How to start a Furniture Making Business in Nigeria

How to start a furniture making business in Nigeria

How to start a Furniture Making Business in Nigeria

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HOW TO START A FURNITURE MAKING BUSINESS IN NIGERIA

Every day as individuals build houses, set up various companies and businesses, there is always a need to get furniture whether it is a chair, table or cupboard as furniture is also a decoration. When people move into their new home, they need a bed to sleep on, a chair to sit, wardrobes for their clothes, a dining table, sofas, kitchen cabinets and different kind of furniture too. This makes the furniture making business have a high demand in the market and ensures that it is a lucrative business.

There are lot of carpenters in the community which makes this business a very competitive one. In order to succeed in the furniture making business, you will need to think outside the box by implementing certain strategies and procedures. When starting a furniture making business, you need to have a good eye for what your clients and customers want, tailor your designs according to their specific needs. They will refer your excellent services you did for them without you asking

People don’t want to go through the stress of importing furniture from other countries, which is why they settle for quality local products. In order to start a furniture making business, you don’t need to necessarily become a carpenter. Individuals that want to start a furniture making business can be divided into 2 which are

  • Individuals who have carpentry skills, knowledge and experience. They know what it takes to start a furniture making business
  • Individuals who have no carpentry skills or knowledge but are willing to start the business

Both individuals can apply the same procedures and guidelines when starting a furniture making business. They include

  • Find your niche

Finding your niche deals with specifying the kind of furniture you want to make such as home furniture and office furniture. This also deals with specifying the kind of materials you want to implement in manufacturing your furniture such as wood, metal or bamboo and the kind of services you want to offer to your customers and clients

There are a number of niche ideas that you can choose from in the furniture making industry. They include:

  1. Children’s furniture
  2. Furniture remodelling
  3. Bathroom Vanity
  4. Kitchen Furniture
  5. Office Furniture
  6. Garden and Outdoor Furniture
  7. Luxury Furniture
  8. Online Furniture sales
  9. Furniture recycling
  10. Furniture finishing
  11. Furniture designing
  • Do a research on your target market

It is very important for furniture making businesses to keep up with trends and produce what the customers want. The taste and style of people differs from one another. Getting to know what people want will aid your furniture business as you will be able to deliver the right products to the right people. This research will not only help you know what people want but you will get to know how large the furniture business is and how you can outperform your competitors. Your target market may include

  • Individuals who you sell directly to
  • Local and national furniture retailers
  • Architects and interior designers
  • Companies and businesses requiring office furniture
  • Develop a business plan

Every entrepreneur should have a business plan as it allows them commit their ideas and plan into writing providing a road map to success of the business. A business plan will also ensure that the business is accessible to various loans and investors. A well detailed business plan includes the following

  1. Executive summary (This will be done after the plan is written)
  • Business Overview
  • Market Overview: The Opportunity & Solution
  • Competition
  • Financial Highlights
  • Our Ask
  1. The company overview

This is the introduction and description of your company. It covers the following details

  • Mission and vision
  • Overview of company history/capabilities
  • Product description and present stage of development
  • Competitive advantage (what’s different or better than competition)
  • Past customers and performance (if applicable)
  • Legal entity, hours of operation, location description and attributes
  • Structure & Ownership
  • Management Team
  • Intellectual property status (if applicable)
  • Commercialization strategies (if applicable – timeframe and actions to move from idea to marketplace
  1. Product and services

This covers the following:

  • Definition of Products or Services to be Sold
  • Product Viability
  • Technology
  1. Industry analysis, market analysis and marketing strategy
  2. Swot analysis
  3. Market analysis
  • Market size(Estimate of the total market size for the product or service and trends
  • Quantification of the size of each market segment in terms of (Naira spent, units used, number of people, percent of income etc.)
  • Competition to the business
  • Market Segmentation and Demographics
  • Customer Profile(Actual and potential purchasers of product or services by market segments)
  • Barriers to Entry
  1. Marketing/sales plan
  2. Management and operations
  3. Summary of risks involved
  4. Professional and advisors
  5. Financials
  • Cash flow projection and/or existing (3 years) with breakeven analysis
  • Income/Expense projection and/or existing (3 years with ratios and benchmarks to industry)
  • Sources and uses of funds (funds needed, owner equity, how funds will be used/start-up cost analysis
  1. Funding
  • Amount of Money Sought
  • Use of Proceeds
  1. Project implementation schedule if any
  • Decide on whether to buy an existing business or not
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You could decide to buy an existing business or start up your own furniture making business. Buying an existing business means that the products, customers, regular sales, staff, premises and equipment are already in place and you won’t need to purchase new ones.

