can install CCTV cameras at different locations in the store so as guard against pilferage.

You should also install good burglary system. If the area is not secured, you will also need to get your own security personnel that will keep secure the business at night.

7. You will need warehouse to store up goods – Due to high inflation, storing non perishable goods bought a fair prices for subsequent sales can be profitable. This is not a mandatory, but if you have the means, space and resources, you can make provision for your own warehouse.

8. Install good fire fighting equipment – Fire can raise down goods worth millions of dollars within few hours and cause great loss. Therefore, you need to prevent fire out breaks at your supermarket. Place fire extinguishers at various locations of the supermarket. If you have the funds, you can also install fire alarms and fire hydrant lines. Ensure that your staff are trained on fire prevention and fighting techniques. Money spent on fire prevention is never wasted Monday at all.

9. Register your business with the appropriate bodies – Register your business with the cooperate affairs commission and all other applicable organisations. Doing this helps to make your business official and also helps you to avoid unnecessary disturbances from anyone.

Read Also:  Want to Own a Primary or Secondary School in Nigeria? Follow These Ten Steps.

10. Stock your supermarket with products and  open your business to the public – it’s now time to stock up goods for sale in the supermarket. Above, I listed several examples of items that can be sold in a supermarket. There are many other products you can sell in addition to the ones I listed.

Just as I advise most people going into trading, it is better to use a part of the money you wish to use to buy goods to buy a few of several items you wish to sell in your supermarket. Keep part of the money as you will need it to buy additional goods that you have discovered are mostly demanded by customers.

Have a notebook or computer record for items that customers are demanding so that you can buy more of those items for sale.

11. Advertise your business – You must have mapped out your marketing plan in your business plan. Now the time to implement your plan. Use all available and effective strategies to advertise and publicise your products. People need to know that your business exist and the reasons they should buy from you instead of your competitors.

In Summary

Supermarket business is lucrative and will always thrive due to the inherent benefits to customers and the entrepreneurs. Setting up your own supermarket is one way you can build a profitable business and even create jobs for others.

It is not as difficult as you think.  Just follow the basic guidelines above.  If you don’t have the needed capital to start a standard supermarket, try starting a mini or medium scale supermarket. With time the business can grow.

What are your thoughts or questions on how to establish a successful supermarket business? Let me know by leaving a comment  below.

If this article was of help to you, kindly share with friends using any of the social media platforms at the top or bottom of the article.


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2 Comments

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