STEPS TO STARTING A SMALL BUSINESS IN NIGERIA
STEPS TO STARTING A SMALL BUSINESS IN NIGERIA
Steps To Starting A Small Business In Nigeria
Unemployment has by far been an epidemic in the Nigerian economy and the society at large. In the last few years, unemployment rate has increased and thereby leading to several economic challenges. Statistics shows that as at September 2016, 65% of Nigerian youth face unemployment. With the current standard of living, it is no wonder why a lot of people have gone into entrepreneurship and working towards financial independence.
For most people, it is not really about not having a 9 – 5 to go to but having a career that has the flexibility to grow with them, alongside investing greatly on themselves. The advent of small businesses being a popular phenomenon is not a new thing anymore but a lot of people do not know the first thing about starting a business. Not every business is positioned to be a successful one, the small businesses with employees only get to survive for at least two years. As a new entrepreneur you could be up for a big challenge when you do not follow the necessary steps in starting a business, these steps help in building your business foundation and making it set for success. Here are 10 steps that are required to start a small business successfully, you would need to take it one step at a time.
It is most likely that you have identified the business idea, the next move would be to bring it into reality. Learn to run your business idea through a validation process before thinking of going any further. For a business to be successful, it has to solve a problem, satisfy a need or offer goods/services that appeals to the market. As you carry out your research, the questions should offer and answer to these:
- Is there need for the product/service?
- Who is in need of it?
- Are there competitors presently?
- What the weight of the competition is currently?
- How the business would fit into the market?
For your business to become a reality, there has to be a plan, a blue print that would guide your business from start to establishment and probably up to business growth. This is a must have for budding entrepreneurs. However, there are different types for the different types of businesses.
- A traditional business plan is an important step for small business owners, most especially those who are pitching to investors or financial institutions for funding. Due to the vast nature of writing business plans, this phase could be overwhelming. A traditional business plan is to be sectioned in the following:
- Executive Summary
- Company Description
- Products or Services
- Market Analysis
- Marketing Strategy
- Management Summary
- Financial Analysis
- Appendices and Supporting Information
- One Page business plan: This is for entrepreneurs who do not anticipate financial support from any organization. This one-page business plan gives the entrepreneur more clarity about what is about to be achieved, this type of business plan can be improved over time.
As a startup entrepreneur, a lot of money is not totally required to start your business but it would surely require an initial investment as well as the capacity to cover the expenses before you start earning a salary from its profit. Here is what you would do, put up a spreadsheet that estimates the one – time startup costs of your business, this includes (licenses, permits, equipment, legal fees, insurance, branding, market research, trademarking, property lease, business launch etc.). Also keep a spreadsheet for expenses you would make to keep the business running for at most, a year (rent, utilities, advertising, production, customer attraction, salaries etc.). An addition of the accosted would determine what your initial investment what would be.
The business can either be a sole – proprietorship, a partnership, a limited liability or even a corporation. The structure you choose for the business would have an impact on many factors, such as the business name, liability, how you file your taxes. Initially, you can pick up any structure and then as the business grows you can reevaluate and change the structure as your business grows and in need of change. Now, planning a structure for your business may not be a lay man duty, so therefore you would need the service of an attorney or CPA (Certified Public Accountant) to ensure that you make the right choice for your business.
The name your business bears have a major role to play in almost every aspect of your business, take out time to think through all of the potential implications as you explore the different options of a name. After choosing a name, check if it has been trademarked or it is currently in use by someone else, if it not in use, then you would need to register it. A sole owner of a startup must register the business name with either their state or country clerk.
Get the business license and permits
When starting a business, there would surely be a lot of paperwork involved. The type or variety of license and permit is dependent on what business you are launching and in what state it is being located.
Have an accounting system
Have an effective accounting system for your business, it is by far one of the most important systems for a budding business. This would help create and manage your budget, set the rates and prices, file taxes and many more. You can either learn how to set it up yourself or you go ahead to hire a freelance accountant.
Where your business is located, is another important aspect you would have to pay attention to. It could be a home office for the meantime, a shared or private office space.
Get a Team
If your business is the one that needs extra hands, please start searching from now. Take out time to outline the positions that would require being filled up and their job responsibilities as well. It is not necessary to hire employees but you could outsource the job to independent contractors.
Every business need clients and customers for it to thrive effectively, so you would need to start promoting your business by creating a marketing plan for both offline and online sales.
Once you have completed these activities for your start up, you will have covered most of the important bases for your business to flourish on a good note. Do bear it in mind that a successful business does not become one overnight but improves over the years. Use the plan that you have created and work on your business and its growth consistently, this would increase your chances of success in business.
Patriarch Business Advisory (PBA) aka Patriarch Advisory (PA) is a management consulting firm committed to bridging the knowledge, finance and mentoring gap of small and medium sized enterprises in Nigeria. We provide excellent bespoke services that are extremely useful to any business. Among others, our services include business financing, marketing strategies, growth and expansion plan, and objective business diagnosis. Some our deliverables include Business Plan, PitchDesk, Grant and Loan Application, Proposals, Concept Note and so on. Please contact us today to discuss your specific concerns. The excellence we put to our work stands us out.
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