No doubt the current economic recession and rising unemployment are forcing Nigerians to venture into various businesses. For instance, if you are thinking of opening a business that could yield great profits, perhaps going into the manufacturing sector, either on a small or large scale, a shoe manufacturing factory may not be a bad idea after all. Bearing in mind that every person in this world needs a good pair of shoes – some even need a closet-full of shoes to make them happy – shoes, therefore, are in demand any time of the year.
Shoes are important accessories that complete and compliment an individual’s outfit. Everyone needs one form of shoe for everyday activities including weddings, church, school, work and other formal and informal events.
With this, the shoe industry is one of the most profitable industries that could bring success to any entrepreneur with the right skill and good business sense.
Starting a shoe manufacturing company can be a tough one but it also has the potential of giving you a lot of profit. The competition in this business is stiff, but it is flexible and if you know what you are doing, you can break into the market. All you need is hard work and dedication.
To start up a shoe factory, a few things must be put in place to ensure stability and success in the trade. The following are some points and guidelines to be remembered in establishing your own shoe factory.
Market survey
The first thing to do is to determine your target market for your shoe factory. Choose which type of shoe you would like to manufacture, whether sports shoes, formal shoes or any type of shoes. To do this, you must take into consideration the availability of raw materials in relation to the capital and skill you possess. It is also important to know the type of shoes that will appeal to customers, what the brand competitors are selling and their prices and also what you intend to sell to your target market. You may likewise determine if you want to start your business from home so as to checkmate expenses or decide if you just want to go ahead and establish. Having all this knowledge first hand will help enhance your marketing efforts.
Business plan
Every profitable business starts with a concrete business plan. This enables an entrepreneur to see every angle of the business and dealing with potential problems effectively. This also adds efficiency and stability to the business. Accordingly, the business plan should include the business site, the machineries and equipment needed in manufacturing shoes, where to buy raw materials, the number of employees needed and your potential buyers.
The size of the manufacturing site should depend on the size of the intended operation while reserving a space for possible expansion. The factory must be divided into different segments for different manufacturing stages. Also, the machineries and equipment should be positioned inside the manufacturing site while keeping functionality and convenience in mind.
Understudy or hire a designer
It is important to have knowledge of what you are getting into, so this means, you should get someone who is into designing of shoes and learn from him/her or hire such for your factory. You can also go online to make your search easier and locate one, learn how to design trendy and fashionable shoes that can sell in today’s market.
Company registration
Registering your company with the Corporate Affairs Commission (CAC) is one of the essentials of business. It is important to register a name for your shoe company, get a logo and obtain vendor’s license. This will enable you run and manage your company as a legal entity.
Ensure that all legal documents are processed to avoid potential legal impediments to your shoe factory. This may entail some cost but this will save you more if the government authority discovers that your business lacks permit or is defective.
Location
Here, you have to get a space that will be able to accommodate your workers and your machinery and other equipment for the production of shows shoe. Whatever location you secure, make sure it is within town and in the range of your budget.
Staff
As much as possible, hire employees who already have experience in shoe manufacturing. If this is not possible, reserve a portion of your capital for training employees to ensure the quality of your shoes.
Raw materials
At this stage, you will need to get in contact with as many suppliers and manufacturers as you can, so as to choose the one that offers you the lowest unit cost in raw materials.
Pricing/Account
To get this done, you need to first set the right price for your shoes both online and offline and then obtain a business account through your bank to accept online payment through online orders. In all, make sure the prices you decide on cover your production cost and that it is affordable for your target market.
Marketing and advertising
When you are done with production, the next thing is to start marketing and creating awareness for your brand. Contact wholesalers and small shoe stores as your initial clients. Beware of wholesale clubs advertised in the internet. Some of these are not legitimate or not good clients. You also need to advertise your shoe in the local print newspaper and different trade publications, you can also place ads in men and women’s fashion magazines so that customers from both sexes can easily access your product. You can also get in touch with independent retailers in different locations and offer them certain percentage of your profits if they assist in marketing your shoe to their buyers.
Online visibility
The world is a global village now and you can get more from your online presence through the social media. Create a website for your shoe line or get a web designer to help you build a suitable site where you can upload pictures of your finished product and their prices.
Also, contact several search engines like, google.com and Wikipedia and submit your website to them so that the name of your site will come up on the first or second pages of their search engine anytime customers search for shoes.
