9 Steps to Starting a Successful Nigerian Business
Starting a profitable business in Nigeria is simple, but it can be difficult, especially if you are unfamiliar with the Nigerian business landscape. Do you want to know how to start a business in Nigeria as a Nigerian entrepreneur? If you are, this is the post for you. There is some business you can start in Nigeria at any level, regardless of who you are or what your financial capacity is. Even if you don't have any money, you can establish and run a successful business in Nigeria if you are willing to learn about the advantages and disadvantages of the Nigerian business market and the fundamentals of entrepreneurship.
In terms of profitability, competitiveness, and return on investment, Nigeria is truly one of the best places in the world to do business. Nigeria is regarded the top business destination in Africa, with over 160 million people with respectable purchasing power, which is the largest purchasing power in Africa.
Companies that had previously ignored Nigeria have had to bite their fingers with remorse. The telecommunications business is an excellent example. Many telecommunications behemoths ignored the country, issuing dire predictions about how the telecommunications industry will fail in Nigeria. It required courage for MTN and Econet, who were virtually unknown in Africa at the time, to invest in the Nigerian market. As a result of their success in the Nigerian market alone, these companies rose from obscurity to become one of the world's largest telecoms corporations. Other telecommunications companies, such as Vodacom, that abandoned the Nigerian market were made to rue their decisions. Do not allow this to happen to you.
Another factor that contributes to Nigeria being one of the finest places to do business is the problem of taxation. Despite some corporations' complaints about backhandedness and multiple taxation, Nigeria maintains one of the world's most considerate taxation regimes and 'not too' complex regulatory frameworks. If you want to start a business in Nigeria, you must first grasp how business operates in the country, as well as market appraisal, risks, and the legal and bureaucratic frameworks involved. This is the goal of this article: to assist you every step of the way. Have fun on the ride!
How to Start a Business in Nigeria
1. Find an excellent business idea.
Your company concept is the initial step in launching any type of business anywhere in the world. You must have an excellent idea to start a small business in Nigeria. You must have a concept of the type of business you wish to start. Unless you are developing a new innovation, any idea or business opportunity will suffice. It doesn't have to be something fresh; if you have the funds, you could even buy a franchise. Nigeria has the people to absorb any product that is supported by sound commercial judgment. Ideas frequently coincide with your enthusiasm. If you are enthusiastic about anything, it should be simple to come up with a company idea based on that enthusiasm.
"A company concept is just another idea," says Ajaero Tony Martins of mytopbusinessideas.com. However, an idea that is supported by a strong practicality, a thorough business plan, and a knowledgeable business team is no longer a concept. It's now a viable business prospect worth investigating." So, while a good company idea alone does not ensure success in business, a mediocre business idea combined with sound business principles does. The world is full of amazing "million dollar ideas," but it is also short on seasoned entrepreneurs.
2. Get yourself ready
The next stage in beginning a business in Nigeria is to properly prepare yourself. You may believe that this is unimportant, yet it might mean the difference between success and failure. Running a business in Nigeria is difficult but rewarding, thus you must be tougher to survive. Nigeria is a difficult but potentially rewarding operating environment, which is why you must be well-prepared to face the obstacles on the ground.
You can prepare by attending seminars and workshops on the business you want to start and gathering all of the required knowledge about your chosen field. You may also prepare yourself by accepting the possibility of failure tomorrow; you can prepare yourself further by raising your risk tolerance. Finally, you prepare yourself by deciding to succeed despite the odds and competition.
3. Conduct a feasibility study
Before investing a cent in a business opportunity, the next stage in beginning a profitable business in Nigeria is to conduct a complete feasibility study to determine its viability. This is essentially where most Nigerian startups fail.
Many people invest in a business concept or opportunity just because a friend or family stated it was profitable, only to be disappointed. Others, in response to questionable information, enter an industry blindly and fail. Even while entrepreneurship is all about taking risks, entering an industry without a thorough understanding of its foundations is a recipe for disaster.
4. Create a solid business plan.
Proper planning is vital for every business's success. Create a comprehensive business strategy that covers all aspects of your operation and stick to it religiously. Your business plan is extremely significant because, in addition to providing you with clearly defined goals and objectives, it can serve as a reference point to which you can refer at any point in time in your firm. Many people miss this critical part of business startup without fully comprehending the repercussions. Looking at a plan and seeing how far you've gone can be a terrific source of motivation to keep going. It can help you assess whether you have strayed from your initial vision and, if so, how to get back on track.
