Road Transport of Fuel/Petroleum products is a profitable business in Tanzania and East Africa that need a lot of strategic plan to start. This business plan will be used to define the scope of our services, as well as a means of gaining the necessary investment to open the company. It will also be used continually  in the evaluation of road transport of fuel business’s  mission, goals and objectives.

Executive Summary

ARA transport is an indigenous energy, logistics and transportation service company duly registered and it has obtained a license to transport petroleum products across the country. The company is formed following the increasing demand of petroleum products (example, premium motor spirit, diesel, kerosene, and other petroleum products) in Tanzania. The company primarily focuses on transporting petroleum products from oil depots to the desired destination across the country.

The company has drivers who are helpful, courteous and fully trained to handle hazardous materials. They have licenses so there will be no need for company’s training. Our trucks will be clean, well-maintained and inspected regularly for safety and comfort.

At ARA Transport, our philosophy is one that emphasizes service in the real sense of the word and the realization that effective communication is key factor in our business. The company also realizes that in this competitive market, flexibility and professionalism maintain that leading edge.

The biggest strength of ARA transport is its personnel since experienced and trained drivers who can take care of transportation of petroleum products from depots are the heart of this business.

Mission

The company’s mission is to provide reliable, timely and safe logistics services in the downstream sub-sector of the oil and gas industry.

Vision

To become the leading energy logistics service company in its area of operation by offering services with superior customer value.
To be a reliable partner and act proactively to fulfill all the needs of its customers by delivering tailored petroleum products logistics services.

Objectives of the Company

  • To purchase two more trucks/fuel tankers in the next three years.
  • To extend its operation by acquiring the license to transit petroleum products to the landlocked countries including Uganda, Tanzania, Kenya, Rwanda and DR Congo after three years of operation.

Services Description

Road Transport of Petroleum Products: ARA Transport is engaged in the road transport of petroleum products from the oil depots to the desired destination across the country. The company transports all petroleum products such as: AGO (Automotive Gas Oil – Diesel), PMS (Premium Motor Spirit – Petrol), IK (Illuminated Kerosene), Jet – A1, HFO (Heavy Fuel Oil), IDO (Industrial Diesel Oil) etc.

Competitive Edge

Human resources: We believe that drivers are the life (blood and oxygen) of logistics and transportation business. Your drivers can make or mar your transportation business, so recruitment will be a top company priority. We will make sure that drivers are licensed and well-trained to drive fuel/petroleum tankers/trucks.

Maintenance: Our research has shown that most of the haulage and logistic companies do not carry out a regular maintenance of their vehicles. They do maintenance when their truck breaks down. AT ARA Transport, we shall promote the life span of our truck by ensuring and putting in place systematic maintenance routines. As our business grow and more trucks are bought, we will hire an in-house mechanic to handle maintenance and repairs.

Business Ownership and Structure

Promoter: Khalid Magombeka
Khalid is passionate about the oil and gas industry and the logistic and transpiration business. For the first three years of operation, Khalid will handle many responsibilities as Managing Director/ Truck supervisors / Accountant and head of marketing. After three years of operation, the company will be in the expansion stage and will recruit people to handle these responsibilities.

Business advisor: Said Saleem has spent over 10 years in downstream sub-sector of the oil and gas industry in Tanzania. He owns five petrol stations in Dar es Salaam and he’s also the managing director of Saleem Transport Limited which transports petroleum products in Tanzania and neighbouring countries including Rwanda, Burundi Congo DRC etc.

GET THE FULL VERSION

To get the full version of this business plan which includes the breakdown of startup cost, SWOT analysis, marketing strategies, management plan and financial plan, reach out to us via Hussein.boffu@tanzaniapetroleum.com or +255(0)655376543.

The oil and gas industry has a lot of profitable business opportunities, but they are capital intensive.

However, there are many small businesses that you can also start in many sub-sectors such as retailing of petrol, LP Gas, diesel, lubricants, consultancy, oil services etc.

If you have a dream to start a business in the oil and gas industry, keep on reading, because I will talk about at least 30 most profitable oil and gas businesses that you can start in the industry.

1. Oil and Gas Mediator

Oil and gas companies often make deals with equipment and/or service providers, and whenever they do this, the intermediary earns a handsome commission for every successful transaction carried out. The disadvantages of this business model is minimal because it requires next to no startup capital. All you need are contacts of customers in the industry for whom to serve as intermediary and reputable vendor.

2. Maintenance and Servicing

This is another profitable business because oil and gas companies have many facilities including depots, gas plants, tank farms, power plans, gas wells. So, they will always need to fix and maintain them.

And that is where you come in.
However, and most importantly, you need sufficient technical knowledge and you have to assemble a strong team of service engineers and technicians to fully satisfy your clients.

3. Human Resources (Manpower Management)

Companies in the oil and gas industry are busy with operations and productions such as drilling, extracting etc. They want to focus on their core business and that’s why hiring a recruitment agency will save time and hassles with hiring workers.

Bear in mind that companies in the industry hire many people when they have new projects. So, to stand out in this business, you need keep abreast of what new project is forthcoming in the industry and be the first person to approach the clients for manpower management services.

4. Consulting

While many consulting firm in Tanzania and East Africa focus on engineering and project consulting, there is a gap in the market in need of providing guidance, support and resources for the investors who own or want to start a business in this industry.

So, you fill this gap by starting your own consulting firm, consulting and providing business support for the people who want to build a sustainable business in the oil and gas industry. This business is ideal for people who don’t have a huge capital to venture into an expensive oil and gas business but have in depth knowledge of the oil and gas industry.

5. Products (Fuel) Haulage and Logistics

Due to the increasing demand for petroleum products in East African countries, transportation of these products (for example, premium motor spirit (PMS), diesel, kerosene, and other petroleum products) has opened a lucrative investment opportunity for entrepreneurs. This business is about using fuel tankers (trucks) to distribute petroleum products with transport charges depending on the distance to be covered and the capacity of the truck.

You will have to obtain a license from EWURA to be allowed to transport fuel across the country or to neighboring countries. You will have to purchase a truck and hire a qualified and experienced driver who will haul petroleum products for marketers from depot to their desired destination.

