UNCOVERING THE GOLDMINE IN TOILETRIES
Uncovering the goldmine in toiletries
The need to have a clean environment and live a healthy life makes manufacturing of household and industrial cleaning products, like soaps and detergents, a profitable venture in Nigeria and beyond. There are several firms, especially multinational firms, that are into the manufacturing of these products. But the fact that the greater majority of Nigerians are within the poverty bracket, who often find it difficult to afford the prices of products made by multinationals and other big companies, will always make small-scale production of these products a viable option. This is because the prices will always fall within the people's affordability range.
The Managing Director, Lyd-Mar Industries Limited, manufacturers of Brymar range of industrial and household liquid cleaning products, Mrs. Maria Asuquo, who calimed to have started business at a micro level by meeting the cleaning needs of friends and neighbours, says the business is a profitable venture, if prudently managed.
According to her, about N350, 000 is required to start the business at the small scale level, covering the cost of packaging and other miscellaneous costs but excluding that of the mandatory registration by the National Agency for Food and Drug Administration and Control. On the other side, she says about N20m is required to start a large scale production.
Asuquo says between two to three employees are needed to start at a small scale level, while about 20 or more are required for a large scale operation, depending on the number of departments created.
On the requirement for a simple small scale operation, she says NAFDAC would always require, at least, four rooms- each for production, cloaking, storage of raw materials and finished products. In short, a rented apartment or a medium size three-bedroom flat build on a plot of land can serve as a starting point. However, an acre of land measuring up to 4,840 square yards (approximately 2,880 square metres) would be required for a large scale cleaning factory.
According to Asuquo, the equipment needed for the business include industrial mixers, storage tanks, filling machines, capping machines (optional), product coding machine, labels, plastic bottles, carton or nylon for final packaging.
She says raw materials for manufacturing of soaps and detergents can be sourced locally in Lagos, Aba and Ota in Ogun State.
She says that the business owner should have the basic knowledge of and passion for the business, adds that educational qualification is good but training will further give the required knowledge on how to operate the business profitably.
Stating the benefits of doing the business passionately, Asuquo says, 'When we started manufacturing for just friends and neighbours, the need became more than we could handle. This gave us an insight into what the business held and we decided to get NAFDAC registration for four of our products.
She insists that the market for soaps and detergent is not saturated, and there is still enough opportunity for those who can dare to venture into it. She, however, stresses the need for prospective manufacturers to identify their market niche.'
On the challenges facing the business, she says poor power supply, which adds up to the cost of doing business through the use of generators; and inadequate fund to finance operation and create good distribution networks and awareness for the products are some of the pressing problems that confront small scale production of toiletries.
According to her, quality products may be expensive to produce and there is the need to maintain quality and also produce more than demand in order to eliminate scarcity of products.
She says the government can help manufacturers by improving the power situation in the country. Government can also mandate financial institutions to develop special packages to assist genuine manufacturers.
Speaking further on the challenges of toiletries manufacturing, Asuquo decries the high rate of advertisement charges, saying that media outfits should put in place advertisement packages that promote products and services at cheaper rates to aid the development of SMEs in the country.
Another major small scale manufacture of toiletries, Mr. Bola Akintade, maker of Clean Total soaps and toiletries, says operating at a small scale level can be started with an asset less than N100,000.
'All you need is a two-room apartment, the mixing machine, bulk payment for raw materials and a good source to access packaging. Of course, this is usually made easy when the maker has a distributing van and a landed property of his own,' he says.
Recalling his starting point, Akintade, who is the Managing Director of AK Beauty, arguably the most popular local toiletry products in the Agege area of Lagos, says, 'Small scale production is a promising one in toiletries making. The immediate challenge is distribution, at the initial stage. But once people know the product and they have accepted it, there is no limit to the success that can be achieved.
However, he lists some of the challenges that can bring about failure to include lack of good knowledge of the production process, lack of access to fund, power and product adulteration.
'But some of these can be tackled through proper planning, adequate mentorship and an effective management process.