bebe2: hi NL, i have a bakery in benin city nigeria. it was opened in january and its been run by my sister.
the problem is were are not making a profit.
i spent about 4million setting it up but it has refused to get off the ground.

cost of baking one bag of flour (including other ingredients)according to my calculations is about N11,800.
they are making profit of about N1200 fom each bag after expenses.
this doesnt make sense, i expect to make at least 40% of the cost of making a bag of flour.

we cant even holdon to a baker they come spend 1 month and they are gone.

pls anyone wit experience, can u help wit tips?

bebe2: hi NL, i have a bakery in benin city nigeria. it was opened in january and its been run by my sister.
the problem is were are not making a profit.
i spent about 4million setting it up but it has refused to get off the ground.

cost of baking one bag of flour (including other ingredients)according to my calculations is about N11,800.
they are making profit of about N1200 fom each bag after expenses.
this doesnt make sense, i expect to make at least 40% of the cost of making a bag of flour.

we cant even holdon to a baker they come spend 1 month and they are gone.

pls anyone wit experience, can u help wit tips?

bebe2:

God bless u my dear, everything they will call me, so I thot, open a business and we can all benefit from it.

But am still being asked for school fees and all sorts. I have 4 kids of my own. If I worry about just me and my nuclear family I will be very rich I will holiday all over the world but I have to worry about my nieces and nephews. [/b]I can't ignore them, they were born in my presence, cared for them, fed them bath them, [b]I love them as my own but by the time I pay this pay dat, I start struggling to meet my own bills.

I tire jare

bebe2:

tell me more about this, sounds interesting

strangest: We can set up cctv cameras in your bakery and route it through IP servers for you to be monitoring your bakery anywhere in the world. Lol... Only you that knows how hard to get the money to open a business can successfully control it, others will always see your business as a way to better themselves

uch90: I remember I bought a car sometimes past and gave out for transport business, the experience is not what u want to hear, horrible. The advise is well said your presence 100% matters.

Gooogle:

I like this statement of yours, its obvious one of the reasons for this investment is to help your family.May be proceeds from this business would help them in their day to day issues. I would want to suggest, you hand over the business to everyone of them.Let them understand the size of investment, breakdown how proceeds should be shared and how much is yours at the end of the month. I tell you, every hand would be on deck to make the business work. They would be the directors themselves and make them understand if it fails, then nobody should ever disturb you.

bigheart2013: Yes you can! I asked a similar question before on Nairaland and got very useful tips. Here's the thing.

1. Businesses are established not only for financial profits (cash) but also for economic profits (non-cash), which may be to provide employment ur sister, or to make name, etc. establish which one is more important to you.
2. If you live outside Nigeria never hire a family member or relative to run your business.
3. Don't hire anyone who come to you advertising him/herself or begging for jobs
4. Hire people through a thorough interview process like a real company does. They'll respect the job more.
5. Do not pay salaries. Share the risks by paying only commissions (usually 10% on sales, or about 40% on profits.
6. Commission on sales is more motivating for hard-working people
7. U can also pay a base + commission. Anyone who cannot live on commission is not business-minded. Afterall the owner lives on profit only
8. Have a Bank account with a Microfinance bank (they help small businesses more) not a commercial bank
9. Every dime made must be paid into the bank (and withdrawn if needed)to build cash-flows in case you need loan some day. they should take picturess of bank slips and receipts of purchases and BBM u immediately the transaction is done.
10. Use BBM to stay connected and on top of business. BBM can transmit instant pictures of events & real-time chats as if you are there.
11. Be ruthless, professional, and out rightly non-sense with Nigerians. A lot of fraudulent crappy people out there.
12. You may take a bank loan to share the risk with a local bank, and let part of the loan be management TA (technical assistance), so the bank can provide their own manager to run the bakery professionally as a partner.
13. Another option is to rent out the bakery to a baker who pays you a flat fee every month, just like you will rent out a house you built to a tenant.
14. Every receipt must have the seller's or buyer's phone number on it (not hand-written). make random calls each month to audit or confirm transactions. If they know you call sellers and buyers, they will shape up.
15. Be patient! A business setup in January is not supposed to be making profit by now o!. It usually takes about a year or more to make profits.
16. On marketing use established re-sellers who buy in bulk and pay cash- Supermarkets, bread sellers, restaurants, shops, etc. Don't sell directly to people yet.
17. Please, please, please, hire a lady as a manager, preferably an educated married lady with kids. That's the only thing that works in Nigeria. They may be slow, but at least they won't loot your funds.