I would recommend you start with transporting petroleum products from depots to filling stations locally across the country. As your business expands, you can acquire a new license to transit fuel to neighboring countries such as Uganda, Kenya, Rwanda and Congo DRC.

6. Gas Retailing/Distribution

Cooking gas or LPG distribution is one of the most profitable oil and gas business opportunities. Yes, it demands medium scale capital investment. You also need to have proper licensing from the relevant government agency. Also, the market for cooking gas distribution is increasing.

7. Build a Website

The website should focus on the oil and gas industry. Do reviews, interviews and write original content. Monetize your traffic through advertisements, referrals and affiliate programs.

8. Start a Petrol Station

If you’re brainstorming in order to find a perfect business idea in Tanzania and East African oil and gas sector, investing your cash in the petrol filling station business is a wise decision.
This business ensures steady profit in a reasonable time from setting up. You might feel the market is already flooded, but you can come in and have a go at it. Petrol stations are in every street corner because they make insane profit.

Don’t get me wrong. I am not saying this to brag. Instead, I am telling you this because I’ve carried out solid research. So, I can confidently tell you that this is one of the right business opportunities to pursue.

The filling station market emerged in tandem with the automobile industry.
Most important is the emerging mode of transportation. There are tricycles or “boda-boda,” as everyone calls it, and it has increased the demand for petroleum products in Tanzania. The good news is that, all these vehicles and generators run on diesels or petrol.

With petrol station in every street corner, you might feel the market is already saturated. But with a good location, commercial expertise, systematic marketing and a wide range of services, new entrepreneurs like you can win the competition in this business.

9. Online Fuel Delivery

In the era of booming eCommerce industry, online fuel delivery is definitely a lucrative opportunity for the energy-preneurs. However, the business demands right strategic planning and operating procedure. In addition to that, you have to put a substantial initial investment. It is advisable to start with an operation within a single city. And after getting the sufficient confidence, expand the business.

10. Oil and Gas News

You can make money sharing news and information on latest developments, investment ideas, petroleum business challenges, entrepreneur interviews, etc. through online and offline means such as blogging, publishing periodic magazines, creating an oil and gas job portal, starting TV shows targeting the oil and gas sector and lots more. This is a perfect online oil and gas business for everyone.

11. Oil and Gas Brokerage Services

Even if you have no money to venture into the oil and gas business, you can still profit from the industry by offering brokerage services between buyers and sellers of petroleum products.

12. Start a TV Show Production

You can also launch a TV show targeting the oil and gas sector. You can profile and interview entrepreneurs in the oil sector, review the challenges in the petroleum sector, etc.

13. Blogging on Oil and Gas-Related Issues

Another easy-to-start business in the oil and gas value chain is to start blogging on oil and gas-related issues. It is interesting to note that there are loads of people out there who are making millions annually from blogging. If you are an oil and gas professional or someone who has sound knowledge in the oil and gas industry, one of the businesses that you can consider starting is to start blogging on oil and gas related subjects. The truth is that if your blog has useful and helpful content, you will attract loads of traffic and if you have loads of traffic on your blog, you can easily secure good advertising deals from stakeholders and other businesses in your blog. Just ensure that you update your blog regularly and you will continue to attract traffic.

14. Publication of Oil and Gas Magazine

Another of the several businesses is to start publishing oil and gas magazines. Information is key in any industry and all you need to do to be able to gain ground with this type of business is to ensure that you have relevant contents in your magazine per time. Part of the information that you should make available in your oil and gas magazine are the various business opportunities in the oil and gas industry, the latest trends, news and information as it relates to the industry, and advisory services to investors who are looking towards investing in the oil and gas industry.

15. Lubrication Oil Retail Shop

Selling egine oil, brake fluid and hydraulic oil et al. is a profitable and highly thriving business venture an entrepreneur who is interested in making money from the oil and gas business value chain should consider. The fact that vehicle owners subject their vehicles to servicing at regular intervals creates a market for lubrication oil products. In recent times, there is an increase in the lubrication oil production sector as it is one business you can readily go into with the hope of making great profit. The various needs of lube oils in homes, organizations, factories and industries just cannot be overemphasized because the population of people who have mechanical need for oil have continued to increase over the years. So, for you to start out in this trade, have an expert carry out good feasibility studies.

16. Start Manufacturing Cooking Gas Cylinders

Another profitable and thriving oil and gas-related business that an entrepreneur who is looking towards investing in the industry should consider starting is to go into the manufacturing of cooking gas cylinders. There is indeed a large market for cooking gas cylinder. As a matter of fact, households no longer rely on just one cylinder; they prefer to have one or more backups. This is indeed a capital intensive kind of business. It also requires loads of expertise to be able to stay afloat in this type of business.

17. Start a Filling Station Construction/Building Company

Another lucrative business in the oil and gas business value chain that an entrepreneur should consider starting is filling station construction/building company. It is important to state that you can only successfully start this type of business only if you have the required training, experience and technical skills. The fact that investors are investing in filling station business means that there will always be a market for engineers who are into the construction of filling stations.

18. Go into the Retailing and Supply of Pumping Machines

If you have visited a gas station/filling station before, you will notice that the means of retailing fuel, diesel, gas and kerosene et al. is via a well calibrated pumping machine. This goes to show that there is a market for pumping machines.

19. Health and Safety Trainings for Oil and Gas Workers

Another thriving and profitable business in the value chain is health and safety training for oil and gas workers. If you have the required background (experience and qualifications) to train on health and safety, then you should consider starting an organization that trains oil and gas personnel. In point of fact, health and safety is taken seriously in the oil and gas industry simply because of the risk and hazard that workers in the industry are subjected to in a bid to carrying out their jobs.

20. Manufacturing and Sale of Oil and Gas Machines and Equipment

Manufacturing and sale of oil and gas machines and equipment is yet another thriving and profitable oil and gas related business that an investor who is looking towards starting a business in the industry should consider. Oil drilling and exploration equipment, pumping machines, casing and pipe stacking and handling equipment, pumps, slush, oil and gas rig, gauges and meters, valves, actuators, regulators, cranes and lifting equipment, hazardous area electrical equipment and several other equipment and machines are marketable. So, if you are looking for a business to start in the oil and gas industry, then one of your options is to go into the manufacturing and sale of oil and gas machines and equipment.

