STARTING A BUSINESS ENTERPRISE IN NIGERIA - What to Know as an Aspiring Entrepreneur - by Matthew Ujah-Peter

 

There is no one specific way to start an organized business enterprise  but there are standard and acceptable paths to follow that are legally and economically viable. Below are some of those paths:

1. Networking/Relationship/Mentorship/Advisory Board: it all depends on how you understand it and on which one you can apply to your particular business adventures. You must relate and network with fellow entrepreneurs as well as those who have become successful in business (mentors) and experts in various areas of business expertise as official or unofficial advisers (masterminds) to stay updated and informed with the latest.

2. Record Keeping: it is a mandatory habit you must form. Business management thrives on records. A very important record is your finance and account record.

3. Register a business name or incorporate your business at the Corporate Affairs Commission (CAC): This gives your business both legal identity status and legal hedge (or protection). As an incorporated business, for example, your liabilities are limited only to your equity or shares/monetary investment in that business. However, there are other investments by you such as all the sweats, tears and times you invested all through the ideation to formative days that cannot be easily quantified in money. These should be taken into account as far as your equity in the business is concerned.

3. Financial Discipline: An entrepreneur must be able to see money and keep his sanity. Every penny must go into running and maintaining the business. Get a bank account. Never yield to the temptation that the money will not quickly finish when large money comes into the business. Many entrepreneurs go into spending spree in the name of rewarding their long labours. Before they realize it they have overstepped the boundaries by overspending.

4. Place yourself under salary as a staff: any money you take for your personal use from the business must be regarded as salary advance (I.O.U) and must be deducted from your salary at month end. You have no right to any money other than from your salary and dividends. And you do not take dividend in advance the way you take salary in advance.

5. Know the difference between salary and dividend: salary is what you are paid as a staff monthly. Dividend is what you are paid annually from the profit the business makes according to your shares or share capital in the business even as the owner. There are other shareholders who should earn dividends, too, with you. They are private shareholders and must earn dividends (according to their private shares in the business.

This is in the case of Limited Liability Company. But as a venture or enterprise (that is, sole-proprietorship or one man-business as they are often called in our part of the world) you should try your best to run that small or micro business as if it is a limited liability company, because that is where you should be heading to. One day very soon that venture or enterprise should become incorporated.

6. Draw a line between business money and personal money: Do not use business money to run your private affairs. Your car is not part of your business assets. Do not use the business money to run it. Use your salary instead. Company or business vehicle must be run by company or the business. Personal affairs must be run by personal money.

7. Have investment mentality: Increase your asset, reduce your liability. Design your business to take interest in other assets outside of the business such as buying other business shares, investing in real estate and other passive income generating businesses such as intellectual properties etc.

8. Build your system and structure from the beginning and keep expanding and improving it as the business grows:do not start a business you cannot build structures and system around. You must not let your business tie you to it. You must design your business system so it can operate even in your absence. 

9. Packaging: rightly package your business right from your complimentary card, letter headed paper, logo, brochure/profile etc and climaxing at your products, services and customer care and sales delivery. While your corporate colour, logo, website, brochures etc are great form of packaging, your service will finally determine if those were merely cosmetics and glitz.

10. Competitions: keep tabs on them. Watch out for their weaknesses and cash in on them. Work hard on your own short-coming to beat their strong points. Concentrate on your own edge over them. There must be something about your business that your competitor lacks. Harp seriously on it and protect it.

11. Cost: consider cost in all your doings. If the cost (financially and/or otherwise) of something will impact on your clients / customers negatively, do not embark on such thing unless there is long term/future overall benefit. 

12. Knowledge and skill: without relevant and up-to-date knowledge about the business and the industry you are playing in, it will be easy and predictably likely to lose one’s capital in no time. Appropriate knowledge and relevant skills act as protective shield around your capital. Leverage on the advice, expertise and experiences of others. As the saying goes, “information is the commodity of kings”. Business emperors trade in information and knowledge. Information is an integral building block of business empires.