18. Ok having said all this. Please fire your sister now if she's not performing. Give her N350k gift to start her life somewhere

All the luck.

bebe2:

The bakery is in ikpoba hill, aduwawa.

Our sales is not great, we just bought a van to help wit distribution.

Bakers are not staying for long we ve been looking for bakery helper for sometime wit no luck.

Once we register the van am hoping sales will increase.

bebe2: hi NL, i have a bakery in benin city nigeria. it was opened in january and its been run by my sister.
the problem is were are not making a profit.
i spent about 4million setting it up but it has refused to get off the ground.

cost of baking one bag of flour (including other ingredients)according to my calculations is about N11,800.
they are making profit of about N1200 fom each bag after expenses.

Hello maaa'm u can thrive successfully with ur business here in Nig. While U re outside, If n only If U mek me the manager of that business. Contact me if u re interested
this doesnt make sense, i expect to make at least 40% of the cost of making a bag of flour.

we cant even holdon to a baker they come spend 1 month and they are gone.

pls anyone wit experience, can u help wit tips?

bebe2: hi NL, i have a bakery in benin city nigeria. it was opened in january and its been run by my sister.
the problem is were are not making a profit.
i spent about 4million setting it up but it has refused to get off the ground.

cost of baking one bag of flour (including other ingredients)according to my calculations is about N11,800.
they are making profit of about N1200 fom each bag after expenses.
this doesnt make sense, i expect to make at least 40% of the cost of making a bag of flour.

we cant even holdon to a baker they come spend 1 month and they are gone.

pls anyone wit experience, can u help wit tips?

Raymondenyi:

Hello maa'm u can successfully thrive in ur business here in Nig 4rm d UK, If n only IF u make me the manager of that business. Should u b interested contact moi.

Virgin Finder: Nigerians are extremely ruinous people, most of them.
They can't be trusted, not even your family members.

By the time you return home to inspect your business, your sister would've built a house, bought 2 cars and opened her own bakery off your sweat.

Who is a fool? How can you stay over and expect someone to do all the hard work for you just like that.

Nigerians are not that human o.

Even under your very watchful eyes, you'll find them trying to defraud you not to talk about when you are miles away.
Madam, you are on a long thing

Rimbaldi:

In my opinion,

1. ur business is still very young and u are too much in a hurry to start making profits. You don't even have the framework on ground yet and u expect profits?

2. Did you formulate a business plan for the venture cos it sounds to me like u just upped and poured money into venture?

3. If u set out with a plan from the onset, then u should know that 2-3 months is not enough to break even. Stick to the plan with only minor adjustments due to operational realities on ground.

4. Our people can be dubious BUT before u start blaming ur sister, how much do u know about how the business is being run?
5. What kind of bread do u make? Who are ur target clientele? What are u doing to reach out to them and get them to patronize u? What incentives are u offering them? Why should they buy less of some other baker's products and more of yours? Or do you expect them to just jump at ur bread? Na ur bread sweet pass for Benin? Ur sales are only as good as ur marketing strategy. Even companies with less than average quality products still make a killing with the right marketing mix.

5. U LIVE IN THE UK AND U CANT SEE THE SALES ADVANTAGE IN THAT EVEN WHEN NAIJA DEY WORSHIP ANYTHING EFFIZY WORTHY? How attractive is your packaging and how appealing is ur bread to the eye? Does ur bread wrapper contain ur uk mobile number as one of customer care hotlines? Do you call customers randomly to keep a tab on sales and for PR purposes?

6. How often are u in touch with ur sister? How many times a day do u call her or BBM her to keep tab on operations? How many of ur workers do u have their contacts and do u reach out to them at all? I don't know ur sister, but I don't think she should run the business. You can let her oversee things generally while she is on a stipulated salary or COMMISSION(preferrable) but not run the business. Employ someone with experience and let her manage the person if necessary. If she doesn't like the terms and conditions, she will look for something else to do with her life or like someone said earlier, give her a parting gift. Get POS machines and let customers pay directly into ur account at the swipe of a card. Do online transfers to an operational account for purchases and sundry expenses.

