Are you thinking about going into oil and gas business but don’t have the huge capital required for this type of business? Diesel business is the ideal oil and gas business you can start with little capital. You can start diesel supply and distribution business anywhere and anytime but there things you must know before starting the business.
If you want to be in the diesel business, you can check out the bio-diesel opportunities. Diesel is an eligible fuel form and with the tax reduction programs offered by the government, you’re sure to benefit. Since this product does not entail chemical reactions or procedures, you no longer have to obtain a license from environmental agencies in your area.
Is diesel Business Profitable?
You need not be told before answering this question because diesel business is part of oil and gas business. Oil and gas business is one of the most profitable businesses anyone can do. Some people even refer to oil and gas as liquid gold due to its profitability.
Read also : 21 Profitable Oil and Gas Businesses you can start in 2017
Must know facts about diesel business
The only way to ensure your success in the coming months and years is to create a thorough business plan. This can help you in finding out if you’re ready for this venture and if you still need to gather relevant knowledge. It will also familiarize you with possible challenges you might later encounter in the business and the likely solutions.
You need to establish connections with trade associations that are focusing on bio-diesel products. By doing so, you can sell the diesel with ease and you can instantly generate trust/confidence from customers. There are no education or chemistry requirements for this type of business. Still, you will have to conduct some research to learn more about the industry.
Customers prefer to do business with those who are experts and competent. What will happen if you can’t answer the questions of clients? With the right knowledge comes power. Know what you really want and work out a plan of action.
When starting a diesel business, you will have to choose an ideal location. The site itself can be costly since you need a large business area with an office and the diesel storage. You can seek help from professionals on how to design your place of business. Hire the needed staffs and stick with the competent and experienced once. One mistake can cost you the whole business. Make sure that all your staffs know what they are doing and that you can trust them. Secure the needed liability insurance since you’re going to offer certain products. Provide your employees with adequate salaries and benefits to avoid fast employee turnover.
Starting a diesel business is no joke. It requires careful thinking and planning. You can advertise the business with ease by using the right methods like banners, billboards, flyers, and business cards. Have a separate budget for the advertising campaigns and try to monitor if you’re generating interest from the customers. On the big day, you can get a surge of customers if you can convince them the bio-fuel is a great alternative. With a business license and certification, you can sell the bio-diesel at a lower price. Educate your customers about this option to convince them to patronize your business. Soon, you can earn considerable profits since a lot of people today want to go ‘green’.
Read also: Startup Guide for Cooking Gas Business in Nigeria
Required facilities for diesel Business
This business demands you have some equipment and facilities for its smooth running, as having this things will go a long way in making the business easy and very profitable for you.
These are tanker with discharging nozzle like those used in filling stations. This type of tankers makes your business easy to carry out as you don’t need delivery vans and jerry cans. It will attract more customers to you especially the corporate ones. The trust will be there because they will be seeing the products discharged to them without any double handling.
This will be a bit capital intensive because the cost of the tanker will add to your initial startup cost.
2.Jerry Cans (gallons)
This is a cheaper alternative to number one. You can adopt this option if you are starting on a small sale. All you need here is to procure some used/new gallons and get a delivery van to deliver the product to your prospective customers.
This is very essential to the success of this business especially if you are adopting the number two above as it will be needed in hauling the products. If you don’t the capital for procuring the van, you can decide to hire pending the time you are able to raise enough capital to procure your own.
The concern is that the cost of hiring will eat deep into your profit and may affect the pricing of the product.
Also important is steel storage tank for storing your products. This may be surface or underground. But the surface tank is cheaper for a newbie.
How to source for Products
Sourcing for products can be difficult if you don’t know where and how to go about it. That is I said you need to establish connections with trade associations that are focusing on bio-diesel products.
You can also look for those that are already in this type of business and learn from them. If it requires you undergoing apprenticeship with them for some months don’t hesitate; you reap the benefit on the long run
Where to get Customers
After putting in place all that is needed for the smooth running of the business, then, the next thing is to look for customers. Without customers, there is no business.
To get customers, reach out to the following;
- Private companies
- Government establishments
- Construction Companies
- Individuals using heavy duty equipment (e.g soundproof generators)