The Vice President of the Lagos Chamber of Commerce and Industry and founder of Toki Mabogunje and Co. (TMC), Mrs Toki Mabogunje, is a business-development consultant who is interested in the management and growth of small and medium enterprises (SMEs) on the African continent. Over the last 26 years, Mabogunje has been involved in commercial and business enterprise from both a public and private sector perspective. In this interview with Evelyn Osagie, she speaks on the problems bedevilling the sector. Excerpts:
You are an entrepreneur and business consultant with over 26 years of experience in consulting, helping small and medium businesses to thrive. Tell us how it all began.
What happened was that I started my career in law, working for the government; and then left it to go and start a broadcast entity, Minaj Media Group. But I was working as a Company Secretary (Legal Adviser). After some time in Minaj, I decided I wanted to understand the business of broadcasting. So, I went to Stanford University and did some Executive Management programmes. I was then appointed to head Minaj’s operations in the United States. I now had the opportunity to start from the scratch a broadcast entity in the U.S.A. And that, for me, was a very motivating and captivating job. When I saw how much support one gets from the US when you want to start a business, I decided to come back to Nigeria and help Nigerian businessmen and women achieve the same level of success. So I left Minaj to start my consulting firm.
How many of these SMEs have you worked with so far?
Although I can’t count, TMC is 15 years now in the business. Honestly, I haven’t really counted, but it could be close to 2,000 enterprises. I am sure of this because we used to produce some newsletters that we were circulating to 1,000 enterprises which were our readership at a time. And that was years ago when we were still printing newsletters, but had to go online because of cost. And in those 15 years, we’ve also worked on major SMEs projects for international and local brands, such as World Bank and so on.
The high turnover of SMEs or slow growth has been linked to the non-availability of loan and government support. What do you think are some of the gaps and weaknesses that hamper the growth of SMEs?
One of their weaknesses is their lack of putting value to the services of the professionals who can help take their businesses to the next level. They have gap in managerial capacity. That is part of the reason they can’t access loans. They often assume because they’ve gone to school, they can be everything – from security man, accountant to human resources manager and legal adviser. Another is their lack of value in themselves, that is to say, they don’t invest in themselves. So, it is the knowledge they came out with from school that they still have 20 years later – no upgrading, no up-scaling, nothing! The third is their attitude to the business. I think because we are faced with so many challenges, such as power outage, many SMEs do not spend enough time on strategic issues. By strategic issues, I mean training and empowerment of their staff to run the business while they are looking for the money, and deciding which market to go into, or what new packaging to put on their product. They need to understand that they are supposed to be thinking strategy and empowering their staff that are foot soldiers to run the business.
Do you think the government is doing enough for SMEs?
The government is not doing enough, but I think they’ve done some things. There are certain funds available, and even though Nigeria is a big country with 170million people, much more needs to be done. The president started a YOUWIN! programme to encourage young people, which is nice. And although they did 1200 for three years, i.e. about 3600, it is like a tiny drop in a very large ocean. And I think they feel bad when people speak against them as if they are doing nothing. We all recognise they are doing something, but what we are saying is that it is not enough. They have to do a lot more.
Like what?
One: whether we like it or not, we have to get the issue of power right. Small businesses cannot carry the burden upon their shoulders. Government is not doing enough: the basic infrastructure is not there. Today, every small business is a local government: they do their own light; they do their own water and so on. It is not done like that in any society that wants to grow. Sometime in 2003, I went for an SME Policy programme by ILO with only two of us from Africa out 25 of us. During the project presentation at the end of the three-week programme, involving projects we intended to implement in our country when we returned, while presenting mine, I started with I will buy generator and the whole crowd started laughing, amazed. And they said: “But that’s not possible, it is your government responsibility to provide water.” And I said “Yes, in every other country, but Nigeria.” I said a businessman who has not taken care of power, water, road and a few other things on the side is not yet serious about doing business. And this is why Nigerian products are not being competitive enough because we are competing with people who are producing in a country where the basic infrastructures are in place. Two, credit needs to be released because all around the world, businesses thrive on credit. Our financial market is shallow; we don’t have long-term funds to encourage production, that is why almost every Nigerian is a trader. People are trading more than they’re producing. I dislike how warehouses and shops, and not factories, are growing in Lagos because it shows that we are consumers, and not producers. More of our products should be sold outside the country. I want to walk the streets of China and see made-in-Nigeria goods, the way I see made-in-China here in our streets. And the banks cannot borrow for too long because we don’t have long-term funds.
