ncolumella:
Dear Entrepreneurs

would you be interested to startup a business which has a guaranteed return on investment within one year of
operation?

if yes, then click on the link below

www.nairaland.com/2392421/lpg-home-delivery-service-business#34953410

ncolumella:
click to read more

ncolumella:
click link below

www.nairaland.com/2392421/lpg-home-delivery-service-business#34953410

ncolumella:
Most LP Gas cylinders in service worldwide are made of steel and fitted with brass valves. In Nigeria, the most commonly used cylinder carries a 12.5 kg fill and the tare weight is in the range 14–17 kg, that is, up to 30 kg when full. The weight is a problem for anyone who needs to carry it. The steel is subject to impact damage and to external corrosion and the consumer cannot see the contents. The weight problem has been addressed in other countries by the use of stainless steel and aluminum to replace mild steel but there is a cost penalty. Smaller capacity cylinders have been introduced in many countries, including Nigeria, but while they are lighter they require more frequent refilling.

ncolumella:
Clearly, a growing LP Gas market will require additional cylinders. There are advances in cylinder technology, which will be explored. Irrespective of technology, funding will be required for new cylinders and to bring existing cylinders (where practical) to an acceptable standard. Neither the industry nor its customers can be expected to bear this burden without assistance. However, a project to produce composite cylinders at competitive prices in Nigeria would benefit from growing regional markets, in addition to growing domestic demand.

ncolumella:
The existing LP Gas road tanker stock is in generally very poor condition and is inadequate to cater for an expanding buoyant market. In general the industry needs newer, safer tankers and the services of capable haulage contractors to participate in a rational pattern of primary and secondary road transport distribution. The responsibility for primary transport of LP Gas to the primary depots should be taken on by the company, or companies, operating the depots. Debottlenecking in the port of Lagos will require government intervention. It will be the responsibility of the marketers/ distributors to organize their own transport from the primary depots to their own filling plants throughout the country.

ncolumella:
LP Gas is sold on a self-collect basis and, for urban and peri-urban dwellers, is normally available within about 10 minutes (by vehicle). Kerosene availability is within about 5 minutes.

obinna2nv:
Hmmm, this looks like an "explosive" business prospect. Lol...

ncolumella:
One of the principal barriers to switching to LP Gas for potential customers is the initial cost of the equipment. One cluster in the urban middle-income group stated that they had access to credit. On enquiry however, it was established that these respondents all worked in the same organization and that the staff had set up an incompany cooperative. The majority of respondents did not have access to consumer credit and the survey did not disclose any microfinance or easy payment system which could be relevant to the acquisition of LP Gas equipment.

ncolumella:
A disturbing number of existing LP Gas consumers thought that the product is not safe and this perception extended to nonusers also. Respondents quoted both direct and anecdotal accident experiences.

ncolumella:
Obviously, a range of household LP Gas appliances to meet different needs and budgets is essential for new consumer formation. However, demand will be limited until consumer confidence in LP Gas is reestablished. The initial cost will present problems, particularly in extending LP Gas access for the poor. Much can be learned from experience in other countries about the design and manufacture of household appliances adapted to local cooking practices.

ncolumella:
good morning

ncolumella:
Below is an overview on how to set-up this business.

■ Overview
=========
Propane or liquefied petroleum gas (LPG) popularly called "cooking gas" is a hydrocarbon produced from natural gas
and crude oil refining. A nontoxic, colorless, and odorless gas, the 1990 Clean Air Act and the Energy Policy Act of
1992 approves propane as one of the cleanest burning of all fossil fuels and Nigeria has this gas in abundance.

To start a propane home delivery business entails purchasing portable propane cylinders from manufacturers or bulk
dealers, storing the cylinders, and selling them to retail customers such as homes, restaurants, farms and others by
delivering them to the customers door step.

The core of the business is developing a customer base and delivery of the standard 12.5kg propane cylinders to
residential homes, and delivery of 50kg propane cylinders to commercial clients such as restaurants, caterers
construction companies, hotels and office complexes based on order.

This business is very profitable in Nigeria and currently, gas is been purchased from the refilling plant between
N1900-2100 and then resold for N3000-3500 making a profit of over N1000 per 12.5kg cylinder.

■ Business Scope
===============
Propane is often cheaper than electricity , convenient for use, and available in abundance. Such factors account
for its widespread use for cooking in over 40million homes in Nigeria and establishments.