21. Welding Services for Oil and Gas Companies

Another profitable and thriving business in the oil and gas industry that an entrepreneur who is looking towards starting a business in the industry can successfully start after acquiring the required training is to offer welding services. Welding is one of the services that are needed in the oil and gas industry to deliver precision welding jobs. So, if you are looking for a business to start in the oil and gas industry, then one of your options is to provide welding services for oil and gas companies.

22. Oil Farm/Depot

Imported fuel as stated above are stored in tank farms. Most oil marketers don’t own tank farms and, as a result, always need to store their petroleum products in other tank farms. With a large operating capital, you can construct a tank farm for the sole purpose of leasing it out to oil marketers who bring in petroleum products.

23.Open a Training School/Institution

There are very few colleges and universities that offer specialized training in the oil and gas sector. Starting an institute focused on the oil and gas industry is a good idea. Choose a niche, hire trained instructors, lease property and provide a robust curriculum.

24. Sell Equipment

The oil and gas industry uses lots of machinery to carry out their activities. You can buy or fabricate equipment targeted at a sector. The business is lucrative and requires lots of investment in money, technical knowledge and testing.

25. Supplying Safety Equipment

Every sector of the oil and gas industry needs lots of safety equipment. Safety is a major concern and a priority in the business. The companies need to buy equipment regularly. This is where your company comes into the picture. You can buy safety gears from major manufacturers and supply companies in the industry.

26. Insurance

The industry is very hazardous so they need proper insurance cover. You can hookup with an insurance company as a sales representative. You make money through the payment of commissions. The more insurance premiums you sell, the higher your profit.

27. Retail Kerosene

Kerosene business is profitable and has a huge market. People use kerosene to cook meals and light fires.

28.Oil and Gas Enterprise Software Application

Technology companies are equally not left out as they can build tech solutions specifically targeting the oil and gas industry, and license the software to companies in the sector.

29. Oil and Gas Exploration

Oil and Gas exploration is capital intensive and not for the faint-hearted. You need to get an exploration license or block. Exploration involves lots of demographic data, drilling and experts in exploration. You can also secure contracts from other oil companies to use your drilling equipment.

30. Cooking Gas Reseller Shop

Liquefied petroleum gas (LPG) market (popularly known as cooking gas) is expected to grow by fifty percent in the near future due to the wide adoption of LPG as a source of energy for cooking in residential areas, replacing other traditional cooking fuel such as charcoal and firewood.

The first option to go into the LP Gas business is to set up a retail shop in highbrow areas. Location is a key driver to success in starting cooking gas reseller shop. To start this LP gas business, you need at least 22 to 35 pieces of gas cylinders (preferably 15Kg and 6Kg gas cylinder), regulators and hose, and weighing scale. You will buy the cooking gas from major dealers/superdealers and resell them to households in your target location.
I often wonder how they make a profit seeing that there is intense competition in this business. But the best part is that, as the number of the household switching to this fuel increase, demand increase and more customers arise.

31. Offer Legal Services

There are legal practitioners who are well-vested in the business of oil and gas. This set of lawyers are specialized in oil and gas law, and they are making the most out of life in the industry. What they do is to offer legal advice to those in the industry who desire their services. This aspect of business opportunity in the oil and gas industry, according to findings, is a well-acknowledged service and it is a lucrative job for lawyers in the oil and gas industry, and that the job is reserved only for lawyers. So, lawyers, this is an opportunity in the oil and gas industry for you.

32. Start a Crude Oil Refinery

Tanzania import millions of tons of refined petroleum products annually. By building a crude oil refinery using limited stock feed supply in Tanzania, you will not only reduce the amount of petroleum products import in the country but also cater to the booming consumer demand by providing Tanzanians with affordable petrol, diesel, jet fuel and other petroleum products.
Setting up a crude oil refinery requires a huge startup capital, but it is very profitable business if you can pull up resources to start this business.

33. Host Industry Events and Conferences

If you don’t have the massive capital to venture into those expensive oil and gas businesses but you have passion for the oil and gas industry, you may consider putting together industry events and help professionals and companies learn about new development across the industry and build relationship that are valuable for career and business development.
If your event can attract relevant decision makers in the industry, you will make handsome money from attendees and sponsorship from companies who are looking for visibility and exposure across the oil and gas industry.

I hope this help.

At Tanzania Petroleum, we are committed to helping people make their entrepreneurship dreams come true in this most valuable oil and gas industry in Tanzania.

Executive Summary

AFRI Training Limited will be a training and development company in Dar es Salaam, Tanzania that offers training services to experienced and newly hired personnel to EPC Contractors,  pipeline operators, operators, mining companies and construction companies, with skills and knowledge required to succeed in the natural, construction and infrastructure sector.

This business plan will be used to define the scope of our services, as well as a means of gaining the necessary investment to open the company. It will also be used continually  in the evaluation of AFRI Training Limited’s mission, goals and objectives.

The key to success for AFRI Training Limited is the ability to market effectively,  creating high-quality learning environment where people enjoy themselves, and hiring qualified  and experienced instructors to aid in the running of our courses.

The discoveries of massive natural gas in Tanzania, along with the resulting investments in infrastructure such as ports, oil and gas pipelines and renewable energy projects, have created a significant demand for local workers in Tanzania. The sad reality is that operating companies find it difficult to attract highly qualified local people for implementation of the projects in the region.

AFRI Training Limited hasave equip itself in this challenge and has assembled a strong team of qualified and knowledgeable instructors to fully satisfy the needs for highly qualified workers by developing workers and moving them from just local level to world class professionals and industry leaders.

AFRI Training Limited is projecting  a modest net profit in its first year  of operation with this increasing steadily  by the end of the third year.

Company Summary

AFRI Training Limited is a new manpower development company that provides training services to new to experienced and newly hired personnel to EPC Contractors,  pipeline operators, operators, mining companies and construction companies with skills and knowledge required to succeed in the natural, construction and infrastructure sectors.

Company Ownership

AFRI Training Limited will be duly registered as a limited liability company financed partially by direct owner investment.

