Ice Block Production – A Simple but Profitable Small Business That Makes Cool Profits in Africa View

Don’t know how to start an ice block production business? You’re about to learn a lot of interesting stuff!

In the ever busy and crowded streets, roads and markets of West Africa, millions of people go about their daily business – business people, traders, office workers and school children.

In the midst of all the hustle and bustle, we often dehydrate under the hot weather and will need a glass of something chilled to refresh ourselves (usually water, juices or soft drinks).

At home, the electricity supply problem is forcing households to use ice blocks to preserve their food and drinks. The strong demand for ice blocks for cooling has created a booming business opportunity in cities, towns and villages across Africa.

This article introduces you to this small business idea and everything you need to know to succeed in it!

Why do we have such a huge demand for ice block in Africa?

It is our usual practice here on Smallstarter to give our readers a deep understanding of every business idea we share. By understanding the factors responsible for the demand behind every business, entrepreneurs can become more creative with their products and adapt in time to changes in the market.

Like every other idea we’ve shared in the Business ideas section of this website, consumer demand is the basic reason for the booming ice block business.

Let’s now take a look at other reasons for the huge demand for ice block in some of Africa’s cities, towns and villages…

Geography & Weather

A large portion of Africa sits on the earth’s equator and lies within the tropical climate region. This means that our continent enjoys more direct sunlight and heat compared to the temperate parts of the world (such as Europe and North America).

It is estimated that many parts of Africa enjoy (or suffer) an average of 300 days of bright sunlight every year. This means that for most days of the year, the weather is hot and humid as the sun shines ever so brightly for up to five hours on most days.

In fact, temperatures during the day can rise up to 40°C especially in the northernmost parts of the continent which have a savanna or desert climate.

The hot and humid weather conditions in many parts of Africa leads many people to drink more water to refresh and rehydrate their bodies.

In these modern times, most people prefer to drink chilled/cold liquids when they can afford it. In fact, we tend to feel more refreshed by drinking chilled water (or soft drinks) compared to ordinary ‘unchilled’ liquids.

Add to this the growing effects of climate change and global warming and you can guess that more parts of Africa will experience hotter and longer sunshine. This will undoubtedly lead to a higher consumption of chilled liquids like water and other drinks (juices, sodas etc). photo credit: clutchmagonline.com

Convenience

Convenience is another major reason why the ice block business is booming across Africa.

It is true that many people own water coolers/refrigerators and can afford to cool their own drinks. However, it’s not convenient or possible to carry your own cooler everywhere you go. You will likely have to buy drinking water from a vendor who buys ice blocks to cool the drinks she sells to customers like you.

It’s simple logic: the more people like you who buy chilled drinks when they’re out of their homes, the more ice blocks that are sold.

Another convenient reason why people prefer to use ice blocks is that they are faster and more efficient at cooling stuff.

Compared to cooling your drinks in a fridge (too slow) or stuffing them in a freezer (limited by size), ice blocks can provide more flexible cooling in any location; whenever and wherever you want it! Cool, don’t you think?

The terrible electricity situation

In our recent solar energy article, we looked at the terrible situation of electricity supply in many parts of Africa. Our continent arguably has the worst electric power infrastructure in the world with the lowest scores in power generation, consumption and security of supply! (source: World Bank).

In many countries on the continent, less than 20 percent of the population is connected to the electric power grid. The situation is worse in rural areas where less than 5 percent enjoy any electricity supply.

Even if we all had our own water coolers and refrigerators at home, how would they work without electricity? How many people can afford generators (of a sufficient capacity) to power water coolers refrigerators and freezers?

Rather than incur these extra costs, most people prefer to buy ice blocks to meet their household cooling needs (especially food preservation).

In the absence of electricity, buying ice blocks is a much cheaper, efficient and flexible option for most people in Africa’s towns and cities.

The terrible electricity situation remains one of the biggest reasons for the booming ice block business.

While we may curse the government about the power situation in our countries, some smart entrepreneurs in the ice block business are making good money from the problem!

Relaxation and social events

In our popular article, ‘Bars and Nightclubs – How to profit from Africa’s growing appetite for relaxation and partying’ we explored the trend of increased social activities and relaxation in Africa’s growing towns and cities.

This trend is largely a direct consequence of our continent’s large and overwhelmingly young population, rapid urbanization and economic prosperity.

There is also a rising trend of outdoor events like weddings, religious gatherings, clubs, relaxation spots and other social gatherings.

