Infrastructure challenges of doing business in Nigeria - Naija Business 101

Hello and welcome to the show. This is the sales for the Nigerian. Businessperson Podcast. It's. Available on Spotify, Google Podcasts, Apple iTunes, or any podcast player of your choice, so subscribe for free once you're done listening to this episode, just in case you're using your web browser to listen. Today on the show we have audio recordings from the WhatsApp School of Business program that I advertise on Saturday the 15th of July 2023.

The goal of the program was to introduce folks to the fundamentals of doing business in Nigeria and to show how sales and business development principles can help you overcome the harsh landscape of doing business in our daily beloved country. I also wanted to answer general business questions posed by the participants and the program was delivered entirely. Over WhatsApp. For the course of more than one week, and this is an example of how you can get truly convenient business education in your pocket.

And learning over. WhatsApp at your. Convenience. If you love what you hear on the podcast and you like daily access to me to ask me questions related on how to sell in your business, then the WhatsApp coaching club is now open and the investment required for that is only 5000 naira a month. You ask me anything, I give you answers and assignments to move your business forward. So if you're interested, hit me up on the socials.

Don't worry about how to spell my name. I spent most of my time on LinkedIn and my name Tavis Shima Ayedi. Is the correct spelling. You can find it in the web browser where you're currently listening to this episode. You see the spelling of my name, the e-mail address on the photo, and it's also in the profile of the podcast app where you're currently listening to my voice. So Tavishima I gave it. The correct spelling of the name is there.

So if you're interested in the 5K, the WhatsApp coaching club, the 5K monthly investment, then let me know. Hit me up, send me a message on 08064662140. The country code for Nigeria is +234. And for those of you who are trying to save to start a business, I'm affiliated with a reputable financial institution in Nigeria that has 504 billion naira in assets. And what that means is they're not going to go broke anytime soon.

They're secure organization to work with, they're not going to run away with your money anytime soon, then the business of protecting and guaranteeing your savings, this is not a bank, so you're not going to have an ATM card. You're not going to get hit by lots of miscellaneous fees. And you're going to get an interesting, or rather, you're going to get an improvement on the interest that you get from regular savings banks in Nigeria.

And then of course, this is safer than using loan sharks for the capital to start your business, because loan sharks are going to want to embarrass you and your whole family, and they want you to put your father and your mother up as credit. Sorry, not credit. What's that word as collateral for the loan? So if you're interested, they hit me up on 08064662140 to get started on saving towards your dream. Now remember, it doesn't have to be saving towards a business.

Any savings plan will do. People have saved with this organization for their children's education. Let's say, like me, we have kids in primary school and you're wondering about secondary school. And the all. Expensive university education. And then of course folks like my mom saving towards retirement. So if you're interested. Give me up and let's get you started. Now on with the episode for today. Welcome to day two of the sessions again.

I'm your host Tavishima Aidi, a sales coach and business consultant. Yesterday, which was day one, we looked at the promise of doing business in Nigeria and freestyling on what the possible upside might be of doing business in Nigeria. So today they too, we're going to start delving into the problems, the challenges of doing business in Nigeria. That's a lot of what was being advertised on the promos that was being put out of on socials that's promoting the program.

So we're going to start going into detail what some of these problems are and how these problems negatively affect our businesses, but of course we're doing so. We're doing so with the mind of the with the mind view that we're going to brainstorm on solutions eventually and remember that for the remember that the approach we're going to be taking is we're going to be looking at things through a business development approach towards trying to solve these problems.

So this is your first time if you're just signing up to the event today and this is the first audio that you're listening to. Then after you're done listening to it, you know that you have to scroll further back in the chat. You'll see the early introductory messages where I spoke about the purpose of the group. And there's also things that we're going to be talking about over here. And you're going to catch yesterday's lecture or audio recording rather, where we went into the promise of doing business in Nigeria.

So the first challenge we're going to look at today is infrastructure, the poor infrastructural development. In Nigeria, and that is the first challenge that we're going to look at in the Nigerian business environment. Now, when we say poor infrastructural development, we mean the poor development in things like transportation systems, whether it's public transportation systems or having good roads or having a good railway system, because these things are important.

And it wasn't always the case because my mother would tell me stories about growing up in a railway town. My team from Benry estate, my mom's village is Uday and who they happened to be one of those really vibrant communities that lived along rail tracks in Nigeria. So it was a real, well, it wasn't really a real community per se because the village was there before the railway lines started, but the railway lines passing through that kind of help things and back when we were kids would go and visit my grandmother and who they sometimes would run.

To the old train station, Well, not really a train station per se, because it's more or less. It's like a bungalow with several, what do you call these things? Several rooms. Next to it was a long rectangular kind of bungalow with a platform where people would step on and step off and would go and play on the tracks and then look around and things like that, but even as a. That time I'm going to go and visit my my grandma in the 80s and let's say the 90s, the the rail facilities were already run down.