Many Nigerians miss their homeland here. Over 85 percent of small business owners in Nigeria, it is said, do not have business plans. If you want to achieve, you must break away from the crowd. Furthermore, banks do not lend money to enterprises that are now operating or plan to continue without a business plan. Even if it is a one-page informal business plan, write it down. Your one-page business plan may not catch the attention of the bank, but it is a step forward because it will allow you to focus on fulfilling your business mission and accomplishing the intended goals and objectives.
5. Become acquainted with the market
This is a really crucial phase. Before entering any firm or industry, ensure that you have a thorough understanding of its fundamental parameters. Every firm has an inside secret, and if you want to prosper, you must discover it. Understanding the market for the industry you want to enter helps boost your chances of success.
Inquire, for example, "Who will be my customers?" What do they want to be served? Who are my primary rivals? Who is the market leader, and what are they doing differently? Do I stand a chance of surviving? Can you gain a market share in your planned business industry? These are the questions you must address before beginning any business in Nigeria.
6. Find a nice site.
Where do you intend to establish your company? That should be the following inquiry when you've been thoroughly acquainted with the market. Are you planning to locate your business in your neighborhood or in an industrial area? Are you going to stand out from the crowd by creating your own brand in a specific location? Or are you planning to operate from Nigeria's commerce and commercial hubs?
"If you intend to sell general products, consider situating your shop in areas such as Aba, Yaba, Tradefair, Idumota, Lagos Island, Oshodi, Mile 12, and so on. However, if you are in the service industry or are developing a specific brand, you can locate in places like as Ikeja, Allen Avenue, Apapa, VGC, Victoria Island, CMS, Ikoyi, and so on. However, wherever you choose to settle, make certain that you are properly prepared to handle the rigors of the terrain." - http://www.mytopbusinessideas.com/
7. Register and license your company
In Nigeria, most businesses are run as single proprietorships, and you can do the same. But, if you actually want to develop a great firm that will last, I recommend that you register a business name or figure it into your expense predictions as a short-term plan. Remember to obtain all essential licenses and permits.
You have the option of forming an entity as a sole proprietorship, a limited liability company, or a public liability company. After deciding on a business entity, you can have your company name registered at the Corporate Affairs Commission's office in Abuja, Alausa, Lagos, or wherever is most convenient for you. It is also advisable to consult with a lawyer to avoid making costly blunders. Hire a lawyer to help you register your company and meet other regulatory criteria. Furthermore, your Lawyer will assist you in developing your business policy and operational legal terms.
8. Capital and start-up finance sources
Before deciding to start a business in Nigeria, you should have secured the necessary funds to at least get the firm off the ground. Financing a business is generally one of the most difficult hurdles that an entrepreneur faces anywhere in the world, and Nigeria is no exception. There are numerous ways to obtain business start-up financing, and it should not be difficult, particularly if you are a Nigerian (Nigerians are really innovative people).
The truth is that it will primarily rely on the size of the company. If you do not have the necessary startup funds, you may borrow from friends or the bank (in this regard, you have to be cautious to avoid starting your business on the wrong foot of bad debt). Debt is only beneficial when the funds are invested for cash flow or capital gain.
Look for levarage as well. Leveraging the framework of well-established firms is the quickest approach to develop in business. So, if you want to grow more quickly, search for leverage. Aside from obtaining a bank loan, leverage can be obtained via obtaining credit lines from suppliers, forming a strategic relationship with a larger company, or obtaining a contract. Whatever leverage you decide to pursue, go for it.
9. Begin small.
Start small and grow your business. Keep in mind that Rome was not constructed in a day. Following all of the preceding processes, this is where you get down to business, this is where you start the business. Most people formulate fantastic plans, conduct feasibility studies, and even raise the necessary funds to start a business, but for reasons best known to them, they never start. Perhaps it's due to apprehension about failing. You must have guts because not everyone has the courage to start a business. Most people can only dream of it, and only a few are willing to take the risk. Are you willing to face the risk of establishing your own business in Nigeria? Only you have the solution.
Actually, this is where your work as an entrepreneur becomes more difficult because statistics show that 75% of all new enterprises fail during the first five years. And of the 25% that survived, 80% will fail within the next five years. This means that almost 90% of all new enterprises fail during the first ten years. These figures may be harsh, but they are entirely accurate. Are you willing to accept the risk? If you answered yes, then get started.
Congratulations if you've made it this far because you've just launched your own small business in Nigeria. You've begun the game and are now ready to be resilient. Survival is the name of the game at this point. You may take a beating from bigger competitors; you may make a business error; or you may encounter complex business issues such as a change in government policy; but don't quit up. Stay tough and persevere because you, like Aliko Dangote of the Dangote Group, Bill Gates of Microsoft Corporation, and Steve Jobs of Apple, can make it to the top.
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