The recycling business is beginning to gain ground in Nigeria unlike before. An aspiring entrepreneur can make millions of naira running a recycling business.
In Nigeria, most people still need to be educated about waste disposal because an average Nigerian take sachet water or plastic drinks and throws the nylon or plastic on the road. Hence, there are so much waste all over the country blocking drainage and making the country dirty.
If you are considering venturing into the recycling business, you will not only be running a profitable business, you will be carrying out community service and contributing to the health improvement of Nigerian citizens. The recycling business is a win-win opportunity for you and the environment.
In this article, you will learn everything you need to know about starting a recycling business. If you dutifully follow the steps highlighted here, you will run the business like someone that has been specially trained for it.
The major requirement needed to start is to select the recycling business idea that interests you and start working on it immediately. However, you must know that there is stiff competition in recycling business, so you will need to be knowledgeable about the business to stand tall amidst competition.
What Is Recycling Business
Recycling business involves the refurbishment of waste products or materials to create new, useful products.
Pros of Starting A Recycling Business
1. It helps protect the environment
If there was no recycling, waste products would have been burned or ended up in the landfill. Thereby, causing harm to the environment.
2. It conserves natural resources
Recycling waste reduces dependence on raw (natural) resources, which are already massively depleted.
3. It creates job and business opportunities
In recycling, people are employed to collect, sort, and handle machines. Hence, you are creating job opportunities for the unemployed in Nigeria.
4. It is profitable
The recycling business is lucrative in Nigeria because there is an existing market for it. As many people live below the pyramid in Nigeria, recycled, yet good products will appeal to them.
Steps To Start Recycling Business
Step One: Find A Niche
As mentioned earlier, the recycling business is a competitive business venture. Therefore, if you are starting small, it is advisable to find a niche that is not too saturated but in demand.
To achieve this, conduct thorough market research to investigate what recycling businesses already exist in your area. Also, find out how they are able to sell the materials and the pricing system they use.
There are hundreds of recycling businesses in Nigeria and you need to select the best to invest in. Here are some of the most common recycling businesses in Nigeria:
1. Waste Or Garbage Recycling
Actually, this is one of the most popular recycling business ideas. Waste recycling is the processing of used materials into new, useful products.
It uses less energy and it’s a great way of controlling air, water, and land pollution. You can recycle the wastes from homes and businesses, picking up their bins on a regular basis.
Waste items that are usually recycled include:
a. Plastic Waste – This include water bottles, plastic bags, rubber bags, plastic wrappers, etc
b. Paper Waste – This include books, magazines, newspapers, cardboxes, envelopes, etc
c. Glass Waste: This include broken bottles, beer and wine bottles
d. Aluminium Waste: This include cans from soda drink, tomato, fruit cans and other types of cans
2. Printer Catridge Recycling
New printer catridges can be quite expensive and many people cannot afford it. Hence, recycled catridges is the alternative they opt for. A simple cleaning and refilling process will provide you with a good profit.
3. Tire Recycling
In Nigeria, used tires are found on almost every street. You can find them in landfills and other areas. Recycling them holds great profit potential. However, it is sometimes difficult to find the right companies to work with but with good research, you can find the right companies to partner with and start recording your profit.
4. Wood Or Timber Recycling
This is the process of turning waste timber into usable products. Wood recycling dates back to the ’90s and it’s still as profitable as ever. You can get recyclable wood from construction waste, demolished buildings, old furniture and other similar sources.
5. Scrap Gold Recycling
Without mincing words, gold recycling is one of the best business ideas to venture into. Interestingly, gold is easy to melt and does not lose its purity even when used repeatedly. More than that, gold recycling is cheaper and better for the environment than mining new gold.
6. Electronics Recycling
Usually, it is not everybody that can afford new electronics. Some don’t even go close to new electronics, hence, you have a ready market for your new business. All you need to do is purchase scrap electronic devices and sell them to recyclers for profit. Some of the electronics you can recycle include mobile phones, laptops, computers, television, and other types of electronics.
After selecting a niche, you can either collect the recyclables and sell to recyclers or recycle them yourself and resell. The former is good if you don’t have the required capital needed to get recycling equipment and machines.
Step Two: Create A Budget
The amount needed to start your recycling business depends on the size of your business and the kind of operation you want to run. Most importantly, you will need to budget for licensing and permits because you can hardly run a recycling business without them.
Additionally, if you are quitting your job to start recycling business, endeavour to set aside some amount of money that will cater for your running expenses for at least a year or two. This is because the profit may not come immediately as expected.
Other expenses to bear in mind
- Business registration
- Vehicles to haul recyclables
- Storage space for your recyclables
- Employee salaries
- Machineries to process recyclables
- Money to pay people for their recyclables
Step Three: Create A Business Plan
Recycling business requires a thorough business plan to begin. All the research you conducted will help you write a detailed business plan. A business plan is a formal document containing the details of how you will run your business.
With your business plan, you can apply for funding and grants to start out your business. There are different sections that must be included in your business plan.