MAN backs BoI recapitalisation
The Manufacturers Association of Nigeria (MAN) said it will continue to support the existence of Bank of Industry (BoI) alongside the new Development Bank of Nigeria (DBN) being set up by the Federal Government.
MAN, which maintained that its advocacy role has kept BoI afloat, insisted that there is need to re-capitalise the bank to enable it discharge its responsibility to the real sector.
The association’s President, Dr. Frank Jacobs, said BoI does not have the capacity at present to attend to all the needs of manufacturers, adding that MAN in its recent advocacy requested that the Federal Government re-capitalise BoI.
He said, “another development bank would help in augmenting the activities of BoI. This will set competition among them and it will make manufacturers to have alternatives.
“Last year, the association in its usual practice engaged government at all levels, including Ministries, Departments and Agencies (MDAs), on a number of issues affecting the manufacturing sector in particular and the Nigerian economy in general; halted the arbitrary increase in electricity tariff in the face of power inadequacy and poor supply.”
The MAN president said the association prompted the Central Bank of Nigeria (CBN) to give approval for the allocation of at least 60 per cent of available foreign exchange to manufacturers, and refocused government’s attention on resource based industrialisation through purposeful engagement with the Federal Ministry of Science and Technology, research institutes and tertiary institutions.
“Periodically, we engaged government on the issues of patronage of made-in-Nigeria products. We have had forum on it and we’ve recorded success; today they are coming up with buy made-in-Nigeria policy.”
He stated that the association has advised the Federal Government not to sign the ECOWAS-EU Economic Partnership Agreement (EPA) in its current form, while advocating for the reviewing of Export Expansion Grant (EEG) which has been in limbo since 2014.
He stated: “We are advocating for improved budgetary allocation for the upgrade of critical infrastructure by the Federal Government as evidence for the establishment of the Development Bank of Nigeria.”
MAN President, however, stated that the association has secured a favourable tariff regime for the pharmaceutical sector and promoted sector-specific incentives of national economic development.
While speaking on 2017 focus, Jacob maintained that MAN in consonant with its mandate would pursue some strategic issues on the association’s advocacy radar.
He urged the government to enforce significant improvement on infrastructure, especially power and transport.
He tasked the government on general improvement in the business operating environment, calling for abolition of multiple taxation and unorthodox mode of collection and review of CBN’s list of 41 items not valid for foreign exchange to enable manufacturers source critical raw materials that are not available locally.
Commenting on backward integration policy of government, he called for the development of the country’s abundant natural resources for industrial inputs and enactment of relevant manufacturing friendly laws.
NECA berates CBN over violation of court ruling on stamp duty
The Nigeria Employers Consultative Association (NECA) has berated the Central Bank of Nigeria (CBN) over its failure to comply with the Court of Appeal’s ruling on the reversal of the N50 stamp duty.
Calling for immediate compliance, NECA expressed serious concern over the non-compliance of the apex body in the matter between Kasmal International Services Limited and Access Bank and 23 others, directing all Deposit Money Banks (DMBs) to discontinue the illegal charging of N50 per transaction in lieu of stamp duties.
Recall that the CBN had directed banks to commence what NECA described as the illegal deductions, which did not only affect corporate bodies but all Nigerians, including the very vulnerable ones.
NECA and organised businesses had opposed attempts by the Nigeria Postal Service (NIPOST) to compel companies to affix a N50 postal stamp on all receipts, invoices and documents evidencing transaction of N1,000 and above.
NECA had also kicked against CBN’s directive to banks based on its illegality and in the light of pending litigation in the courts on the matter.
Director General of NECA, Mr. Segun Oshinowo, noted that there has been a landmark ruling in the case at the Court of Appeal on this subject matter between Kasmal International Services Limited and Access Bank and 23 others, which declared the deductions illegal.
“NECA has expressed grave concern over the failure of CBN to reverse its earlier directives to all DMBs to halt the charging of N50 per eligible transaction in accordance with the assumed provisions of the Stamp Duties Act and Federal Government Financial Regulations (2009).
“The CBN is hereby advised to comply without further delay by pulling an end to further deductions and commence the refund of all accrued deductions in the past to their customers.”
NECA urged the Buhari-led administration to restrain its operatives from pursuing policies that will increase the burden on the citizenry, both corporate and individuals.
It affirmed that stamp duty’s applicability is limited to purchases involving large sums like a house purchase or importation of goods as against the position of applying N50 postage stamp to all receipts given by any bank (or financial institution) in acknowledgement of services rendered in respect of electronic transfer and teller deposits.”
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