Starting a furniture business in Nigeria is a lucrative business idea. Individuals and businesses build buildings and structures of different shapes and sizes daily. There is a constant need for a furniture piece, be it a table, chair, wardrobe, bed, kitchen cabinet, or even a wooden decoration.
Nigerians are constantly trying new things, including new and beautiful furniture. People want a masterpiece and luxury furniture like never before. It has led to the evolution of the furniture-making business. It is beyond the use of ordinary wood or inferior materials for production.
As such, furniture making is constantly in demand, thus making it very lucrative. The more lucrative a business is, the more competitive it becomes. There are a lot of carpenters and wood designers in this industry, so it will take a lot of strategic thinking to win against the competition.
The majority of Nigerian furniture manufacturers are starting to arm themselves after realizing these new realities. They are learning to make custom-designed furniture to meet and surpass international standards.
Table of Contents
Things to Consider When Launching a Furniture Business
- The price of setting up your company; covers things like business planning, advice, and registration.
- Permits and licenses issued by authorities
- The price of purchasing a warehouse and a showroom
- Materials and equipment expenses
- Payroll costs 6. Advertising and marketing costs
- The price of developing a business strategy or building a website (if you cannot do it yourself)
- Training expenses
Starting a furniture business doesn’t mean you necessarily need to be a carpenter. There are primarily two types of the furniture business industry and they are;
In this branch, you (or your skilled employees) make the furniture and sell it directly to customers. You are in the full stack furniture business, which involves acquiring the raw materials and converting them into finished products on one side. Then you handle the sales and marketing section of this business on the other side to generate revenue for your business.
This branch is usually complex because you have to deal with momentary losses and difficulties, but there is no doubt that you will make the most gains if you take this route in the furniture business.
Buying And Selling of Furniture
This involves buying furniture from a manufacturer and reselling it for a profit. It does not require much capital to start. You could purchase furniture from local companies or import from foreign companies and resell it to new and existing customers and make a profit from it. All you need is a showroom, a good location, and a good marketing strategy.
How to Start a Furniture Business in Nigeria (Step-by-Step Process)
- Target Market Research
- Picking a Niche
- Business plan Development
- Register your business
- Raise Capital for Your Business
- Getting an Insurance
- Intellectual Property Protection
- Hiring Competent Manpower
- Acquiring Necessary Tools and Equipment In Furniture Making
1. Target Market Research
Some may say that it is important to select the niche first before you do the research for your target market. In reality, however, it is important to do your market research to know the kind of furniture that is in demand and what is not.
It is also important to keep up with the trends as well as your potential competition so you know what they are lacking and you include it in your designs, making it your unique selling point and also how to make the most profit from each niche.
Deciding on a niche does not mean you do not keep an eye on other niches, do your research and tread carefully so that you know when to switch and when not. Your choices ought to be adaptable.
The tastes and styles of people differ from one another. Getting to know the desires of people will help your furniture business as you will be able to sell the right services to the right people as such, generating revenue for your business and also helping you outperform your competition.
2. Picking a Niche
Before starting your furniture business, it is important to pick the niche that you wish to be known for, and the type of furniture which your business will represent. If you wish to generalize, your business will not go far. Picking a niche goes as far as selecting the kind of materials you will work with.
If you fail to pick a niche, you fail to have a business. Picking a niche helps you determine the kind of market you will be selling to. It also determines if the demand and purchasing power of this target market is high. Picking a niche also decides if your services will be to the local market, the foreign market, or both. This will help you create a more effective business plan.
3. Business plan Development
After selecting your niche, the next best thing is to craft a business plan. It is a known fact that a person who fails to plan, plans to fail and this holds especially in a business setting. Every potential furniture business owner needs to create a business plan because it will help them commit their ideas and plan to writing, providing a direction that will lead them to a successful business.
The primary content of a business plan is your medium and long term as well as your business objectives and your intent to make these goals a reality. The power of an irresistible business plan is usually underrated. It not only grants you access to funds from investors, but it also helps you stay focused on the path leading to your goals.
If you do not know how to write a business plan, get someone who can. However, it is best to create your plan yourself. You can study business plans online and slowly create yours. You don’t need to rush when creating these plans, it should be done slowly and taken one step at a time.
A typical business plan includes:
- Executive Summary– a brief overview of your business idea
- Business Description– a detailed information about your business concepts, mission, and vision
- Market analysis- Analyze the market by conducting competitive and target market research.
