How to Start A Block Industry In Nigeria
Block Industry In Nigeria – Updated December 27,2020
Block making (commonly called block industry) is a very profitable venture. It is funny to me that some people still think that block making is a vocation for the uneducated and unskilled people. Far from it! Whether you are a school dropout, a university graduate, a professional or a retiree looking for profitable business to engage in; block making is a venture to consider.
And the best part is that it is scalable.
Meaning you can start with small capital and grow it to become a big venture. You can also start big if you have the financial capacity and still grow it to become bigger.
Why is block industry growing rapidly?
The simple reason is rising population and increasing housing needs.
Nigeria’s population is about 206 million people and growing at 4% yearly. The country is rapidly urbanizing with almost half of the inhabitants already living in cities. And according to some studies, by 2050, seventy-five percent of the population will be urban based.
Any wonder there is pressure on shelter. The National Bureau of Statistics puts housing deficit at over 17 million units and will need an investment of NGN60 trillion to cover this wide gap.
The need for housing is pervasive; including shelter (residential accommodation), recreation, offices, places of worship, markets, schools, shopping malls, hotels, parks, amongst others. An essential component used in the construction of these properties is cement concrete block. For this reason blocks are always in demand.
It therefore provides a good opportunity for investment. If you have ever thought of taking advantage of the ever expanding real estate sector, consider investing in block industry.
What is Involved
Block industry is about setting up a facility to mould blocks of various sizes in large quantities. And then, selling to people who are building houses or contractors handling construction projects of different forms.
Cement blocks can either be solid or hollow. However, hollow blocks are most popular and commonly used for housing construction in Nigeria.
The block making plant considered here is one that produces hollow concrete blocks of 9 and 6 inches. The major raw materials required are sand, cement and water. Cement is the binder.
Bigger factories may produce all types of blocks including hollow blocks, solid bricks, interlocking, curbstones, slabs, retaining walls, etc. The production of these require the use of a multi-functional block making machine.
Block Industry Set Up
Block making can be labour intensive. Or capital intensive. Thus, it is your level of investment that determines your scale of operation. A labour intensive set up, what you need is a manual mould. And a large part of the production process, from mixing to moulding will be handled by human labour.
A manual set up can be enhanced by the adoption of a manually operated machine. Many of the block industries you see around are set up this way.
The process can also be semi-automated. In this case, part of the production process is manually carried out and other parts handled by machine. In a semi-automated process, the moulds are fed into the machine and the blocks are vibrated mechanically. The output of a semi-automated process is far higher than that of manual process.
There is also a fully automated process which requires investment in automated concrete block making equipment. In this model, the process of block making is completely automated. Once the sand, cement and water is fed into the machine in the right ratio, the machine takes the materials through the process of mixing and moulding automatically.
However setting up a complete automated line of block making plant with sophisticated equipment in a large expanse of land will require much more investment. On this scale, it is a very capital intensive venture.
How Much Do You Need to Start?
My goal in this blog is to help visitors/readers identify interesting and lucrative small scale business and investment opportunities. Businesses they can start with small amount of money. Block industry is one of such ventures.
With an investment of N800,000 or even less, you can set up a manual block industry, using a manually operated machine. This is assuming you already have a vacant land. On this scale you will be producing between 200 to 500 blocks per day depending on your strength or number of labour you employ.
Such a small scale block industry can be making as much as N10,000 in daily profit if you are able to develop a ready market. This will translate to N60,000 per week for a six day working week and N240,000 per month net of all expenses.
Isn’t that cool?
What You Will Need to Establish Your Block Industry
This is the number one thing you will need to establish a block industry. A piece of land measuring 600 sq.m will be enough for a beginner. You can either buy the land outright if you can afford to, or rent it or even partner with land owners. However, in acquiring your land, you must give consideration to the topography. Don’t site your block making business in a water logged area or swampy environment.
This will affect your business because your block will continually be moist, or can be carried away by erosion. Most importantly delivery will be affected because vehicles may find it difficult accessing your site to pick your blocks. For this reason, ensure that your plant is located on a dry land.
