How To Start Building Materials Business in Nigeria or Africa: The Guide

How To Start A Building Materials Business In Nigeria Or Africa: The Complete Guide | Image: MCL Construction

With the growth in population and boost in industrial companies comes the need for more buildings. The building materials sector is growing alongside the construction industry, and, judging by current statistics, the numbers are not dropping in the nearest future. On one hand, as the human population increases, the need for residential buildings rises. On the other hand, as more individuals delve into industrial businesses and firms seek to expand their business empires across the world, the need to build suitable industrial structures or upgrade the existing ones also rises.

The global construction materials market as of 2019 was valued at $916.31 billion and there are indications that it will hit $1.2 trillion by 2025 at a CAGR of 5.76%. The Asian building materials market is expected to have the most significant growth in the world. It may probably be because 30% of building materials are produced in China, or it may be that the increase in urbanization and the government’s generation of infrastructure and housing project investments is the main driver. However, countries such as China, France, Japan, Germany and the United States of America dominate the construction materials landscape.

A building materials business remains a lucrative business in Nigeria. The construction materials market was reported to be ₦2.1 billion in 2019, and there are expectations that it will record a massive rise to about ₦13 billion by 2024 at CAGR of 16.7%. Major cities such as Lagos, Kano, Abuja, Port-Harcourt, Kaduna and Benin City are expected to contribute the most to the rapid growth. Private and government projects such as the construction of estates, road, boreholes, and electricity, among others, are some of the notable factors driving the growth of the industry.
Retailing construction materials is highly productive both as a small-scale and large-scale business. Despite the high competition in the industry, the success rate is high, given that the necessary factors are put in place. If you’re considering starting a building materials business in Nigeria or anywhere else in Africa, you will find this guide helpful.

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What Are Building Materials?

Building materials are a group of naturally-occurring materials (wood, sand, gravel, timber, etc.) and human-made materials (cement, block, glass, etc.) used in the construction of buildings, roads, bridges, and other basic facilities.

 

What Is A Building Materials Business?

A building materials business is the purchase, retail and distribution of materials used in construction, and selling of such materials to builders.

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Business Opportunities In Building Materials Business In Nigeria And Across The World

1. Block Production And Sales:

Although there are many other materials used in building, concrete blocks are still the most basic materials used in construction. A block making business is highly lucrative both in large cities and small towns.

2). Cement Production And Sales:

Cement is the material used in almost all modern buildings. This makes the demand for cement prominent in the construction industry. Companies in charge of production, sales and distribution of smile to the bank, thanks to the steady flow of income and endless demands all across the globe.

3). Roof Installation:

Roofing is a critical point of any building, not just because it is essential for safety and security but also because it could be used as a unique decorative part of the home. Sales and distribution of quality roofing sheets and materials make a very lucrative business enterprise because they are the desire of every engineer and homeowner. You could sell roofing materials or offer roof installation services.

4). Sales and Installation Of Aluminium Doors And Windows:

In recent times, aluminium materials have replaced wood in the making of doors and windows. Aluminium doors and windows are top-selling items in the building industry right now. Sales, distribution and/or installation of aluminium windows and doors makes a suitable and lucrative job or business for interested individuals.

5). Carpentry And Interior Design:

Building projects require the services of a carpenter. More so, interior designers are equally on the demand to give the interiors of homes and offices an exquisite or lovely touch that suits the company or the personality of the homeowner.

6). Ceramic Tiles Sales And Installation:

The new trend in home exterior design in most parts of the world is to use ceramic tiles instead of regular paint. Ceramic tiles are also used in the floor design. They add to the aesthetic value of the apartment. Tiles make up a significant part of home design and construction. Homeowners and engineers are always on the chase of experts at tile installation. In the same vein, retailers and distributors of ceramic tiles make significant profits off ceramic tiles.

7). Wallpaper Sales And Installations:

Another modern trend in the construction industry is the use of wallpapers, especially those with 3D designs. 3D wallpapers give hyper-realistic effects to the home, and homeowners love them. Production, sales and installation of wallpapers at residential and industrial buildings hold lots of prospects for experts.