I never saw a train run through there and trains would also run through them. Macquity, that's for those, for those for Nigerians who are older and who lived in that part of the world. Macquity is the capital in Benry State. So, but of course I haven't seen any train run through, Markwardly because I am of the time when by the time I was born, late 70s, early 80s, these sorts of things were already becoming a challenge.

The real infrastructure was already dying. And it's a similar state of affairs that people can relate to, no matter which part of the country. So people up north, they can relate, people in Canada can relate down South, they can relate in the western part of the country, in the east, everybody can relate to these sorts of things. So when we say poor infrastructure development those are the sorts of things that we mean the poor facilities available to transport people and goods and also by extension services across the length and breadth of the country.

How do you transport services? Well, very easily I'm, I'm a sales coach and a business consultant and. Because of online technologies, zoom and all that, I can do business with people in Lagos quite comfortably. But then there will be times when somebody was saying, you know what, let's not do this zoom thing. Why don't you come down to Lagos or why don't you come down to Nassaura or whatever, and let's make this thing happen.

I'm going to have to hop on a plane or take public transportation or whatever. That's why I'm not fueling my car. And then off we go. And so that is how. That is how good infrastructure and transportation also affects the the, the promotion and the utilization of services as well. So poor transportation network of course poor power network, we all know that because the power goes off all the time challenges in the telecommunication infrastructure.

This is one that has increased somewhat since the time I was a child because at some point good. Telecom, telecommunications backbone in Nigeria. And then things get nationalized, it's Nitel and then things go to crap and then there's a couple of decades of nothing but Nitel and spotty performance. And then with the return to democracy, opening up the economy with what's it called. GSM, I think used to be called GSM back then.

I don't know what they're called now, but GSM, I think that's global systems for mobile communications or whatever, but basically. Technology behind mobile phones. So mobile phones into the market, we have lots of providers. It seemed to function quite well. Internet drops out every now and then. Sometimes there's some blackouts you can't get to reach through to some people. The average business person in Nigeria because of that problem has three or four, let's say two or three carriers then put it that way.

Yeah, I'll say two or three, because whenever I'm at training sessions or networking sessions, things like that. Most people have two phones, 2 lines. Some people like me, have one phone dual SIM, 2 lines. But then you have some people who have two phones, dual Sims and two lines on each SIM because they're trying to do well just to make up for the gaps. Then there's also challenges in water infrastructure. Not every part of the country is hooked up to urban portable water supply and these can have some challenges for specific kinds of businesses.

So for consultants like us and service based professionals like back when I was in my wedding photography days, water wouldn't have been an issue but for people who run restaurants, other kinds of catering services. What else? Sanitation services. Let me see. Laundry services, you know, for those sorts of people then yes, water is a challenge. So as I've listed through the problems rather the the, the poor infrastructure that we have in the country.

What you should be doing right now if you're listening to this is making a note transportation OK how does that affect my business whether I'm a consultant, waiting photographer or whether I run a laundromat or whether I be kicks power, how does that affect telecommunication, how does that affect water, how does that affect? That's because eventually we're going to open up the group here to the question and answer session.

We'll be tackling questions and looking at things from a sales and business development perspective, how we can overcome or work through some of these challenges. So the problem with poor infrastructure development, of course it affects our businesses in different ways, but these are just some of the major problems. It increases the costs of good sold because transportation is poor and let's say water is poor and power is poor.

We have to provide for some of these services ourselves and that. Increases the cost of goods that were taken to the market because we have to factor in the cost of our generators, inverters, boreholes, wells and what have you. It increases friction in the business process because it's hard enough to get up and do business every day without having to worry about merua. Merua in this part of the world, those are the people who are water.

What should I say, water vendors, water hawkers who move around basically with. This handheld trucks, trucks that you push and they have several gallons of 25 liter, 25 liter gallons where they carry water about 10 or maybe 12. So in this part of the world, in some parts of Abuja and in lots of parts and places in Lagos because I lived in the Ketja. Before moving to Abuja, in the Keja, Mirua was common in Abuja, certain parts of the town, Mirua so anyway so if you run a restaurant it's hard enough to worry about buying your meat,

your chicken during the pre cleaning, hiring, staffing, all of those concerns then to now have to worry about where you're going to get clean water supply just to keep the restaurant running. So that's the increased friction in the business process and then of course there's reduced productivity. Because a lot of time is spent trying to sort out some of these things, queuing to buy for fuel, going to look for the mechanic to fix your your fix, your generator plant, what else?

