If you ask successful entrepreneurs how to start a business, many would probably tell you to start small, work smart and be diligent. While they are not wrong, starting a company can be challenging. You know your products/services, target audience, and goals, but you lack knowledge on the way forward.
While it might seem easy, many enthusiasts have failed to build a successful one. Business Day Nigeria shows that 61% of startups failed between 2011 and 2020. This could be due to many factors, from mismanagement to fraud, which explains why the Guardian believes 80% of budding companies fail. This shows that proper planning and execution are vital to successfully starting a business in Nigeria. This article will discuss those steps and how you can utilize them.
Necessary Steps to Start a Business in Nigeria
Building a new company requires adequate research, firm financial decisions, and long hours of commitment. Here are some of the things you can do to start a business and build your SME successfully:
There are hundreds of niches to choose from, but you can’t afford to offer generic services. There will be enormous competition to overwhelm you. You should channel your strength and marketing budget to a specific market.
There are several niches to dive into to start a business in Nigeria. These niches include catering, textile designs, electronic retail, grocery retail, solar energy products, health and beauty products, indoor sports, home, and office equipment, real estate, and many others. You need to stick with one. For example, rather than offer catering services as a whole, you can choose to bake cakes or stick with biscuit production, which is better than staying under the generic umbrella. You will build your brand from the ground up with this specific product. However, you can choose to expand and grow into other niches later.
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Do your market research
To start a business in Nigeria, you should start your market research with a comprehensive outlook. Weigh your success by how large the market is and the essential factors that affect its growth.
You should also broaden your knowledge of the future trends to take advantage of the industry’s technological revolution. Know the industry’s customer service, improve on it, and entice consumers to your company.
While conducting your research to start a business in Nigeria, you should also consider your demography, i.e., your target audience, gender, rate of income, location, and interests. You can figure this out by creating a questionnaire to your potential customers through various channels— like email, social media, and the company’s website— to know what, which, and how they prefer their services. This assessment will help you know the best steps and how to take them.
After acquiring your necessary information, you can sort it out using a spreadsheet to know the revenue, age group, and the range of people that responded to know who needs your services.
Write a business plan
Every successful entrepreneur starts with a good plan. Yours is no different. Your plan should entail your start-up capital, expected income and profit ratio, investment options, loan options, marketing strategies, target audience, pricing options, and many more.
This detailed document keeps you in check and gives you headway when you start executing your business plan. It also helps you track your growth and amend your mistakes— it is like a manual. You can even show it to potential investors to get funding, especially investors who want to know your brand.
Study your competition
Studying how your competitors operate is a fast way to understand how the industry works. You can start by observing their strengths and weaknesses in marketing, customer service, automation (which makes transactions faster), payment methods (to know if it is flexible or not), and their mode of operation, among others.
You can do this by putting yourself in the consumer’s shoes: purchase your competitors’ products, observe how they operate, and visit their website to learn the best way to sell your products. You should use your competitors’ mode of operation as your guide to starting a business. This will help you boost and organize your portfolio.
You already know that building a start-up is expensive; sometimes, you can’t bootstrap it. This is why you need to source funding through loans, venture capital, crowdfunding, and pitching partners who can afford it but do not have the skill and time to dedicate to the company.
This is possible when you have a well-detailed project that financers can deem profitable. To cap it all, one of the ways to get funding to start a business in Nigeria is through family and friends. Ask if any of them wants to invest in your company— which has a lot of prospects.
Make your customer support more accessible
It is important to make your brand easily accessible to consumers. This will help you build trust and credibility with customers and potential clients. To effectively start a business in Nigeria, you should create communication platforms for your client base to answer any questions or solve any difficulties they might be experiencing.
Make yourself available online and offline, depending on your client base. You can create social media accounts— with WhatsApp, Twitter, and Instagram— to communicate better with your audience, have an active phone number that can be reached 24/7, and create a working email to pass out information and cold-pitch prospects.
Market your company
Marketing is the soul of any successful enterprise, and with the infusion of technology into several industries, many people can now project their business ideas into marketing strategies. You can implement your marketing campaign through promotional tools, ads, and a website where you can create SEO content so that customers who might need your services can find you.
You can also utilize email marketing and physical marketing, where you can give flyers, talk on podcasts, and feature popular shows that your target consumers always watch. Online advertisement is an effective way to publicize yourself when you start a business in Nigeria. You can utilize social media platforms to pitch your services and products to prospects.
Create a website for your brand where many customers can find answers to their questions, book appointments, and purchase your products with satisfaction. You can also promote yourself by volunteering to companies that sell to your target audience, leverage their influence, and get customers through them.
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Build your team
You cannot establish a brand alone. You need teams to achieve your agendas. You need a sales team to market your products and services, human resources management to engage employees, improve performance and overall productivity, and an advisory board to help create corporate and business strategies for successful operations.
You also need a finance department to create budgets, and track funding, expenditure, and profit. As your company grows, you’d need a research department —to find better ways to create your products or offer your services— and a legal department to help with any complex legal issues. All these will contribute to gradual but eventual success in the market.
While it might seem overwhelming to start a business in 2022, the best way to start is to begin your first step. You can build your start-up to become successful through grit, dedication, detailed planning, teamwork, and marketing. You can also follow these steps to establish proper planning, team building, and adequate marketing strategies to ensure that you have a solid plan to achieve your goals and business ideas.
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