 

Facts And Benefits Of Building Materials Business

  • The construction industry is diverse.
  • Not all aspects of the industry are capital-intensive.
  • The construction industry is a growing industry, which is beneficial to the business.
  • Building materials business is not sector-specific.
  • Starting a building materials business does not require much academic knowledge or qualification.
  • Countries such as China, France, Japan, Germany and the United States of America dominate the construction materials landscape.
  • A building materials business is a way of meeting a fundamental human need.
  • It is easy to start.
  • The building materials business is not a suit-and-tie profession.

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Types Of Building Materials

1). Concrete:

Concrete is a composite substance made from mixing cement, sand and crushed stone with water. It usually takes up to 7 days for concrete to reach the full strength and requires special attention when extracting it from the case to avoid a reduction in capacity. Concrete is a solid material. It is brittle and has insufficient tensile strength. When combined with steel, concrete is more durable and more suitable for a broader range of structures like tall multi-story buildings, bridges, roads, tunnels and so many others.

2). Steel:

Steel is one of the most substantial building materials available. It is also the most ideal for the structural framework of tall buildings and extensive industrial facilities.

3). Wood:

Wood is a natural resource, and is the most available and most widely used construction material across the globe, especially in the building of apartment homes in developed overpopulated countries. Large wood types such as timber are used to build the frames of large structures such as multi-story buildings and bridges. Engineered wood is another type of wood used in construction. It consists of various forms of wood glued together for specific construction applications. Examples of engineered woods are glued laminated timber, plywood and fiberboard.

How To Start A Building Materials Business In Nigeria: A Step-By-Step Guide

1). Identify Your Material(s) Of Interest:

First off, you have to select the materials you plan to deal in. It is advisable to focus on materials that are closely related, for a start. This will help you streamline your business your investments and efforts. You could, however, choose to expand the scope of your business over time.

2). Write A Business Plan:

A comprehensive business plan is necessary to put your business interests and goals in perspective. It outlines the business plans, scope, objectives, etc.

3). Site The Business:

Like every other business, location is instrumental to the success of a building materials business. Make sure to site your business in a very busy place. Building materials are mostly traded at open markets and select stores. Building materials stores, depending on the area, could be divided into various types: small shops of ​​70-100 Sq.m, bigger shops of ​​150-200 Sq.m, large shops of ​​500-1000 Sq.m. and warehouses of from 500 to 2000 Sq.m. You could choose any store size and open either at the designated building material sector of the market.

4). Register Your Business:

Registration is necessary to establish your business as a legal entity. Register with the legit associations, regulatory bodies and secure all necessary permits.

5). Stock Up:

This is the point where you network with the right distributors or direct manufacturers of the building materials you intend to sell. If your interest is in materials such as cement, it is advisable to buy directly from the manufacturers in order to get quality goods at the best rates possible. In addition to procuring goods, it is necessary to get the right safety kits for members of staff and customers in a bid to forestall accidents and industrial hazards. A building material business has a lot of materials that can cause physical damage. Your store or warehouse needs to undergo the same baby-proofing done to houses, for the safety of your customers, employees, and also you. Asides from baby-proofing, ensure you at all times have a complete first-aid box insight. Showing concern for the safety of your employees is an attractive trait to customers.

6). Employ Staff:

The next step is to employ skilled staff, depending on the kind of building materials in question.

7). Advertise Your Goods And/Or Services:

A building materials business also needs advertisement. Although it is self-advertised, running a marketing program on and offline will benefit you. You could run billboard ads, social media campaigns, you could organize surveys that will get people informed about your business, and patronize you eventually. A decent customer service department is also a successful way of advertisement.

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Challenges Of Starting A Building Materials Business In Nigeria

  • High start-up capital, particularly for large-scale building materials business.
  • Stiff competition in the industry.
  • Price policy.
  • Difficulty in getting trustworthy dealers
  • Fluctuation in market prices
  • Risk of buying fake or sub-standard materials
  • Poor road network
  • Excessive levies and fees

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To Sum It Up

The building materials business in Nigeria can be a lucrative and profitable venture to start-up, due to its vast market demand and on your ability to build a wide network. If you’re looking for a lucrative business to venture into, the building materials business in Nigeria is a great option to explore.

 

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