IDENTIFYING NIGERIA SMALL BUSINESSES WITH POTENTIAL

Oftentimes the Professionals in Nigeria want to have an additional source of income because their salaries are not enough to cater to all their needs, they think of investing some of their funds in small businesses. Most times these businesses struggle and fail, leaving the investors in debt and financial instability.

The reason for a large number of failing small businesses in Nigeria is that most people base the choice of their business on assumptions rather than identifying a problem or the need for a product or service and making sure their business is designed to meet such needs.

Assumption VS Obvious Necessity

Assumption

 

Investor A thinking:

 

There is no lovely boutique in this area where I can buy good quality footwear, I am sure there will be people who love good quality footwear.

Decision: I need to open a boutique where people can buy quality footwear.

 

 

Obvious Necessity

Investor B thinking:

Every morning, there is a long queue in this area as people struggle to get water from a central water tank. Most residents of this area arrive late at their places of work while students are known for regular late coming in their schools.

 

Decision: I need to tap into the business opportunity that will provide a solution to this problem but still conducting a survey is necessary

Comparison

In the case of Assumption, Investor A assumes that people will need quality foot wears because she likes them but the truth is that the standard of living of the residents of that area might be such that an average resident cannot afford footwear of her taste. Opening the footwear shop in that area will leave her struggling for sales while overheads keep growing. That often marks the beginning of failing businesses.

In the case of Obvious Necessity (Investor B), There is a worrying situation for these people and any business solution that will serve as an alternative source of water supply to them at a very reasonable cost will be considered a good one. However, the need for a feasibility survey in making a business decision cannot be over-emphasized.

In summary, before you invest your funds into that small business be sure that there is a need for your (products and services) business and that is geared towards problem-solving and profitability.

Tunde David Animashaun

Babatundeee12@gmail.com