Business Start-Up Hints: This is for Nigerian Entrepreneurs – In fact, this is part of our series of publications on business growth in Nigeria. We understand that opening a new business is always a big challenge. By industrial experience, we have also come to know that many entrepreneurs focus only on business idea and forget so many other things. These are the things we bring together now for you. In fact, they are part of Management Tips for Beginner Entrepreneurs. We therefore advise whoever that is starting to pay extra attention to these points to avoid business failures.
Complete Entrepreneurship Empowerment Summit owners of Cessummit.com offer entrepreneurial solutions. We offer modern entrepreneurship empowerment strategies to help start-ups and existing businesses avoid business failure. From so many years of our industrial experiences and wide researches, we opine that every startup company or business must redouble their precautionary measures to avoid failure. This is because, we also understand that over 60% of newly established business in Nigeria don’t survive up to the third year. So, in order to help those just starting out, we have listed here over 13 tips for those who want to avoid the most common mistakes when starting a business. Please, reda on.
Discuss your business idea with trusted friends:
Generating a good business idea is one thing. But, it’s another thing all together for it to worth establishing. You know it that in Nigeria, ones you have started a business, or at least you leave your house every morning for something, others, busybodies, will start counting your millions. That is why you must start well. In fact, discussing the intended business with trusted friends at an early stage can save you a lot of time and money. Forget the fear that someone will copy your project. Get to interact with other entrepreneurs on that line of business. They may have gotten failure or success experiences that you need to know about.
Did you get that? I happen to be interacting a lot with young business men cum existing ones. Experience, they say is the best teacher.
Remember too, that we are taking a broad approach to this topic. Therefore, it takes care of all shades of business types. And, listed under are some of our previous articles on this subject matter that can be of immense help to you. Just click on the highlighted tags to read them. Please, read on, there are still a lot to talk about.
- Business start-up challenges
- Avoidable mistakes while starting business
- Accounting and auditing for start-up businesses
Validate and Revalidate your business idea:
Complete Entrepreneurship Empowerment Sumit – cessummit, has found out that lack of planning is one of the main causes of death for businesses. We know that mistakes are common, but the important thing is that failures are seen as a learning process. But you can avoid frequent failure by taking a very important initial step. And that is, testing and validating your business as quickly as possible by and via developing a bankable business plan for your business. In doing this, don’t be afraid to completely change your strategy if necessary. So, if you invalidate an idea in a short time, the damage is less.
That is why we don’t recommend a-ready-made business plan for business men and women. Why not go for a customized one with current commercial data suitable for your business? That is the type we do for our clients. Take time to go through the next paragraph on our business plan procedure.
Our Business Plan Procedure:
To start with, we negotiate the professional fee out of which 60% payment of the agreed sum must be made before commencement. And, the balance is paid just before the final copy is delivered.
After this we send to client the business plan assumptions information details. This will enable client give us personal and business information that will help us build and customize the business plan. With that, we are able to raise planning assumptions on the investment requirements. These include personnel cost, admin cost, direct and indirect production cost etc. We will then send this across to client for acceptance and perhaps, contributions.
On agreeing with the business plan assumption variables raised, we will go ahead to generate the business plan financial and operational analysis and build up the business plan.
At this state we will send to the client the projected Income Statement (Profit and Loss account) generated. This is to enable the client assess the scope and performance of the business with the view to determing whether that suits him/her or not.
At this point our final payment becomes due and must be paid before the business plan is finally emailed to the client. Depending on the client’s readiness to co-operate, twos week is enough for the business plan to be completed.
I hope you liked that. That’s is our procedure for developing a bankable business plan for you. You may wish to check on some of the business plan templates that follow. Just click on the highlighted links.
- Role of business plan for beginners
- Agric-product services
- Manufacturing services
- Fashion and Entertainment
- Schools and Academic services
- Distributorship businesses
- Mining Business
Legalize your Business – Business Start-Up Hints: This is for Nigerian Entrepreneurs
This is another start-up essentials that you must do. I keenly listened to somebody who was narrating how their shops got burnt in the market, and government of the day did nothing to help them. Then, I asked; is your business registered? And, he said No. The next question I asked was, if government wanted to come to their aid, who will the government say they were helping; illegal business men and women? Many don’t understand this?
Look; when you legalize your business by registering it with C.A.C and obtain other operating licenses like from NAFDAC, SMEDAN certificate and others, and pay your tax adequately, then you can talk.
Try to get your business registered. You can contact us to do that for you at minimal fees. We will help you also get other permit and compliances certificates. We don’t belief in short-cut, every legal procedure must be followed. Get our contact at the end of this page.
Now, read the following topics on this subtopic of this subject matter. Click on the highlighted links to read along. Send your commends, questions etc. through the comment box bellow.
Know Your Customers Base:
In this, know each of your customers deeply. There was this story of one who deals in Iced Fish. One day, customers gathered to buy fish. Because some cannot afford to buy a pack alone, so they have to get like 3 people together to share the content. And, then, a woman came in gathering people to share with. You know what, the woman disappeared after collecting the other people’s money.
Did you like the story? If that happened in your business premises, what would you do? There are other types of similar stories here and there around you. So, please, put measures in place to know your customers deeply.
As a matter of fact, the more you know your customer, the more likely you will not have such embarrassing stories around you. You may think that it does not concern you, but think again. Yes, it’s not enough just to have information about the size of your target audience and business preference. It’s also important to understand the customer behavior, habits and routines. In fact, this information will help you manage your environment, customize products or services, conquer users and achieve success more easily.
