Do you want to start a bureau de change business? If YES, here is a complete guide to starting a bureau de change business with NO money and no experience plus a sample bureau de change business plan template. The world is a global village and there are leverages available for citizens of one country who may decide to travel, do business or study in another country.
Aside from understanding how to communicate with people in your host country, you would need to change your money into their currency so that you can freely spend while you are there. As a Nigerian or someone who lives in Nigeria, if you want to engage in international trade cum business, you would need certain currencies of the world and the united states Dollar, Pound Sterling and the Euro readily comes to mind.
This goes to show that the bureau de change business in Nigeria is a viable business that aspiring entrepreneurs looking towards starting a business can successfully start. The truth is that if you choose to open a bureau de change shop in a commercial city in Nigeria, you will definitely make huge profits from the business because it is a thriving business all over the globe.
Part of what you would need to launch this type of business is good business skills; excellent mathematical skills, excellent customer service skills, good understanding of world currencies, startup capital and the required business license.
Starting a bureau de change business requires huge startup capital but the fact remains that it is a profitable venture. It is important to state that a bureau de change business is a highly risky venture, because you stand the chance of been duped since you will always work with liquid cash.
So, if you have done the required feasibility studies and market research, then you might want to venture into this business. If you have been tinkering with starting your own bureau de change business, but do not know how to go about it, then you should consider going through this article; it will give you the needed guide and direction.
18 Steps to Starting a Bureau de Change Business
Table of Content
- 2. Conduct Market Research and Feasibility Studies
- 3. Decide Which Niche to Concentrate On
- 4. Know Your Major Competitors in the Industry
- 5. Decide Whether to Buy a Franchise or Start from Scratch
- 9. Discuss with an Agent to Know the Best Insurance Policies for You
- 10. Protect your Intellectual Property With Trademark, Copyrights, Patents
- 11. Get the Necessary Professional Certification
- 12. Get the Necessary Legal Documents You Need to Operate
- 13. Raise the Needed Startup Capital
- 14. Choose a Suitable Location for your Business
- 15. Hire Employees for your Technical and Manpower Needs
- 16. Write a Marketing Plan Packed with ideas & Strategies
- 17. Develop Iron-clad Competitive Strategies to Help You Win
- 18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
1. Understand the Industry
If you have visited any airport in Nigeria, or key commercial cities, you will be greeted by young men from the Northern part of Nigeria calling on you to know if you want to change ‘Dollar’ or any foreign currency. They can be found in the walk-ways of key commercial centers and usually, their offices are always within trekking distance.
A bureau de change as it is popularly called in Nigeria is also known as a non-bank foreign currency exchange company. It is a business in competition with other financial related businesses that make profit from selling currency at a higher exchange rate. In setting its exchange rates, they ensure that they keep an eye on the rates quoted by competitors, which may be subject to government foreign exchange controls and other regulations.
If you are a close watcher of the Nigerian foreign exchange market, you will agree that the industry has witnessed tremendous changes. The Second-tier Foreign Exchange Market (SFEM) was introduced in September, 1986, the unified official market in 1987, the autonomous Foreign Exchange Market (AFEM) in 1995, and the Inter-Bank Foreign Exchange Market (IFEM) in 1999.
In Nigeria, Bureau de Change was licensed in 1989 to accord access to small users of foreign exchange and enlarged the officially recognized foreign exchange market. It is important to state that the exchange rates in the Bureau de Change are market driven. A parallel market which is also called ‘black market’ for foreign exchange has been in existence since the exchange control era.
Research shows that scarcity in the official sector and bureaucratic procedures necessitated the growth and development of the black market (parallel market). The growth of the foreign exchange market in Nigeria up to its present state was greatly influenced by a number of factors such as the changing pattern of international trade, institutional changes in the economy and structural shifts in production.
Generally, a foreign currency exchange company/bureau de change is often located in places like banks, travel agencies, airports, hotels, main railway stations and international trade centers or any location where there is likely to be a market for people needing to convert currency. This is the reason why bureau de change is particularly prominent at travel hubs, although currency can be exchanged in many other ways both legally and illegally in other venues.
The Bureau De Change Services industry is indeed a large industry and pretty much active not only in Nigeria, but in all the countries of the world.