- Organization and Management- details about your company’s structure, key team members and their duties
- Product or Service Line- a description of what you are offering and its benefit to customers
- Marketing and sales- containing strategies for promoting and selling your product or service
- Fund requesting- This is added to the business plan just in case you are seeking funding, outline your financial needs
- Financial projections- projected financial statements, including income statements, balance sheets, and cash flow statement
- Appendix- any additional supporting documents like resumes, permits, or market research
It should be noted that the exact structure of a business plan varies, but these elements are commonly included to provide a comprehensive overview of your business
4. Register your business
Registering your business name with the Corporate Affairs Commission in Nigeria will enable your company to be recognized as an independent entity distinct from its owners. This will make potential clients and customers more eager to work with you. You can register your company as a limited liability company.
Requirements to Register a Business
The applicant must first select two appropriate suggested names for the business. When this is done, the CAC web portal will be checked for availability to make sure the name is free and not currently used.
Choosing the type of company to be registered guarantees limits whether a private limited company, private unlimited company, or company. The objectives and business of the company must be provided. The registered principal address of the company.
It will be necessary to determine the share capital and the procedure for shareholding among shareholders.
It will be necessary to have the details of at least two (2) Directors. A copy of their means of identification, such as a voter’s card, national ID, driver’s license, or international passport.
Information about the company secretary (a director may serve in this capacity): The applicant must provide information on the company’s shareholders. Details such as names, occupations, residential addresses, email addresses, mobile phone numbers, and means of identification, such as driver’s licenses, international passports, or national identity cards. You should note that the directors listed can also hold the capacity of shareholders in the company if desired.
The above are the core requirements needed to register your business. The other requirements include:
It is essential to have someone with legal expertise create the protocol and articles of organization of the company before registering it.
Then, a consultant will create the necessary incorporation documents. They include:
- Information on the director that has been duly verified and the CAC Form 1.1 declaration of share capital.
- Duly stamped Memorandum and Articles of Association.
The individual completes all the incorporation documents with the input of an accredited lawyer, who duly attests to the incorporation documents.
The required payments must now be made online, and the legalization paperwork must be promptly stamped online.
Now, in preparation for the commission’s final examination, the stamped incorporation paperwork will be properly posted into the CAC web portal.
If all the incorporation documents are well completed and executed, the commission will immediately incorporate the company and issue an incorporation number online. It normally takes less than 48 hours for the consultant or attorney to get the Certified True Copies of the other paperwork and the Certificate of Incorporation from CAC.
5. Raise Capital for Your Business
Capital is the backbone of a business startup. Without sufficient capital, you cannot own a business. To scale your furniture business in the shortest time possible, you will need a lot of equipment and materials and most of these materials are not cheap.
There are various means to raise capital for your furniture business, some of them include:
- Self-financing: Capital provided by the business owner. You are in charge of ensuring that the business has enough capital to run.
- A grant from governmental bodies
- Loans from banks or cooperative society
- Funds from family and friends
- Investors: If your business plan can convince your potential investors that your furniture business is worth it, they will happily invest millions into your business. For this reason, having a good business plan is crucial.
6. Getting an Insurance
When dealing with furniture, there is a tendency for an accident to happen. This may be a result of dealing with inflammable materials. This includes paint, fabrics, and so on. Some of your employees are also prone to be involved in an accident.
It is something that could happen at any time. To minimize losses, it is important to acquire insurance protection for your business.
7. Intellectual Property Protection
This is another important procedure to undergo when starting a furniture business in Nigeria. This is very helpful, especially when you are dealing with ideas and designs. Since your ideas and work go into designing various pieces of furniture, acquiring intellectual property protection will help you secure your originality and uniqueness.
It helps keep other brands and competition from stealing and reproducing your ideas. It also keeps them from making money off it without your knowledge and permission. This intellectual property protection is of 4 types namely:
- Copyright protection
- Utility patents
- Design patents.
8. Hiring Competent Manpower
The kind of manpower you have can either make or break your business. Hiring manpower depends on the type and size of your business. It is not compulsory to have carpentry or wood design skills and experience before you own a furniture business.
You can employ specialists or some trade jackets (if you don’t have the luxury to employ specialists in every area) that will handle all furniture manufacturing processes. To ensure that your business runs smoothly, you need these kinds of staff:
- Arm makers
- Hand carvers
- Furniture finishers
- Cabinet makers
- Quality control inspectors
- Product testers
- Receptionist or Secretary
- Marketing officers
- Product designers
You can acquire the above-mentioned personnel through the following ways:
- publishing a job announcement on your website, in social media, and by email marketing
- enquiring of friends, family, and members of your business network about possible candidates
- Adding the vacancy to general recruitment websites
- Advertising the vacancy in industry trade media or local newspaper
However, if you are skilled at making furniture yourself, you can start alone, but as the business grows, you want to employ experts who will work with you.
