The business is location specific within the territory of
the GSM provider. This means that only recharge cards made for Nigerian market
works within the Nigerian territory.
However once the cards are loaded the smart phone owner
might switch the phone to roaming and receive calls anywhere in the world. The
usage tariff is higher but handy for travelers.
Anybody can start
a recharge card business in Nigeria. The amount of money you make depends on the
amount of investment in the business. The more recharge cards you have access
to the higher your profit margin. The business is simple, however new
technology and trends keep evolving everyday.
What
are GSM Recharge Cards?
Authorized agents mandated to printed cards that contain
Pin and serial numbers. The numbers are generated using special algorisms
provided by GSM companies. They are usually 12 digit numbers used to load
airtime into phones.
Why
Start a GSM Recharge Business
There are many reasons to starting a GSM recharge
business. The primary reason is the simplicity. Secondly you can operate from
anywhere in Nigeria and guaranteed huge customer base.
You can run the business as a side gig or full time
enterprise. The downside is that the profit margin is very small. You need to
sell a substantial number of cards to make good profit.
Pros
- The job is easy to start
- You can operate from anywhere in Nigeria
- You are guaranteed huge customer base
- You can run the business as a side gig
- You can work part time or full time
- Startup depends on your business template
Cons
- Low profit margin
- You need to sell huge number of cards to profit
- There is a minimum number of cards allowed by wholesalers
- You face lots of competition
How
Much to Start a GSM Recharge Business
The amount of money depends on your business template. If
you want to sell the cards alongside an existing business then you start withN10,
000. However the profit margin is so low that the earnings could only add a
small amount to your shops profit.
If the main focus is on the cards startup should be from
N300, 000. This amount represent renting a small shop/kiosk at N120, 000,
inventory N80, 000 and actual cards N100, 000. Every card dealers re-invests
the money minus the profit into buying the cards.
The
GSM Card Purchase
The GSM numbers are generated using encrypted pin
numbers. The numbers are either printed on paper or a recharge card.
The wholesaler or retailer purchases the cards or
generate them. Methods used in generating the numbers include an app, a device
or through a computer system.
Types
of Recharge Card Sellers
Top
Level Dealers
There are three categories of recharge card sellers. The
top level seller buys directly from GSM operators and sells to wholesalers.
This level of people require huge amount of investment running into millions of
naira.
Recharge
Card Wholesalers
The recharge card wholesalers buy from the dealers and
sell to the retailers. They can start by buying recharge cards of about N150,
000. Some sell to retailers and directly to the general public. A good way to
increase profit is to add a side deals such as phone sales and data services.
The
Recharge Card Retailer
The recharge card retailer could sell the cards
exclusively or as a side gig. The profit margin is very low and startup about
N10, 000.
You find retailers in grocery stores, supermarkets and
beverage stores. The retailer makes about 5% per card. So if they sell N10, 000
denominated cards in one day they make N500.
The Retail
Store Location
The location of your store is very important. The best
location is in an area of heavy pedestrian traffic. As a retailer you need to
sell at least N20, 000 worth of recharge cards a day to make N1000 daily.
A wholesaler earns significantly more than retailers.
This is because of bulk sales of cards and vouchers. They can easily manage
N100, 000 worth of airtime to retailers. This translates to N5000 naira daily.
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