Some of the factors that encourage entrepreneurs to start their own bureau de change business despite the fact that the business is risky is that the business is highly profitable and can be started informally without the rigors of raising capital to meet certain capital base/capitalization as required by the regulating authorities.
Over and above, starting a bureau de change business requires professionalism and a good grasp of how foreign exchange works on a global platform. Besides, you would need to get the required certifications and license and also meet the standard capitalization for such business before you can be allowed to open a bureau de change company in Nigeria.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of those who require the services of bureau de change cut across people and businesses who need to convert their local currency (Naira) to any foreign currency of their choice for various purposes.
So, if you are looking towards defining the demographics for your bureau de change business, then you should make it all encompassing. It should include international businessmen and women, international students, importers and exporters, international tourists and visitors, individuals, entrepreneurs and startups et al within and outside the city you are operating in.
3. Decide Which Niche to Concentrate On
There are no niche ideas within the bureau de change line of business except for some few bureau de change firms who have narrowed down their operation to only US dollar, Euro and Pound Sterling. Usually, it is expected that a standard bureau de change engages in the exchange of frequently asked foreign currencies including African currencies.
The Level of Competition in the Industry
The level of competition in the bureau de change business depends largely on your financial base (the liquid cash you can afford to change per-time) and how big and organized your bureau de change business is.
The truth is that no matter the level of competition in an industry, if you have done your due diligence and you brand and promote your products or services properly, you will always make headway in the industry. Just ensure you have what it takes to raise capital for your business, know how to partner with banks to access forex and you know how to reach out to your target market (those who frequently need forex for their business).
4. Know Your Major Competitors in the Industry
It is the norm that in every industry, there are always brands that perform better or are better regarded by customers and the general public than the others. Some of these brands are those that have been in the industry for a long time, while others are best known for how they conduct their businesses and the results they have achieved over the years.
These are some of the leading bureau de change businesses in Nigeria;
- Bancorp Bureau De Change Ltd
- Zakfiza Interprises Nig Ltd
- Saboeleja Trading And Investment Ltd
- Obi And Sons Company Investment
- Ogbeni Bit coin
- Specifiq Resources Limited
- Exchangeindeed Com
- Ex Currency
- Hanana Global Link Limited
- Chinedu Exchange Investment Limited
- Fesman Bureau International Limited
- Sole Corporate Signatures
- Enterprise Xchange Dolla Store Esds Limited
- C3 Global Enterprises C3ge
- Ibr Global Markets Limited
- Crypto Merchant
- Johnkay ServicesGeeomotayo Cargo And Money Transfer
When it comes to starting a bureau de change business, you just have to get your feasibility studies and market research right before venturing into the business. It is good to mention that bureau de change business is not for rookies; it is for professionals who have successfully gathered the required experience to handle such business. But an aspiring entrepreneur can learn ropes on the job. You just have to be careful so that you don’t get swindled.
Starting this kind of business entails that you raise plenty of startup capital (pool cash from interested investors). If you are already a wealthy person, this might not be an issue. If you cannot, you may want to consider pulling resources from family and friends. Depending on the scale at which you want to start from, you might require as much as multiple thousands of dollars, pounds, Euros, Naira and other currencies to get started.
5. Decide Whether to Buy a Franchise or Start from Scratch
Unfortunately, in Nigeria the only industry where you can easily get a franchise to buy is the fast food industry. Aside from that, you must be prepared to start your business from the very scratch. So, if you have plans to start your bureau de change business in Nigeria, then you must start from the scratch.
6. Know the Possible Threats and Challenges You Will Face
If you decide to start your own bureau de change firm today, one of the major challenges you are likely going to face is the presence of well – established bureau de change firms and also banks because they are also involved in forex. One of the ways of overcoming this challenge is to be aggressive with your marketing.
Some other threats that you are likely going to face as a bureau de change services firm operating in Nigeria is unfavorable government policies, fraudulent people who may want to play a fast one you, the arrival of a competitor within your location of operation and global economic downturn which may affect your ability to raise working capital and access forex. There is hardly anything you can do as regards these threats other than to be optimistic that things will continue to work for your good.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
When considering starting a bureau de change business, the legal entity you choose will go a long way to determine how big the business can grow; some bureau de change business design their business and services for regional markets, some for national market, while others for international market via online platform and wiring.
You can choose a general partnership or limited liability company for your bureau de change business. Ordinarily, general partnership should have been the ideal business structure for a small – scale bureau de change business especially if you are just starting out with a moderate startup capital.