Mohamed Aboud: Owner and Managing Director; will own 45% of the company.

The other limited partners will own   30% and 25%.

Mission 

The mission of AFRI Training Limited is to develop and transform local workers from just being users to be world-class professionals and industry leaders.

Our purpose is to move the local industry professionals from just users and followers to ex-pat experts and to professionally independent focal point which will produce local leaders of the industries, and they will able to lead the industrialization phases execution accordingly.

Vision

AFRI Training Limited is seeking to be a training hub in East Africa by providing training that meets industry standards and requirements.

Objectives

  • To achieve a substantial sales revenue during the first year of operation.
  • Increasing sales modestly  during the second year of operation.
  • Increase customer base by 25% by the end of the third year.

Keys to Success

Effective Marketing: We will market AFRI Training Limited as a distinguished name in Tanzania and we will do it creatively so that our services  will reach each of our market segments.

Knowledgeable and Experienced Trainers and Management: By providing trainees with knowledgeable and qualified staff who show genuine interest in the participants, clients will be confident that AFRI Training Limited will meet all their manpower development needs and requirement.

Up-to-Date Curriculum:  By offering an up-to-date industry curriculum, students, employers and the society can be confident that the program meets the quality standards that produce highly qualified workforce.

 

To get the full version of this business plan of industrial training and development company in Tanzania including financial plan reach out to Hussein.boffu@tanzaniapetroleum.com or +255655376543

 

Table of Contents

Executive Summary

Objectives

Mission

Vision

Company Summary

Company Ownership

Start up Funding

Products and Services

Market Analysis

Market Segmentation

Competition

Competitive edge

Marketing Strategies

Management and Personnel Plan

Financial Plan

 

 

Imagine you start a business with much lower risk. Even if the business failed, there would still be something tangible to hold on to.

Businesses that thrive even in bad economy.

One of such businesses is the filling station business, otherwise known as a petrol station business.

Consider this:

You are not marketing any product because consumers already abound.

You would surely make a lot of income doing side businesses like car wash, mechanic workshop, and restaurant.

Big companies like DSTV MTN ,BANKS etc. rent office space from petrol stations. And we haven’t talked about shopping malls, too.

You see, everywhere you turn under the petrol station business, there are opportunities waiting for you to grab them.

But how do you start this lucrative business in Tanzania? Here is a step-by-step guide to starting your business in Tanzania.

1. Study the market:

The first thing you will need to do is to determine the requirement and break down the cost for starting a petrol station business in Tanzania.

What equipment, machinery and skilled labor will be required to start a petrol station business? Who are your potential suppliers and where will you buy fuel? You will also need to know what regulations, certification you will need to comply with.

2. Write a business plan:

This is a comprehensive document that proves on paper that a viable market exists for your petrol station business and that you can sell enough of products and services at your planned petrol station to be profitable and attractive to potential backers. Your petrol station business plan provides the main strategies and tactics you will use to make your dream come true. It also valuable in promoting  your business to bankers, investors and  business communities.

Your petrol station business plan should comprise executive summary, vision and mission statement, objectives, industry trends, market analysis, SWOT analysis, marketing plan, operational plan and financial data and projections.

Read also:      A Sample Business Plan for Starting and Running A Petrol Station in Tanzania

3. Evaluate the marketability of the location:

If you want to build a petrol station, location is a key determinant whether your petrol station business will fail or succeed.

If you make a mistake in location, the business is already a huge mistake.

For your petrol station business to be set up, you need to set up in the best location in your target city. The biggest mistake people make is this: they just purchase land and rush into building petrol station without doing a little homework.

They spend a lot of money, time and effort building a petrol station only to find that the station is selling a little volume from the market in trading areas.

The petrol station business should have the advantage of being in an easily accessible and highly visible location.

No matter how good your marketing strategies are, if you build a petrol station in a non-strategic location, you will make little sales.

If you want to see your petrol selling huge volume of fuel in the marketplace, you need to evaluate the marketability of your area. Before you take the next big step of purchasing or build a petrol station, you should evaluate the marketability of your site.

You need to determine whether there is a market for selling petroleum products as well as who the target customers are. You need to determine who your competitors are and how you will stand out in this competitive business. You need to determine how much volume the station is expected to extract in the trading area.

Before you pour your blood, sweat and tears as well as a lot of time and resources into building a petrol station, you should evaluate your location and do a little homework to know whether your location will sell before you go into the trouble of building petrol station.

You will need to answer “Yes” to this question: “Will a petrol station sell in this area?”

It’s just a matter of finding answer to these questions:

  • What are future development plans in your area? And what are the economic activities that may attract traffic?
  • How much volume of diesel, petrol and kerosene the station is expected to sell in trading areas.
  • Traffic count or estimated quantity of cars and vehicle per days.
  • What are the competitive advantages of nearby petrol stations?
  • What are the land parameters to comply with and the legal requirement?

You should already have much of this information if you have been doing a solid home work. Evaluate your land. If your evaluation reveals that your location will not sell or will not sell well enough, let it go or find a way to make your location profitable.

You can outsource this task to a consultant like us to evaluate the marketability of your area and compile a report that will help you whether your petrol station will sell or not.

4. Put up and raise startup capital:

The petrol station business in Tanzania is a lucrative one that needs a sufficient startup capital. It is likely to cost TZS 225 million to TZS 1 billion. You can get it from investors, borrowing money from banks, friends, or savings.

Not surprisingly, inadequate capital is the leading cause of the petrol station business failure.

5. Launch your company:

You will need licenses from regulatory authorities including EWURA, NEMC, OSHA etc. You will need to purchase equipment such as storage tanks, pumps and start construction of your petrol station.

6. Sell the products:

Now you have all permits and licenses and you have built your petrol station, the next stage is to start marketing your petrol station to make sure you attract enough traffic to reach your sales goals.

7. Keep up with the market:

You need to be abreast on what is going on in retail petrol station business in Tanzania so that you can stay ahead of competitors.

I hope this help.

At Tanzania Petroleum, we are committed to helping people make their entrepreneurship dreams come true in this most valuable oil and gas industry in Tanzania.

