Nigeria is one of the largest markets in Africa because of its population and its available resources, many foreign investors have ventured into the country and taken a bold step by establishing their businesses in the country and today most of them have been successful in their line of business.
They were able to make a feasibility study about the market and understand what the people needed the most and this has helped most investors a lot.
In this post, I am going to highlight the major things you need to know before starting a business in Nigeria and the different secrets these investors have been hiding from you.
Some groups of foreign investors have crossed the line by using the media to spread rumours about Nigeria in other to scare potential investors away from Nigeria so that they can continue to milk the country alone.
Nigeria might be suffering from insecurity and other infrastructural problem which can be a major factor that can hinder investors from investing in the country.
When they find out that competitors are making advances to come into the country they will use their powers and connection to ensure that their competitors don’t invest in the country. Even as a new company coming into the country for the first time you can still succeed.
According to guardian news which was published on the 12th of May 2021, Foreign Investors have pulled out N1.6trillion from the stock market over insecurity in the country.
I believe news like this can hinder investors from coming into the Nigerian market. In this article, I want to focus on the brighter side regarding how you can enter into the Nigerian market and establish a successful business.
But before considering starting a business in Nigeria there is some vital information you need to know.
Continue reading to find out the major things you need to know before starting a business in Nigeria
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Back to the question of how to start a business in Nigeria, below are 8 steps you need to consider before starting a business in Nigeria.
- CAC registration
- Target audience
- Cultural and religious beliefs of the people
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Before starting a business you must have your capital ready at hand, the Nigerian currency is very weak to dollars. At the time of writing this post, a dollar is equal to N540. So this is an advantage to you as an investor.
If you are ready to succeed in Nigeria you need to plan how you intend to spend your money. It is always cheaper to get landed properties in your desired location.
The country has been suffering from a series of blackouts for over a decade, so when starting a business in Nigeria you need to make available your own electricity if your product depends on electricity for production. There are different methods you can get stable electricity at a cheaper rate.
- Solar system
- Mikano generators are popular brands in Nigeria that almost all companies use because of their durability and their ability to offer 24/7 electricity.
- Direct electricity from Nigeria electricity and power holding company.
Labour is cheaper in the country, there are so many graduates seeking jobs and most of them are qualified and have the required skills.
Nigerians are fast learners and they adapt faster. It will not cost you much to get them working and you will surely get their loyalty if you treat them well by paying their salaries and bonuses when due.
Payment of tax is mandatory if you want to operate in the country, the tax department will always visit you if you are found guilty of not paying your tax which can make you lose your company or license to operate in the country.
This is one of the most important things you need to consider before you establish your business in any part of the country.
You need to ask yourself these questions below
- Which state should I establish my business in?
- What are the culture and behaviour of the people?
- The population density of the location.
- The religious laws.
Editors Tips: The best locations to start a business in Nigeria are Lagos, Abuja, Ibadan, Portharcourt, Kano, Calabar e.tc
The CAC stands for cooperate affairs commission and it is a body responsible for the registration of businesses in Nigeria. They are in charge of processing the registration and reservation of your business name to ensure that you are the only party using that particular business name.
To ensure that your business is legal you have to pass through the CAC by providing the necessary and required documents.
Knowing your target audience will help you to know where to channel your product or services to.
You need to categorize your audience based on the following
- Their educational background
- Their interest
- Age grade
- Their religion
- Financial status
If you can make a feasibility study based on the information above, knowing how to target the right audience will not be a problem.
Cultural and religious beliefs of the people
Nigeria is a country where the people are so moved by religion and culture. You should never try to involve yourself in anything that has to do with these two. We have seen a scenario whereby people go mad and wild because someone insulted a prophet. To avoid destroying your business and property it is advisable to stay away from any of these two.
And also it is advisable to make research to know if your product is been accepted in a particular region where you are establishing your business. For example, you cannot take tight clothes or clothes that expose sensitive parts of the body to the northern part of the country that is populated with Muslims.
You will only end up inviting some group of fanatics and mobs to blaze down your company before the police even arrive.
You have to be careful and ensure that none of your products or services clashes with people’s religious beliefs.
You can contact an expert to help you review your service or product to know the region or people you can sell your product to.
This is the view of the author and it is not being endorsed by the federal government of Nigeria.
Thank you for reading