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Making Money Off A Ailing Business: The Palm Oil Business - Business - Nairaland

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Making Money Off A Ailing Business: The Palm Oil Business by OteDOLLAR(m): 11:30am On Mar 20, 2016
When most people hear that palm oil business is very
lucrative, they quickly dismiss the idea of taking a plunge
because starting up a palm oil processing company requires
much more capital than they can ever afford. But the truth is that you too can tap from the opportunities in the palm oil business without necessarily having to set up your own processing company or starting a palm plantation. How? You can achieve this by buying and selling palm oil for profits. In fact, you can make millions just by buying, storing, and reselling palm oil. One of Nigeria’s billionaires, Orji Uzor Kalu started out in business as a palm oil trader and he made millions from this business. Before I discuss the steps involved in buying and selling palm oil for profit, let me enlighten you about the commodity and its marketability. ( I am assuming you do not know anything about it before now. Pardon me if you
already did ).

4 REASONS WHY YOU SHOULD START TRADING PALM OIL FOR PROFITS

Palm oil is a natural extract from the red palm fruit.
It is orange or yellowish red in color, and it is widely
produced in West African countries and in Far East
countries such as Malaysia and Indonesia. In these
countries, it is widely consumed by the natives, and it
is also exported to neighboring countries.
Palm oil owes its huge demand in countries such as
Nigeria and Malaysia in part to its huge population
and health benefits. Palm oil is a good source of
vitamin E, which promotes healthy skin. It is also rich
in carotene, which enhances vision. And most
importantly, unlike most other oils, it doesn’t
promote the accumulation cholesterol and low-
density lipoproteins that are harmful to the body.
Another reason why palm oil sells well in the above-
mentioned countries is its relative cheapness when
compared with other edible oil, and its relatively long
shelf life. With proper storage, palm oil can last up to
one year without losing its quality.
In Nigeria and other West African countries, virtually
every household cooks with palm oil. So, you can
imagine how much profit you can make from the
market in these countries.
With the above in mind, let’s now discuss how the business
of buying and selling palm oil works. It goes without saying
that this business simply involves buying palm oil and
selling palm oil, but there are two methodologies of running
this business; and you are free to choose any of the two or
even combine both.

HOW TO MAKE MONEY BUYING AND SELLING PALM OIL

1. Choosing your palm oil business model

The first model involves buying the commodity, adding
some margin, and selling to the next available buyer.
Though you won’t make huge profits with this model, you
will make smaller profits on a consistent basis. The
downside of this model is that you may be badly hit by
sharp drops in the price of the commodity, which happen
occasionally. But there are two sides to this possibility; you
can make huge profits during occasional price surges as
well.
The second model involves buying during the time of the
year when the commodity is abundant, and selling only
when it becomes scarce. Usually, in Nigeria, palm oil sells
cheapest between February and April ( because it is
abundant during that time of the year), and market prices
go up between September and January.
So, if you buy 1000 liters of palm oil when it’s cheap, keep
it, and sell it when the prices go up, you can make between
100% to 200% profit or even more depending on the
scarcity and on your location within Nigeria. It’s the same
story in other countries where there is huge demand for
palm oil.
In Nigeria, a 20 liter can of palm oil sells for N3,000 –
N4,000 during the abundant season ( depending on your
location). During the scarcity period, that same 20 liter can
goes for N6,500 – N8,000. In Nigeria, palm oil can be
sourced at a cheap price in places such as Edo, Delta, Abia,
Imo, etc and resold at a profitable price in places such as
Kano, Lagos, Kaduna, Abuja, etc. Most times, traders record
huge profits by adopting the second model; but it usually
requires larger capital than the first model. Having
explained the methods of running a palm oil trading
business; let’s now discuss the steps involved in starting the
business.

HOW TO START BUYING AND SELLING PALM OIL FOR PROFITS
1. Get your storage space
You will need to secure some pace for storing your palm oil,
regardless of the business model you choose to adopt. If
you have some storage space right in your home, that
would guarantee rest of mind. But it would be better to
have your storage space close to where your customers are.
So, renting a shop near a local market around you is a very
smart idea. In Nigeria, palm oil is best stored in big blue
drums / barrels, in a cool place away from direct sunlight. It
takes about 8 – 10 (20liter) gallons to fill a barrel.
2. Arrange with suppliers
Aside customers, your business needs suppliers to thrive,
since you are not processing the commodity yourself. Try
to find suppliers that produce high quality palm oil. You
may need to conduct thorough research before making
your choice because the success of your business would
hinge largely on the quality of the palm oil you get from
your supplier. From personal experience, i can say that
good palm oil can be sourced from Imo state in places such
as Ngor Okpala, Ihitte Uboma, Orlu, etc.
3. Decide on transport arrangements
You would need to transport your palm oil from the supplier’s location to your shop or storage location. And in some cases, you would need to transport palm oil to your customers as well. ( In fact, you can make more money by charging extra for delivery. Buyers would readily pay for the convenience ). Most times, palm oil are best transported in gallons and if you are transporting from Eastern Nigeria to either the Western or Northern part of the country, you can use the services of popular transport companies such as The Young Shall Grow Motors, G.U.O Motors, etc. If you have a van or truck to yourself, that would be fine. But if you don’t have one, you would need to hire one each time you need to transport your commodity.
4. Market and sell your product
To make profit, you need to find buyers for your product.
You would easily attract them if you offer high quality palm
oil for unbeatable prices. Depending on your chosen model,
you can choose to sell your commodity to the next available buyer, or wait until prices go up before selling.

www.mytopbusinessideas.com/buy-sell-palm-oil/
Re: Making Money Off A Ailing Business: The Palm Oil Business by tugrow(m): 11:55am On Mar 20, 2016
Good one
Re: Making Money Off A Ailing Business: The Palm Oil Business by Valentinooo: 4:28pm On Mar 20, 2016
@op, Good bless u greatly for this info

1 Like

Re: Making Money Off A Ailing Business: The Palm Oil Business by magchi: 7:41pm On Apr 22, 2017
Large quantity of Good quality of Palm oil can be supplied within Lagos and environs. Serious Buyers contact Obinna on:
Whatsapp: 08063452021
Calls: 08063452021 or 07087043818

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