Best Business Opportunities in Nigeria

by Alex Daruty | Aug 15, 2019 | Business Expansion

Business opportunities in Nigeria may seem hard to uncover at first, but when taking a closer look, the country has a high business potential. Whether you are an entrepreneur looking to setup/expand in Nigeria or simply an investor, the country has the potential to provide significant return on investment.

Nigeria business overview

Population: 188.7 million

National currency: Nigerian Naira (₦)

Economic freedom score: 57.3 (ranked 111^th worldwide)

GDP (PPP): $1.1 trillion

Growth (2018): +0.8%

Unemployment: 7%

Inflation: 16.5%

(source: https://www.heritage.org/index/country/nigeria)

Nigeria is one of the major players on the international trade scene. The West African country is the 49^th largest exporter in the world, with a positive annual trade balance of $8.26 billion after deducting imports of $39.5 billion from its total exports of $47.8 billion (2018).

Nigeria’s top 5 commodity exports

Crude petroleum - $36.9 billion
Petroleum gas - $7.39 billion
Refined petroleum - $603 million
Cocoa beans - $504 million
Rough wood - $333 million

Nigeria’s top 5 commodity imports

Refined petroleum - $6 billion
Wheat - $1.09 billion
Raw sugar - $406 million
Rice - $302 million
Palm oil - $199 million

Top 5 business opportunities in Nigeria

We have compiled a list of the 5 best business opportunities in Nigeria. All these business opportunities are fast moving in Nigeria, and considered the ‘safest’ investments, with more than decent ROI.

1. Livestock farming and agriculture

Simply put – Africa holds around 65% of the whole world’s unused land. Added to the suitable climate of Nigeria, farming and agriculture is definitely a lucrative business. Africa’s agriculture business will be worth $1 trillion in less than a decade (un.org). It is good to note that currently, most of Nigeria’s livestock farming and agriculture business are based in rural areas, with low level of automation. With a proper investment in equipment and professional production line, getting in the farming and agriculture sector is a sure ‘win’.

2. Alternative power installation

Sadly, Nigeria is often considered as a ‘superpower with no power’. According to data from the WorldBank, only 54.4% of Nigerians have access to electricity. Power cuts are widespread across the country and the population relies heavily on diesel generators. Electricity supply per Nigerian has barely changed since 2005, while the population has rapidly by over 57 million meanwhile. Getting into the alternative power business in Nigeria would not only help the country, but also drive reliable revenue to whoever is investing. Moreover, since the current power cuts vastly hinder growth, the Nigerian authorities encourage projects aimed at providing reliable power to the country.

3. Logistics/haulage business

With the ever-growing number of business in Nigeria, the delivery business could be one of the most lucrative opportunities with low-end investment. Everyday, thousands of business haul their goods from one location to another. One way to get into this sector is by targeting big companies that need regular haulage of perishable goods, such as farms, breweries and agriproducts. This is a booming business in Nigeria, with more and more investors recognising the need to fill the increasing demand for logistics and haulage.

4.Waste management

For many years now, waste management has become a significant problem in Nigeria. The World Bank states that approximately 70% of waste produced in Africa ends up in a landfill or in water. As the population grows, waste management becomes even more problematic. Savvy Organisations, such as Visionscape, are already banking on this sector – they offer a range of services aimed directly at tackling the waste management issue, such as waste collection, disposal and recycling.

5. Private schools

According to Caerus Capital, around 60 million African students will be enrolled in private schools by 2021. It is well known that the current educational system in Nigeria is facing a tough time providing quality education to its rapidly growing population. Low-cost private education is certainly one of the most profitable ventures one can set up in Nigeria. With more and more private schools emerging, the competition has improved the quality of education and school fees. Nigerian authorities also encourage foreign investment in the education sector, as they look to improve the literacy rate in the country.

3 Reasons to invest in Nigeria

Nigeria is the largest economy in Africa. The country is the number one destination for Foreign Direct Investment in Africa.
The population of Nigeria is set to overtake that of the United States by 2050. This means there is a huge potential market for almost any product.
The Nigerian economy is growing at its fastest pace since a recession two years earlier. The local authorities have been heavily trying to attract and retain foreign investment.

How to get a head start in Nigeria

Let’s face it: running a business on the African continent is very challenging. With local laws getting amended frequently, it may look daunting to many entrepreneurs and investors to set foot in Nigeria.

However, Africa HR Solutions offers a full range of business services dedicated to Organisations looking to get a footprint in Africa.

You can get a definite advantage over the competition by using our services.

Simplest and fastest way in Nigeria to hire people without having a registered entity
We manage the payroll and employment duties
Single solution for all your HR requirements in Africa & a central point of contact for all your queries
Always available for your queries and reports
Full compliance with local legislation’s – expert across Africa
Centralising of payroll functions
Team dedicated to quality and flexibility to meet your requirements
Up to date statutory changes through multiple sources
Professional indemnity and employer liability