To start a business in Nigeria is great, because when you want to, you can afford to do stuff without your boss looking over your shoulder. Yet as cool as it sounds, starting a successful company is a very difficult activity which only a few businesses survive.
In your bank account, you don’t need a large amount of money or a degree to run your own company.
What you need, however, is a good business idea, a concrete execution plan and the passion to wake up and keep grinding every morning.
In this article, I’ll share the main steps and processes of what you need to start a successful Nigerian business.
Before you get the steps to start a Business in Nigeria, you need to first understand the factors that affect businesses in Nigeria .
In a working environment, companies grow faster – this is a proven reality.
Researchers have performed multiple research pieces in the goal of finding the secret sauce in which any entrepreneur or business owner will play a key role and have a relatively good chance of secret in business.
Luckily, both of these researches conclude on the same outcomes; 3 factors typically come to play to be a good entrepreneur.
These factors are tools which form the entire business landscape, irrespective of geographical location and business type.
Market access, human capital availability, and access to funding have been described as the primary resource cum success factors common to any successful company.
It’s necessary to locate your office or operational base near either your raw materials, resources or the market.
This article looks at those variables in order to explain how they impact Nigeria’s micro and small business issues.
Knowing how these tools impact micro and small business development will help a aspiring entrepreneur understand the market environment better and plan their market structures better.
1. Access to Market
This is rather a very controversial piece; Nigeria has a population of about 180 million people, with about 30 percent of these people being prospective markets irrespective of the type of business they are venturing into.
It therefore means that regardless of the form of company conducted, the total possible size of the market shared by all players in the national market is at least 54 million potential customers – that’s massive! .
This therefore means that Nigeria is a viable market, taking into account the scale of the market and ignoring other determinants.
This finding therefore calls for the answer to the question as to why Nigerian companies choose to try to satisfy international markets over their own local markets
2. Human Capital development
Sadly, subsequent governments have been neglecting this great country’s educational system since the late ’80s.
The university system also considers it trendy to send its undergraduates through apparently outdated programs and courses, rendering their goods unsuitable in terms of skills for business demands.
The reaction to this is that due to her skills and know-how limitations, Nigeria is not well placed to compete competitively on the global market.
Due to the costs associated with expertise and labor, manpower is very important in managing commodity value, both quality and price.
Given the lack of manpower, the few available who have found ways to establish themselves largely outside of the existing educational system are mostly consumed by multinationals and other high net worth businesses all competing on the same market as micro and small businesses. Only a few end up becoming businessmen.
This is a major problem which plagues Nigerian businesses. Business capital raising is not an easy job in Nigeria.
Angel investment and venture capital have been the two sources of funding identified as the most significant to the growth of companies in many research pieces conducted.
Sadly, Nigerians are not “angels,” it is exceedingly difficult to ask a Nigerian, most of whom are struggling with their individual finances, to provide a company with angel support.
Just a few venture capital companies from outside the country are investing in Nigeria, and sadly, the prevailing bank lending rate of over 25 percent makes trading with them almost impossible.
Below are the Steps to take to Start a business in Nigeria
1. Check yourself
When you’ve made up your mind to start a business in Nigeria, you need to evaluate yourself carefully by asking yourself these questions.
· Do I have the required skills to run that business?
· Do I have everything I need to lead a team or handle it?
· Do I have the capital needed to raise the business?
· Do I have the drive and the enthusiasm to make this a success?
So, be very sincere with your answers and if the majority of your answers to the above questions are “YES”, then you are ready to start your own business.
Not all business ideas are worth starting from when it comes to starting a company. The best business ideas are creative, realistic, market-required and easy to scale.
Start by looking at what problems exist in your environment when searching for a business concept, and seek to solve and monetize such a problem.
And if you have a totally new business concept, think about what your company can deliver and concentrate on how to make something better and cheaper. You might need to ask people questions, do your own work and seek advice from entrepreneurs as well.
Be sure to have a good understanding of these business before starting a company. Attempt to perform a market study by asking your potential clients a few questions about the issue you want to solve.
Work even on the direct and indirect challenges that exist on the market today. Try to find out about their goods and services, and how you think your company will stand out among them.
If you want to start a company, it’s one thing to do a market study, it’s another thing to make good use of the input from your study.
The whole purpose of this is to help you get more knowledge about the company you want to start and help you create a solid business base.
You wouldn’t want to start a business today in Nigeria and it starts collapsing tomorrow or it starts dropping, instead of watching your business grow. Therefore, you have to learn how to start a company.
A business plan is a systematic statement of corporate goals, reasons they are feasible, and strategies to achieve them, according to Wikipedia. This can also provide historical information about the company or team seeking to accomplish certain goals.
Whether big or tiny, it needs a plan for the company for any company.
A business plan helps you remain focused and organized when starting a company. Some of the qualities of a good leader is to note the organizational skills.
Therefore, you are checking out some business plan templates online to act as a reference in writing your business plan.
6. Get funding for your business
Starting a company needs not only your skills and commitment but your resources as well. Any business needs a startup capital that will be used to fund the company’s day-to-day operations.
In case you don’t have the resources needed to start the business, there are different ways to procure financing for a new company (bank loans, grants, equity investments etc.).
Most companies are dying because of lack of funds, so make sure you have enough money to compensate for the downtime.
7. Start your business registration
Business registration is essential for those wishing to start a company. You can register your business with your country’s government or with the agency responsible for registering business in your country.
For instance, if you are a Nigerian company, you can register your company at federal level with the Corporate Affairs Commission (CAC), and then at state level with the Chamber of Commerce.
Your company being licensed with the appropriate bodies gives your company legitimacy and authenticity.
8. Get your team together
If you intend to be the only one to run your company, then you may not need to start building a team. But if you are going to hire people certainly, you need to create a strong team.
For your company, you are building a strong team and these people are supposed to contribute to your business growth, but if the team is not well-built, they can also help you downgrade your business. So building it to grow and be successful.
Development is crucial to a firm’s survival. Any company that doesn’t expand will eventually die no matter how long. Make sure you do whatever you can to ensure your company continues to expand.
The number one metric for assessing a company’s growth is a consistently positive cash flow. The more cash-flow an organization produces the more potential it has to prosper and develop. Therefore, make sure you have the right resources to help you keep track of your cash-flow from the first day of business.