The current market of petroleum products in Tanzania is $1.77 billion, growing at the annual rate of 15 percent.

With continued economic activities in Tanzania, this growth rate is likely to accelerate in the near term.

Although there has been series of natural gas discoveries in the past 10 years and small gas production in Tanzania, the demand for energy is growing fast and this demand can’t be covered by liquefied natural gas (LNG), new natural gas field development or alternative energy initiatives.

The best way to meet Tanzania’s huge energy demand is the combination of these sources of energy, including petroleum products.

So, no matter how much is imported, more is needed to meet the ever-growing energy need in the country.

The wholesale petroleum products business is so lucrative that aspiring entrepreneurs who are passionate about benefiting from petroleum product wholesaling can jump in to sell to an already available market.

The best part of selling petroleum products in Tanzania is that you are not cajoling people to buy products they don’t intend to buy like multi-level marketers do.

You are serving people who can’t do without your products.

What is Petroleum Products Wholesaling and How does it Work?

Now that you know that there is a huge and profitable market for petroleum products in Tanzania with endless potential growth, let us have a look at what petroleum products wholesaling business is and how it works in Tanzania.

The wholesale petroleum business is nothing new in Tanzania.

Well-know oil brands like Total, Puma Energy (previously Oil BP) etc. are all petroleum wholesalers (popularly known as oil marketing companies). These companies are all foreign.

Over the last few years, several great brands that are owned by Tanzanians started to emerge in the market. You already know brand names like Lake Oil , Afro Oil, and many more.

These companies engage in importing, storing and trading petroleum products to commercial consumers as well as to end users through their retail petrol stations outlet. There is a large upfront investment needed to get tanks, trucks, training, certification and products if you pick to follow these route.

However, there is an exiting and profitable market for independent petroleum wholesalers who operate without their own specific retail brand name.

These wholesalers sell petroleum products to transport companies, mines, farmers, colleges and schools, factories and to some unbranded or privately-owned petrol stations. Some independent wholesalers trade petroleum products to land-locked countries such as Burundi, DRC Congo, Rwanda and Uganda.

The best part of this is that Tanzanians can now actively participate and reap rewards from petroleum products wholesaling. As an independent petroleum wholesaler, your task is to go out and look for customers. Once you get an order, you will relay the order to suppliers and arrange delivery from the supplier’s depot to customers.

I would strongly recommend you target large customers who have the financial muscle to pay you in advance before the delivery.

Also, you have to negotiate with suppliers.

Profit Analysis (How much does independent petroleum wholesaler make in Tanzania?)

There is no limit to the amount of money that you can make in the wholesale petroleum business. It depends on your efforts, commitment and your marketing skills or creativity.

Since the wholesale petroleum products price is regulated and like any other commodity, petroleum products price tend to fluctuate regularly due to exchange rates, international benchmarking or fluctuating oil price in the global market.

Therefore, this tends to affect the profit margin in this business.

But a realistic profit margin that independent petroleum wholesalers make is TZS 60 to 67 per liter.

That means for only for only 100,000 liter per month, a petroleum wholesaler will be able to earn around TZS 60 x 100,000 liters = TZS 6, 000,0000.

Keep in mind that the transportation cost (distribution cost) are added in the price.

How to Become a Petroleum Products Wholesaler in Tanzania

Business Plan:

The wholesaler petroleum products business needs strategic planning to start.

To be completely transparent with you, most Tanzanians do not understand the value of a business plan. They only request for business plan when they want bank loan or they engage in business competition.

While it is vital to prepare a business plan before you start business in market, the emphasis of business plan is essentially as a plan to enter the oil and gas industry.

As an independent petroleum wholesaler, you will compete with wholesale petroleum companies that have huge financial capacity and highly specialized and technical staff.

Your wholesale petroleum business plan will act as a roadmap to reach your business objectives and give you a clear picture on how to compete well in the market.

Register your company:

Get your limited liability company registered with the Business Registration and Licensing Agency (BRELA).

Get EWURA Approval:

The Energy Water and Utilities Regulatory Authority (EWURA) is the government agency that regulates the downstream petroleum product sub-sector in Tanzania. You have to get a wholesale petroleum license that allows you to sell petroleum products to bulk customers.

Keys to Success

Merging:

To ensure a good profit margin, pick a supplier who will offer you high-quality products at competitive rates

Marketing Skills:

As I mentioned earlier, you compete with petroleum wholesalers who have huge financial muscles and talented technical team.

So, employing the best marketing strategies will help you to compete well in this industry.

Have you ever wanted to start your own business in the oil and gas sector in Tanzania?

If you answer yes, then it’s a wise decision to pursue.

Tanzania’s oil and gas sector is another name for wealth. To verify my words, plan a visit to the Oyster Plaza building in Masaki, Dar es Salaam, where there are a lot of oil and gas companies’ offices. You will be shocked once you see Mercedes Benzes, BMWs, and all kinds of expensive cars in the parking areas outside the buildings.

This is a living testimony that they make huge money from the oil and gas industry.

The simple truth is that oil and gas entrepreneurs are super busy. They have only two options: either to take a flight for a meeting abroad or to deal with clients. But if you are lucky to meeting them even for 10 minutes, you will be amazed at their lifestyle.

And the reasons they make that huge money is because oil and gas products are fast-moving commodities in the world. The demand for oil and gas end-product and by-products are huge in Tanzania and across the world.

Tanzania has discovered 57.25 trillion cubic feet of natural gas. But according to the US Geological Survey, the country still has potential natural gas reserves up to 441 trillion cubic feet solely in the coastal region, so more gas discovery might be forthcoming.

My friend, oil and gas resources are wealth. The oil and gas sector has turned ordinary and poor people into extraordinary, wealthy people.

The best part of this industry is, the earlier you start, the better. Don’t wait until 2020 to enter the market, because a lot of international guys and only a few groups of Tanzanians are smiling to the bank with money coming from the industry.

I am not saying this to impress, but I want you to start benefiting from the huge gas discovery in our land.

Instead of being proud that you are in the country blessed with huge natural gas resources, now you should know how to monetize these resources and reach your mountaintop.

