Palm Kernel Oil (PKO) is the major raw material for the production of vegetable oil. Ninety percent of what we call groundnut oil in our market is vegetable oil made of palm kernel Oil (PKO). Again PKO is a major raw material for soap making companies. The Palm Kernel Cake (PKC) is a major by-product of a palm kernel oil expelling factory, palm kernel cake is used for producing animal feeds. This is how to start palm kernel business in Nigeria.
How To Start Palm Kernel Business in Nigeria
1. Conduct Detailed Research
Formal and/ or informal market research to understand the nature of the business, the volume of the business, who are the existing buyers and sellers of the product, where are they concentrated and which states you have the chief producers of palm oil. You must also find out the prevailing prices of buying and selling and from which states you can obtain the palm oil cheaper and at the right quality.
2. Get Contacts
If you must succeed in this business, you need to get the contacts of suppliers from different states. You can compile a list of suppliers in a spreadsheet (using Microsoft Excel). It is necessary to know how reliable these suppliers are, the quality of palm oil they need and the prices they offer.
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3. Have Adequate Capital
This refers to the money that is required to start your palm oil business. This includes the following:
- The cost of acquiring land – either you purchase or rent it.
- Cost of hiring workers
- The cost of maintaining the farm
- An estimated cost of purchasing the seedlings you will need to start.
- Sometimes you need to have a palm oil processing machine to ease the workload.
4. Have A Supply Chain
You must find out where sellers (suppliers) of palm oil are and which state produces the best quality at reasonable prices. You must compile a list of suppliers and make efforts to find out who they are, how reliable, quality of oil they sell, credit facility offered and the possibility of establishing long term relationships with them.
5. Exporting Palm Oil
If you’re planning to export palm oil to other countries, then you should consider searching online. Alibaba is a great site to list your palm oil for sale or you can use Vconnect to search for reliable exporters online. You should do a proper background check before giving your palm oil out for export.