How To Start An eCommerce Business In Nigeria

0
3
Girl sitting in front of a laptop
PLEASE SHARE!

How to start an ecommerce business in Nigeria is by knowing what to sell, making an offer, arranging your logistics; your payment method and coordinating delivery without a shiny website, you can still earn. A shitty e-commerce site like Shopngrace earned me millions in Naira. 

Why you should start an eCommerce business in Nigeria 

The digital landscape of Nigeria is unarguably starting to flourish; it has the biggest [internet] economy in Africa, the largest population on the continent, and the world’s most vast concentration of young people. The uptake of mobile phones and improved connectivity infrastructure for this fast-growing populace have contributed to more internet penetration. 

Why is Nigeria the best place to sell right now?

Nigeria is the 33rd largest market for eCommerce, with a revenue of $7 billion in 2021

Currently, Nigeria’s number of smartphone users is between 25 and 40 million, depending on the data source. 

Since it is a frontier market, mobile devices are more commonplace; in 2019, over 70 percent of the country’s internet usage came via mobile phones. 

These metrics, among many others, show the huge potential in the country’s digital economy. 

If Nigeria’s internet economy is a goldmine just waiting to be struck, there is much value to be harvested “online,” simply the virtual exchange of goods and services. 

That is where eCommerce comes in. 

In 2021, African tech startups raised a record-setting amount of venture capital, with more than $4 billion invested

While fintech is unsurprisingly the most funded sector—with $2.3 B—eCommerce comes second, having swallowed USD 174 M last year alone.

That shitty website I showed you earlier is just a way to set your foot in the door.

How do I start an eCommerce business? 

First off, you need a business plan

This seemingly old-fashioned document is the one thing that can help you stay on track and religiously keep tabs on the venture’s long-term goals.

If you’re disorganized like me, you would appreciate this later.

A business plan ensures you direct such affairs properly and diligently, especially if you don’t even have, let’s say, 100k Naira to start with, and you have to borrow from a family member. 

A business plan might get you headway. 

Whether you can do it yourself or have to hire an expert, a business plan is a foremost consideration.

It is not much of a big deal, though. 

e-Commerce Product identification

For an eCommerce business in Nigeria—and virtually anywhere else—to be successful, it needs to be built on sought-after and quality products. 

If there is no demand for the items on sale, the venture might never take off. 

For example, when I sold an electric juicer during the lockdown and raked millions of Naira, courtesy of my dear friend Emmy, it was a time when everyone wanted health.

Everyone wanted to be healthy, so for me to sell a machine that made people fresh juice without stress, additives, and preservatives at the time was a win for me.

This means you need to do lots of homework by researching market demand, considering the high margins, and planning for adequate warehousing. One great place is the Facebook ads library. More in the coming posts

Some other ways to find hungry buying eCommerce products

How do you find products people would love to buy? 

While there are many ways to obtain this information, tools such as Amazon Best Sellers, Google Trends, and eBay Top Products often come off as the easier, more rewarding options. 

These tools help you seamlessly spot the products in most demand, increasing your chances of stocking up on the good market goods. 

Where are your suppliers?

Once you have found the product—or group of products—that would effectively cater to your audience, it is pertinent to locate the suppliers. 

Without this supply chain section, it might prove impossible to get products into the mass market. 

Along this line, it is essential to find intermediaries capable of supplying and according to [possibly increasing] demand. 

If you have about a dozen suppliers listed, it is often advised to engage them separately so you can determine which are the best fits for your eCommerce business. 

Meanwhile, pay keen attention to the cost differences and maintain communication with these entities—as a way to determine their consistency. 

Register the business, officially: Here is

How to register ecommerce business in Nigeria

With suppliers on board, it is time to legally get your business’ name out there. At this point, all roads lead to the Corporate Affairs Commission (CAC), Nigeria’s business watchdog. 

The earlier, the better because you wouldn’t want to find out you are a tad too late to register that unique business name you spent nights coining. 

Registering your eCommerce business with the CAC is the one way to make your customers feel comfortable and safe doing business with you. 

Expert tip: I registered mine as an Enterprise under the marketing agency

Only when you are under the CAC umbrella can your business open a corporate bank account. 

Depending on your state of residence, registering a business name costs between NGN 30,000 to NGN 45,000. 

A business recognized by Nigeria’s authorities is halfway to becoming a trustworthy and credible brand, one with which customers can engage and transact daily. 