Although it is not recommendable to buy an existing because it might be hazardous due to financial issues and challenges the business you are willing to buy has. It more advisable to start your own furniture making business with its own brand

  • Acquiring Finance for your furniture making business

Finance is the backbone of starting a business. Without the required capital, one cannot start a business.  There are lots of equipment and materials that one will need to purchase before starting a furniture making business and they don’t come cheap. There are various sources of finance that one can acquire before starting a furniture making business. They include

  1. Self-financing: This has to do with the capital provided by the owner of the business
  2. Grants from government agencies: Various grants can also be gotten from the programs run by the state government or federal government
  3. Loans from banks: Having a detailed business plan and registering your business name will enable you access various bank loans
  4. Investors: Investors who have gone through your business plan and are assured that your furniture making business is profitable can invest millions of naira in your business
  5. Family and friends: Finance can also be gotten from families and friends that are willing to support your business
  6. Equipment financing or leasing: Another source of finance for your furniture making business is through equipment leasing, which requires that you pay for the equipment in bits. It could be weekly or monthly
  • Register your business name

Registering your business name with the Corporate Affairs Commission in Nigeria will enable your company to be regarded as a separate entity that is different from its owners. It will also lead to quick acceptance by clients. You can register your company as a limited liability company. . The following are the requirements for registering your company as a limited liability company

  1. The first step required by the applicant is to choose two suitable proposed names for the company. Where this is done, an availability check will be conducted on the CAC online portal to find out if the name is available and not already in use.
  2. Choosing the type of company to be registered whether a private limited company or private unlimited company or company limited by guarantee.
  3. The objectives and business of the company must be provided.
  4. The registered principal address of the company.
  5. The share capital and shareholding formula among shareholders will be required.
  6. The particulars of a minimum of two (2) Directors will be required. A copy of their means of identification such as voter’s card, national ID, drivers’ license or international passport.
  7. Particulars of the company secretary (one of the directors may also act as the Secretary of the company)
  8. The applicant will be required to furnish details of the shareholders of the company. Details such as names, occupation, residential address, email address, mobile phone number and means of identification such as driver’s license, international passport or national identity card. It should be noted that the directors listed can also hold the capacity of shareholders in the company if desired.
  9. The memorandum and Articles of association of the company to be registered which is advisable to be drafted professionally by a Legal Practitioner. However, the CAC has provided a generic MEMART, which any new company can be adopted.
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After which a consultant will prepare the following incorporation documents. They include

  • Duly verified particulars of the director and statement of share capital known as CAC Form 1.1
  • Duly stamped Memorandum and Articles of Association
  • The individual completes all the incorporation documents with the input of an accredited lawyer to duly attest to the incorporation documents.
  • The payment of the prescribed fees will now be duly made online and the incorporation documents immediately stamped online.
  • The stamped incorporation documents will now be duly uploaded into the CAC online portal again for the final review of the commission
  • If all the incorporation documents are well completed and executed, the commission will incorporate the company and issue an incorporation number immediately online.
  • Certificate of Incorporation and the Certified True Copies of the other documents will be issued by CAC and received by the consultant or lawyer, usually in less than 48 hours after the company is duly incorporated by CAC
  • Get insurance

When dealing with a furniture making business, there are lots of materials that are highly inflammable such as wood, paint, fabrics, lacquer and others. Some of your employees may also exposed to danger from these various items and there is probability that a workplace accident or fire may occur. In order not to make losses, it is advisable for the owner of the business to acquire insurance protection for the business.

  • Acquire intellectual property protection

Another important procedure to take is to acquire intellectual property protection for your furniture making business. A lot of ideas and work goes into designing various pieces of furniture, in order to ensure that no one steals and reproduces your ideas and make money off your idea without informing you by taking permission. It is important for you to get intellectual property protection.

