How to start pure water (satchet water) production business

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Posted by Felix Okoli on Tuesday August 14, 2012 10:54:51:

Satchet water otherwise known as pure water business in Nigeria is booming and even moreso now than ever before as the price has appreciated to as high as N10 per satchet.

How does one start a pure water business? What are the processes involved?

Well, this is just a brief guideline on the major steps required to start your own satchet water factory and business.

Things you will need
- Company registration (f)
- Land and factory building (f)
- Logo Design and Logo Mould construction (f)
- Satchet rolls and packaging bags (v)
- Raw material supplier
- Treatment tank (f)
- Ultraviolet bulb box (f)
- Water tank (f)
- Borehole (f)
- Automatic fill and seal machines with Ultraviolet bulbs (f)
- Generator(s) (f)
- Delivery truck (f)
- Labour (v)
- NAFDAC approval (f)
- Storage center (f)
- Admin center (f)
- Production center (f)

So for a start, I think you will need the above items on ground first.
(f) = Fixed cost
(v) = variable cost

Getting started with pure water business

1. Acquire a location and construct your factory
For your factory and business. You may need to invest in a land or make use of one you already have. NAFDAC doesn't really like factories located close to residential buildings unless there is adequate space. Make sure it is also not close to any toxic environment or waste land and you can then construct your factory there and also your admin office. It can be a small bungalow suitable for a factory and with good foundation

2. Register your company
Doesn't take much time and cost as you can do it with ease at the CAC office closest to you and you will use your factory location as your permanent business address.

3. Drill your Borehole
Nowadays it is more common to sink boreholes rather than buying from water tankers or using pipe borne water supplies. In places like Lagos, borehole drilling is not at deep at doing one in the north or east where you will have to go deeper. You can easily go for manual drilling which cost about N150,000 rather than machine drilled. I think for Lagos, it is about 120 feet deep by making use of 6 pipes

4. Install machines and pipes
It is better to use copper pipes or plastic rather than other metal pipes. You will need to ensure your borehole is running efficiently and pumping water into the main tank after which it is transferred to an overhead tank and then to your factory where the machines are. The water in the pipe should go through a sediment treatment tank, filter cartridges and then a UV bulb box sterilizer before going to the machines and ensure that water is not contaminated before being packaged by the machine.

5. Produce samples and go for chemical analysis
Your should make a test production after your systems are ready and then test production for a few samples. Test your water and go for chemical analysis to prove they contain no dangerous substances like bacteria, heavy metals and so on. It should be fit for public consumption.

6. Apply for NAFDAC registration
There are guidelines NAFDAC uses before approving any pure water company and you can get more details here: http://www.nafdac.gov.ng/index.php?option=com_docman&task=doc_view&gid=84&tmpl=component&format=raw&Itemid=115

NAFDAC's rule may change from time to time and costs too can change. It shouldn't take more than 3 to 6 months to get approved for a license. With a license, you are ready for business and can start printing your satchets bearing the NAFDAC number.

7. Start production
Once you are a approved, the next step is to start production and you would have to employ sufficient staff to do the job full time.

8. Marketing and Delivery
After your production has kick started, you will need to decide on your market base and know how to reach out to them. You may need to do some introductions and give out products, even on credit and see how they make sales. However the method is to move with your delivery truck and make supply to people willing to buy. After the market has tested your product, they would keep coming back for it and you should give them your contacts in case they want to reach you. So a mobile phone contact and office can be helpful. Some distributors sell in units of 10 bags for N700 to N1000 while they also give out 1 bag free.

Business season
Pure water business has certain season when it booms and when it slows down. The business thrives more in hot weather than cold weather so in Nigeria, it is mostly profitable as sales are much higher during the tropics rather than the harmattan or cold season. It is also more profitable when there is festivities. So expect to make more sales about 6 to 7 months of the year while the rest is mostly slow and you could diversify into other products.

Profitability
Is it really a profitable business? Well I think it is because at a current price of about N100 per bag of 20 satchets, you can sell at least 100 bags a day to make N10,000. In reality however, most producers sell over 500 bags a day to make about N50,000 and for 20 days in a month, that can bring an income of about N1m.

How much do you pay for labour?
It really depends on what the minimum wage is and how many people you have on staff. For a start up company, you can have 2 persons per machine, 2 for loading and 2 for distribution plus one driver. So you can pay about N15,000 for each staff on labour and more for the driver.

Points to Note
Treatment tank: This is a tank like a stainless steel tank where water from your main tank has to pass through to remove sediments and it consists of layers of stones and activated carbon. Activated carbon helps to remove the taste.

Filter cartridges: These are white porous cartridges that allow water to pass through and further clean the water of debris and sediments, some of which the eye might not see. It does not kill bacteria but just makes the water clearer.

UV bulbs: These are ultraviolet bulbs that woulb have to be installed on your system to actually kill bacteria and other micro-organisms that are harmful to man. You may have to install one to clean the water and another one in your machine(if it didn't come with it) to sterilize your satchet rolls before sealing.

Comments:

Re: How to start pure water (satchet water) production business Reply by famous on Tuesday August 14, 2012 at 23:45:51:

Thanks for the info!

Re: How to start pure water (satchet water) production business Reply by Ajamu Adedayo on Wednesday August 15, 2012 at 5:30:14:

Thanks so much for this wonderful info. God bless you

Re: How to start pure water (satchet water) production business Reply by vanessa foods on Wednesday August 15, 2012 at 13:58:25:

I like all your articles,as an entrepreneur I have learnt quite a lot,please I need you to talk about runnin a cold room ie selling frozen foods.thank u

Re: How to start pure water (satchet water) production business Reply by Mr Uyi on Thursday August 16, 2012 at 14:57:3:

Dear Felix Okoli

What a great write up on pure water Business.
This site is very educative and informative, pls keep the good work.
Pls can you give me the minimum start up capital to start this business, excluding land.
Thanks

Re: How to start pure water (satchet water) production business Reply by Felix Okoli on Thursday August 16, 2012 at 14:57:3:

I think N5m would be more than sufficient if you already have land.

Re: How to start pure water (satchet water) production business Reply by Akinsipe on Wednesday August 22, 2012 at 4:33:14:

Pls how much will it cost me to start this business

Re: How to start pure water (satchet water) production business Reply by Thompson on Tuesday September 4, 2012 at 14:22:55:

great work from you sir.
with the exclusion of land,structure,and the delivery van how much will it cost one to start up this business talking about the machines or its equipment. also,do you have any idea business registration will cost.
thanks so much.

Re: How to start pure water (satchet water) production business Reply by EMMANUEL JODO on Wednesday November 21, 2012 at 9:39:17:

LIKE HOW MUCH DO ONE NEED TO START UP PURE WATER BUISNESS? I MEAN AN ESTIMATE OF THE TOTAL AMOUNT REQUIRED.

Re: How to start pure water (satchet water) production business Reply by Felix Okoli on Wednesday November 21, 2012 at 9:39:17:

If you already have land, I think N3m more would do as land and factory setup costs are the main issues. Machines are around N200,000 to N600,000.

Re: How to start pure water (satchet water) production business Posted by GOLD AYINKE on Monday June 2, 2014 at 16:53:41:

TNKS & MAY GOD BLESS U.
Today is the 2nd of June, 2014!

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