In our wedding business article, we looked at some of the interesting opportunities for entrepreneurs and small businesses. (photo credit: facebook.com)

What is my point here? It’s simple. When people gather at these events, they are MORE than likely to consume liquids. Water, soft drinks and alcohol (especially beer) are typically ‘served chilled’ at these events.

Nobody attends a party or hangs out at a bar to drink warm beer!

This is the reason why these events and relaxation spots are huge sources of demand for the ice block business. On most evenings and weekends (Saturdays and Sundays) across Africa, millions of people who attend all sorts of events are direct and indirect customers of the ice block business.

As our population continues to increase and more people earn a little extra to spend on relaxation and parties, the demand for ice blocks will undoubtedly explode.

How to start an ice block production business?

This is the interesting part; I hope you’re still very excited!

Now that you have a better understanding of the demand and market for ice block, let’s now look at the things you need to start one for yourself. It’s indeed a small business that requires basic raw materials, many of which are readily available around you.

Here are the five basic things that you need to start this business:

#1 Water

Water is the most important raw material in the ice block production business. As you already know, ice blocks are made by freezing ordinary water in a container to a very low temperature (usually below zero degrees Centigrade, 0°C).

You will need to find a good source of fresh and clean water for your production business.

It is probable that the people who buy your ice block will use it to cool food/drinks and may not drink it directly. However, because the ice will come in contact with products that will be eaten or drunk, impure or bad water from ice can contaminate or poison the food and drinks.

To avoid this, it is best to stick to the highest standards of hygiene and cleanliness. The water you use could be pipe-borne from the local government water authority or sourced from clean wells or bore holes. You could also buy your water supplies in areas where water is scarce.

#2 Packaging

Ice blocks are often packaged and sold in transparent polythene nylon bags. The bags help to hold the ice both in its solid and melted state.

Because ice can be slippery and difficult to handle, these bags help a lot during transportation and handling of the blocks.

Another good thing about packaging is that it provides you with a great opportunity to put a brand name on your ice block product. This will help to separate your blocks from the ‘faceless’ and ‘unbranded’ competition. It will also help to attract more customers to your business through the contact information on the labels.

#3 Ice block making machines

These are the machines that make ice blocks. Don’t worry, they are not some complex equipment you haven’t seen before.

Ice block making machines are more like deep freezers with a higher cooling/freezing capacity. Some of them have rectangular moulds/containers that you pour the water into in order to produce ice blocks. When the water turns into ice, it usually takes the shape of these containers.

There are both foreign and locally-made brands of these machines and depending on your budget, you can choose from a wide variety of models. Some of the things you should keep in mind when buying ice block production machines are:

• Capacity: This refers to the number of blocks that a machine can produce. Some can produce 20, 50 and over 100 blocks at a time.

Higher capacity machines will likely cost more than small capacity ones. The capacity you choose to buy depends on the number of ice blocks you plan to produce and sell daily. (photo credit: nairaland.com)

• Freezing time: The amount of time taken by the machine to produce ice blocks is also important. Some machines produce ice faster than others and this will often depend on the rating of the compressors.

Don’t forget, the longer a machine spends producing ice, the more you’re likely to spend on electricity and labour. So, it’s often of great benefit to use a machine that forms ice in a short period.

• Compressors: Compressors are the heart of the cooling system and can affect the quality (hardness) of ice produced and the time taken to produce it. Compressors are usually rated in Horse Power (HP) and are commonly available in 1.5HP, 2HP, 2.5HP and 3HP.

The number of compressors may also matter. For example, a machine with two 1.5HP compressors is likely to produce ice faster than another machine (of equal size) with just one 2HP compressor. You must also pay attention to the quality of your compressors. The fake ones can ruin your business.

• After sales support: It’s not just enough to be careful when choosing your machines; it is equally important that you purchase from a manufacturer or seller who can support you when you need to carry out repairs or maintenance. Remember, you may not produce any ice to sell if your machines do not work well. Make sure you buy from a dealer who has technicians (or can recommend one) to repair and maintain your machines.

#4  Generators

Due to the unstable electricity supply in many parts of Africa, it is likely that you may need a power generator to reduce your dependence on the power grid; that is if you experience electricity shortages in your area.

Even when electricity is supplied, the voltage is often unstable and can damage critical parts of your machine (especially the compressors). To produce the amount of power to effectively drive your machine’s compressors, diesel-powered generators are often preferred over petrol (gasoline) powered ones.

