Understanding the Dynamics of Building a Successful Business in Nigeria
Starting a successful business in Nigeria requires careful planning, from ideation to business registration. This process involves developing a solid business idea, creating a detailed business plan, and registering the business with the Corporate Affairs Commission. By navigating the unique challenges and opportunities present in the Nigerian business terrain, entrepreneurs can acquire essential business skills for sustainable growth and success.
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Understanding The Dynamics of Understanding The Dynamics of Building A Successful Business in Building A Successful Business in Nigeria Nigeria Men s Missionary Union Nigerian Baptist Convention January 2021
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Getting Started Getting Started Starting a business can be a very daunting endeavor in any part of the world and Nigeria is no exception. One that requires meticulous planning and decisive execution. The Idea The Business Plan Every Business starts with an idea Once you have conceptualized the business idea, the next step is to translate it into a business plan Ideas rule the world including the world of business This involves a lot of research The easiest way to conceive a business idea is to focus on solving a problem in your community/country and what you really love to do A business plan is the blueprint of any business. It shows the goals of the business and the routes to navigate for success in the business Every successful business venture starts with a solid idea that is backed up with a detailed business plan A good plan is the starting block in a business (Hab 2:2)
Registering Your Business Registering Your Business This is a very important part of starting a business. In Nigeria, a business can either be registered as a Business Name (Sole Proprietorship or Partnership) or as a Company (Private Company or a Public Company). The Corporate Affairs Commission(CAC) is responsible for registering/incorporating companies & businesses in Nigeria as empowered in the Companies and Allied Matters Act. Choose a business name and check for the availability 1 1 Submit the original copies of your documents Complete your pre-registration form to register a Business Name/Company 2 5 4 3 Prepare the required documents for upload Pay for a filing fee The process for registering a Business Name can be done fully online without the services of the Legal Practitioner, Chartered Accountant or Chartered Secretary
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Why Start A Business Why Start A Business There is a very large market for almost every product and services Nigeria is both the most populous and largest economy in Africa The economy is robust with high demand for a wide variety of products and services Population GDP There are several challenges in the country, most of which can be converted to viable businesses Nigeria is fast developing and there is a huge need for innovative products to keep up with trends 200mn $410bn Every business has the potential of impacting several lives Source: World Bank
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Typical Business Life Cycle Typical Business Life Cycle The evolution of entrepreneurial ventures spans various phases, from planting the seeds of a business idea to reaching maturity. There are typically five cyclical stages in a business s existence, they include; 02 02 04 04 Maturity Startup At this stage you might feel there is almost a routine-like feel to running your business. Staff is in place to manage the areas that you should no longer be managing, and your business has now firmly established its presence within the industry. Once you have thoroughly canvassed and tested your business idea and are satisfied that it is ready to go, it s time to make it official and launch your startup May, 2019 Jan, 2020 03 03 Seed And Development 01 01 05 05 Renewal/Decline Growth & Establishment This is the very beginning of the business lifecycle, before your startup is even officially in existence. You ve got your business idea and you are ready to take the plunge. But first you must assess just how viable your startup is likely to be. At this stage, you must reinvent your business by innovating and starting the cycle all over or face the threat of extinction If you re at this stage, your business should now be generating a consistent source of income and regularly taking on new customers
Typical Business Life Cycle: Seed And Development Focus Area Typical Business Life Cycle: Seed And Development Focus Area Create A Business Plan Garner Advice and Opinion From Professionals Consider The Market and Your Role In It Reach Out To Investors It is always important to analyze and firmly establish the strengths, weaknesses, opportunities and threats your business may encounter in the market you intend to enter. The financial foundation of your launch will be a large factor in the success of your business, so try to plan that as much possible, to the very last detail. Financial support at this stage is crucial, so try to find individuals or organizations that may be interested in your project enough to provide monetary assistance. This will involve a great deal of market and economic research to establish the project feasibility. Experienced industry specialists and entrepreneurs you may have access to, as well as business associates, friends and colleagues who are competent in this regard, can provide valuable insight and opinions on the potential of your business idea. Inquire about their main takeaways from the seed funding stage of their own projects and biggest obstacles they had to overcome. Ask yourself if the market is ready to accept your business and if your concept, product, service or idea can fill an existing need in the market. How can your idea soothe the pain points of your prospective customers and clients?
Typical Business Life Cycle: Startup Focus Area Typical Business Life Cycle: Startup Focus Area Establish A Business Structure Consistently Implement New Ideas Figure Out A Sustainable Cash Flow Face and Overcome Various Challenges At the beginning of the startup stage, your employees are likely wearing many hats. Everybody does a little bit of everything, which is a prerogative for any new enterprise, but a corporate structure must exist in order for the company to keep growing beyond this phase. During the startup phase, you spend your time meeting people and developing new ways to sell your products or services. Listening to customer feedback and trying new ideas will provide clarity on what aspect of your product(s) or service(s) to focus on in the future. This is the right time to develop a business model that provides a consistent cash flow that will, in turn, provide consistent growth and the ability to retain old employees and hire new ones. Managing cash reserves and sales expectations, while establishing a customer base and a market presence are some of the biggest trials you will have to confront with decisiveness at this particular stage of the business life cycle.
