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How to start Sand and Gravel Business in
Nigeria
Sand and gravel enterprises operate in one of two main ways;
they either limit the scope of their business to the storage and
delivery of sand, rock and gravel, or they take part in the
actual quarrying and manufacture of the raw material. The
success of both types of sand and gravel companies depends on
the local demand for sand and aggregate materials and the amount
of competition in the area.
The first step in starting any business should be a detailed
analysis of the intended market. Sand and gravel quarrying
businesses thrive in areas of rapid development and new housing
starts, as long as aggregate companies don't already saturate
the market. The best way to determine the feasibility of
starting a new company is to find out what local sand and gravel
companies are charging per ton for their aggregate and then
compare that to the prices charged in nearby communities. If the
cost in your community is substantially higher, there might be
room for some competition in your area.
Start-Up Costs: Starting a full-service sand and gravel
operation that quarries and crushes aggregate requires a
substantial initial investment that could easily run into the
hundreds of thousands of dollars, or more. Land acquisition,
excavation, extraction, crushing, screening and washing
equipment are necessary in addition to trucks for hauling the
material. A delivery-only sand and gravel business has a lower
start-up cost, which includes dump trucks to haul the aggregate
and loaders to load the trucks.
Sharps sand are coastal and riverine areas. Niger delta areas
like rivers, edo, delta have a stronhold of the business.Lagos
enjoys the pride of place as the leading location for highest
use of sand due to the massive road projects, the housing boom
in Ibeju-Lekki peninsula,Badagry and other fast springing
population and industrial centres.
Sand is vital for human habit and survival, industrial
and social development, and for meeting the consumption need of
our rapidly growing population.
Sand is a naturally occurring granular material composed of
finely divided rock and mineral particles. The composition of
sand is highly variable, depending on the local rock sources and
conditions, but the most common constituent of sand in
inland.There are two typs of sand which are frequently sought
for. They are sharp and soft sand.
We have all types of sand. They are used for various purposes in
the construction of buildings. Equally, the types attract
different prices depending on what you want.
Depending on the season and the demand for sand, a weight of 5
tons can go for N 7,000 to N 10,000.
The Construction industry is one of the largest contributors to
the Nigerian economy; it has created huge opportunities for both
skilled and unskilled labor in Nigeria. It is also one of the
highest employers of labor in Nigeria.
A Shelter is the most basic need of man. Therefore, sharp sand
is a commodity that gets sold easily anywhere across the globe.
This business is also called “waterfront/side” business by local
sand dealers.
The waterfront/waterside business booms with an increasing need
for housing for over 200 million Nigerians. With the increasing
number of structures being built daily and the ever increasing
demand for the commodity, investors in the business are hardly
out of business, irrespective of change in stock market prices,
fall in Naira value, rainy or even dry season.
Areas Where Sharp Sand is dredged in Nigeria
In Lagos state, there are sand mining activities From Epe to
Ikorodu; Lekki to Ojo and Badagry. Most of the lagoons in Lagos
state are dredging site for sand dealers.
In Delta State, sand is mined in Ughelli North, Okpe, Udu, and
Uvwie Local Government Areas, specifically in Effurun, Ovwian,
Ugolo, Uvwiama, Agbarho, Oteri and Ughelli towns. Most river
beds in the Niger-delta area witness sand mining.
If you stay around any major water bodies in the country, you
should have noticed the activities of these local sand dealers.
In River Niger in Onitsha, there are lots of sand dealers.
Any community that situated beside any water body will most
likely be a good spot for sand dredging. Sand can be gotten from
any rivers, oceans, and lagoons around the country.
Waterside/front Business Models
The capital intensive Model
sand dredging machineThis entails an investment of #30 million
Naira to 100 million Naira. Investors who follow this investment
model, invest a lot of money in the acquisition of relevant
dredging machines and equipment. They also invest a lot of money
in the acquisition of government sand dredging license.
Also, a lot of money is spent on the acquisition of an
ocean/river corner to be dredged. Investors will also have to
settle the host community.
Most of these investors sell the sand direct it to big
construction companies by per cubic meter and they also sell to
the sand dealer that have invested lower capitals in the
business.
Investment of this scale will require a business plan and market
research to validate the business idea. You will also have to
build a good marketing team that will help you reach out to big
real estate and construction firms who will buy the sand in huge
quantities.
Low capital intensive Model
This entails the investment of capital between Five million to
Seven hundred thousand Naira. People in this level of the
business, make use of locally made wooden boats.
They purchase sands from the dredgers who own the dredging
machine, and then they come to the waterfront and sample their
goods. they serve as the middlemen between the dredgers and
those who demand sand for their various construction work.
The waterside is where the tippers load the sand and deliver it
to the persons who need them.
Get our Practical Training Guide on Sand and Gravel Business.
The Sand and Gravel
business plan provides a detailed roadmap for entrepreneurs
seeking to dive into the Sand and Gravel Industry in Nigeria.
The plan offers an in-depth analysis of essential commercial
elements, equipping you with actionable insights to build a
robust foundation for your venture. It meticulously explores the
nuances of your business idea and considers the local market
dynamics, competitive landscape, and the driving forces behind
market growth.
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