Be formal in your business relationships:
It’s not very right to be informal in business environments. We have come to know that beginner entrepreneurs are tempted to start their activities informally. In most cases, this is to avoid taxes and other official commitments. As consultants, we face a lot of questions at all times. One recently visited me just to find out if he should register a business name as a sole trader or a limited liability company. This is a long story, if this is of interest to you, click here to read about this question.
However, in continuation, without formalization, your business will be unable to grow. I just told you stories of how government can help businesses when calamity strike, but that must be to legally exiting businesses. Do you know that the ability to issue invoices, run a bank account as a legal entity, obtain credit card machines and apply for public loans is exclusive to those who have a registered business.
Now check out the information on the following topics;
Be a good administrator – Business Start-Up Hints: This is for Nigerian Entrepreneurs
Something must be straightened here. The difference between trained administrator, and acquired administrator by experience or talented administrator. You may like to find out what to make out of these. But see our interest here.
That is, having experience in the business is important, but it’s not everything. Again, most beginning entrepreneurs believe that it is possible to manage a company with the knowledge acquired in a specific degree. For many of us, such a posture is inadequate. Without knowledge in administration, the entrepreneur runs the risk of seeing the business sink.
That is why we encourage you to always bookmark this website. So that, even if you are not a trained administrator, you can develop yourself by reading our articles. Look, as professionals, we give you the same knowledge you get from a university degree free of charge. And, if you attend our business summit regularly, you will soon be the best among your equals.
Yes! Look at the following topics:
A well-patterned financial life:
We just discussed about being formal in business. My dear, this is part of it. It’s really unfortunate that many entrepreneurs live in complete financial disorganization. As we can proof to you, this is terrible for business. Please, to get going fine, the first step is to organize your cash flow. In fact, with a simple spreadsheet, you can track incoming and outgoing values. You can also include future predictions or budgets. In fact, some management software helps with financial control information. Such software gives information on what is due and what should come into your wallet or bank account. In this way, you have total control of the monetary situation and will be able to plan the healthy growth of your business.
As professional accountants, we can plan your internal control system to suite your business, if you contact us. Here are some of our write-ups on this sub-topic.
Distinguish between Personal and Business Expenses.
The truth is that if you don’t do this, the personal and madam’s expenses will soon overwhelm your business revenue. What many family members think is that the money is there. But you know that the money in your business is not yours. May be 80% of it are loan or credit purchases. So, what do you think if you give answer to every call from your family kitchen?
Be careful then. This is because, sometimes, because of financial constraints or sheer disorganization, an entrepreneur uses company money to pay personal expenses or vice versa. For professional accountants and tax experts, this is one of the most common mistakes among small business owners. We recommend that your set a monthly salary for yourself. And for sole traders, set a monthly withdrawal of the business’ earnings for personal use and reinvest the rest of the profits in the company itself. That is how to stabilize and stimulate the business growth.
Do proper mark-up on your products:
This is how to consciously define the value of your product. Experience shows that beginning entrepreneurs also often make a lot of mistakes when it comes to defining the profit margin. This in fact, affects fixing of product prices. This is because it’s common to find entrepreneurs who sell a lot but complain about not seeing the money coming in.
As a matter of fact, this miscalculation is common among entrepreneurs. Even those who think that they are doing well are doing so structurally. In fact, many of them are profiteering, selling fake products or reaping the benefit of inflation which they think is gain. Did you catch this joke! It’s not a joke my dear. It’s a serious issue.
This is where you need our services. We need to sit down with you and work out the real value of your product or services. This is because there are correct techniques to define profit margins and prices of products and services. If you don’t know them, it’s time to review the company’s finances. Contact us.
Check out the following:
Build a negotiating skill for Business Start-Up Hints: This is for Nigerian Entrepreneurs
Furthermore, negotiating well is to consider cost and benefits. It’s to consider the value of your products or services. It’s knowing the components of your products and services. In fact, cutting costs and saving as much as possible – the entrepreneur who thinks like that goes far, according to the founder of ContaAzul.
Therefore, an important strategy to get the best use of resources is to negotiate with resource suppliers. However, if you have a good cash flow, you will be able to make large cash purchases. This will mean lower costs to replenish inventory and higher profits when selling. Otherwise, learn how t negotiate for credit purchases.
Manage inventories – Business Start-Up Hints: This is for Nigerian Entrepreneurs
Inventories are stock of raw materials, semi-finished and finished products. This is relevant for manufacturers and dealers. This is because management of these is also one of the key points for the success of a business. Remember that if you sell, you have to deliver. And, when you deliver, stock depletes. This is why you must know exactly how much of each item is available.
Read about stock management here:
Employ good communication strategies:
In fact, assorted communication strategies are needed. In fact, such robust communication strategies must be adopted in any business. Notwithstanding the size of your business, this is essential. In modern time, some of these can be created at no great cost. What about an email newsletter for your customers? This will enable you inform them about news and promotions. This is a relatively inexpensive way to inform them. As you now know, social networks, cannot be ruled out.
Innovation and creativity are synonymous. The founder of ContaAzul does not believe that it is necessary to “reinvent the wheel”. He opines that creative solutions and unique differentials are decisive to lead your company to success.
Check out these:
Summing Up on Business Start-Up Hints: This is for Nigerian Entrepreneurs
This article, Business Start-Up Hints for Nigerian Entrepreneurs, emphasize on your ability to roll out your business successively. Legalizing and good management for your business is the key. Properly defined values for your goods and services are other important success factors. In fact, we have included over a 100 articles here to help widen your business horizon and articulations. If you cannot make sense out of these, you have to start reading again.
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