Most Nigerians running businesses in Nigeria started the business for different reasons; to have an extra source of income, to be more independent and have control over their time or simply to leave a legacy.
Whatever the reason for starting a business might be, here are 4 things you need to know either as a fresh baby-faced entrepreneur or even as a seasoned warrior in the Nigerian business space.
4 Things No One’ll Tell You About Running Businesses
There’s such a thing as Founder Dependence:
If you get hit by a car, is your business still producing income the next day? A business that can’t operate without its founder is a business with a deadline. Many businesses suffer from founder dependence, and it is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows.
In theory, meeting this challenge is easy—a business owner merely has to give over more control to employees or partners. In practice, however, this is a significant stumbling block for founders because it usually involves compromising (at least initially) on the quality of work being done until the person doing the work learns the ropes.
Money Management can make or destroy your business:
Having enough cash to cover the bills is a must for any business, but it is also necessary for every individual. Whether your business or your life, one will likely emerge as a capital drain that puts pressure on the other. To avoid this problem, small business owners must either be heavily capitalized or pick up extra income to shore up cash reserves when needed.
This is why many small businesses start with the founders working a job and building a business simultaneously. While this split focus can make it challenging to grow a business, running out of cash makes growing a business impossible.
Money management becomes even more important when cash is flowing into the business. Although handling business accounting and taxes may be within the capabilities of most business owners, professional help is usually a good idea. The complexity of a company’s books increases with each client and employee, so getting an assist on the bookkeeping can prevent it from becoming a reason not to expand.
The hours, the work, and the constant pressure to perform wear on even the most passionate individuals. Many business owners—even successful ones—get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge.
Fatigue can lead to rash decisions about the business, including the desire to abandon it altogether. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.
Money isn’t the only capital you need:
Money is important to running a business. But this, sometimes, isn’t the most important form of capital needed for business growth. Finding the right people to work with or having effective business processes are equally as necessary as having money to pay those right people you find (Yes, it’s a paradox.)
This is, in no way, an exhaustive list of things to take into consideration when running a business in Nigeria (as you’d still have government regulations, market forces, and other vagaries of the business to contend with). But being aware of these pitfalls can go a long way in determining how well your business scales.