In Nigeria, there are over a lot of challenges facing the growth of many small businesses in Nigeria. Over the years, Nigeria as a country has been faced with challenges on a large scale which has by extension, affected the growth of small growing businesses in the country.
Well, in this article, we’ll be
uncovering some of the factors
facing small business growth in
PS: The factors enlisted in this article include both external factors and self-made problems made by these entrepreneurs.
Check out nine factors facing small business growth in Nigeria. Here they are:
- Power Supply
The electricity crisis in the nation, which impacts large corporations, including multinationals, down to one-man businesses like barbers and tailors who depend on power to conduct their businesses, has not yet been resolved by the government.
The remedy to this is to purchase solar power plants or a generator, which requires the business to spend a significant amount of money even before any sales or production have been made.
This has an impact on the business because the money that could have been used to develop other aspects of the business is instead spent on fuel and generators and because whatever the business produces will cost more to the consumer as a result of the need to avoid losing money.
- Financial Problems
A key component of launching or establishing a business is financing. In addition to many other things, purchasing materials, equipment, and supplies require money. In Nigeria, financing is a significant issue, particularly if an entrepreneur lacks the funds to launch the business.
The banks that should be assisting investors are unwilling to lend to start-ups or new enterprises because they do not trust them, do not believe in them, or feel that they lack experience. There is the problem of interest rate or collateral to deal with when such new enterprises or entrepreneurs are fortunate to get a financial institution to help and support them.
In order to attract consumers, banks typically charge high-interest rates on the loans they offer. Another issue is that the return period is typically brief, making it very impossible for the small business to repay within the allotted time.
- Limited Resources
Having limited resources is one challenge faced by small business owners in Nigeria. This is because most of these small business owners were not prepared financially before starting the business.
Well, as an entrepreneur, you must come up with innovative ways to get more done with less money. Recall that your business is still in its early stages. You must make use of your limited resources.
As a startup, you simply cannot afford to spend extravagantly. Being resourceful and frugal is essential if you want to succeed as an entrepreneur.
Being an entrepreneur, having a fantastic concept is one thing, but coming up with original, creative ways to put that idea into practice is quite another.
- Bad Road Network
To help save money and time, most businesses set up shops close to their supply of raw materials or target market.
But the issue of transportation will surface if this is not viable. The majority of Nigeria’s roads are in poor condition, and the country’s canals and railroads have not yet reached their full potential. Terrible roads have prevented items from reaching their destinations or have harmed the carriers of the goods, causing products of businesses to become stalled on the roadways for days.
Due to the impact on perishable items in such circumstances, this can cause businesses to suffer significant losses.
- The practice of attempting to be an all-in-one business is another element that is so detrimental to the growth of small businesses in Nigeria.
It might just be harmful to your ability to succeed as an entrepreneur in business. Keep in mind that you might not be able to excel at any of the activities if your business philosophy is built on dividing your time and attention between several of them.
There is a good chance that the sky will be your starting point if you focus all of your energy on one niche that you are very familiar with and also enlist the assistance of others to further your effort in that direction.
- Stress In Getting Government Assistance
The government has come under fire for not doing enough to support new businesses and entrepreneurs in general. You must register your business and provide all pertinent information before you may launch it.
People frequently lament the expense of such registration associated with registering a business, which causes a delay in the business’s timely launch.
Additionally, there are issues with the business being subject to significant taxes and tariffs.
These are some of the difficulties one could run into when attempting to launch a business in Nigeria. One can overcome these issues and build a successful business from a startup to a conglomerate with careful planning and persistence.
- Lack Of Feedback From Customers
The trust of a business typically rests with its customers. If, as a business owner, you ignore their suggestions for how to improve your goods or services, it is obvious that you have no business operating.
You must set up a platform so that your customers may communicate with you directly. You need a channel for feedback. Positive comments will motivate you, while negative feedback will highlight your areas for improvement.
- Lack Of Understanding Of The Business
A deep understanding of the industry you are entering is crucial everywhere, including in Nigeria. You might also enjoy the qualities of a strong business plan.
Business ideas are evolving daily, just like the rest of the world. You should feel at ease as a business owner enrolling in regular professional business courses.
Your understanding of the industry will grow as a result of keeping you up to date with new developments. If you want to succeed in the business of your choice, you must constantly be willing to consider new concepts.
- Inability To Use Social Media To Their Advantage
The modern, efficient method of reaching more individuals for increased patronage is social media. These channels are available to more than just companies that provide services online.
Having a strong internet presence will support your business growth even if it is run offline. To reach a market that is unaware of your business’s existence today, web marketing is simply the best option.
This article has been an eye-opener for you as a potential or an established business owner in Nigeria. In this article, we’ve been to see nine factors facing small business growth in Nigeria.
We’ve sure you learned a lot from this article.
Do well to leave a comment below.