How to Start a Profitable Ecommerce Business in Nigeria

If I told you that you could launch a profitable ecommerce business in Nigeria today, would you think I was crazy? 

Well, the simple truth is, you can!

With the consistent rise in the number of smartphone users and internet penetration in Nigeria, the ecommerce industry has witnessed enormous growth since 2010.

Even more, data have shown that the e-commerce and m-commerce industries are set to record higher growth in the coming years.

You can start an ecommerce as a side business while working full time in Nigeria.

1. Identify a High-Potential Product

The first step to building an e-commerce business is knowing what product you want to sell. There are several things that come to mind when deciding what your product offering will be.

You might want to know the global market demand, high margins and easily it can be warehoused and fulfilled.

There are numerous free tools to help identify hot products; they include Google Trends, Amazon Best Sellers and eBay Top Products.

With these tools, you have the resources to find out the current hottest products. Smart ecommerce experts know how to spot a trend earlier.

The earlier you can spot a trend in product opportunities, the higher your chance of turning it into a thriving ecommerce business.

The general rule of thumb is to pick a niche and product you will be interested in because you will be investing a lot of time, energy and resources to set your ecommerce website.

The more passionate you are, the easier it will be to succeed in online business.

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2. Lockdown a Supplier

You might have a great business idea and tons of website traffic, but if your supplier cannot keep up with your demand, your business strategies are dead on arrival.

Great communication is a key success factor, especially if you are contracting an international supplier that you identify through a resource like Aliexpress.

The first thing to do is to have a list of potential suppliers you wish to partner with. Then go ahead to ask them precise questions to unveil their capacity to supply. Anyone that is unable to answer those questions should not remain in the list.

In the end, you should have half a dozen suppliers to engage with in more detail. Cost shouldn’t be the determinant alone, communication should fill a greater part of that process.

This will result in a 100 per cent confidence in the suppliers that you will eventually sign in.

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3. Decide a Business Name and Secure Your Online Presence

Besides figuring out what to sell and who the supplier should be, another challenging decision is deciding your business or brand name and choosing a suitable and available web domain name. 

Your business name needs to be not only easily remembered and appealing to your customers, but it also needs to have domain name availability and social media handles.

It is best to go for the dot-com version always, even if it requires you paying for a premium fee from a domain flipper.

It is important to have the dot-com available and also available on all the social media platforms you wish to use to promote the brand online.

As soon as this is confirmed, then the brand name is finalized. You are likely to run into challenges deciding your business name, in such a situation, you can try Shopify’s business name generator tool.

See Also: 12 Biggest Facebook Ads Mistakes To Avoid in 2020

4. Build Your Ecommerce Business Website

It is time to build your online store.

If you have been following closely, you must have realized that an online store is a major requirement to start an e-commerce business in Nigeria and anywhere in the world.

Because you need an online presence where customers can do business with you. Perhaps you cannot afford to hire a web developer, you can begin with a free WordPress site, then upgrade to a pro version as the business grows.

Also, there are numerous platforms like Shopify, Bigcommerce and WooCommerce that helps you set up an online store from the scratch without you having web designing skill. So, you can start with that as well.

In Nigeria, established e-commerce marketplaces like Jumia, Konga and Kara offer you the platform to start your online store. With these platforms, you have access to marketing and other logistics.

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5. Set Up Your Fulfilment and Shipping Method

One benefit of the e-commerce business is that you can sell your products to people in different locations at the same time. However, this depends on having a good delivery system.

Your delivery system can determine the credibility of your business in the marketplace. On-time delivery encourages customers to score good reviews for the brand and in turn convinces more customers to do business with you.

Hence, it’s vital to partner with reliable and established logistics companies. One of the smartest options is to acquire your own delivery bikes and hire people that will ride them. 

This method is more cost-effective especially when you are running a payment on a delivery model for the business. In such a situation, you do not need to bother about how to get the payment at the point of delivery.

Popular Logistics Companies for Nigerian Businesses

1. FedEx Nigeria
2. GIG Logistics
3. Ocenj Logistics
4. Courier Plus Services Limited
5. DHL
6. Creseada International Limited
7. AGS Movers Lagos

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6. Setup Revenue Goals

You can’t launch into ecommerce business without establishing desired revenue. What is the cost of your product, per unit, doorstep delivery?

What are your shipping costs for different locations, as well as all fulfilment components, such as employees, software, packaging, etc.? 

It is extremely important to have specific revenue goals, down to daily goals. If you sell products with an expiration date, so achieving those goals helps to ensure you don’t get stuck with unsellable inventory. 

In addition, find ways to cut costs. It can be a way to skyrocket your revenue as your sales volume increases. “If you are doing a lot of volume in transactions, don’t be afraid to negotiate a better rate with your processing company,” says Benjamin Velner, CEO of Merchant Scout.

See Also: 10 Common and Costly Google Ads Mistakes To Avoid in 2020

7. Design a Marketing Plan

At this stage, you have a product and a website, the next step is to figure out to reach your target audience with your offering.

To start generating sales immediately, create a Facebook ads campaign that also includes Instagram. Influencer marketing is an effective way to drive online conversion.

It is good to have your marketing plan include long-term elements of digital marketing such as search engine optimization, but you need to direct your focus towards generating sales right now for you to scale quickly and generate revenue.

Ensure you track and measure everything — this involves setting up your conversion pixels and events to know the channels that drive the most conversion.

The more data you are able to track, the easier it is to optimize your campaign, create targeted ads and also make an informed decision.

See Also: 10 Sure Ways to Make Money Online in Nigeria 2020

8. Launch Your Online Store

Here is the best advice you can get when it comes to starting your ecommerce business: do not wait for the perfect time to launch. As the business grows, you are going to need to constantly test, learn and make changes — it’s never going to hit perfection.

Be eager to split-test different aspects of the business; from the product page to your campaigns. Never let excuses or fear hinder you — you can only tell how viable the business is when you launch.

Successful ecommerce businesses have their various failure stories that eventually led to success. Be ready to fail but don’t give up – try again and again.

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