Nigeria has a population of more than 150 million out of that 40 % represent the young and active population.
Starting a business in Nigeria comes with some really challenging challenges apart from the standard ones each business faces. In Nigeria you need to offer your own energy source, Pay substantial communication costs, compete with bad roads, slow Government procedures and insecurity.
The current state of power distribution in the country is this that there’s simply no guarantee on how many hours of electricity supply you could get per day or in the event that you could find any at all. Despite all the attempts of the Government in this regard, the nation of Power distribution has remained poor.
As a company owner, you have to factor in the expense of producing your own power for 100 percent of the time typically. When you consider the fact that in many foreign nations, this is not the situation. This definitely contributes to higher company startup expenses and luckily more marketplace for generator Producers and Suppliers.
With the advent of the GSM Technology at 2002⁄2003, mobile phones became available on the streets in Nigeria. how to register a business in Nigeria in terms of Tariffs has stayed high once you compare it to other nations. Most GSM companies and Fixed line mobile Operators have dreamed of the high cost of electricity generation for their business activities and also the high cost of their operating licenses as the major causes of high phone tariffs.
These factors also affect the online service providers to a large extent. The bulk of the populace still depend on satellite technologies which is still very costly in Nigeria.
When you plan to do business in Nigeria, get ready for high web and phone bills.
Depending on the kind of business you want to do, almost 80 percent of Nigeria streets outside the business centers are bad. For those in the business centres, I could say about 60% are poor. If your plan is to start a road transport related company like logistics, cargo, delivery, taxi etc you might want to get a significant sum of money for automobile breakdown as a result of poor roads. Even if you’ve got a mill, then you may sill have to get your products to the distributions centers. This is another major challenge to doing business in Nigeria.
In Nigeria today, the insecurity problem applies mostly to the oil rich south-south along with the Northern areas. Other regions of the country are rather safe besides the inevitable isolated little incidents like burglary and land break-in. Unfortunately, Nigeria depends heavily on Oil and has made quite enormous investments in that regard.
The petroleum industry accounts for the majority of foreign direct investment in Nigeria and the present hardship situation in the oil producing regions isn’t helping that industry of the economy. Although there has been attempts by the authorities in this regard but a good deal more needs to the done to enhance the quality of life of individuals living in these regions before it can grow to be completely safe to do business there.
All these are by far not the only challenges you would face to begin or run a company in Nigeria but they are the most annoying ones.