What capacity should your generator be? Well, it depends on the power needs of your ice block making machine. It is best to follow the recommendations of the dealer/manufacturer you buy your machine from. Ensure that you buy a durable generator that doesn’t break down often or require very frequent maintenance or repairs.

Five Tips for success in the ice block production business…

Like every business on earth, there are things you can do to bring luck to your side in the ice block business.

By keeping these tips in mind, you will enjoy a significant advantage over other people in the ice block business who do not understand or follow these tips.

Here they are:

#1 Target high population density areas

The ice block business is a volume business; the more blocks you sell, the more money you make!

Ice block businesses that sell large volumes are usually located in areas that have a high population density and experience a lot of physical, economic and business activities.

Busy roads and streets, areas with high pedestrian traffic (like markets, schools and industrial/residential estates) are good targets for this business.

Many of the people who will become your customers (like petty traders, shop owners and restaurant operators) are usually located in these areas. Your ice block business needs to be close to the action!  (photo credit: kubwa.olx.com.ng)

#2 Ice block is a seasonal business!

Although I mentioned that ice blocks can make for a lucrative business, it is important that you know it’s also a seasonal business.

During the rainy season, which usually starts around March and peaks in July, there are fewer hours of heat and sunlight. When the weather is cooler, people don’t like to take cold/chilled drinks as often as they would in a hot weather.

As a result of this lower desire to consume cold stuff, the demand and prices of ice blocks usually fall during the rainy/cooler months of the year.

Armed with this information, I strongly advise that you reduce the quantity of ice blocks produced during the rainy/wet season and increase production during the dry/hot seasons.

For those of you reading  this who want to start this business, it’s better not to start during the wet/rainy season so you don’t get discouraged by the small quantity of sales you are likely to make.

#3 – Target habitual consumers

Habitual consumers are those people and businesses that require a constant supply of ice block to meet their personal, household or business needs. Some of these habitual consumers include event/party planners, restaurant/hotel operators, petty traders and vendors in busy streets and markets.

These consumers will be interested in any ice block maker or supplier who can meet their daily needs for ice block at a price and convenience that makes sense. With a number of this type of consumers as your customers, you are assured of a steady volume of sales in and out of season.

#4 – Watch out for the competition!

From a business analysis perspective, ice block production is a low-entry barrier business.

This means that anybody who can afford the machines can fill up containers with water and Voila! she’s in the ice block business! No special skills or knowledge is required!

As a result, your competition can enter this business easily. Should this discourage you? Of course not! To survive, you will need to be smarter than your competition. (photo credit: businessgross.com)

Ice blocks are a commodity product; they all basically look the same. Price and convenience (location) are usually the only things that will make more customers patronize your ice block business over other competitors.

To remain competitive with your pricing, you will need to keep your production costs low.

Always keep a close watch on how much you are spending on electricity bills, water and labour. Reduce wastage and unnecessary costs as best as you can.

If you’re just starting out this business, you may not need to employ too many hands. It’s a very simple and straightforward business that you can handle yourself. If you can keep your costs as low as possible, it becomes possible for you to offer better (lower) prices than your competition and still make a profit!

#5 Take care of your machines

Your ice block making machine and power generator are the heart of your business. You should always make sure that you stick to the recommended maintenance schedule.

If your machines stop working, the business stalls and you may disappoint your customers who depend on you for their ice block needs. The last thing you want for yourself in this business is a reputation for disappointing/failing your customers.

To avoid any of these undesirable outcomes, keep a technician on hand to take care of any mechanical or electrical faults as they arise.

What do you think about the ice block business?

In this article, we revealed the reasons why the ice block business is booming in many parts of Africa and the key things you will need to start this business.

We also shared a couple of tips that will help you to succeed in the business. It’s a simple business model that requires no complex skills or technical knowledge. You can run it as a side business or focus on it full time. It is one of those businesses that never run out of customers (unless there is very stiff competition).

We believe that the opportunity and information we have shared with you in this article can be taken further by your creativity and energy. You could also choose from many more lucrative business ideas in the Business Ideas section of this website.

What do you think about this business opportunity? Please leave a comment, share your views and ideas or ask any questions you may have in the Comments section below.

We would also appreciate that you share this article with your friends using the Facebook, Twitter and Google+ buttons below. You never know, you could inspire and change somebody’s life today!

To your success