Indeed there are a lot of lucrative businesses in Nigeria that one can start up. However, the profitability that comes with the spare parts business cannot be overemphasized. In this article, we’ll be taking a look at the dos and don’ts on how to start a spare parts business in Nigeria.

How to Start a Spare Parts Business in Nigeria

#1. Create a Business Plan: –

Like every business, a business plan has to be made. This plan will help you identify potential setbacks and also possible breakthroughs or opportunities in your new business. A business plan too would help you know how much capital to budget for the startup.

One should be able to tell from your plan how you intend to run your business and fund it. Remember too that not all business plans was or is self-drawn, sometimes you may need a professional to help you write a business plan.

#2. Make smart choice: –

There are varying ideas on how to start spare parts business in Nigeria, thus one has to be very choosy when selecting the parts areas to dive into; as a wrong choice could lead to disaster. Of course, no one wants to go into a business with disaster as a reward.

If you have enough capital to invest and of course, the know-how about this business, the following two types of spare parts business is good for you to consider:

Private retail spare parts store

This means you will need to have a store in a good location to be able to sell the spare parts to your customers. This type of spare parts business is very profitable in Nigeria, as customers have firsthand contact with you the Seller, and can buy at a stance what they want.

Retail spare parts store with workshop

Unlike the first kind of store discussed above, this one is having an auto store with a workshop. This means that customers will have the opportunity of buying and fixing their automobiles at the same spot. It is also very profitable as the first and requires a lot of planning and capital investment to set up.

However, if you do not have so much capital to invest into the business and perhaps don’t understand well the outworking of the business. Then the next two is for you:

An online spare parts store

In this setting, one does not need any physical place or store to carry out his/her parts business. You can operate this kind of business from the comfort of your home; all you need is an internet connection and a computer or mobile device, a constant presence online to be in touch with customers and prospective buyers.

Spare parts Franchise

In this setting, you decide to start the business as a partner, perhaps with someone or company with experience in the automobile industry. One can also consider being a Distributor or a Dealer.

Read: How to Buy Car Parts from Salvage Yards in Nigeria

#3. Carryout market research: –

No matter the type of spare parts business you have chosen to startup, remember to carry out market research. An industry-wide market research and feasibility study will help you understand market conditions and opportunities. Of course, you are going into a business where you have strong competition, especially from old hands already in the business, so you want to be able to win customers for yourself.

Also, you want to know how to and the best means possible to transport your goods to customers from your store. You also want to understand the kind of automobile brand that rules the market in your particular region, state or city; so you don’t start up a business that will have less or no patronage.

Understanding the industry too is key and making friends with people already in the business might help you in understanding the concept of different spare parts. If you feel you don’t want to be deceitful (getting information from your competitors and coming up to open the same business) you can go far away from the region you intend to start up to do your findings.

#4. Fix and compare your price: –

Even the bible calls foolish a Man who starts up a building without first calculating the cost. Thus, you need to calculate and estimate the cost of a startup. Put into consideration the rent of the store, cost of purchasing the spare parts, and perhaps cost for other operating expenses. You may also need to compare the costs for the different types of automobile spare parts business to know which your budget will handle efficiently.

#5. Choose a location for your business: –

A good location for your business can be a determinant in defining how fast your car parts business grows. Proximity to customers is important as everyone loves a stone-throw or nearby solutions. Ensure too that your location is big enough to accommodate your business. For you wouldn’t want your customers to be inconvenient or meet an untidy business spot.

#6. Register your business and get licensing: –

You have to register your business and get the business name. Also, all the necessary licenses and documents needed to commence should be procured. In most cases, one may need to register with the market union or auto dealers association that manages the same business.

Related: How To Buy From Ladipo Auto Spare Parts Market

#7. Setting up your online or offline store: –

After procuring your business location, designing your ecommerce website and getting all the necessary business licensing. It’s now time to set up your store. First, you need to identify the parts you want to begin with and purchase them in stock. It also involves getting a steady and trustworthy supplier or perhaps buying directly from the original equipment manufacturers (OEM).

In setting up your physical spare parts store, you will need electricity, shelves, and hangers as the case may be, and most importantly; optimizing every space in the store. However, if you intend to run an online store, then your setup will be different, as you will need perhaps an app, a blog or a website set up that will serve as online store.

#8. Employ the Manpower: –

Once your business is set up, you will need to hire the right employees. This will depend on the business needs. In most cases, you will need to employ a mechanic and an auto engineer with a semi-skilled worker who could serve as a secretary. Whatever the case, make sure you have just the right hands on deck.

#9. Do promotions: –

Now, you need to do a lot of promotions and advertisements to get your business on track. Remember, nobody knows you yet. So to put your business out there, you need to advertise, advertise and advertise.

Summery: How to Start A Spare Parts Business In Nigeria

As you take a journey through this lucrative and profitable business of owning and managing a spare parts business, you will find the above information very useful.

We hope success wouldn’t be far off if you put things right.

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