2011 - A Promising Year for Nigerian Entrepreneurs



A Small Holder Organic Tropical Banana Farm in Lagos, Nigeria



The Year 2011 promises to be an excellent one for Micro, Small and Medium Enterprises (MSMEs) operators and entrepreneurs.  It appears particularly promising for those whose visions and growth plans had been discouraged in the recent past by the lack of access to credit or finance.  The President Goodluck Jonathan Administration and Mallam Sanusi led Central Bank of Nigeria (CBN) appear very determined to offer them practical solutions to the problem.  Their public pronouncements on the issue lead me to believe that this is a “must win battle” for these two leaders.  Perhaps this is one field in which they wish to leave their footprints in the sands of time.  

Some of the common reasons why MSMEs operators and entrepreneurs are not able to secure finance or gain access to credit include:

1.       A pervasive perception that it takes a “miracle” to access credit from a Nigerian bank.

2.       The enduring poor credit standing or rating of MSMEs in general by lending institutions.

3.       The inability of most MSMEs to provide collateral and credit guarantees.

4.       Weak business plan documents and proposals.

5.       The high cost of MSMEs credit administration and management.

I find a lot of hope in the on-going efforts of CBN, Bank of Industry (BOI) and their partner organizations to address these issues using a multi-pronged approach.  I believe the solutions to these problems are nothing like rocket science.  The bigger part is “political will” and the present crop of leaders seems to have that in good measure. The MSME operators and entrepreneurs must also play their roles in this regard because it is simply not enough to remove the supply-side obstacles.  The demand-side challenges also need to be overcome and this has to be done by the MSMEs operators and entrepreneurs themselves.  Sources of finance and credit to MSMEs that should be seriously and carefully considered in 2011 include:

1.       The Small and Medium Enterprises Equity Investment Scheme (SMEEIS)

2.       The National Automotive Development Fund

3.       N100 Billion Cotton, Textile and Garment Industry Revival Scheme

4.       CBN N500 Billion Intervention Fund

5.       USD 200 Million Fund for the Entertainment Industry

6.       N200 Billion Re-financing and Restructuring of Banks’ Loans to the Manufacturing Sector.

7.       N200 Billion Small and Medium Enterprises Credit Guarantee Scheme (SMECGS) for Promoting Access to Credit by SMEs in Nigeria.

Let me conclude by warning fellow entrepreneurs that a key consideration in choosing a source of business finance or credit is to strike a balance between equity and debt in order to ensure that the funding structure is appropriate for your particular business.  There are no one size fits all in this regard.  Please remember that Mallam Sanusi (CBN Governor) is a professional risk manager!  The overall objective in raising finance is to ensure that the financial risks carried by your MSME are maintained at an optimal level.

Uzo Nduka

Lagos, Nigeria

What does the failure of any one entrepreneur represent to a nation?

The failure of one entrepreneur represents a great loss to the nation and society.  A loss of opportunities to create wealth. A loss of opportunities to create new jobs. A loss of opportunities to improve GDP and also to improve the quality of life of some citizens if not all.

"The failure of one entrepreneur is a national tragedy."

Uzo Nduka
Lagos, Nigeria


    An entrepreneur's fish pond at lunch time.

Innovation: The Spirit of Entrepreneurship

There is no arguing that innovation is the spirit and soul of entrepreneurship. 

My intention in this short piece is to highlight four fail-proof opportunities for the serious minded entrepreneur to innovate, and be successful.

1. Production technologies and processes that are very efficient: These are sure winners, especially when supported with robust management and marketing systems.  It means that the entrepreneur can beat other players in the market place in terms of production volume and price - you can deliver more and cheaper too. The entrepreneur that has innovated this type of technology may consider selling the patent rights if they do not wish to live with the hassle of day-to-day management of the enterprise.
2. Personal charisma or persona: It might surprise some people to learn just how many entrepreneurs succeed and become fabulously wealthy, simply because of one individual's charisma or persona. It is particularly important for entrepreneurs in the entertainment, hospitality and specialty products or services industries to explore opportunities and to innovate a "strongly emotive and unique selling point" for their business in this area.  Be careful though! You must have the right "face" and "personality" to pull this off.
3. Quality that surpasses customer expectations:  The entrepreneur that can innovate and create products or services that surpass customer expectations will most certainly do well in the market place.  Customers are bound to become your self-appointed sales representatives and will market your products or services to their friends and contacts, at no direct cost to you.  Please bear in mind that customer expectations are dynamic and that you have just signed up for a marathon race that has no finish-line, if you elect this pathway to entrepreneurial success.
4. Making luxury goods affordable to the masses: A determined entrepreneur should always scan the market to identify various luxury goods and services that he or she can make put within the reach of the masses through innovative production, packaging and marketing.  You are not likely to miss target if you go this route, and the masses will thank you for it, after all you are letting them enjoy some product or service that had been exclusively for the rich.

With best wishes.

Vision for SMEs in Nigeria



A quick means of moving farm produce to the markets

 You might be bemused by these images. I am certainly not.

What I see are multi billion Naira Industries. Industries that are in their infancy.

Bear with me and consider the following facts:

1. Population ~ 150,000,000
2. Land mass ~ 900,000km2
3. Urban:Rural population ~ 30%:70%
4. % of population living below the poverty line ~ 65
5. % of population over 15years of age that is engaged in primary agriculture > 50.

   

   Cottage cassava processing factory in rural village, Delta State, Nigeria

   

I envision a Nigerian nation where one of every ten persons you meet is an active and productive entrepreneur.

Entrepreneurship is one endeavour at which Nigerians can compete and beat the world. I do not know one Nigerian adult that is not thinking seriously about starting a business.  Our entrepreneurial spirit is just Supreme.

My dream and my mission is to help make this a reality.