Cooking gas: Home delivery for win-win solution
• Rakes in quick returns
To some, the oil and gas sector is a business terrain meant for the high and mighty. They believe that people operating in this sector are only those connected to corridors of power with the financial muscle to acquire necessary appliances, as well as engage the right categories of personnel.
But while some people hold tightly to this belief, creative businessmen have broken the distributive chain in gas supply.
To make the process easy for people to buy and use cooking gas effortlessly, some foresighted marketers have elevated the operation by making provision for customers to call and get the product delivered at their doorsteps. This has brought respite to many consumers, who are thereby spared the trouble of going to a dealer to obtain the product.
Sunday Mbang, a marketing manager in one of the companies in the distributive chain, explained that people generally believe that the product is very dangerous and so avoid using it.
“But the onus falls on us to enlighten and convince buyers that the product is better than any other household fuel, if carefully handled,” he said. He said one of the ways to encourage people to use cooking gas is by making the product available, take it to their doorsteps and, if possible, help customers fix the cylinder to the cooker.
“We just have to be innovative in our approach to get people to buy. So, aside services that include creating awareness on safety measures, we also make provision for door-to-door delivery. This way, customers can call us from anywhere within the metropolis and we supply at their doorstep with service charges ranging between N500 to N1, 000.
“Though some people still regard cooking gas as meant only for the elite, more people are beginning to embrace the idea because it is a cheaper alternative to firewood, coal, kerosene and even electricity. This explains the increase in demand, especially in the urban areas across the country,” he said.
Explaining some of the marketing strategies adopted to sell the product, Ike Ayaegbu, a salesman with a gas company, said they do not always wait to receive calls to move out, as there might be people in need of their services, but who may not know their personal or company’s telephone numbers.
So, they load their vehicles with different sizes of cylinder and drive to areas that people are likely to buy. And the outcome has been wonderful. Explaining further, he said the method could be likened to hawking because they go to potential clients in branded vehicles to canvass for sales and in the process give out their numbers.
Said he: “We go to streets, where there are potential customers, as well as places, where there are a lot of joints and sometimes around campuses because students like something that would hasten their cooking. And because the difference between patronising us and going to the filing stations or depots is sometimes between N500 and N1, 500, which they consider negligible, taking into account the inconveniences of time and distance.
“Most customers prefer we come to them, especially those that use big cylinders, perhaps because of the stress of taking the cylinders to and from the depot,” he said.
Is the business of transporting cooking gas from one place to the other lucrative enough? David Erosemele, a marketer, replied in the affirmative. According to him, the market is huge, but the supply is low.
Said he: “We cannot meet demand, which is why some people still depend on kerosene stoves, as an alternative till we bring their supply. I make between N800, 000 and N1, 000, 000 per week. The business is worth all the trouble.”
On what it would take a new entrant into the business, Erosemele explained that it is one business that shouldn’t be ventured into without adequate knowledge of how the market operates. He believed that anyone going into the cooking gas retail business must first undergo some years of apprenticeship to learn the intricacies of the business.
“Anyone desiring success should not just plunge into a business he/she has little or no knowledge of. So, it is advisable to consult people that are already established in the business for detailed explanation of the hazards, sales, preferred quality, measurement and types of cylinders among others. So, knowledge is key and potential investors should note this,” he said.
Charles Osoka, another gas supplier said with an amount ranging between N500, 000 and N800, 000, one can start the business on a small scale and at a semi-rural area. With proper management, it is possible to grow the business to any level.
“Start small by buying the huge cylinder, i.e. the 400kg or more depending on the available money at one’s disposal. You can then begin to distribute. With the 400kg cylinder, one can refill 66 cylinders of 6kg and 50 of 8kg. This could attract profit between N80, 000 and N100, 000, depending on price fluctuation.
“If in a place where demand is high, this quantity might run out within a week. The business has the capacity of raking in quick returns, which is the reason it is always good to locate one’s shop where there are many potential customers, such as middle class areas,” he said.
What is the process involved in delivering the product at consumers’ doorsteps?
Esther Okon, a gas dealer, explained that there are two types of delivery service: cylinder exchange and tanker refill. According to her, cylinder exchange enables one to exchange his/her empty cylinder for a refilled one, while tanker delivery involves a cooking gas tanker coming to one’s home or company to refill cylinders.
Throwing more light on this, she said smaller cylinders were introduced for easy movement and to make people use more of gas for cooking, while industrial or heavy household users depend on the tanker for refill.
According to her, the business is flexible and encourages proprietors to use their initiatives to excel.
Explaining how her organisation has been able to remain afloat despite the hard times, she said this could be attributed to dynamism, renovation, focus and determination.
“You don’t just expect to hit gold the first year. Like any other business, you must first invest and later begin to harvest, as there is the teething period. The truth is that if one invests well, makes necessary contacts, as well as have regular supply, success would certainly come. Nigerians are yet to realise that cooking with gas is cleaner and better. By the time they key in fully, sales are sure to increase in future.
“We started with N1, 000, 000 seed money, which was spent on renting a big shop, acquiring cylinders and hiring professionals to fix our equipment. Today, however, we have recovered all of that. Initially, we began by hiring tricycles to deliver, but now, we have our own branded vehicles and bikes that move to different homes to supply.
“To boost sales, we keep a record of our clients, as well as know their consumption capacity. We also visit them often. This means we know when they are likely to run out of supply and without being called, we appear ‘magically’ to replenish their supply. With this, we are able to expand the business and are engaged throughout the year,” she said.
On tips to make distribution easier, she explained that if one must service customers in fairly distant places, there is need for a truck or van that is capable of safely hauling the product to designated areas. She advised new entrants not to get fixated on the idea of buying the trucks, as there are people that can handle this aspect of the business at a reasonable fare, while still leaving enough profit.
“The business is broad. At the initial stage, one can hire vans or even tricycles (keke Marwa) to supply the product. But if you can afford to buy a truck, it is advisable to regularly service it to avoid disappointments. You can, as well, lease one whenever it is needed, pending when you would be able to acquire yours,” she said.