How to start Exportation Business in Nigeria 2018 [Complete Guide]
Exportation business in Nigeria is the next biggest and economic driven activity, mainly referred to as the non-oil export because of its emphasis on other exportable from Nigerian aside crude oil and its various forms.
The export activities are regulated by the National Export Promotion Council and it even has its own bank; NEXIM and this bodies help to put light and provide help to budding exporters and corporate bodies in Nigeria.
Exportation business has a high growth potential and it is believed to be the next business in rave in coming years, it is only proper that you key in with the oncoming wave.
Agricultural Exportation business is the New Oil
According to this Punch Newspaper report, Nigeria earned a total of $730m (N143bn) from its non-oil exports in the fourth quarter of 2015. On the 28th January, 2016, the Executive Director/Chief Executive Officer of Nigerian Export Promotion Council (NEPC) Mr. Olusegun Awolowo stated that the NEPC has put in place some plans to increase the country’s non-oil export revenue to $18billion by 2019. A lot of money change hands in non-oil export. How would you like to get your own fair share of $18billion? Keep reading.
This goes to show that the exportation business industry in Nigeria is largely underutilized and with the oil-boom dying slowly, the government is bent on diversifying our interests and sources of foreign revenue from oil to Agricultural and mineral resources.
This is a golden opportunity for the smart entrepreneur to key in and prosper. Yes, export business is very profitable and the earning potentials will only increase in the coming years.
What does EXPORT Means
Export is the movement of goods from one country to another either for profit or non-profit.
The emphasis is on the word movement; thus, it is basically the movement of goods from one country to another.
Types of Export
- Commercial export (any export that is for monetary value)
- Non-commercial export (any export for non-value)
Categories of export
There are four different categories of export, this is important as it helps to properly the type of product that you will be exporting:
This mainly has to do with agricultural produces made ready for export. This is the major types of export we aim to practice in Niger, as we are blessed with enough land to cater to this.
- Solid Mineral
As the name implies, it is the export of solid minerals and resources like lead, tin, columbite etc.
- Manufactured products
This has to do with semi-processed goods and fully processed or finished goods.
Yes, you can also export services, it does not have to be goods all time, but intellectual properties and services can also be exported from any country.
Quality of an exporter
To become a very good exporter, you must consider the following traits and attributes:
- You have to be Passionate
- Integrity and trustworthy
- Adherence to export laws and rules.
- Capacity building
Why do we export
The following are reasons why we export from Nigeria
- Earn foreign reserve/exchange.
- Scarcity of FX.
Challenges of export
Just like every other businesses, export is known to have the following challenges:
- Funds/lack of finance
- International market
- Multiple documentations.
- Language barrier.
- Scarcity of FX.
- Product adaptations
- Gestation time
- High infrastructure
How to Start Exportation Business in Nigeria
Before you venture fully into export business, you have to gain the proper enlighten or you will make a huge mistake. Importation business is really simple than exportation business and you will get to know this firsthand when you get into it proper.
To get into this fully, you have to understand the following:
- The working of the market and its dynamics
- Export Documentations
- Getting the necessary Licenses
- Logistics and Transport procedures
- International legalities
- Sourcing for products to get the right quality.
Now it is time for us to go hands-on on how to become an exporter in Nigeria.
Get the Perfect exportation Business Plan and Research
If you fail to make a plan, then you have planned to fail. Export business is all about information and if you do not get a proper business plan, you are setting yourself up for a woeful loss.
A business plan is critical not only as a road map to your business success, but as a basic requirement to secure export loan from banks, financial institutions and government bodies. Your business plan should include details like:
- What agro product of mineral resources do you want to export?
- Where is this product found?
- Who wants to buy it? How well do you know your market? Do you know who your buyer is and what they want?
- How much do you need to start?
- How much do you have?
- How profitable is the venture? What is your Return on Investment (ROI)? ROI could be as low as 10% or as high as 100%
- How do you plan to maximize profit?
- How will you get paid? What is the exchange rate? How long should it take to get your money?
- For how long is the produce available? Some agro-produce/crops are seasonal. Is there enough in the market to sustain delivery? Some newbies accept export contracts for products that are either not available or not sustainable. This results in customer disappointment and creates a negative reputation for other well-meaning exporters.
- What is your mode of transportation/shipping?
NOTE: The secret of export is in the information and knowledge, you need to get the best export training, it will cost a lot but it is your first path to becoming a renowned exporter in Nigeria.
Register your Exportation business name
This is an important part of the business, it makes you more credible and trustworthy, so after making your mind up, it is time to proceed and name your business with a corresponding registration with the corporate affairs commission.
The registration is really important if you are to apply and get your National Export Promotion Council (NEPC) license and certificate.
Your business must be registered as either a Limited Liability Company, cooperative society or Government/Non-government organization.