All these other concerns. Because we spend time doing these sorts of things, it's less time spent servicing customers or looking for new customers that we can put into the business. It also leads to reduced global competitiveness for those people that are in the export market. And that's something that my brother, my mom and I experienced first hand back when we had the family export business where we used to export charcoal.

We started with charcoal and did a few run of some commodities. So yeah, that was a problem that we faced. Transportation is an issue that means it leads to higher trucking costs. Higher trucking costs means that the cost of goods goes up and then the amount that you have to sell on the international market, it causes a problem. So for things that are sold, or rather that are produced in Nigeria and Ghana, for instance,

you'll find that the how the Ghanaians are able to sell palm oil much more cheaply than we can, even though we have more precisely because of these sorts of problems the palm oil folks over here have to worry about. Transportation, getting the stuff out of the plantations, refinement is an issue because of power and you know, blah blah blah. So it has all kinds of effects, and by the time you're getting ready for the export market, it makes things really, really uncompetitive.

Your prices are really expensive, and for a while it led to really was brief. And I don't know if has occurred again, but for a brief while they led to the absurd reality in Nigeria that at some point it was cheaper to buy what's that thing called soy Was cheaper to buy soy from America than to buy soy from Bennu state. So if you are in a book, so in Abuja back then were based in Lagos, so we're in Lagos. You wanted soy.

Yes, if you want to buy from Banner State, it would get to you sooner or that's why I would get to you sooner. But it was cheaper to just export the thing from America if you could. Sorry, not export, import if you could find a reliable buyer. So it leads to these surprising ton of events. Then there's also diminished attractiveness for investors because if business is going to be. This hard and this expensive, with so many points of friction,

then it's not an attractive place for investors to put that money. Which is why there's all this talk of attracting international investment and blah, blah, blah, and how the government has to work on infrastructural challenges before that happens. Oh, sorry, excuse me. That was an alarm that I set just to make sure that I don't go too long today. OK, Yeah, we've gone over 10 minutes. So I should be wrapping this up. Actually bring in this today's today's audio resource or the lecture bringing that to work close, so diminish attractiveness for them investors, whether locally because your business doesn't look too good cause your costs are high, or whether internationally because the cost of doing business is just so high that people just don't want to get in.

And then there's poor employee retention and this poor recruitment. Because if your business is such a hassle to work in, people do not want to work with you. I remember being a young lawyer, a law firm. You're in the office, you're in Kano, it's hot as hell already. And then the power goes out and you're there in the suit, in the office is dark, it's hot, it's sweaty, and the generator has packed up again. The 2nd generator has packed up as well, and then maybe the third generator.

There's no fuel in that. So you guys just have to sit in the office. It's not a very, it's not a very comfortable working experience and these are some of the things that put people off and make it unattractive for employees to work with you. In fact at the time when I was in Kano that was in 2000 and seven 2008 back then I remember that most hotels or rather the reputable hotels in Kano. You would say on average they would have about 5-6 generators,

and that was because they expected to run their generators in eight hour shifts throughout the whole day. That's eight hour shifts for 24 hours if need be, and that was just a state of affairs back then. However, I haven't lived in Kano since 2007, 2008, so I don't know how good things have become or how bad things have deteriorated too. So like I said, while we are listening to these clips about what the infrastructure challenges are, we are not supposed to be going over with me.

This country is dying. This country is going to the pits. This country is going to the dogs. We're supposed to be brainstorming on solutions so that we can have impactful deliberations later. Remember, the lens we're going to be looking at this is going to be through the business development approach. The reason why we're going to be doing that is not because we should absolve the government of his responsibilities. But it's because really the average person like you and I

has no control over macroeconomic issues. There's nothing I personally can do to bring the railways back or to make transportation better or to increase the effectiveness of the power grid or to make sure that the telecommunication companies provide efficient Internet services or that we provide. Clean pipe on water to different parts of the country. So individually, there's nothing we can do about all these macroeconomic concerns.

So of course, we're only going to be looking at things that are within our own sphere of influence, within our own sphere of control and that's why we're going to be taking a uniquely business development approach towards these sorts of things. So that's it for this particular. Lecture on the infrastructure problems of doing business in Nigeria. The chat is still going to remain closed for now and it's still going to remain closed for the rest of the day and we're going to have another audio resource up later on the group about another challenge.

But don't worry, we are not going to remain stuck in this mood for long because the the the main Crocs of this. Group of this event is to make sure that we brainstorm solutions on how to move our businesses forward. It's my assumption that everybody here so far I've not been able to confirm even though they're not loads of us, that most of us are selfemployed and we're in business for ourselves. So thank you very much for listening and.

The Next Order resource is going to come up later in the day in the late afternoon, and I'm looking forward to interacting with you guys as a group when the chat function is open and also to continue interacting with those of you privately who have engaged with me outside of the chat. So thanks for your time and attention, I'll catch you guys at the next session.