Besides, registering increases your chances of remaining unique. 

Going online

Now that your business has gotten the Nigerian stamp, it is time to establish an online presence. 

Since we are talking about eCommerce, there is a need to get a domain to protect your trademarks and copyrights. 

Buying a domain also helps your business look more credible, increase brand visibility and get a priceless search engine ranking.

Expert tip: namecheap.com has been the registrar and host for all my domains. Chat support if you’re undecided.

Your business name, domain name, website, and email must tally. 

To check whether someone else has already taken your preferred domain name, you can search it on Namecheap.com. 

If you’re lucky enough, the name will come up untouched. 

Depending on which registrar you go to, getting a domain name in Nigeria costs NGN 3,500 and NGN 4,000. 

Yearly subscriptions often cost the same. You can decide if you want to use .com or [just] .ng for the website address: e.g., myeloma dot ng. 

Time to set up your store

Sure, you have your goods, and they are safely stored in the warehouse. 

But, this is eCommerce: you will need an online store to sell to customers over the internet. 

Because this is usually where it gets technical, do take your time to get the right platform for your business.

In this case, you might want to work with a professional web developer, one able to relate to your brand’s needs.

Work hand in hand with the expert to develop the best layouts and designs. 

WordPress is your go-to if you want to DIY; you can start with a free site, then later switch to the paid version. 

However, ensure to weigh all your options to realize the best fit. After all, you can set up a mini-store on platforms like JUMIA, Konga, and Kara. 

Logistics and payments

Logistics fulfillment and payment gateways are two salient aspects of eCommerce, especially in a market like Nigeria, where many supply chain problems prevail. 

You can learn how to open a PayPal account in Nigeria that sends and receive funds

The market’s postal infrastructure is very unlike that in developed countries, and that forms a major reason African eCommerce was initially on a slow takeoff. 

You need to partner with a reputable and reliable logistics service provider to circumvent the hurdles. 

One of eCommerce’s perks is not being restricted to particular locations, as it is for traditional stores. 

However, an effective logistics strategy should be able to get your products to their buyers quickly enough, so your choicest provider needs to cover a large amount of area. 

That is why some eCom enterprises partner with more than one logistics business. 

Bear in mind that your logistics partner might also be the payment collector. DHL, GIG Logistics, FedEx Nigeria, and Courier Plus are the names that first come to mind. 

Marketing your eCommerce brand

More people won’t know about your eCommerce business if you don’t advertise. 

There is no such thing as too much marketing, as even the most established businesses spend huge sums of money to keep up their appearances. 

To increase brand awareness and generate leads, you can leverage social media and other platforms like Google AdWords to spread the word. You ought to have a vivid idea of who your target audience is. 

If you want to sell fashion items, your customers are most likely young people with a significant means of livelihood. 

First, create accounts across all existing social media platforms—or the ones most relevant to your business—to organically engage your potential customers. 

Spending much cash on adverts doesn’t guarantee they will convert. What works is a keen understanding of what works and the best way to replicate it. Before running ads, do extensive research to know what makes your business tick.

What are your revenue goals?

This is where you determine how much the cost of the product is and how much you will sell them. 

You need to factor in the financial implications of supply, storage, and doorstep delivery for each product to be sold. 

Also, what does it cost to package and ship the items to the different locations they have been ordered from. This way, you’ll know when the eCommerce store is profitable and when it is retrogressing.

Revenue goals need to be clarified down to the daily. That means you need to look for ways to grow the income stream daily. 

If you sell products that come with expiration dates, such goals assist you in making sure you don’t get stuck with inventory you won’t be able to sell. It’s all about cutting costs and boosting profit margins.

Final thoughts

One of the hardest things about starting a business is deciding when to launch. However, often, there is no perfect day or time to launch an eCommerce brand. 

If you have everything ready and correct, you can kick off as soon as possible. The learning process never really ends.

Recall that research is everything. Painstakingly observe the market and understand their behaviours. 

Then, innovate around the roadblocks and find ways to reduce costs. Keep an eye on your numbers and leverage them to increase your sales. 

If you would like to learn the exact process I use to make millions on Shopngrace’s shitty website, you can comment below and if I see great interest, I will make a detailed blog post about it.

You can connect with me on LinkedIn or via my Telegram channel

PLEASE SHARE!