But if your intention is to grow the business and have clients from all across Nigeria and other countries of the world, then choosing general partnership is not an option for you. Limited Liability Company, LLC will cut it for you.
Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholders meetings and other managerial formalities.
These are some of the factors you should consider before choosing a legal entity for your bureau de change business; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and of course taxes.
If you take your time to critically study the various legal entities to use for your bureau de change business, you will agree that limited liability company; an LLC is most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.
Upgrading to a ‘C’ or ‘S’ corporation will give you the opportunity to grow your bureau de change business so as to compete with major players in the industry; you will be able to generate capital from venture capital firms, you will enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures.
8. Choose a Catchy Business Name
Generally, when it comes to choosing a name for a business, it is expected that you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. If you are considering starting your own bureau de change business, here are some catchy names that you can choose from;
- Good Deal Bureau De Change, LLC
- Forex 24/7 Services, Inc.
- Alhaji Ma’ Dollar, LLC
- Lamido and Sons Bureau De Change, Inc.
- Ade Bros® Bureau De Change, LLC
- Buba Group® Bureau De Change, LLC
- Akin Johnsons® Bureau De Change, LLC
- Brighter Days® Bureau De Change Ltd.
- Eze Ego & Sons® Bureau De Change Inc.
- TY Tanko® Bureau De Change, Inc.
- Andy Best® Bureau De Change, Inc.
- Northern Link® Bureau De Change, Inc.
9. Discuss with an Agent to Know the Best Insurance Policies for You
In Nigeria and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. So, it is imperative to create a budget for insurance policy covers and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your bureau de change services business.
Here are some of the basic insurance policy covers that you should consider purchasing if you want to start your own bureau de change business in the United States of America;
- General insurance
- Risk Insurance
- Credit insurance
- Deposit insurance
- Financial reinsurance
- Health insurance
- Liability insurance
- Workers Compensation
- Business owner’s policy group insurance
- Payment protection insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
If you are considering starting your own bureau de change business, usually you may not have any need to file for intellectual property protection/trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
11. Get the Necessary Professional Certification
When it comes to bureau de change business, you do not need to have any formal training or special certification before you can be allowed to start the business. All you need is informal training that will give you the needed skills and business exposure.
On the other hand, if you come across any form of certification that can aid you to conduct your bureau de change business, then by all mean try and pursue such certification.
12. Get the Necessary Legal Documents You Need to Operate
The essence of having the necessary documentation in place before launching a business in Nigeria cannot be overemphasized especially a bureau de change business. These are some of the basic legal documents that you are expected to have in place if you want to legally run your own bureau de change business in the United States of America;
- Certificate of Incorporation
- A Certified True Copy of the shareholders register in which the equity interest of each shareholder is properly reflected together with the original for sighting.
- A copy of the share certificate issued to each shareholder
- A certified true copy of the Form CO2 [Return of Allotments] filed with the Corporate Affairs Commission.
- A certified true copy of the Form CO7 [particulars of directors] and written confirmation that the Board of Directors approved by the CBN has been installed.
- A certified true copy of the Memorandum and Articles of Association, filed with the Corporate Affairs Commission.
- The opening statement of affairs audited by an approved firm of accountants practicing in Nigeria.
- A certified true copy of the certificate of Incorporation of the company [together with
The original for sighting purposes only].
- A Copy each of the letters of offer and acceptance of employment by the
Management staff and a written confirmation that the management team approved by the CBN has been installed.
- Company Bylaws
- Insurance Policy
- Memorandum of Understanding (MoU)
13. Raise the Needed Startup Capital
Aside from the required capitalization and funds in various currencies you have to work with, starting a bureau de change can be cost effective. Securing a standard office in a good business district (commercial center), equipping the office and paying your employees are part of what will consume a large chunk of your startup capital.
When it comes to financing a business, one of the first things you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.
Here are some of the options you can explore when sourcing for startup capital for your bureau de change business;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell of shares to interested investors
- Applying for Loan from your Bank
- Source for soft loans from your family members and your friends
14. Choose a Suitable Location for your Business
Bureau de change business requires that you see physically with your clients hence it must be located in a good location; a location that is prone to both human and vehicular traffic and a location that is at the epicenter of a business district or international travel hub if indeed you want to attend to loads of clients and maximize profits from the business,
The fact that you can operate your bureau de change business from any part of Nigeria does not mean that location has little influence on the success of a bureau de change business. If you have taken your time to study the bureau de change business, you will realize that bureau de change businesses and related businesses are willing to pay expensive rents in order to stay in a busy business district; a place where business activities and financial activities are at its peak.