#2. Moulding Machine
After land, the block moulding machine, is the most important piece of equipment you will have to acquire to set up your block industry. There are locally fabricated machines that are manually operated. There are also automatic moulding machines and multifunctional machines that can be imported from China, India, Germany, etc. The type of machine you install depends on the scale you want to operate..
#3. Standard Source of Power
You will need regular power supply to keep your vibrating moulding machine running. A diesel generator is highly desirable. Most operators use Lister engine. We hope there will be a time in Nigeria where entrepreneurs will no longer need to provide their own source of power.
#4. Construct a Shed
You will have to construct a shed to house your block moulder and your Lister Engine. This will protect these equipment from rain. The shed is a simple structure with four beams and without block walls but covered with a roof. If you have the resources, you can carve out an area with block walls within the shed to serve as your office, changing room for staff and a store to keep your raw materials, particularly cement.
#5. Source of Water
Water is a very crucial material in the production of concrete blocks and you will be needing it in very large quantity and regularly too. Water is needed to mix the cement and sand as well as to sprinkle on the moulded blocks to enhance its hardness. The best strategy is to dig a well in your site for regular water supply. If you have the resources then sink a borehole but a dug well will serve the purpose adequately.
#6. Overhead Water Tank
You will need an overhead water tank to collect water from the source for ease of use.
#7. Pumping Machine
This pumps water from the Well or bore hole to the overhead water tank, ready for use.
#8. Delivery Van
An open pick-up vehicle is adequate to serve as your delivery van. You will need this van to enable you deliver products to your customers at their sites. A serviceable fairly used vehicle can serve this purpose and as you scale up your operations, you can acquire a suitable truck.
#9. Wooden Pallets
Get a carpenter to construct wooden pallets for carrying blocks to the drying/curing place. Construct, as many as possible, depending on the capacity of your plant.
You may also need a mixer. Other equipment you will certainly buy include: head pans, shovels, wheel barrow, head pans and water hose. The quantity you will buy will depend on the scale of your production and the number of hands working on your facility. These items are easily available at any hardware store or building material market around.
A key success factor in this business is to locate your industry in a rapidly developing area with a lot construction works going on. This will not only ensure regular demand for your products but also make delivery easy because most of the people that will be buying from you are those building around your location.
It is also essential to locate your block making factory on a dry land to avoid flood destroying your blocks and other raw materials, such as cement and sand. So it is important that before you set up your factory, you do a detail study of the environment to ascertain both the commercial and technical viability of your project.
Your success will largely depend on your organization skills, your capacity to reach out to bricklayers, building contractors and other people in charge of building projects. Reach it to these people and get them to patronize you with whatever incentive you can offer.
You will also have to make arrangement for regular supply of the materials you will need, especially cement and sand. There is nothing as bad as not being able to meet order because you are not able to source materials. You should develop good relationship with cement and sand suppliers so such that you can get these items on a single phone call whether or not you have the money to pay immediately.
You will use mostly daily paid labour. But will also need to hire experience workers to operate the moulding machine as well as the sand and cement mixer. For these processes, you will need people who have some experience to know the right mix of material to produce the quality of blocks required.
Depending on your scale, you will need an admin and account staff to help organize things around and liaise externally on corporate matters as well as keep the books. You may need a marketing person to manage relationship and develop business. Of course, you can confidently handle this function as the entrepreneur if you have the necessary skills. Or if you are operating on bootstrap.
Very important is the services of a security guard to man the entire facility. This is important because your block making facility is usually an open space. Hence the need for somebody with the responsibility.
The security guard will secure unsold blocks, unused materials and prevent vandalization of your equipment.
Every business start up needs to careful planning to ensure enduring success. Would you need any help in your planning? Feel free to contact us at kobotalk. We can help develop a block industry business plan, source and procure good block moulding machine and help out with business registration.
These are some of the services we render at a cost very friendly to your economy.
To your success as always!
Buchi creates content and leads the Team at Stalwart Investment Partners; a business development and investment consultancy firm. He provides strategic advisory to help SME's, small business owners and HNI's grow profitable business and make informed investing decisions.