Nigeria is blessed with vast resources and a very huge population. This makes it a great place to set up a business.
More and more expatriates are trooping into Nigeria to set up businesses, and that goes to show how favorable the business terrain in the country is.
However, achieving anything tangible from your Nigerian start-up requires a lot more than having the required capital. First, you would need a very solid business idea and then you would need to back it up with the proper research, planning and implementation.
To help you successfully launch your start-up in Nigeria; here are some of the steps you need to take:
1. Develop a business idea
First, you need to do a proper research to come up with a smart and unique business idea. I mentioned unique because one mistake most Nigerians make is that they ignore many of the vast business opportunities in Nigeria and instead decide to ‘copy’ other people’s ideas.
If selling GSM recharge cards looks like a very profitable business, before you know it, almost everyone is selling recharge cards. Nigeria is very large, and there are a lot of products and services that are still unavailable or could be better.
So, don’t copy other people’s ideas, instead, you should take time to brainstorm on the solutions you could proffer and the needs and yearnings you can help to satisfy.
2. Write a business plan
You cannot start a journey without having a destination in mind. Can you? Even Nomads usually have a destination in mind before they set out with their cows.
Your business plan is the blueprint of your business. It shows where you are going and guides you throughout the journey. Hence, it is important for you to take your time to write a business plan before moving to the next stage of starting your business.
Writing a business plan is quite easy, and there are even software packages that you can use to do it easily.
3. Register your business
The next step is to register your business with the Corporate Affairs Commission (CAC). There are three main types of business you can register in Nigeria:
- Sole proprietorship.
- Private Limited Liability Company.
- Public Limited Liability Company.
To register your business in Nigeria, these are the steps you should take:
- Decide on the ownership structure of your business.
- Choose three preferred business names.
- Visit the CAC office closest to you to find out if your preferred names are still available for registration or have already been taken by another company. Some business names may also be rejected if they are offensive or reserved.
- Provide details of your new company such as your proposed business address, memorandum of association, articles of association, details of directors, share capital and allotment, and all other necessary information and forms required by the CAC.
- Pay the necessary fees. For a sole proprietorship/business name as it is popularly called, you would need between N12,000 and N15,000 to register your business with the CAC, while other forms of ownership would require at least N30,000 for registration.
- Upon verification and compliance, the certificate would be issued to you and then you are free to commence operation of your business.
4. Complete tax registration
The legal process of setting up your business isn’t complete until you have visited and registered with the Federal and State Inland Revenue services.
The Federal Inland Revenue Service (FIRS) is where you would send all the Value Added Taxes, Company Income Taxes and Withholding taxes, while the State Inland revenue would be in charge of collecting all PAYE taxes deducted on your employees as well as other necessary taxes and levies. You may also need to register with some local government agencies for payment of some taxes and levies.
5. Obtain necessary licenses and permits
This would depend on the nature of business you wish to operate. If you want to operate a transportation business for instance, you would need an inter-state transport permit.
There are a lot of licenses and permits specific to different businesses so it is important to find out which permits you need to apply for to run your kind of business.
6. Acquire office space
Next, you should seek out a suitable office space, which would be accessible to your clients and expose you to the type of clients you need to patronize your business.
7. Set up a website
More than 40% of Nigerians visit the internet daily. Therefore, you should look for a good web developer to help you create a user-friendly website that will give your business solid internet exposure.
8. Develop a marketing plan
Just like your business plan is important, your marketing plan is also extremely important. Many Nigerians business owners start a business without a marketing plan or an idea of how they intend to promote and sell their products. This is a mistake you should avoid. Have a clear plan on how you intend to penetrate the market and outsmart your competitors.
9. Work on branding
Lastly, you should work hard at creating a unique identity for your brand. Design your logo, business cards, company brochure and all necessary materials to help you promote your business.
With all of this in place, you would have completed all the legal requirements and would be ready to start your own business in Nigeria.