The location you chose to open your bureau de change business is key to the success of the business; hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people with the required purchasing power and lifestyle
15. Hire Employees for your Technical and Manpower Needs
There is no special technology or equipment needed to run this type of business except for customized forex software and social media management software applications and other financial related software apps. You will also need computers, internet facility, telephone, fax machine and office furniture (chairs, tables, and shelves).
When it comes to choosing between renting and leasing an office space, the size of the bureau de change business you want to build and your entire budget for the business should influence your choice. If you have enough capital to run a standard bureau de change business, then you should consider the option of leasing a facility for your office.
As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. Averagely, you would need a Chief Executive Officer (you can occupy this role), Bank Relationship Manager, Accounting Officer, Marketing and Sales Executive, Front Desk Officer and Security Officer.
Over and above, you would need about 6 key staff to effectively run a medium scale but standard bureau de change business.
The Service Delivery Process of the Business
A bureau de change firm is expected to first and foremost build a robust working capital (in various foreign currencies).
A bureau de change either exchanges forex with local currency (cash for cash) or they leverage on the banking platform to conduct their business. For example, if a big-time customer wants to change huge amounts of forex, the bureau de change operator can either wire the equivalent of the money to a specified account as request by the client or the bureau the change is expected to take the equivalent of the forex to either the residence of the client or his or her office.
16. Write a Marketing Plan Packed with ideas & Strategies
As a bureau de change operator, you would have to prove your worth over and over again before attracting big-time customers. So, if you have plans to start your own bureau de change business, it will pay you to build trust. People and organizations will patronize your business if they know that they are going to get good deals and not be duped. Here are some of the platforms you can utilize to market your bureau de change firms;
- Introduce your business by sending introductory letters alongside your brochure to all the international businessmen and women, international students, importers, exporters, entrepreneurs and startups et al within and outside your area of operation
- Advertise your business in relevant financial magazines, radio and TV stations (make yourself available for forex services related talk shows and interactive sessions on TV and Radio)
- List your business on local directories
- Attend international forex expos, seminars and business fairs
- Create different packages for different category of clients in order to work with them (people exchanging huge amounts should get a better deal compared to people exchanging smaller amounts)
- Leverage on the internet to promote your business
- Join local chambers of commerce and industries around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks
- Engage the services of marketing executives and business developers to carry out direct marketing
17. Develop Iron-clad Competitive Strategies to Help You Win
The bureau de change line of business is a competitive industry, and you must come up with a unique and highly creative strategy to be able to outsmart your competitors in the industry. Part of what you need to do in order to stay competitive in the industry is to continue to make available currencies of various nations at highly competitive rates. Organizations and people will always run to you if they know that they will get what to want as it relates to forex.
Another strategy that you can adopt is to ensure that your organization is well positioned; key members of your team are highly qualified and certified as it relates to their job roles.
18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
If you are in business and you are not deliberate about boosting you brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portray your business to be.
If your intention of starting a bureau de change firm is to grow the business beyond the city where you are going to be operating from to become a national and international brand, then you must be ready to spend money on promotion and advertisement of your brand.
In promoting your brand and corporate identity, you should leverage on both print and electronic media and also social media (the internet). As a matter of fact, it is cost effective to use the internet and social media platforms to promote your brands, besides it is pretty much effective and wide reaching.
Below are the platforms you can leverage on to boost your brand and to promote and advertise your business;
- Place adverts on financial magazines and related newspapers, radio and TV stations
- Encourage the use of word of mouth publicity from your loyal customers
- Leverage on the internet and social media platforms like YouTube, Instagram, Facebook, Twitter, LinkedIn, Google+ and other platforms to promote your business
- Ensure that you position your banners and billboards in strategic positions all around your city
- Distribute your fliers and handbills in target areas in and around our neighborhood
- Advertise your business in your official website and employ strategies that will help you pull traffic to the site
- Brand all your official cars and ensure that all our staff members and management staff wears our branded shirt or cap at regular intervals