- Your company’s goals and objectives
- Market research and fesibility study
- SWOT analysis
- Competitive advantage
- Financial projections
- Marketing strategy
Step Four: Get Capital For Your Recycling Business
Once you’ve estimated the needed amount to start your recycling business with, the next thing to do is to source for a way to get it. You have different funding options. One of the funding options available to you is to obtain a bank loan. In reality, small business owners find it difficult to obtain loans from banks because of the inability to provide the required documents or collateral.
However, there are several funding options; friends and family, angel investors, venture capitalists, international grant opportunities, etc. In most cases, the requirements are to submit a detailed business plan and other documentation about your business.
Investors want to be sure you understand the business you are venturing into. Hence, your business plan should come in handy in this step. On the other hand, if you have enough savings to begin, then you can move to the next stage.
Step Five: Register Your Business With CAC
In Nigeria, the recognised body for registration of new businesses is Corporate Affairs Commission (CAC). It is important to register your recycling business as soon as you start so that you don’t encounter challenges and harrassment from government officials when you begin operations.
First and foremost, choose your business structure. Do you want to register as a sole-proprietorship business (Business Name) or as an incorporated entity (Limited Liability Company)? You can also register the business as a social enterprise (NGO).
The cost and requirements for both are different. But, you can start out as a business name owner and later upgrade to a limited liability company as you grow.
The registration procedures are easy and can be done online via CAC’s portal. Alternatively, you can hire a lawyer to handle the registration process for you because most aspiring entrepreneurs encounter challenges completing the registration themselves.
One of the trusted firms known for offering business registration service at a low price is ReDahlia, located at 43B, Emina crescent off Toyin Street, Ikeja, Lagos. The good news is that your distance is not a barrier. They can carry out the registration process for you and deliver the certificate to your preferred location.
Step Six: Obtain The Needed Permits And Licenses
The recycling business deals with the environment so, it attracts certain licensing and permits before establishment. Therefore, endeavour to get all necessary licenses and permits before you begin operations.
For instance, one of the bodies that issue recycling license in Lagos is the Lagos Waste Management Authority (LAWMA). Once you get licensed with them, your name will be listed on their website stating the category you belong to and your certificate number.
Apart from LAWMA, ensure to research other regulatory bodies in the recycling business. This will help save you the embarrassment melted out by law enforcement agents.
Step Seven: Acquire The Relevant Equipments/Machines
At this point, you are ready for business and you cannot run your recycling business without equipment or machines. Hence, you need to purchase them.
If you are on a lean budget, you could go for equipment leasing or partner with recycling companies that are willing to work with you. The niche you choose will determine the equipment or machine to purchase.
Generally, the equipment you need includes: scales to weigh your plastic waste, bins, sorting and grouping equipment, washing gears, etc.
If you are working with larger recyclables, you will need shredders, pulverizers, granulators, and other size reduction machines to break down materials
into smaller sizes.
Other equipment include:
- Vibrator feeders
- Magnetic separators
- Baling machine (Vertical balers, horizontal balers, two ram balers, etc)
- Metal Shears
Another way to make money from your equipment is to lease them out to recyclers and collect hire fee in return.
Step Eight: Acquire A Space Or Land In A Good Location
The recycling process begins with the collection of materials. For instance, you can collect recyclables from people’s homes, waste management companies, dumpsters at commercial facilities like office buildings and warehouses, industrial facilities, etc. Thereafter, these recyclables will be taken to recovery center (your acquired space) for further processing.
It is important to have your business location where people are most inclined to drop their recyclable wastes. That way, people can freely bring their recyclables to you.
Importantly, ensure your chosen location is approved for such a business. You can approach your local government to find out if your proposed location is approved for your kind of business to avoid future challenges.
Asides from having an open space for material processing, you can also get an office to secure your equipment against theft.
Step Nine: Hire Employees
The employees you need in the recycling business are broad. When you begin, you will need people that will help you with the collection of recyclables and there’s no limit to the number of persons you can employ.
The good part is that they don’t have to be permanent employees. They can work on a commission basis. Additionally, you will also need some full-time employees that will handle the machines and day to day affairs of the business.
Step Ten: Promote Your Business
There are many manufacturing companies in need of your recycled materials and now is the time to reach out to them. Advertisement is the oil of your business and you mustn’t joke with it.
Although waste management is very lucrative, you may not mine the money in it if you don’t have a good marketing strategy in place. The good news is that marketing has been made easy in this century with the advent of the internet.
Apart from setting up a website for your company, ensure you open a page across social media platforms. Additionally, there are other ways to promote your product such as word of mouth, newspaper advert, collaborations and partnerships, etc.
In conclusion, before investing in any type of business, it is important to know everything about the business. Therefore, in addition to all you’ve learned in this article, it will be nice to intern at an existing company or get mentored by someone already in the business. That will give you practical knowledge and experience about the business.
Are you running a recycling business or working on starting one, we will like to read your thoughts in the comments.
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