An Ice business can be a very good way to make money, it has low barriers to entry and can be seasonal. This is a guide on how to start an ice making business in South Africa.
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Ice making can be profitable, especially when run correctly, it’s not really a fancy business. There are a lot of ups and downs. This is because of the seasonal nature of the business; ice is most in demand during the festive season. Demand goes down after that and even more so during winter.
The reason why demand is so high during the festive season is because people are going out more, and need ice because of the heat. There are much more fun parties and events that are hosted during the festive season.
To succeed at this business; you have to think in terms of the whole year and not just month to month. The barriers to entry are fairly low but maintenance is high.
Get operating premises
You have to find a space to work from, it doesn’t have to be a commercial building. It should ideally be big enough for you to be able to make all your ice. You can build a really big outside room where you will work from. Especially if you have a big yard, or you can use your garage or a similar structure.
I don’t recommend going out to renting operating premises when you are just starting out. That will just cut into your profit margins and it can take some time before selling enough ice to cover your overhead.
Buy an Ice making machine
These machines range from as little as R2000 for personal use and to over R50 000 for commercial use. Try to maximize your budget, if you have R20 000 to spend then buy one for that amount, or else you won’t keep up with the demand.
You should be able to make over 60 000 bags of ice on demand, that’s something that cheap machines won’t be able to do. Invest in your machine, especially if you are hoping to supply restaurants and other establishments.
Have your own water supply
You need water to make ice, lots of it, you can’t use municipal water or tap water, that will cut into your profits. It’s best to have your own water supply, it’s either you get closer to a water source like a river or you use rain.
Ice makers that are not within easy access of a river often use rain water, they collect rain water then purify it. This costs a lot less than using municipal water, which you might have to pay for and may be of low quality.
Market your business
Your ideal target market is businesses, you won’t make a lot of money by selling to individuals. You have to target restaurants, hotels, bars, nightclubs and other outlets that serve refreshments. That’s where the money is, these outlets usually buy in bulk. This is why you have to have a good machine because they will think you are unreliable when you don’t deliver on time.
Register your business
Some businesses will not work with an unregistered company, make sure that you register your ice making business. It is currently R125 when done through the CIPC, the cost of registering a private company has never been this low.
This was a guide on how to start an Ice making business in South Africa. Do you have any thoughts or questions? Comment below.