As a new SME, it is very unwise to enter the Nigerian market without gaining insights into the terrain. Many businesses fail because they fail to gain insight into the country’s business terrain. Many people enter the Nigerian market in a haste, without doing their due diligence.
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As a marketing strategist with over 7 years of experience in managing and observing businesses and the business world, I will be giving you six surefire market insights so that you can be equipped before delving into the world of business.
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How Profitable Is The Environment?
This is the most important question you must ask. Not all areas in Nigeria are good for business. If you are about to enter into a business, don’t simply do what you desire, do what the market desires. For example, it is unwise to start a makeup business in a rural area or begin a catering school in a rural area, because in such a place, majority of the people are low-income earners who simply want to survive. The best place to build a makeup business or a catering school is in urban areas, especially in a place like Lagos and Abuja. It is now left to you to either change the business or relocate to an area where such business will be profitable. In rural areas, businesses like selling foodstuffs are ideal, especially food that is not grown by the people. However, it is unwise to sell food products that are traditionally grown by the people. You can start a poultry, fish farming business in an area where there is a need for protein.
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Accessibility To The Market
It is not wise enough to build your business in an area that is far from the markets. The best SMEs either build their business in a populated area or get their business inside a market that is being visited by a great number of people daily. If you are a supplier or producer, it is expedient that your place of production is closer to the market. This can save you both money and time. It is unwise to situate your business in a remote area. Further, before starting your production, ensure you have ready wholesalers and retailers that you are in touch with, so that you can easily reach out to them when the goods are ready.
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Government Policy
Another insight new SMEs must look out for is government policies. It is necessary to understand if there are government policies that govern the kind of business you are about to venture into. For example, there are some areas in Nigeria you can’t build factories. Some products need to be certified by government protection agencies, such a food, and drink production. For example, if you want to go into the production of table and sachet water, you must get registered by the NAFDAC. The government must inspect the production sites where goods are produced.
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Methods Of Publicity & Campaign
How you get to publicize your business is very important. Some businesses should be more of offline, one-on-one marketing, which should be done within the area where the business is situated. However, this does not mean you shouldn’t invest in an online campaign, but you should focus your time getting the neighbourhood to know about your business. Also, there are some businesses in Nigeria that require visiting the traders in the market to introduce them to your products. You might as well invest in posters, signboards, handbills, and so on. It is advisable for businesses in Nigeria to carry out a blend of both online and offline campaigns, because over 60% of Nigerians are either not connected to the internet or are not regular users of social media.
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Price
Another insight for new SMEs is the question of price. New SMEs should use price as a medium of penetrating the market. One simple way to ensure your prices are fair to you (and other artisans) is to look at sellers in your niche. Find 3 to 5 who are selling items similar to yours and find the average price. You can also price your goods according to your labour cost. For example, if you want to venture into the sales of table water, and a pack goes for the sum of 500 Naira, it is advisable to sell yours at the rate of 450.
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Accessibility To Raw Materials
Another insight you must consider is how cheap and easy can you get raw materials? For example, you want to go into the baking of bread, can you easily access bags of flour and sugar. Is there a large distributor nearby? How much will it cost you to get raw materials? How frequent is the possible supply of raw materials? These are the questions you must consider before delving into such a business.
Featured Image Source: Luigi Bungaro
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