How do you start a business in Nigeria?
Many Nigerians are aware of the hard, harsh, economic environment of the country, many business in Nigeria have started and failed for many reasons, the most recurring or important factor while business fail is is the harsh economic reality of the country. Before you set out to start a business, you should put things in view and weight the realistic nature of your plans. Will they scale through in Nigeria’s kind of economic situation? Or would their growth be stagnated so much that the business fails within five years?
It’s a fact that 90% of business are said to fail in the first five years all over the world. It might even be worse in Nigeria’s case where the environment is not business friendly at all.
As a Nigerian setting out to start a business, you have to endeavor that the success rate of your business is high and you don’t lose your investment and money. The real important question then should be put. How do you start a business in Nigeria and not fail? How do you exceed the five years recommended for business to fail?
How to start a business in Nigeria and not fail
It has already been stated in this post that before one moves on to establishing a business, then there are decisions he should take. There are also factors he has to put into consideration. This is to avoid the failure of the business.
- Capital: This is the foremost factor you have to consider before starting up a business. Do you have the required capital? This is one of the less physical factor to be treated here, but it’s very important.
Let’s take capital like the water in a business. It feeds the functioning of the business. It is with capital that you rent a space, get yourself the required goods and equipment and even employ workers if you have to. So, before starting a business, consider if you have the capital that can carry you on for as long as the business takes before it breaks even.
- Compatibility of the business: The business you want to do, can you do it? Is it a business you’re passionate about? What drives you for that business?
You should not be pick a business choice because of the profit incentive. You should pick it because it is something you can do, there is also an amount of profit on it and the business doesn’t fail easily. You don’t have to just pick any business and begin to do it. Ask questions and make research.
- Location: This is a very important factor to consider in a business. Location most times affect the success of that business. Do your chosen location have the purchasing power of your business plan? Can they buy your goods or demand your services?
For instance, you cannot go and open an ice cream store in Makoko area of Lagos State. An ice cream store is certainly not in the to do list of the residents there. Same way you cannot go and open a roadside buka in a closed street of Victoria Island. Business is all about putting the customers in your shoes, knowing what they want and how to satisfy that want for them.
- Creation of market: Before starting a business, do you know that you have to create or identify the market of your business? You don’t have to just go and make a business without creating a market for it.
Creation of a market for your business is very important so as to have buyers right before you start. The major thing that sustains a business is the sales and income it generates. Once a business continues making sales, the business will still be in existence. So, right at the point of beginning a business, you should also put into consideration, the idea of having a market for your goods and services. For your business not to fail in the first five years is dependent on how your profit balances your expenses.
The first and easiest ways to create a market for your business is through the words of the mouth, informing the family members and friends so close to you. Then, you move on to networking further by reaching out to friends who would tell their friends. Just be good at exceptional marketing and your business will make sales.
- Knowledge of the business: You should note that you must have a good knowledge of the business before venturing into it. Most at times, if you don’t have good knowledge of a business and start it, there is 75% it will fail.
This is the reason why most business people have to take time to learn a business before they venture into it. So before starting a business, take out a minimum of six months to learn the processes of a business even if you have to pay, when you have a good knowledge of the business you choose to do, the concept of the business is improved and harnessing all its aspects is ensured. Apart from the determining factors we have mentioned here of how to start a business in Nigeria, there are also other issues and factors to consider. All of them help in pushing the success of your business. Your success is determinant on your own decisions.
Endeavor to choose a profitable business. You shouldn’t entirely focus on profitability, but making great profits is not a bad idea.
Choose a less competitive business
Select business based on the capital you have and how you will scale the business; how that business will grow. Choose a business that agrees with your mental and physical strength.
Get the knowledge of business budgeting, checks and balances, stocking and profit and loss. Know when your business is making profit or losing.
All these tips and factors mentioned in this post will enable you know how to start a business in Nigeria, and will help you to make things right. It’s now about you making the right decisions.