Apply & Get National Export Promotion Council (NEPC) license and certificate.
After registering your business and its name, getting the NEPC license is your next point of action and you must meet the following requirements.
Documents required for NEPC License
You need the following documents depending on how and which types of business you are doing the NEPC registration for:
LIMITED LIABILITY COMPANY
- Certificate of Incorporation
- Certified True Copy of Memorandum and Articles of Association;
- Current Certified True Copy of Form CAC 1.1 — “Section C” (Particulars of Directors) formerly known as Form C07 or Form CAC 7.
- Certificate of Registration (Issued by Issuing Authority in the State and F.C.T)
- Bye Laws of the Society
GOVERNMENT AND NON-GOVERNMENTAL ORGANIZATION
- Certificate of Registration
- Constitution of the Government Organization and Non-Governmental Organization
- Memorandum for Guidance of Applicant
Registering for your NEPC License and Certificate both Offline and Online
To do this, you need to visit the NEPC office in your state. You will:
- Buy Exporters Registration Form at the cost of N1,000
- Pay a N13,500 registration/processing fee and
- Submit your completed registration form to the NEPC, attaching the following documents:
- Photocopy of Company’s Certificate of Incorporation;
- Certified True Copy of Memorandum and Articles of Association
- Certified True Copy of Form CO7, in case of Limited Liability Company or a copy of the Law establishing the agency in case of Government Organization.
Or do it online with the following instructions:
- Click on “Exporter registration”.
- Create an account by filling in Name, Email address and Password and click register.
- On the dashboard Click on Register New Certificate.
- Fill in the details of the company seeking an exporter certificate (Remember to save as draft before proceeding to next page).
- Choose the type of company and upload the relevant documents. Note: Business names are not accepted and any company that registers with a business name would not be refunded, Individual CAC documents should be scanned as a single document before uploading. e.g. the form C07 might have multiple pages but these pages need to be scanned to form one document.
- Choose Certificate delivery option; pick up or Courier. N/B Courier cost an extra N2500
- Click on Preview to review the information supplied in the form then click on Submit and proceed to payment.
- An invoice is generated then click on make payment
- Copy down the Remita Retrieval Reference (RRR) and choose your preferred method of payment
- After payment remember to confirm the payment by clicking on Log > Certificate, then copy down the order id and input it into the field, click on confirm payment and you will receive a notification of the status of the payment.
- Your certificate will be processed after confirmation of payment. You will receive an SMS and Email alert once your certificate is ready. This would normally take within 24 working hours for Pickup and up to 72 working hours for delivery.
Visit the NEPC website for more information.
How to source for Export client and buyers
What is the need of starting your export business, if you cannot get buyers and customers?
Friends, relatives and word of mouth
This is the basic way of sourcing for buyers and clients for your export business. You can request the help of your friends and relatives to use word of mouth in helping you seek for clients.
You can export food stuff to relatives in Europe and around the world where they enjoy Nigerian dishes. This is a cool way to make money.
International export trade websites
You can source buyers on international trade websites and portals. In the e-book, I listed over 10 super-hot trade websites around the globe where you can showcase your products and find foreign buyers.
You can get buyer recommendations from other exporters and export consulting firms. These are people who are already in the business and can show you the ropes plus get you a lead or two. This is where your ability to network comes into play.
Other ways to get buyers include
- Chamber of commerce.
- Bilateral chambers
- Commercial department/attaché of embassies.
- Attending trade fairs and exhibitions.
- Trade brokers
- Export agents
How to get capital and funding for your exportation business
I will begin by telling you never to use a bank loan to service your first exportation from Nigeria, but you can use your own personal savings or cash from friends and family.
You can only use bank loan in expanding the scope of your exportation business an dnot for starting. You can also seek out for angel investors or do group exporting with other like minds.
List of Exportable Products from Nigeria To Other Countries
Before exporting, you need to know the list of products you can export especially to countries like the United Kingdom, USA, Canada, Dubai, china, India, south Africa, Australia.
There are some products you cannot export from Nigeria, and they are termed to be on the prohibition list, but the ones listed below are goods you can consider safe for export from Nigeria:
- Tin ore,
- Crude oil, etc.
- Palm Kernel Oil
- Textiles and Garments
- Cocoa Butter
- Sesame Seed
- Yam Tubers
- Cassava Flour
- Cashew Nuts
- Chili Pepper
- Fruit Juice
- Cosmetics and Soap
- Cashew nuts
- Cocoa (seeds and processed)
- Kola/bitter kola
- Cow bones/cow horns
- Gum Arabic, Rubber
- Sesame seeds
- Shea nuts/Shea butter
- Mangoes, sugarcane
- Plantain flour
- Ground melon
- Ground maize
- Prawns, etc.