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Cold room business is one of the most lucrative businesses in the SME sector in today’s Nigeria. Every day, some businessmen and women across Nigeria work hard to take advantage of the ever-present need for seafood, poultry products, beef, fruits, vegetables, and the like. In the process of solving this ever-growing challenge of people’s basic needs, they are smiling at the banks.

While most people don’t know that this money-spinning business is lucrative, many Nigerian businessmen and women have become multi-millionaires as a result of investing in the cold room business.

In today’s Nigeria, It is almost impossible for people to eat a meal without accompanying it with fish, meat, chicken, or turkey, hence the demand for more cold rooms to meet these products storage. This business is not as rowdy as most of the businesses out there. From fish to meat, turkey, and chicken, there will always be a need for frozen foods consumption every day in Nigeria.

According to statistics by the Fishery Committee for the West Central Gulf of Guinea Nigerians consume about 1.2 billion birds (mainly chicken and turkey) every year. In the same vein, they consume about 3.32 million metric tonnes of fish annually. These stats are an indication of a huge market environment where both the farmers and businessmen in this line have the potential to make billions in revenues.

Before we dive into how to start the business, let’s see what a cold room is and what the business entails.

cold room storage

What is a Cold Room?

What is a Cold Room?

As defined in my last article, cold rooms also known as walk-ins in a simple language are fridges or freezers with larger storage space. Technically cold rooms are enclosed walk-in facilities which have their internal temperature controlled using refrigerants.

In another word, these are storage rooms with a lower and controlled temperature meant for the storage of perishable goods and products.

WHAT IS THE COLD ROOM BUSINESS ALL ABOUT?

The Cold Room Business entails the storage, preservation, and distribution of perishable food items; direct from the farms to the consumers. Farm produce majorly poultry produce, (such as chicken, turkey, and seafood) typically passes through various distribution channels before getting to the consumers. During this distribution process, a lot of business activities occur.

Now without much talk, let us go into the process of starting a cold room business here in Nigeria.

To start a Cold Room business you have to first be able to determine how you want to run your own cold room business.

chiler cold room

DETERMINE YOUR BUSINESS MODEL

 

Your first assignment here is to figure out how you want to run your cold room business. You can call this a business plan or whatever name you like to call it. When it comes to the cold room business, there are two major ways you could go about it.

  1. SELLING YOUR PRODUCTS

With your cold room, you could go into the frozen food business I.e buying frozen foods products from direct importers or big farmers (for poultry products) and selling a distributor, wholesalers, or directly to the final consumers depending on your capacity. Aside from the frozen foods and poultry business, you can also go into the dairy products business which is another green aspect of the cold room business without much competition. The dairy business involves the sales of fresh milk and yogurts products to dairy companies with ever-increasing demands of their raw materials for production.

2. HELPING PEOPLE STORE THEIR PRODUCTS

Some cold room owners don’t sell anything of their own in the cold room; all they do is focus on helping other people store and preserve their products and they get paid for their service.

Once you have determined your Business model then you can go ahead to make a business plan on how to start the business and make a profit. The following are some important steps to consider when making a cold room business plan If you want to make it big in this business.

COLD ROOM BUSINESS PLAN

1. Do Your Proper Market Survey

Just like any other business anywhere in the world, doing a proper market survey can never be overestimated. This is like the bedrock of your business, which has a way of determining your business success and survival rate. At this stage, you might want to research if there are existing cold room businesses in your area or the area where you want to establish your business. A good way to go about this effectively is speaking to retailers who buy and sell fish, meat, turkey, and chicken of where they source their products in the area.

2. Choose a Suitable Location for your business

When sitting your Cold Room Business in Nigeria, especially Lagos, some major important factors need to be considered. These factors include but are not limited to;

  • Good Motorable road networks
  • Proximity to an industrial area or market area.
  • Availability of Electricity etc…

You need to put these and more into consideration when deciding on your location, and depending on your business model, plan, and capacity, ΒΌ to 1 plot of land space should be enough to start up your cold room business

3. Register your business

Just like any other business in Nigeria, it is important to choose a name for your business and get it registered with the Corporate Affairs Commission of Nigeria. Depending on the scale on which you want to operate your business, you might also need to register your business with some relevant state or local government authorities if you are going to be operating on a large scale like distributorship.

4. Get The Required Equipment For Your Business

As the name implies, a Cold Room is the most important equipment needed to start this business. But aside from the cold room listed below are some other necessary equipment that will be required for the business set-up.

  • Chest Freezer
  • Measuring Scales
  • Safety Equipment
  • Cutting Table, Cutting Planks, Cutlass & Knifes and so on

5. Alternative Power Source

As the electric power supply in the country can not be relied upon for this business, it is of utmost importance to get a reliable stand-by alternative power source (Generator).

6. Find Reliable Suppliers/Importers

For you to excel in the frozen food business or whichever aspect of the cold room business you might want to venture into, you must have a minimum of 2 or 3 major suppliers/importers from which you get your product from. These will help you get the best in terms of prices and varieties of products for sale. There are some major fishing companies around Lagos that we can recommend for you to source your products.

7. Publicity & Marketing

Although the cold room business has its way of marketing itself once you have a reliable service (word of mouth/Referrals), just like any other business we can just rely only on the business marking itself. You should have a planned budget for marketing the business once it’s set up and running, you need to do effective marketing to broaden your chain of customers. You can explore various means of advertisement based on your budget and your business size. Social media is one of the readily available tools that could be used in this regard, word of mouth and referrals also does the magic.

How Much Does It Cost To Build A Cold Room in Nigeria?

I get asked this question most of the time I discuss with prospective clients or intending entrepreneurs planning on starting the Cold Room business. The truth is that there is no straight answer to this question. The price of the cold room machine is variably depending on at what capacity you are talking about. It will cost between 3.5 and 7 Million Naira to build a standard size cold storage room.

More articles on cold room

ABOUT US

Ofin Global Engineering is an HVAC&R Engineering company. Our field of expertise are in the design and installation of commercial cold storage rooms and blast freezers. We have proven track records of providing high-quality customized cold rooms and blast freezer machines that suit our client’s purpose. We also pride ourselves on our consistent completion of projects both on time and within budget.

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To find out more about cold rooms or to book a consultation, contact the Ofin Global team today.

Call +2348063150242 or send your questions and enquiries to “info@ofinglobal.com” and start your journey towards energy-efficient cold room storage. Feel free to visit our website at www.ofinglobal.com.ng

 

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