Selling household gas in Nigeria: Entrepreneur identifies gap in the market

Olasupo Abideen

Opab Gas is a Nigerian company that supplies liquefied petroleum gas (LPG) to households and businesses in Kwara State. The company was started in 2018. Co-founder Olasupo Abideen (26) answers our questions.

1. Give us your elevator pitch.

Opab Gas offers a safe, convenient and affordable gas refilling solution to individuals and businesses through a network of locations in Nigeria. We use digital scales to weigh the gas content in the cylinders, which builds trust among customers.

Customers can refill their cylinders with their preferred quantity of gas by either walking into any of our six locations or by ordering through our social media platforms and website. Once an online order is placed, we connect customers to the nearest gas station.

2. How did you finance your startup?

We started with a 100,000 Nigerian naira (about $259) personal contribution from myself and an additional 100,000 naira soft loan from friends and family. In addition, the company has received two grants of 100,000 naira and 1.5 million naira (about $3,884), respectively, to really expand the business to where it is today.

3. If you were given $1 million to invest in your company now, where would it go?

It will give us the opportunity to build a prototype of a smart meter which will be installed on the cylinders. The smart meter will automatically inform customers if their gas is finished as well as send a message to their nearest gas station, which can then come to their house and refill the cylinder.

The smart meter will also make a loud noise for 30 seconds in the event that the gas is leaking. If no-one attends to it within 30 seconds, the system will shut down automatically to avert a fire hazard.

4. What risks does your business face?

Unfavourable policies from the government. There is no unified process of taxation. We are paying taxes to the local government, the state government and the federal government. It reduces our profits and capacity to scale if we have to pay taxes to the same government three times. We are not getting value from all this tax, as infrastructure such as roads, is very poor. We have to repair our vehicle every two weeks due to the bad roads.

One of the six gas refilling stations run by Opab Gas.

Another risk is the lack of adequate measures to verify new entrants in the gas business. There are people who will simply start selling gas without the required technical know-how and expertise. When things go wrong, such as gas explosions, it reduces people’s trust in LPG as an energy source.

5. So far, what has proven to be the most successful form of marketing?

Word of mouth through our existing customers. The healthy and safety (HS) card that we give to our customers has also been a success. In addition, social media has been productive in generating new business.

6. Tell us about your biggest mistake.

Appointing staff who didn’t have a guarantor. I’ve learnt that no one is to be trusted. Every new staff member needs to have a guarantor – someone who knows them well and who would refund any stolen money.