Sachet water business is one of the most lucrative business you can venture into in Nigeria. As a popular saying goes: water is life, access to pure drinking water is essential for healthy living. Nigeria does not have good public water supply that is safe for drinking. So, most of its populace depend on packaged pure water as its popularly called, as their source of safe drinking water especially in towns and cities.
Why Pure Water Is Necessary
Drinking pure water helps guard against water borne diseases. According to Vestergaard, water-borne diseases are caused by drinking contaminated or dirty water. Contaminated water can cause many types of diarrheal diseases, including Cholera, and other serious illnesses such as Guinea worm disease, Typhoid, and Dysentery. Water related diseases cause 3.4 million deaths each year globally. To avoid contracting these serious diseases, we need to ensure we only take good and pure drinking water. So, water sourced from bore hole has to be purified to remove dirt, disease-causing germs, and other impurities. That’s why sachet water production business is surely one of the best business to get into.
Is Sachet Water Business Profitable In Nigeria?
Sachet water production is a very profitable business if you can manage it well. Considering its population, hundreds of millions of sachets of water are consumed everyday in Nigeria, and this figure has always been on the rise. The reason is because Nigeria’s population keeps increasing in major cities and towns. Add this to the absence of public water supply, and you will immediately realize a rough estimate of the quantity of sachet water that is consumed everyday. A smart investor knows that the best product to deal with is the product that is in high demand. Therefore, sachet water production business is one of the best choice for investing. The demand isn’t going down very soon as sachet water has become the most credible alternative means of getting anything close to clean drinkable water for the average Nigerians. Therefore, how do you cash in on the demand of sachet water production to make money for yourself?
Without much ado, let me take you through the requirements for setting up a sachet water business.
Sachet water business is capital-intensive and requires many vital components to start. But, like we have rightly stated earlier, it is quite lucrative if well-planned and well-managed.
The first thing to do is to hire the services of a water business consultant to first and foremost enlighten you about the business. Then, carry out a proper feasibility study with your requirements and get you a custom financial plan. With this, a good business plan can be created. The financial plan should contain the Project Startup Cost, Projected 12-month Cashflow Analysis, Projected 5-Year Profit & Loss Statement, and Projected 5-Year Balance Sheet. In addition, the financial plan should be able to provide estimates pay back period (PBP), break even level, and annual rate of return.
We (at NairaMan Consults) provide water business consultancy, and we have been doing this successfully since 2011. We provide custom feasibility and business plans which can even help you in processing a bank loan if you so require. We also provide one-on-one consulting which includes tax advice, etc. Contact us on WhatsApp by clicking this link → wa.me/2347052278800 or simply by calling 0705 227 8800. Now, let us continue our discourse.
Pure Water Factory
Your pure water factory can be cited on a fenced standard 3-bedroom bungalow with bore-hole water source. But, before choosing a factory location, ensure your consultant carries out a subsurface (bore-hole) water analysis in recommended and approved laboratory. This would save you a lot of money in water treatment. Your factory location requires the following compartments/rooms for approval from NAFDAC:
- Water production room
- Raw material storage room
- Finished product room
- Changing/cloak room
- Laboratory room
- General office room
We will explain what all these rooms are used for in your factory in a separate article some day. Before building, kindly consult with your consultant to ensure that your building layout complies with NAFDAC recommendations for a sachet water factory.
While you are building your factory, you can at the same time be processing your company and brand. The brand is the name of water products that will be produced by your company. Branding is very important in business, so in addition to your business name, you need to design a very professional logo for your product because perception is the best sales man.
You need to register a business name, and register it as a company with CAC, register your brand name and trademark it at the Commercial Law Department of the Federal Ministry Of Industry, Trade And Investment. You need to hire the services of a consultant (patent lawyer) to achieve both of these objectives. You can consult with your lawyer about getting this requirement (incorporation/branding).
Machines/Equipments & Raw Material
Sachet water business requires equipments (water treatment plant, packaging machines) and raw materials (sachet water nylon films and packing bag rolls). Sachet is packaged in bags of twenty sachets using low density films for the sachets and supplied in packing bags is a combination of high and low density. The treatment plant serves a specified number of Sachet Filling Machines because it provides a fixed litres of water per hour.
Production process: Raw Water is pumped from the borehole to the overhead tank. It passes through quartz sand and activated carbon filters into a reserve water tank. Attached to the reserve tank are micro filters which lead to an automated dosing system that injects the required chemical that ensures the PH value before the water moves finally to the packaging machine (Dingli, Koyo, etc) which is fitted with UV filter and has sachet rolls preloaded on it.
Everything in this process constitute the equipments and machines that will be required in your sachet water plant. The setup/installation of these machines is to handled by an experienced technician which we (at NairaMan Consults) can help you with.
Supply trucks help move the package water from your factory to the market where it is in demand. Sachet water factories usually has 1 or more of these trucks. Depending on your budget, it is advisable to get two trucks because the distribution is the soul of your business. Also, do not be economical in your budget when it comes to supply truck. The trucks will be supplying deep in the developing areas which have bad roads in most cases. There is nothing as bad as buying a truck that breaks down so frequent, it can kill your business.
A decent European used truck with good history is what you need. N3 million can get you a very good Mitsubishi Canter. But, you can still make do with a Chinese Dyna truck.
You will need minimum of five persons to work in your factory for a start then increase with time as the demand may be. Among these will be production manager, packers (1 per packaging machine, drivers (1 per truck), offloaders (1 per truck), security guard. Hiring experienced staff is highly recommended especially for production manager and drivers. It is key to a successful management of your factory, so you must ensure they have cognate experience.
Once all the other requirements listed above have been put in place, the technical consultant is required to make provisions for SOPs, and certain other tools necessary during inspection. Then, NAFDAC will be invited for inspection and approval if all requirements have been satisfactorily met.
NAFDAC is the organization authorized and empowered to regulate and ensure quality assurance in product manufacturing especially in food (which includes water) and drugs.
Again, this is an area that we (at NairaMan Consults) can assist you with. Our technicians take care of installations/setup, training and must secure NAFDAC approval before their job is deemed complete.
Normal operation of your sachet water factory starts immediately after NAFDAC approval with the raw material inventory that was purchased with the machines. It is at this stage that your management prowess will be put to test.
As we have mentioned earlier, we provide consulting in business planning, factory setup, & NAFDAC approval. We can help save you headaches of engaging quacks and unnecessary expenses of engaging expensive technicians with our all-in-one consulting service.