Some experts are calling for a review of some policies on finance and industry, especially to include SMEs in unclassified sectors
It is a global practice. Around the world, governments are amending and passing new legislations that would include SMEs. And that is because there is the growing realisation that SMEs are the foundation of any economy. And we need such review in Nigeria. It would create business opportunities for SMEs, and by extension it would develop the economy. And government interventions should border on policy shift. There is need for some actual implementation of frameworks that are being released. I am amazed that with all the difficulties we have here, Nigerians are still managing to survive and make money. It should be commended! So, they have my empathy… my clients have my empathy all the time. So, in doing my job, I spend a lot of time counselling, directing and motivating them not to give up. SMEs need motivation because it can be very demoralising.
Apart from encouraging young SMEs, what else does your consulting firm do?
We work on four platforms: one is what we call training and capacity building. We do training and capacity building for all level of companies; large, small, medium and associations. I started getting involved with associations, like Lagos Chambers of Commerce, so that I can meet people in associations and to talk about capacity building of larger groups. We also do business and legal advisory services. I deal with their legal documents. If they have to sign a contract, I look at it. Some Nigerians tend to feel disadvantaged when they are dealing with a foreigner; and don’t often check their contract properly to find out later they’ve signed a contract they shouldn’t have. We are finalising an online shopping platform. We are also into publishing, such as workbooks on past training programmes. Next, we are into special projects, such as for nine years while Nigerian Liquefied Natural Gas (NLNG) was in Lagos, we were the ones that did the due diligence of their employees. In the World Bank project on SMEs that I spoke about, we worked with close to 1,500 SMEs over the span of three years. And as member of associations, we’ve decided that we want to affect policy; so, since 2009, we’ve been running an all-round table on things that affect SMEs, involving 50 strong stakeholders – Central Bank, Bank of Industry, World Bank, the PMOs, Parcima, Lagos Chamber of Commerce and Industry, the Ministry of Trade and Investment and so on. We would call the stakeholders made up of with arrowheads and directors into a room and pick a particular topic with the mind that you have spoken with 49 top people in the sector who have the power to affect the sector and are able to implement programmes discussed. We’ve had about four till date.
As Vice President, how has the organisation been able to affect the lives of small and medium businesses?
The Lagos Chamber of Commerce and Industry is not a good example, because they’ve been around for very a long time and are not doing badly. They have got a little bit of deep pocket because they run the Lagos International Trade Fair. And they have properties in Lagos, and due to other events earn some income which they spend towards delivering service to members. But there are many associations in Nigeria that are not in that position. So they are really struggling to positively affect the sector. I am even involved in programmes by International Development Partners as consultant to build the capacity of associations to deliver service to their members. We are trying to encourage associations to have more of interventions that would impact on the business growth of members. However, the Lagos Chamber is trying to increase their membership, i.e. encourage more businesses to join; and have a platform for them to engage with other businesses from other places. It is constantly battling with Lagos State, and sometimes, the federal government on their policies. For instance, after setting up the advertising board, businesses that had their names plastered on their vans were asked huge amount, calling it adverts. We had to fight it off, insisting that there should be a difference between labelling one’s van and the actual advertisement. It was a long battle and now we’ve won.
What type of leader does the business sector need now?
It needs a leader who is focused on business and interested in the growth of the economy; one that is ready to pay serious attention to the issue of security – security of life, property and investment. Also, we need a leader that is serious about creating an enabling business environment which touches on infrastructure, such as power, good roads, access to water, houses and now our human capital. The ordinary man on the street is entitled to the best of education.