Typical Business Life Cycle: Growth & Establishment Focus Area Typical Business Life Cycle: Growth & Establishment Focus Area Turn Your Focus Inward Strengthen Your Customer Relationships Require Funding Maximizing Profit The key point here should be building a team by hiring quality people to run segmented operations. As the manager of your business, you should spend time on whatever helps the company grow and anticipate barriers that could decelerate this growth. Through a well- established recruitment process, create order and cohesion with clearly defined objectives. To deliver your business into the maturity stage, the growth phase needs investment. Outside investment capital is what you will likely have to require through either investors or debt. In the case of the former, you will gain advisors and give up equity. With the latter, you retain equity and sign personal guarantees with banks for funding. This step requires the business owner to judiciously manage revenue and outperform competition. Addressing the challenges in the operating environment is fundamental for the success of this step. Your high-profile employees should take a more proactive stance toward client relationships as well as internal processes. Both experienced senior leaders and workers at lower levels should partake in helping your clients become advocates, thus pushing your enterprise to grow even further.
Typical Business Life Cycle: Maturity and Renewal/Decline Focus Typical Business Life Cycle: Maturity and Renewal/Decline Focus Area Area Renewal/Decline Maturity Expanding The Business Finding An Exit Strategy Innovation Talk With Experts About Reinvesting Before deciding on this step, ask yourself if the business can sustain more growth. What are the market opportunities, if any, for another expansion? Can you cover the possible failure financially? Are you, as a leader, fit to navigate challenges that new expansion would bring? This step will require a great deal of internal and external company position analysis. You, along with the management team, must communicate the right information at the right time, to the right people. You can perform this exit through a partial or full sale of the business. How the sale process will turn out will depend on the type of business you have and the decisions you make about moving forward. Reinventing the business through innovation is critical for the continuous relevance and success of the business venture. It is important to anticipate the change in business and market beforehand. They can help figure out how to meet emerging changes in the market and whether there is capacity within the company to meet these changes. This might include modifying current offerings or inventing a completely new business model, which is both time-consuming and costly.
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Livestock farming One of the fast business opportunities in Nigeria is livestock farming. This industry is continuously emerging and is yet to discover its fullest potential. This business can be started even in your backyard, if you know how to operate the equipment and take care of your livestock. For this business, you will need patience, knowledge, and experience. Some of the niche areas that you can venture into are catfish farming, poultry farming, cattle grazing, goat rearing, snail farming, and many others. Exporting Agricultural Products Nigeria is a country which is full of various natural resources and quality food. You can start your own exportation business, if you register with the Export Promotion Council of Nigeria and decide which specific product would be best for exporting. Some of the products that are in high demand abroad are cassava flakes, cocoa, yam flour, groundnut, chili pepper, cashew nuts, mango, and many others.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Mining Nigeria is a very vibrant country when it comes to mineral resources. Some of the minerals that our country is especially rich in are coal, iron ore, limestone, bitumen, and others. The mining sector is growing in Nigeria. The government also supports the mining industry. So, if you have a good, trustworthy team, as well as the financial capabilities, you could venture into this sector. Oil and Gas Business Owning a Petrol Filling Station, Supplying of Diesel, and Distribution of Kerosene are some the areas you can invest easily and make good money for yourself. Petroleum product marketing is very lucrative and requires a substantial amount of capital. It has been making millions for people and creating millionaires in Nigeria for years.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Uniform Sewing If you are good at sewing clothes, and you would not mind doing it for a living, then you should probably choose this business. There are plenty of schools in every state, and they all need uniforms for their students. Besides, there are also a lot of corporate organizations, whose employees also wear uniforms for example, the security staff, the multiple military and para- military organizations require wearing uniforms, and since they have a lot of people involved in their activity, they always need new ones. Business Writing Excellent writing is valued nowadays, and you can make some money if you take up freelance writing. At first, you will not even need the starting capital to begin your journey the only things you will need are the skill and desire. You can search for the orders online or write for a company which will want your texts. The benefits of this job are countless, and the main one is you will not have to go to the office or perform some hard work it can be done at home from your laptop with a cup of coffee.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Call Centre Agency Call center business is very popular, because there are lots of people who need guidance, advice, or want to complain about services. Therefore, you can set up a call center agency, where you can work for large companies according to contracts. This business will also not require substantial start-up capital unless you would like to hire more workers, which can be done later when you grow a little. Recruitment Agency Nigeria suffers from the problem of unemployment, and there are many people in desperate search for jobs. You can become a recruitment agent, which will connect people to the jobs of their dreams. All you need to do is to cooperate with different companies and recruit people for them. Your recruitment agency can grow and expand with time, as you make more and more profit. To succeed, you need to be good at finding the right people for specific jobs.