 

 

 

INNOVATION, CREATIVITY AND SERVICE – How an Entrepreneur Differs From a Traditional Business Man - By Matthew Ujah-Peter

Electricity was not invented, it was discovered by man. That means that ever before man began to walk on planet earth, there was electricity just like other things such as herbs, plants and precious stones that existed before man’s arrival. Electricity lied hidden within nature as a latent force awaiting the development of man’s mind. And suddenly, after thousands of years of man’s sojourn and adventures on earth – it was discovered.

But then it needed to be harnessed and channeled for man’s productive use. It could have been seen as some form of evil since it can kill. But someone thought it would benefit man and beneficial it turned out to be. Over the years the best materials and means by which it can be used are continually been discovered. Today, virtually all instruments and tools man use for his day-to-day work are powered by electricity. Life, as it were, that seemed to be like a black and white photo in the days that pre-existed the discovery and use of electricity, suddenly turned full colour at the advent of electricity.

Before the discovery of electricity there weren’t so many varieties and alternatives as we now have as far as work processes were concerned. Technology used to be crude and cumbersome. Now technology is highly proliferated, simplified and diversified, thus making life over the centuries steadily but surely unfolding in varieties and beauty. Life’s hidden beauties, bounties, treasures and varieties continue to unfold before our very eyes like an old black and white television picture changing into full colour.

You would agree there are so much more THINGS still in existence but yet to be discovered awaiting discovery. And a great deal is lying hidden within you! Yes, you that are reading this. Before we knew it as a people, the west came and discovered the treasure lying hidden beneath our soil called petroleum. For years our ancestors were trekking and trampling on it not knowing that any such things existed.

 Since the discovery of petroleum, other valuables and treasures have been lying hidden from our views. It is a pity that the minds of people in this part of the world are conditioned to only value things that are within the sense realms – things already known or discovered. It is positions and possessions that are more valued rather than information and ideas. We hardly value things that are within the framework of ideas and information, not realizing that it is those who value things in their intangible states in forms of ideas that are the ones leading and ruling over the rest of humanity.

The people who know the “WHAT” in this life usually get the jobs. Those who know the “HOW” get to be their boss.  But those who know the “WHY” lead them all. The “WHAT” people are people with enough information on the worth of things but usually they at the becks and calls of the “HOW” (or know-how) people. It is the know-how people who teach or show know-what people things to do and control what should be done. Then there are the “WHY” or know-why people. They design, create, hold and wield the ladder that all the others climb and work on. The “WHY” people are thinkers; they are questions askers. They seek to know the reason behind things – reasons why things should be or should not be. They are purpose-driven individuals. They therefore design frameworks, structures and systems then recruit the know-how people who in turn teach or recruit know-what people.

Know-what people are skilled and semi-skilled people. They are technicians and handy men - usually people with handiwork or with basic education who are working class people at the lower rungs of the ladder under the know-how people who are better educated or professionals and experienced people - officers or office-holders and managers at the higher rungs of the ladder who work for the know-why people, the innovators, inventors, investors and intentionally creative people that design, create and hold the economic ladders. They are the vision-driven, mission-minded and leadership-oriented class of people. These are the entrepreneurs! An entrepreneur is not in business just for the money. The people with such motives are called businessmen.

Do the entrepreneurs make money? Of course, they do. An entrepreneur is an innovator, an inventor and an investor wrapped up in one body. The innovator part of him/her is the person who seeks always to make life and processes of doing things easy and better for others. Men like Henry Ford, who made automobile accessible and affordable for others, Bill Gates who made computer operation and operative system available and affordable for others are examples. The inventors in them seek ways to bring into existence things that would be beneficial to humanity. Examples are Thomas Edison, John Baird and Graham Bell etc. The investor in them is the businessman in them. Their innovations and inventions, in reality, are investments. They may choose to earn a living for their works. This means business. However, the pure traditional businessman is often not bothered with service to humanity. Gains and profits are his major concerns.

This clearly shows that if one is going into business solely for personal gains and profits, he/she is not an entrepreneur. He/she is a businessman or businesswoman. There is nothing wrong with being a businessman or a businesswoman. Even the entrepreneur, too, is a business person. The difference is the primary motive driving the venture.