But don’t get me wrong, this is not a get-rich-quick scheme. To make good money in this industry, it requires a long-term commitment and building a strong relationship with clients. And just like anything worth having, it takes effort.

Are you interested in starting business In Tanzania’s oil and gas? Here are the requirements:

1. Find A Niche

Tanzania oil and gas is huge, and there are multiple routes to break into this industry. So, the first things you should identify are business activities that you have proven capabilities and capacity to do well.

I meet a lot of entrepreneurs who want to do all trades in the industry. But that’s not for you. Because you won’t succeed if you want to engage in all the trades at once.

To succeed in this sector, you have to put 100% of your energy into one business activity. And once you are doing well in that business activity, that’s when you diversify.

Finding a niche starts by identifying products or services you want to render in the industry.

Here are some of the business activities you could decide to do in Tanzania’s oil and gas sector:

  1. Become an oil operator. You will set up a company that searches and extracts oil and gas resources out of the ground. You might hear it often called Exploration and Production Company. It is capital intensive because it requires advanced technology, equipment, machinery, and highly trained manpower with expertise and experience in extracting oil and gas resources. But it yields solid profit if you manage to go on it.
  2. Offering mechanical services (e.g. welding and fabrication services.)
  3. Catering services (e.g. feeding oil and gas workers or pipeline construction crew on the campsite.)
  4. Logistics and transportation services.
  5. Offering oil and gas tools and equipment (e.g. pipes, valves fittings, drilling bits, casing pipes, etc.)
  6. Selling drilling chemicals, corrosion inhibitors and oil and gas materials (e.g. barite, bentonite, sodium chloride, uniform, coveralls, safety boots, gloves, etc.)
  7. Finance and insurance services.
  8. Legal and IT services.
  9. Supply of office materials.
  10. Engineering procurement and construction management.
  11. Wireline services, direction drilling services, well drilling services, maintenance services, etc.

And the list goes on.

2. Register With The Business Registration And Licensing Agency (BRELA)

Once you have identified the services you want to render in the industry, the next step is register with BRELA.

This is imperative because no individual is allowed to bid in the oil and gas sector. It’s only for registered companies. So, do business in Tanzania without getting into a legal trouble. You should register a business name or limited liability company with BRELA.

Registering with BRELA is fast, easy, and cheap, if you meet their qualifications. Here are the requirements to get registered with BRELA:

  1. Memorandum and article of associations.
  2. List of shareholders and directors (their names, address, and date of birth.)
  3. Share distribution.
  4. Share capital.
  5. Name of the company secretary.

3: Get Necessary Licenses And Permits

Now that you have registered your company with BRELA, and BRELA has given you a certificate of incorporation, the next requirement is getting licenses and permits.

But permits and licenses vary depending on the kind of oil and gas activity you intend to do.

If you want to be an oil operator; that is, you buy a gas block for extracting oil and gas resources, the agency responsible for such permit is Tanzania Petroleum Development Corporation (TPDC).

If you want to be a contractor (those who want to provide engineering, construction, mechanical services, and other technical jobs), you shouldyou’re your permit from the Contractor Registration Board (CRB).

For suppliers and consultant, get a permit from the Regional Trade Office.

Bonus: For entrepreneurs who want to setup a lubricant (engine oil) or petrol station business, get a license from the Energy Water and Utility Authority (EWURA).

4. Register With Oil And Gas Companies You Want To Work With

Now that you have a license to operate in Tanzania oil and gas sector, the next step is to register your name with international oil and gas companies as a vendor (contractor or supplier.)

5. Win Your First Contract

The most challenging task in the Tanzanian oil and gas industry is getting your first contract. This is because nobody wants to be the first customer. But sometimes you need only one customer to grow fast in the industry.

To grow fast in the industry, alliance, partnership, and joint venture across the country with experienced international oil and gas contractors is necessary.

Attend conference trade shows and join Tanzania oil and gas associations.

This will enable you to learn how to do business with large oil and gas companies in Tanzania and increase your contacts.

What Are You Waiting For?

Now you know the requirement to  start  the oil and gas business in Tanzania. If this interests you then it is time take all necessary steps to make this reality.  You can do this if you commit yourself to your own success.

Think back for a moment.

What do you imagine when someone mentions the oil and gas sector?

Businessmen worth billions? Oil barons? The government?

Let me also ask: what do you think it takes to succeed in the oil and gas sector in Tanzania?

I have some good news for you.

It’s not by having a huge capital, neither by offering the most perfect products, nor by even having a lot of contacts in the industry.

Sure, it does help, but not always.

Supposing you want to climb Mountain Kilimanjaro (the tallest mountain in Africa), would you go climbing yourself or get an experienced guide who would lead you to the summit?

It’s the same in the oil and gas sector, too.

To succeed in Tanzania’s oil and gas sector, you need to find experienced people who have succeeded in the sector, people who are willing to guide you.

Once you can do that, you can be sure that when you follow their steps, you’ll succeed.

There’s a catch, though.

A Guide For a Million Dollars

Yes, you heard me right.

That’s how much it takes to get an experienced person in the oil and gas sector to guide you.

Imagine consulting your mentor at $200 per hour. I’m just estimating low. Some will charge you $500 per hour. Some, a thousand dollars.

Imagine that. O-N-E T-H-O-U-S-A-N-D D-O-L-L-A-R-S.

Multiply that by a minimum of three hours per day.

Multiply that by a minimum of three times per week.

Multiply that by four weeks in a month.

(You would have learned much in a month, but still, you won’t be able to stand on your own yet. You need a minimum of six months to a year to learn all it takes.)

Multiply that by a minimum of six months.

Here’s the breakdown for a $500 per hour consultation lasting three hours for three times a week, and for six months:

$500 * 3 hours * 3 times per week * 4 weeks in a month * 6 months = $108,000

That’s a whooping sum of money. And you can bet your money that you’d have made ten times that amount in six months.

But can you afford it?

For you, that’s like a million dollars.

An Alternative Guide For a Few Bucks

But what if I told you that you can learn how to start an oil and gas supply and services business in Tanzania without annoying anybody?

What if I told you, you can save a ton of time on getting a guide, on how to get deals, on how to prepare acceptable prices (quotation), and on winning contracts and supplies?