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Daycare center The majority of families have children, but they also need to work hard to earn enough income to cover their expenses. Therefore, not every parent can allow themselves to spend time with their child. There are quite a lot of daycare centers, but not all of them are competent. So, if you love children and are sure that you can care for them, you should consider setting up a daycare center. Training center Are you skilled in a particular field, and feel like you could help other people to develop their skills? Then the training center business can become a niche that will bring you good money. This business can be profitable nowadays because it is always in high demand among the clients. For instance, millions of Nigerians every year write different tests and examinations, and they need someone to help them out with preparation, so they search for various training to get ready for their exams.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Waste Management It is another niche which can become profitable, and it has a significant potential for the future. It can eventually become profitable because many Nigerians are still unaware of the proper waste disposal ways, but there are some states in the country, like Lagos, which are actively encouraging the waste management among people. There are a few stable businesses that can be started in this niche, and the examples of such companies are waste disposal, waste recycling, organic fertilizer production, junk hauling, and some others Importation Business Nigerian is a very major consumer of several imported items, ranging from automobiles, spare parts, electronics, clothes amongst others. The demand for high quality imported products persists, especially for goods that are not currently being produces locally.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Food Processing This involves collecting the raw materials that food is made of, and then turning those materials into the finished product Some options in this line of business are vegetable oil production, oil palm processing, yogurt production, tomato puree production, garri processing, rice milling, fruit juice production, amongst several others. Alternative Power It is a very relevant topic nowadays, as Nigeria is fighting the power supply issues. The world these days goes green, and in our country, the government already took steps to improve the power sector. However, there is a growing demand for the power generators of alternative types in particular, solar energy, inverters, and windmills. So, you could attempt making money by the importation and retaliation of these materials, or another way for you would be focusing solely on the alternative power installation.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Farming Farming is a very lucrative business now as the government seeks to diversify the economy. The most important step when it comes to this business would be acquiring a good piece of a farm, and then you can start planting certain crops on it. We already have talked about the livestock farming business, but if you feel like you would instead take care of crops than livestock, then you should consider this option. Bottle Water Production People drink water daily because staying hydrated is essential for everyone s health. Besides, pure water is needed these days, and you can become one of those people who produce it and supply those who need constant hydration. If you produce clean and cooling water, then there is a significant chance for the customers to purchase it in large amounts.
Lucrative Business Opportunities In Nigeria Lucrative Business Opportunities In Nigeria Real Estate The prices of properties appreciate rapidly in Nigeria. If you buy land now anywhere in good and rapidly developing location, the value appreciates even faster. You can buy and quickly resell and make profit Or you buy keep and sell later. You can also focus on property agency, where you help property owner source buyers for their properties and earn commission on sales Transportation Nigerians are always commuting either interstate or intrastate and our very large population makes the demand for transport services is very high, especially in the urban centres of the country. If you invest in this business and properly manage your vehicles and staff, it would be a very lucrative venture
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Challenges of Running A Business in Nigeria Challenges of Running A Business in Nigeria Inconsistent Government Policies Lack Of Adequate Infrastructure Lack of basic amenities and infrastructure poses a serious challenge to business owners in Nigeria. Business owners spend lots of money to make up for the lack of infrastructures such as; power supply, internet connectivity, good access roads, etc. Unfavorable government policies and the inconsistency in the policy directions of the government has posed a major challenge for the Nigerian businesses 01 04 02 Inaccessibility of Funds Trust Deficiency 03 Lack of capital is a major challenge to business owners in Nigeria and despite efforts by the government to provide aids in the form of grants and loans, a lot of business owners in the country still have limited access to these aids Corruption is very rampant in both the public and private sector in Nigeria making it challenging to trustworthy individuals to do business with
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Navigating the Nigerian Business Terrain Navigating the Nigerian Business Terrain Understanding the budget/income levels, beliefs/biases and demography of your target market as well as the trends driving the market is very vital to run a successful business in Nigeria Understand the market Cultivating relationships is critical to the success of businesses. These include relationships with suppliers, customers, competitors, regulators, experts as well as other business owners Build Relationship Most line of businesses in Nigeria have umbrella bodies. Getting involved in these associations or unions can be highly beneficial. Professional networking via LinkedIn is also advisable Network Aggressively Locating your business to optimize logistics for the input supplies and demand for your product and/or service is also vital for success of a business Location Despite the inherent difficulty in raising capital, being able to source funds either as grants, loan or equity from individuals, NGOs, Government agencies, investors and financial institutions is vital Sourcing for funds