The major uses of propane are:
1. In homes and commercial establishments majorly for cooking, heating swimming pools, operate furnaces, water
heaters, air conditioners, outdoor grills, washing machines, and other appliances.
2. To fuel vehicles. Refueling propane and gasoline vehicles take the same time but the cost of propane is
typically less than conventional gasoline.
3. To fuel cooking appliances, such as those used in restaurants.
4. To operate propane-driven forklifts and fleet vehicles.
5. To control pests, dry crops, and power irrigation pumps on farms.
6. To cook food out-of-doors and power outdoor devices.

■ Exploratory Study
================
Every business has its own particular challenges and obstacles, and a propane distribution business is no different. The entrepreneur first needs to undertake a SWOT analysis and prepare a BUSINESS PLAN to start a propane business.

The exploratory study for a SWOT analysis and BUSINESS PLAN should include:
1. Understanding how the industry functions, including capital required, profit percentage, average expected cash flow and the like.
2. Identifying wholesale distributors or refillers of propane. The main criteria for evaluating suppliers should be pricing, reliability in supply, and transportation costs.
3. Identifying transportation, and distribution methods. (Type of delivery truck, capacity and distribution route)
4. Identifying storage areas.( A place to store your cylinders)
5. A good understanding of the various regulations, especially safety standards governing propane businesses,
including the entrepreneur’s obligations. (DPR licensing)
6. Selecting an area and identifying the extent of competition in the area. The best approach when starting out is to
concentrate on a particular customer type in a particular area, and then gradually expand the net.
7. Possible impact of future technological breakthroughs and changes in regulations.
8. Estimating start-up costs and cash flows. It may cost between N3million and N6million to start a propane home
delivery business.

One good idea is to seek advice from existing business owners or researchers. People who are in the business in a non- competing area may readily share experiences and provide valuable practical tips and insights often overlooked during theoretical studies.

■ Legal Registration
=================
Once the exploratory study is over and the entrepreneur has a good idea of what the propane home delivery business is about, the next step to start a propane business is securing statutory approvals. Unlike other businesses, legal registration for the propane home delivery business is easy and is not a major challenge in starting a propane home delivery business. Apart from the usual CAC registration and tax clearance, you need to obtain a DPR licence to operate.

A far amount of risk is carried when you start a propane home delivery business. For this reason, the entrepreneur
needs to:
1. Register the business as a corporation or Limited Liability Company to protect the entrepreneur’s personal assets.
2. Purchase insurance. Insurance is mandatory and many permits and license for this business require the entrepreneur to show proof of insurance.
3. Registering for tax purposes.

■ Getting Started
==============
After securing statutory clearances comes implementation of the business plan. This includes:
1. Confirming the suppliers or franchisers and executing an agreement for supply of propane cylinders with them.
2. Setting up of the storage space for propane cylinders and making it compliant with the safety regulations in force.
3. Arranging for trucks to transport the propane cylinders.
4. Establishing office space for administrative tasks including the setting up of computerized inventory, accounting, and order tracking systems.
5. Hiring the required assistants, especially to oversee the propane storage space and deliver the propane cylinders.
6. Establishing retail space by which customers can contact the business. This includes setting up a front
office, making websites, and arranging for telephone numbers and email contact.
Once these steps are in place, it is time to start the business. The order quantity and inventory depends on the
business volumes. An approximate stock of 100 cylinders should suffice during the initial stages.

■ Advanced Considerations
======================
The following considerations also require attention at the time of starting the business:
1. Providing employees with the required training.(how to handle cylinders, Customers care service & relationships)
2. Establishing a customer base by contacting local homeowners, shops, commercial establishments, farms, and other places that require LPG. The presence of competitors would require either reducing prices than what the competitors offer and or providing some value added service not provided by the competitors.
3. Undertaking various outdoor advertising activities such as purchasing billboard space, distributing fliers, placing
notices at grocers and community centers, using direct mail and search engine optimization techniques.



Click on the link below for more infomation and to purchase our Professional Business plan/Feasibility study on this project. Our business plan comes with a 3years financial report which includes , cash flow, cost & Sale forecast, viability etc.

Cost of business plan: 30, 000

www.nairaland.com/2392421/lpg-home-delivery-service-business#34953410