What if I told you can save a lot of money in discovering the main area of business opportunities in the oil and gas sector in Tanzania, the list of goods and tools you can start to supply, and how to register your business as a supplier or contractor with various oil and gas companies in Tanzania?

If you would like to sell products or offer services to the oil and gas sector and make a large profit margin, I encourage you to download our guide titled, “How to Recognize Potential Business Opportunities in the Oil and Gas Sector in Tanzania.”

In this guide, you will discover:

  • How to start an oil and gas supply and service business in Tanzania. Everything about planning your business, market analysis, and financing your business.
  • How to become a contractor or supplier, including licenses and permit you to need to get started with the oil and gas supply and services business.
  • A roadmap on how to recognize potential business opportunities and how to be noticed and considered by oil and gas firms.
  • How to present your goods and services to oil and gas companies.
  • How to get deals and win contracts. You will learn how to prepare and submit an acceptable bid or proposal.
  • How to raise money for your supply or contract.
  • A list of goods you can start to supply to oil and gas companies.
  • The main area of business opportunities in the oil and gas sector in Tanzania.
  • Tips to survive in Tanzania’s oil and gas sector.
  • More interesting businesses opportunities in Tanzania’s oil and gas sector.
  • List of oil and gas companies that are searching for oil and natural gas in Tanzania.

…and many more.

I’m not asking you for a million dollars. Not $10,000. In fact, I’m not even asking for $100.

Download this guide now for TZS 30,000 now.

To buy the book, make a payment of TZS 30,000 through Tgo pesa, M-pesa to any of these numbers:

+255689955711
+255655376543
+255653702878

Once your payment is done, send an SMS to +255689955711 or +255655376543 with the following details:

Your full name.
Your email address.

Alternatively, send an email with the above details to info@tanzaniapetroleum.com The moment we receive your email or SMS, and we confirm your payment, the eBook will be delivered to your email address (in PDF format) within ten minutes.

You can then download it and read it on your Smartphone or computer.

If you’re not in Tanzania, send an email to info@tanzaniapetroleum.com and we will devise a payment option for you.

Meet the Author

Hello, my name is Hussein Boffu, and I’m the author of How to Recognize Potential Business Opportunities in the Oil and Gas Sector in Tanzania. I’m also the author of How to Start and Run a Profitable Petrol Station Business in Tanzania. I’m also the founder of TanzaniaPetroleum.com

I am an entrepreneur specializing in the oil-and-gas supply chain. For quite some time now, I’ve been consulting a lot of businesses, both local and international, regarding starting a business in Tanzania’s oil and gas sector.

I have been approaching and talking to executives, and have been selling goods and equipment to various oil-and-gas companies in Tanzania.

The Complete Guide for Just a Token

To buy the book, make a payment of TZS 30,000 through Tgo pesa, M-pesa to any of these numbers:

+255689955711
+255655376543
+255653702878

Once your payment is done, send an SMS to +255689955711 or +255655376543 with the following details:

Your full name.
Your email address.

Alternatively, send an email with the above details to info@tanzaniapetroleum.com The moment we receive your email or SMS, and we confirm your payment, the eBook will be delivered to your email address (in PDF format) within ten minutes.

You can then download it and read it on your Smartphone or computer.

If you’re not in Tanzania, send an email to info@tanzaniapetroleum.com and we will devise a payment option for you.

The East African oil pipeline (or the Uganda-Tanzania pipeline is the talk of the town now. Not only in East Africa but all over the globe.

The construction of this pipeline is officially on. Social and resettlement planning services have been undertaking it in Tanzania.

The sad reality is that people don’t know about the business opportunities available in the project.

More and more people keep wondering what the opportunities emerging in this project are and how they can be part of it.

“Do they offer equipment or provide services?” they ask themselves.

If you are among these people seeking to do business in this projects but have no idea how to get started, then no need to worry.

This article shows you some opportunities available in the project and how you can participate so that you can reap a substantial profit.

The Tanzania-Uganda Pipeline Opportunities

  1. Pipes and connection supplies: One of the opportunities in this project is to supply and manufacture seamless tubes and pipes (LSAW) and also supplying steel pipes.
  2. Chemical Supplies: For the construction of the pipelines, there are a lot of specialty chemicals needed, from corrosion inhibitors additives to scale remover to chemicals that reduce paraffin build up. You cannot run a pipeline without these things, and you can get them from China really cheap. Which means your profit margin may increase by 30-50 percent.
  3. Pipeline equipment supplies: These cover all materials that are required in the pipeline transportation system. It includes fittings, valves, scraper traps, insulating flanges, flow tee, pumping station, etc.
  4. Civil engineering works: These include building construction work, construction and maintenance of roads, construction and maintenance of drainage system, etc.
  5. Pipeline inspection services.
  6. Food supply.
  7. Security services.

Are you ready to utilize opportunities in this project? Here is how to grab the opportunities:

1. Identify the decision makers and influencers in this Uganda-Tanzania pipeline project.

The first step in pursuing opportunities in the Uganda-Tanzania pipeline is determining who the decision makers are.

Decision makers are the people who can approve or disapprove your proposal.

No matter how big a company is, there are decision makers who can approve or disapprove documents.

This can be easily achieved by making a list of key players in the project and starting to build long term relationship with them.

2. Demonstrate your experience.

You should demonstrate that you are the right person to execute the project you’re proposing.

You should demonstrate your capability and your experiences in executing similar project.

“What if my business is small and new n the industry?” you may ask.

Well, the answer is pretty simple. You still have a chance to tap opportunities in the Uganda-Tanzania pipeline project.

If your business is small and new, and you don’t have any experience or working history to be taken as references to the service you want to render, you should consider going into a joint venture with an experienced contractor in the oil and gas industry in such bidding venture. However inexperienced, you still have a chance to participate in this work.

You have learned the opportunities in the East Africa pipeline project and you now know how to access them.

If you want to learn more about the opportunities in the Tanzanian oil and gas sector and how you can grab them, click here to know more.

 

If you are struggling to attract clients into oil and gas, you’re not alone. because that’s happening, Not just to you. But to tons of entrepreneurs  in Tanzania and beyond.

