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Starting a business in Nigeria, like in other countries, has a fair share of ups and downs. When a budding entrepreneur gets the idea to start a business (these are the list of businesses you can start with steps to start them), it is often exciting all the way until it gets to the point of actually starting the business. This is because starting a business in Nigeria particularly does not depend solely on having a great idea. You need to understand the intricacies of starting a business in Nigeria.
Do you need a business name to start your business? Are there special licenses you need to apply for before starting your business? Which business structure is right for you?
How To Start A Business In Nigeria
In this post, I will take you on a step-by-step strategy for starting a business in Nigeria. Here is how to start a business in Nigeria:
Identify A Problem To Solve
If you want your business to be successful, the best way to adopt a business idea is by identifying a problem that your business wants to solve in the market. For example, it is very easy for an entrepreneur to start a business using an existing model that is currently working. And while that is not totally a bad thing, it is much more sensible for your company to create its own business model using its own unique selling proposition. Identifying a problem and proffering solutions to it helps make your company stand out from the competition, thereby making you more profit in the long term.
Facebook, as a platform, solves the problem of people wanting to stay connected with family and friends, Airbnb provides a viable alternative to people staying in hotels, and Paypal and Payoneer solve the problem of sending and receiving money over the internet.
The idea is simple; the bigger the problem that your business solves, the more likely that people are to pay you for it. So, when looking to start a business in Nigeria, you must start by identifying a relevant problem that your business will solve. Flutterwave took advantage of this when they created a solution that helps Nigerian businesses receive and process payments over the internet, and they have made a lot of money for it.
Do A Market Research
It is important that you do market research when starting a business in Nigeria. This is because Nigeria is a very unique market with unique needs. So, if you make the mistake of bringing a foreign concept to the market without localising it, you might waste a lot of money and close shop. Therefore, to start a profitable business in Nigeria, you need to carry out market research to understand the market that you are looking to enter.
During the market research phase, find out important information such as who your target audience are, who your top competitors are, the amount of money you will need to start your business, and also predict how long it will take for your business to break even.
Set SMART Goals For Your Business
One of the biggest mistakes one can make when starting a business in Nigeria is not setting business goals and objectives right from the beginning. There’s a popular saying that goes, “if you fail to plan, you plan to fail” which means that if you don’t plan your business goals and objectives from the beginning, you might find yourself in murky waters.
Setting goals is not enough, though, you have to set goals that are specific, measurable, achievable, realistic, and timely (SMART). If your goals are not smart, it might become a problem for your business. Creating specific and realistic goals that you can always measure from time to time will definitely set you up for success.
Create A Business Plan
To set objective business goals, you need to create a business plan for your business. A business plan is like a map for your business; showing you the starting point while predicting with intelligent guesses where you will be per time.
A business plan should contain important aspects of your business like your mission, your vision, your objectives, your strategic partners, SWOT analysis of the market you are entering into as well as your unique selling proposition. Basically, a business plan is a breathing document that shows the details of your business.
To write a business plan that actually works, you should do proper market research as I said earlier so that you will be working with actual figures instead of making up estimated figures.
See Also: How To Write A Business Plan Step By Step For Your Business
When looking to start a business in Nigeria, I will always advise budding entrepreneurs to make sure that their business plans are short and straight to the point. As you establish and begin to run your business, you can always adjust your business plan.
Source For Funds To Start Your Business
One of the main areas where entrepreneurs struggle when looking to start a business is in the area of funding. So, when looking to start your business in Nigeria, you need to consider how you will source funding for your business. If you do thorough market research, chances are that you will have a fair idea of how much you need to start and run your business until it reaches profitability.
Are you going to bootstrap with your personal finance? Do you need some family and friend support to start your business? Do you want to go the crowdfunding route? Or do you want to pitch to angel investors and venture capitalists? Whichever way you decide to go, make sure that it is a viable means of funding and that it can help you start your business and run it until it becomes profitable.
See Also: Small Business Funding – 9 Ways To Fund Your Small Business In Nigeria
Choose A Relevant Business Structure And Register Your Business
Now that you have sorted out the funding for your business, the next step is for you to register your business. But before you go ahead with your business registration, you need to choose the business structure that is relevant to how you want to run your business. To do business in Nigeria, it is required by law that you register your business with the Corporate Affairs Commission. You need a business registration to be able to open a corporate bank account and be able to receive payments from customers. We have a resource in our shop that will help you understand your business and the law.
There are various types of business structures, but in Nigeria, you can register your business as a business name, limited liability company, incorporated trustees, and you can also trademark your brand. The business structure that you choose will ultimately be determined by how you want to float the business as well as how many partners are running the business together.
See More: Understanding The Different Legal Business Structures
Assemble The Right Team
There’s a saying in business circles that your staff members are your first set of customers- that could not be truer. You need your staff to first believe in what you are selling before they can help you sell to others. And when assembling a team, make sure that everyone understands that they have a role to play in customer service.
Gone are the days when customer service duties are left to the sales team or the front desk officers. If you want to build a company that retains its customers, you have to make it clear that everyone that comes in contact or talks to customers knows and understands customer care.
It is also important to note that while it is great for new companies to start lean, you don’t want to hold your business back by overloading employees with work. Hire right and put square pegs in square holes.
Starting a business in Nigeria is a very rewarding experience if you know what to do. However, it could become challenging if you don’t know the step-by-step approach to starting your business in Nigeria. With the steps outlined in this post, you should be prepared to start your business in Nigeria and make a profit.
Are you yet to start your business? We have resources that will help start both online and offline businesses in our shop. Follow the link to get them.
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