7. I concur with what Bigheart2013 said in his post and this is just an addition. 4mil is reasonable to start that kind of business but will do a lot more if u planned well ahead. What usually prevails is that people just do a little research and pump money into a business because they have it, and when the venture flops it is easy to blame it on the next guy. A lot of people here who got burnt probably did not do their own research and relied heavily on the info their kith and kin provided them with only the expected profit margin ringing in their ears like door bells. If u want to start a business that would be run by proxy, it is usually best u start and run it urself for a couple of months to really get first hand experience. So I suggest next time u can get a leave, come down to benin and run it for a couple of months, that way u get to know the challenges and strategize on how to surmount them. We have foreigners owning businesses in Nigeria and running them by proxy through the same Nigerians that everyone is quick to call criminals. How do they do it? One way is they employ locals and get their 'brothers'(countrymen)to manage everyone else without really having that power to squander funds. Take Lebanese businesses in Nigeria for example, some of their operations are structured to undergo approval from UAE,Qatar or wherever else their HQ is located and very often, the real management teams make unexpected trips to inspect operations. I know urs is a small scale venture compared to those, but u could take a cue from them. UR REAL PROFIT COMES WHEN U HAVE A STEADILY GROWING LIST OF LOYAL CUSTOMERS. UR FIRST TASK IS TO GET THEM HOOKED ON U.

lumideezle: So my dear to answer your question directly, first things first, temporarily shut down your bakery, get professionals to prepare a good business plan and feasibility study so you can know exactly what you are or have gotten yourslf into.

bebe2:

Hmmmmm ok, wat experience have u got?

bigx: Does your sister have prior experience in running a bakery or is this her first time?

bebe2:
No it's her first time

blink182: instead of you trying to convince her, you are making rubbish of her genuine concerns. Bini people when no de use juju play. I believe u even told a lie by saying you don't believe in juju.

In the long run, you seem more like someone who wants to tell us she has a bakery than someone looking for feasible business solution.

bebe2:

thank u, am giving it 8mths to improve if it doesn't I will rent it out as stated in option 13.

bebe2:

thank u, am giving it 8mths to improve if it doesn't I will rent it out as stated in option 13.

donpata: Like really, most of the people talking here have no experience in baking things. Evryone is running his mouth based on the Nigerian thing we know - Dishonesty. But to the question; Yes, u can run dat bakery even without coming over yourself. Some businesses however require that the owner has a significant idea of how the business operates. I mean, like the bakery, u shouldnt just be a novice in bread production, u must know a bit of wat nd wat 2 mix to get diz or dat. Then all u need to do is to direct ur sister based on the information u are recieving from her. U would only suspect foul play if u dnt trust her in the first place or if she's not acting to ur dictates.

that said, I also run a bakery and i must tell u dat in recent times, bread business profits have deminishd due to the serious hike in price of commodities. I also suffer by making abt 1.5k per bag which is not mearnt to be. Take for instance, a bag of flour sold for 5200 as at early last year; but now, it goes for 7200 (since GEJ hike d import duty 4 wheat flour) nd d prices of bread are not things u could just wake up a day nd change simply bcoz the cost of productn has risen. U nid some cooperation from other bakers so dat evrytin can be uniform. Now dats where ive been suffering coz the members of d bread union in my place aint cooperative. So u see d cycle continues. Anytime theres a loss u suffer it greatly cos d profit margin is so small.

D only way u can break even is if u specialize. The business is so competitive as there are too many pple now on the scene. U nid to consult to improve ur bread greatly so u can invite more distributors. Coz truly, d higher u produce, the much u gain. imagine producing 15 bags a day at a gain of 1200 per bag; dats sometin in nigeria today. bt if u can specialize and produce very standard bread, u could gain at least 3k per bag. With a good distribution network, imaging hw mch u will make by producing just 10bags a day.

contnd later

amdman: [b][/b]

This is more or less what I said earlier. Let the desk top economists and investors talk, but it will not change the fact that profit margin in the business is slim. Therefore you have to constantly innovate to increase production and boost sales. Benin has rapidly expanded in the last few years, so if you know your onions, there are things you can do with that your bakery that will be just amazing. I have tried it in Lagos and the results are just unbelievable!!!

NOTE!

YOUR SISTER MAY NOT BE DEFRAUDING YOU. SHE MAY BE LIMITED BY HOW MUCH SHE KNOWS.