But I have shocking truth for you today. The truth that prevents you from selling in the oil and gas.

The outlined are the truth:

                  

1. Availability of information
The Internet has changed everything. Your prospect has a smart phone, laptop or pad, whatever you call it. But it gives them access to the internet.
So information is at their fingertips. With a click, They can learn everything about your products, services, price, and specification.Even information about you and your business.

The sad reality is that, once they found things they don’t like. They  ignore you offering.

 

 2. Small wallet
Oil and gas companies and business have a small wallet.They cut cost and they want to spend more with less. The is because the economy is unstable right now. And crude oil price drop in the global market has added fuel to fire.  Most importantly, companies are burning with a loaded of tax today.

                

3.  The world is a single village
These days, your prospects can buy to any marketplace. Skype and video telephone has turned the world too small

In Tanzania, example. Many oil and gas companies buy products and services overseas.

So trying to compete in that game is the wastage of time.So how do you stand out?

Perhaps your marketing strategies relied on making more calls, send out a lot of emails. And have face to face presentation.

These approaches are effective.But in today’s oil and gas market, using these approaches you prospect might take longer to respond.

                        How To Overcome These Challenges

Great times of oil boom has gone. So things have changed now in the industry.
But the only thing that  remains  the same  in this sector is, we do business with people we like and trust

However, there’s the smart way. a method that can yield a greater return in the long term.That approach named DIGITAL MARKETING

Digital marketing is when you use the internet to promote your products and services to your high target market.

I often call digital marketing as help marketing. As you don’t do this to push clients to purchase your products and service. But you give them actionable advice about your offering. You show them how your products and service can benefit them.

This build trust and your clients will recognize you as an expert in your area. So if you are offering valves, writes an article about types of valves every engineer should know. If you are selling PPE’s demonstrate how they can benefit your clients. The same way if you offering engineering services.

The reasons this method is effective is, your clients, oil and gas professionals, highly decision makers are online

searching for the solution and valuable information about their business and personal matters. So why don’t you go where they are?

In reality, digital marketing is a new concept in oil and gas, but it increasingly popularity in the industry these days.

So, digital marketing cover everything from email marketing, video marketing, social media marketing.Your online presence

should be part of your sales team that increase your profit margin. But guess what. Having only company website, It won’t pay off.

Do you have an email list? Is your website rank higher when someone searches it on google? Do you provide valuable information about your offering that can help your clients?

if your online presence doesn’t result in you in revenue. Then it’s worthless to your business.

The common sense answer is to focus on getting clients and sales from your website visitors.

LPG Gas Bottles. LPG plant

Cooking gas Image

Cooking gas becomes so popular fuel for cooking.  Have you ever wondered why is everyone using gas for cooking now?.   The answers are pretty simple.

The first thing first, cooking gas is environment-friendly, cook food faster. Best of all cooking gas is very affordable

Cooking gas is also called  Liquefied petroleum gas (LPG)  or simply   “GAS” as everyone calls it.    Cooking gas is made up during refining of crude oil or processing of natural gas.

I don’t want to go deeper into this subject of the formation of Cooking gas.  Let be the story of another day. The topic at hand is how you start, run and make good money selling cooking gas in Tanzania

The market for this product is growing at faster rates. To save forests, government encourage the use of this product. So even people in rural areas are switching from the use of firewood and charcoal.

This business has attracted a lot of entrepreneurs in Tanzania. And cooking gas retail shops are in every street corner.

I often wonder, how do they make a profit with this intense competition. But the best part is that, as the number of the household switch to this fuel,  demand increase and more customers arise.

    Start-Up Money

You don’t need all the money in the world to start up cooking gas business in Tanzania.  With 1,670,000TZSH  you are staring    mid-sized cooking  gas  business in Tanzania

So before we go any further      let look at  budget for starting this business

Gas cylinders (     15kg gas  and 6 kg.  about 20 pieces each size of cylinders) TZSH          1,140,000
Business license   TZSH              80,000
Fire certificate   TZSH          100,000
Hose pipe   TZSH           60,000
Dry powder fire extinguisher 6kg   TZSH           90,000
Miscellaneous   TZH             200,000
Total                                  TZSH          1,670,000      

Read:      How-to-start-video-production-business in Tanzania

How is profitable is Cooking Gas Business In Tanzania

The average profit you can make for selling   15kg cylinder is  TZSH 7000. You buy at a unit cost of  TZSH 47,000 and resell at TZSH 40,000. So if you sell 10   cylinders in a week will make  7000×10= Tzsh70,000. In a month it is possible to make TZSH 280,000

The profit you can make for supplying 6kg cylinder is TZSH  4000. So once you selling 10 cylinders in the week will make you  4,000×10=TZSH 40,000. In a month you will have  a profit margin  TZSH   160,000

That is just an average profit you can make. But I guarantee you 95% profit if you do a good marketing and you sell your item in a good location.

Tips  To Succeed In This Businesss

   

1:Do  home deliveries

Cooking gas is the constant pushing business, so staying back and hoping customers will knock on your door is not a plan. To stand out you should do home deliveries with no extra charges.

Considering you’re starting with limited fund,   so delivering cooking gas to the customer’s doorstep with no extra  costs. might be stressful. But using a cheaper alternative to supply gas can be easily solved the challenge. So  considering using bike instead of car


2:Pick  good marketing strategies

Cooking gas is the personal contact business. So the word of mouth will really work. Approach a friend and family members and tell about your business.  The location is everything. Locate your shop in the area accessible to your target Customers. If you are reliable and you deliver on your promise.  Customers will become a friend of your business.

  Challenges In s  Cooking  Business

1:Fire explosion

Cooking gas is  flammable in nature. That’s can catch fire easily. To stand out, observe gas leakage and fix a problem quickly. Most importantly get fire extinguisher in your store

2:Price volatility

Cooking gas business is the boom and bust business due to the prices fluctuation in the global cooking gas market.  So when the price of cooking gas in the global market drop. It affects the local price as well. This ruins your business as the many customers saves money on buying gas. This will  drop your sales and profit as well.

So,  go out there and make it happen. You will thank me later.

I would love to hear your thought. Leave your comment below.