How To Fund A Business Startup1/2 How To Fund A Business Startup 1/2 Personal Savings Partnerships This involves working with someone that has similar values and business interest as yourself. The partners can pool resources and expertise to start the business together This is perhaps the best source of raising capital for a new business. Personal savings is one of the easiest ways to raise funds for a business, especially for small and medium scale enterprises. Cutting down your expenses to save for the business is a good strategy to raise at least the initial capital. Angel Investors & Grants Grant is a type of fund given by government or some other organization to empower small businesses and entrepreneurs while angel investors are basically wealthy individuals who provide capital for a business start-up, usually in exchange for equity in the business. This option is typically most accessibly by businesses that have significant impact on society. E.g., Technology, Healthcare, Family & Friends Raising funds through your family member and friends whom you have earned their trust is another good way to raise capital for a business. Of course, you must first trust yourself to be able to convince them to invest
How To Fund A Business Startup2/2 How To Fund A Business Startup 2/2 Co-Operatives Microfinance Institutions Depending on the nature of the business, there are microfinance institutions/banks willing to lend funds to business owner without collateral provided other conditions are fulfilled By joining a cooperative and saving small amounts regularly, you would be eligible to access funds from the cooperative which can be channeled into starting your business venture Commercial Banks Development Finance Institutions Loans from commercial banks are still a viable source to raise capital, especially for prospective business owners that can meet the collateral and other legal requirements of the loan terms. You would need to show a detailed business plan for the business, highlighting its feasibility Development Finance Institutions like the BOI, BOA, etc. have a plethora of targeted funds that can be accessed by prospective business owners with less strenuous requirements. Most of these funds are targeted towards the Agricultural, Healthcare, Creative and Educational sectors
Outline Outline Getting started: The idea, the business plan, Registration Why Start a Business Typical Business Life Cycle Business Opportunities in Nigeria Challenges of Running a Business in Nigeria Navigating the Nigerian Business Terrain Essential Business Skills For Business Owners in Nigeria
Essential Business Skills For Business Owners in Nigeria1/2 Essential Business Skills For Business Owners in Nigeria 1/2 Communication Leadership A great entrepreneur must be able to effectively communicate, sell, focus, learn, and strategize. Along the way of your entrepreneurship journey, you will surely need to be able to communicate your vision, ideas, plans, and goals to business partners, customers, existing and potentials employees, etc. Entrepreneurial leadership involves organizing and motivating a group of people to achieve a common objective through innovation, risk optimization, taking advantage of opportunities, and managing the dynamic organizational environment. The qualities of a good leader tend to be more subtle and come naturally. Money Management Sales and Marketing Very simply, if you can t manage money, you can t manage a business. You need to put structures in place to monitor where your income comes from and where your expenses go to. Finance management can make or break a business. Be financially disciplined: Don t waste your money on needless costs Selling is an essential skill every entrepreneur must master. Think about it: Starting from day one in your business, you re selling. Whether it s pitching your idea to potential investors or showcasing your latest innovation to prospects, the success of your business depends on your ability to sell.
Essential Business Skills For Business Owners in Nigeria2/2 Essential Business Skills For Business Owners in Nigeria 2/2 Audacity Time Management Be willing to take risks. Don t debate it, test it! Less talk, more action. See what works by working not talking. Say yes to opportunities that come your way. Say yes first and figure it out later. Enjoy shaking up the status quo Time management is very crucial; it helps to battle procrastination, allowing entrepreneurs make optimum use of their time. Your time is finite/short, use it wisely. Be sure you are doing the things that only you can do and delegate the rest. Persistence & Tenacity Be tenacious. It won t always be calm and sunny. There could be plenty storms and dark days. You need to design strategies to survive the difficult times. Don t give up: Even if you fail or fall along the way, don t give up. Remember that winners never quit & quitter never win. Persistence and determination alone are omnipotent. Inquisitiveness Be willing to learn new ways of doing things. Learning has no end as there is always something new to be discovered about the industry, business or competition. Be open to suggestion from anyone, from anywhere. Listen to the Janitor just as carefully as you would listen to your Chief Financial Officer (CFO) Integrity Be of high integrity; say what you mean and what you say. A business without integrity has a faulty foundation and questionable accounting, personnel or practices will ultimately lead to your business failure. Let s build businesses with outstanding reputation and integrity Customer Centricity Be customer focused: You need to have a very clear understanding of your target customer and his/her fears, desire and dreams
Conclusion Conclusion Your time is limited, so don t waste it living someone else s life. Don t be trapped by dogma which is living with the result of other people s thinking. Have the courage to follow your heart and intuition. Thank You!