There are four different types of protection you can get for your furniture business. They include

  1. Copyright protection
  2. Trademarks
  3. Utility patents
  4. Design patents
  • Purchase the relevant and necessary equipment

One can’t start a furniture making business without the relevant and necessary equipment that will be used in creating various designs of furniture. The following tools and equipment are required when starting a furniture making business

  1. Design Software
  2. Coping Saw
  3. Chisel Set
  4. Smoothing Plane
  5. Block Plane
  6. Combination Square
  7. Computers
  8. Printers, fax machines, telephones
  9. Bevel Gauge
  10. Dovetail Saw
  11. Card Scraper
  12. Marking Knife
  13. Spoke shave
  14. Drilling machines
  15. Assembling equipment
  16. CNC Router
  17. Spraying and Finishing Tools
  18. Veneering Tools
  19. Heating and Extraction Tools
  20. A bevel-up low-angle jack plane
  21. Bevel-edge chisels
  22. Water stones
  23. A pocket square
  24. A 12-inch combination square
  25. A wheel marking gauge
  26. A card scraper.
  27. A mill-bastard file
  28. Other materials such as plank and nails etc.
  • Hire the required man power

The hiring part of any business could make or break the business. You don’t need to have any carpentry skills or experience when you can employ those who will handle all the aspects of the furniture making business. The following staffs would be required when starting a furniture making business:

  1. Woodworkers
  2. Arm makers
  3. Upholsterers
  4. Assemblers
  5. Hand carvers
  6. Carpenters
  7. Furniture finishers
  8. Cabinet makers
  9. Quality control inspectors
  10. Product testers
  11. Receptionist or secretary
  12. Marketing officers
  13. Accountants
  14. Product designers

Personnel can be gotten through

  1. Posting about the vacancy on your website and across any social media or email marketing channels
  2. Asking your business network, as well as friends and family if they know anyone suitable
  3. Adding the vacancy to general recruitment websites
  4. Advertising the vacancy in industry trade media or local newspapers
  • Get a showroom in a good location

The next procedure is to ensure that the company acquires a very good location. The showroom will be used to display the business products to passers-by and those interested in acquiring our services.  The location should be in a commercial buzzing area which is most likely by the road side for passers-by to see.  If no one sees the goods you are selling, then you will make no sales. Many Nigeria furniture sellers, sell at the open place by the roadside and they still make good sells.  Space is also one of the most important considerations to make when selecting a location for your furniture making business.

  • Market and promote your business
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When all is set, and you are ready to open for business. You will need to take care of the marketing aspect of your business. Marketing enables your business to survive and also have an edge over your competitors. This deals with advertising your business by informing people about what you do. You can market your business by

  1. Launching a website or a mobile application
  2. Distributing fliers
  3. Creating a unique business name
  4. Developing an attractive logo
  5. Place adverts on ICT magazines and related newspapers, radio stations and TV stations
  6. Encouraging your customers to make referrals on your behalf
  7. Leveraging on social media platforms and advertising on Facebook, Instagram, Twitter, LinkedIn in order to promote your business
  8. Contacting the buyers at both multiple and independent furniture retailing outlets
  9. Advertising your product ranges in the trade press
  10. Exhibiting at the major trade shows for the furniture industry
  11. Making sure that housing developers are aware of the services you offer
  • Set a fair price for your goods and services

Another important step for you to take is setting a good price for your furniture products and services. It is better for you to charge fair prices based on the unique service you render to your customers and clients.  As a furniture making business owner you will need to consider the following when setting your price

  1. The products and designs that you make that your customers cannot find elsewhere
  2. The person you are selling to
  3. The quantity the customer or client is purchasing
  4. The value and manufacturing quality of the product

Picking the perfect price point is critical to your business success.

  • Open an online store for your business

This will enable you to have an edge over your competitors and clients and customers scroll through your different products and their pricing.  A large number of people will purchase their furniture online because it is easier and it saves time too. This is why it is essential that you spend time on making sure a website is user friendly and mobile or you could use online stores such as OLX in Nigeria

  • Launch your business and maintain your reputation

After all the procedures and guidelines are implemented, you can now start your business. You have to ensure that you deliver reputable and excellent services to your customers and clients which will ensure that your business is known for delivering quality furniture thereby building your company reputation.

CONCLUSION

It is important for you to carry out a well detailed research if you want to venture into the furniture making business. Furniture making is a very interesting and profitable business to start in Nigeria especially if you deliver quality and lasting furniture to your clients. You don’t need to have special carpentry skills to set it up, all you need to do is to follow the relevant procedures and guidelines in order to ensure the success of your business in the long run. Qeeva Avisory Limited ranks among one of the best business plan writing firm in Nigeria. You can contact us for your furniture making business plan on 08023200801, 08075765799, Email: info@qeeva.com

About the author

Onamakinde Dare Daniel is a highly motivated accountant with knowledge in Accounting, Taxation, Management, Audit, Costing and Research. He is keen on tax matters due to its ever dynamic nature.

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