9. Acquiring Necessary Tools and Equipment in Furniture Making
A farmer cannot go to his farm without his tools. In the same way, a furniture business won’t make revenue if there are no tools and equipment to produce various furniture. There are several tools and equipment needed to produce this furniture.
The kind of furniture and designs you wish to specialize in will determine the kind of tools and equipment that you will need.
How to Scale Your Furniture-Making Business Quickly
1. Get a warehouse and showroom in a good location
You should have a warehouse where you conduct all the manufacturing and a separate place where you store the finished furniture for display by interested individuals.
You want to make sure that this showroom is located in an area that passers-by not not ignore can. It’s better to locate it in an area that is flooded with deep-pocket individuals. When they see your work, they will visit your showroom eventually.
If no one sees your work, it does not matter how exclusive it may be, you will not be able to sell a thing.
Many Nigerian furniture sellers sell at the open place by the roadside and they still make good sales. Space is also one of the most important considerations to make when selecting a location for your furniture-making business.
2. Market and Promote Your Business
It is not enough to place your furniture in a good location. If you are not letting people know that they need your furniture, then your business will not generate enough revenue. Play your drums, blow your trumpet, and remind the people that they need a piece of furniture in their homes, workplaces, schools, and so on.
Run paid advertisements, put up signboards and billboards, talk about your product and how it will satisfy the needs of individuals on social media, and let them know. With time, you will have more customers than you can handle.
3. Establish your social media brand
Social media is becoming a completely different universe. The majority of your clientele is active on one or more social media networks. You must, therefore, make yourself visible to them. You have to be social media savvy and business-minded at the same time. Instagram, Facebook, Twitter, Tumblr, and YouTube are good places to start.
4. Network during Major Occasions
It is usually a good idea to start your business with customers who can afford your furnishings and may eventually purchase larger quantities if you want it to grow quickly. Don’t hesitate to introduce yourself, give out your business card, and accept others’’ when you attend such events.
Customers in the furniture industry come from a variety of socioeconomic backgrounds. You interact with people from all social classes. So, figure out how to get in touch with them all. If, however, you solely sell luxury furnishings, then wealthy and well-known individuals should be your target market.
5. Make Connections with Various Businesses
Good locations to start include hotels, government parastatals, churches, mosques, schools, and organizations. Create a brochure outlining your offers, then send it out to these businesses. Don’t simply hand these businesses your brochure. The best course of action is to follow up with the person you come in contact with when you visit these locations.
6. List your Furniture for Sale on E-commerce Websites
List your furniture for sale on websites such as Konga, Jumia, or Jiji.
Use these platforms to launch an online store. You will be able to reach their diverse array of customers. Still, they always take a cut of the money paid to them for the platform.
In addition, there is fierce rivalry, therefore you must set a competitive pricing for your furniture. Many companies that exclusively sell their goods on these platforms generate millions of naira each month. Seize every chance to acquire paying clients.
7. Develop an online store for your company
Not every person will travel to the area where your showroom is situated. Thus, you must develop a website and a mobile application so that customers in the online market can examine your offerings and costs.
Because they will save time and energy, you will attract more clients in this manner. This can help you establish a strong online brand and offer you an advantage over your rivals. You might use internet retailers like OLX if you don’t intend to do this.
8. Secure your Brand Identity
They say a good name is better than riches. A good business name will fetch you customers who will consistently buy from you if you deliver excellent and quality service. With your competence in delivery, your customers will bring you potential buyers who will also do the same. Focus on customer service.
It is also important to brand your products. Doing this will help differentiate your brand from other brands. This makes it easier for customers to reach you if they develop an interest in your product.
Starting a furniture-making business in Nigeria can be a good idea if you do your research and follow the required procedures. Making high-quality and long-lasting furniture for customers is key, and you don’t have to be a carpentry expert to succeed—just follow the steps.
As the furniture business in Nigeria is growing, it is important to keep up with the latest trends to stay successful. Being flexible and creative is crucial for lasting success. Also, sharing thoughts and tips in the comments can help everyone learn and grow together. If you found this helpful, share it with others who might too!