Starting up a business in Nigeria would change your life forever, and can as well pose a difficulty, especially if you don’t understand how business works in Nigeria. Doing business is a Life experience you will never forget because it comes with only two perks: success or failure. You could luckily fill ‘a need for service everyone needs’ and make a lot of money within a short period or you could run in circles starting business after business because none seems to be able to attain profitability.
8 Important Things to Consider Before Starting a Business in Nigeria
Success and failure are facts you will have to come to terms with. You’re more likely to fail in your first venture than succeed. But huge knowledge and pure resilience would make you a success story for everyone to learn from.
Another point that makes Nigeria one of the best places to do business is this issue of taxation. Though some companies do complain of back handedness and multiple taxation, Nigeria still remains one of the countries in the world with the most considerate taxation policies. If you are thinking of starting a business in the country, you need to understand how business works in Nigeria, the market evaluation, the risks, and the legal and bureaucratic frameworks involved. This is the purpose of this article;
1. A good business idea
Your business idea is the first step towards starting any kind of business anywhere in the world. To start a business in Nigeria, you must have a good business idea of what you want to invest into. This could be very complex at first especially when you have a lot of options to choose from. You need to understand that having too many products or services could hinder brand visibility. Why not start with ‘making sure you are solving a problem’
People majorly pay for products and services that solve problems they’re currently experiencing. It could be the help to someone as drug; to relieve a Body Pains, as Sweat Shirt; to protect from getting cold, as machine; to make work faster and easier, as tutor; would make people learn from you. If your product or service solves a pressing problem, people would pay for it faster than anything else. In this economy recessions, people focus more on what they need than what they want. Discover what people problems are, create a real solution, and you’re in business.
2. Mission and Vision
Every startup business must have a mission and vision, these are what would get you prepared to tackle the challenges during hard times in business. Running a business on the Nigeria soil is tough but highly rewarding; so to survive, you have to be tougher. It is the only reason why you are venturing into it in the first place. Whether long term or short term, they would guide your decisions and actions as you get along in your business. Your
your mission is how you plan to get there while your vision is where you want to be. At the most basic and important level, prepare yourself by making up your mind to succeed despite the odds and competition.
3. Research on your Market & Your Competition
A full understanding of the market you’re trying to get into is important if you will record any success at all. Make sure your business plan covers this comprehensively. If you’re unsure of writing a business plan. Identify your potential competition and study what they are already doing. By knowing what is working and what is not working for them, you’d know how to better place yourself. This would help you deliver a great Unique Value Proposition (UVP) that no one is currently offering and would help acquire customers faster than you should have.
4. Have a good business plan
Business Plan can probably evoke different associations. It is hardly without a reason that majority of Nigeria Entrepreneurs choose to “dive into deep water” without checking their swimming ability, i.e. to start without writing a business plan. A business plan is essentially an exercise or “simulator” that clarifies significant issues with the aim to clarify whether you should start your business. And, after the company is established, reduce the risk in the first critical phase. A business plan should not be larger or more complicated than it needs.
A business plan needs to be depends on many factors: The size of the business, the complexity, and the financers. But anyway, a business plan will mainly consist of the following points:
Summary: What do you intend to sell? Who is responsible? What is your market? The abstract should not exceed one A4 page.
Initiators: Personal information, contact information, ownership. Who is behind the idea, who supports it, and do you cooperate with experienced resource persons?
Organization and management: Form of incorporation, ownership, staffing and location.
Business idea: What do you intend to sell? The business idea should be very short and concrete describe what the company aims to do, as well as what is unique about it.
Other business plan tips; two heads are almost always better than one: Seek help from other entrepreneurs, sign up for an entrepreneur course, find user groups on the Internet, get help from people you trust or buy professional assistance.
5. Secure a good location
A good location at the right time can never be grossly over-emphasized. No matter what your business is about, you must always be targeting the right people in the right places.
6. Register and license your business
Some types of business activities can be started without any approval from the government. Other types of business activities are regulated by laws and regulations, and this may require an authorization, license, permit or approval. You must for example be officially approved to establish a medical practice. To start a production business, there are requirements to the premises and you must notify the Municipality before activity commences.
7. Source for capital and start-up financing
Before making up your mind to start a business in Nigeria, you should have procured the necessary capital to finance the business. Financing a business can often be one of the biggest challenges faced by an entrepreneur.
Many entrepreneurs obtain startup capital from relatives, families or friends. Majority must also obtain capital from banks or financial institutions. Here the history either can be against you or it could be beneficial for you:
If you have an orderly relationship with money and you have access to capital and enough faith in the project that you are willing to go in with equity, then your position will be far stronger in dialogue with the bank than if you start at zero.
While many financial institutions will only to some limited extent be able to assess the product/service idea, but they can evaluate your person and what you stand for.
8. Just Start it!
Experience can be healthy – and it can be deadly: “No one has done it before, so it is not possible.” “No, that we have tried earlier and it did not go well.”
Experience can be defined as “knowledge as a result of observation, perceiving, etc.” It is natural that many entrepreneurs embark on a voyage where the zeal and enthusiasm can be significantly larger than experience. And so it must be.
You can think and plan from here to eternity, but in some cases you finally just have to bring it up.