The Nation Newspaper

Tag: SMEs’

  • Made-in-Nigeria goods ’ ll boost SMEs, create jobs

    The Federal Government’s strong push to encourage Nigerians to support locally- made goods and services will help encourage entrepreneurship at the Small and Medium Enterprise (SME) segment.

    This could spur diversification of the economy, create local jobs, and reduce unemployment.

    The Regional Director for Sage in West Africa, Mr. Magnus Nmonwu, made this known on the sideline of the Africa Day celebration with the theme, “Building a better Africa and a better world.”

    Sage is the market and technology leader for integrated accounting, payroll, and payment systems, supporting the ambition of entrepreneurs and business builders.

    Nmonwu said: “Small businesses and start-ups are the engines that will power Nigeria’s growth into the future.

    “The sooner we start supporting our proudly Nigerian suppliers and service providers, the better for us. With our support, they can create wealth and jobs for the country, and many of them could grow into globally competitive exporters.”

    Nmonwu said the Federal Government should be praised for putting the spotlight on local manufacturers through initiatives such as the Made-in-Nigeria Dress Days and an Executive Order compelling state agencies to direct at least 40 per cent of procurement to Made-in-Nigeria goods and services.

    He stressed that local service providers and manufacturers could play an important role in the revival of Nigeria’s economy.

    “We welcome the effort to encourage industrialisation and diversify the economy from commodities into new areas. Strong local demand is the foundation of a manufacturing sector that can grow into an export industry,” Nmonwu said.

    According to him, government was putting its money where its mouth is with its Executive Order and giving the public a good example to follow.

    The Sage Regional Director, however, said there was scope for the public sector to do more to encourage the growth of SMEs.

    Such encouragement, he said, includes tax incentives for local producers, support in accessing finance, and facilitating mentoring and skills development programmes between small business and bigger companies.

    “The government should encourage small businesses to adopt business software so that they can improve regulatory compliance and financial controls. This could also help in tracking the performance of those that benefit from state loans and incentives, and hold them accountable,” Nmonwu said.

    He added that infrastructure investment across roads, power, communications and ports are also important in spurring development of local industries.

  • ‘Patronising local goods’ll boost SMEs, create jobs’

    The Federal Government’s strong push to encourage Nigerians to support locally made goods and services will encourage entrepreneurship at the Small and Medium Enterprise (SME) segment.

    This, in turn, could help spur diversification of the economy, create local jobs, and decrease unemployment.

    The Regional Director for Sage in West Africa, Magnus Nmonwu, made this known on the sideline of the Africa Day celebration with the theme, “Building a better Africa and a better world.”

    He said: “Small businesses and start-ups are the engines that will power Nigeria’s growth into the future.

    “The sooner we start supporting our proudly Nigerian suppliers and service providers, the better for us. With our support, they can create wealth and jobs for the country, and many of them could grow into globally competitive exporters.”

    Nmonwu said the Federal Government should be commended for putting the spotlight on local manufacturers through initiatives such as the made-in-Nigeria Dress Days and an Executive Order compelling state agencies to direct at least 40 per cent of procurement to made-in-Nigeria goods and services.

    He stressed that local service providers and manufacturers could play an important role in the revival of Nigeria’s economy.

    “We welcome the effort to encourage industrialisation and diversify the economy from commodities into new areas. Strong local demand is the foundation of a manufacturing sector that can grow into an export industry,” Nmonwu said.

    According to him, government was putting its money where its mouth is with its Executive Order and giving the public a good example to follow.

    The Sage Regional Director, however, stated that there is scope for the public sector to do more to encourage the growth of SMEs in Nigeria.

    Such encouragement, he said, include tax incentives for local producers, support in accessing finance, and facilitating mentoring and skills development programmes between small business and bigger companies.

    “The government should encourage small businesses to adopt business software so that they can improve regulatory compliance and financial controls. This could also help in tracking the performance of those that benefit from state loans and incentives, and hold them accountable,” Nmonwu said.

    He added that infrastructure investment across roads, power, communications and ports are also important in spurring development of local industries.

    “There is enormous scope for government and the private sector to cooperate on creating polices and infrastructure that create an enabling environment for Nigeria’s business builders,” Nmonwu added.

    He said another good idea might be for government to put together advisory boards with representatives from big businesses, small companies, the government and other stakeholders to understand the voice of small business and develop appropriate policies to help drive them.

    Nmonwu, however, pledged that Sage would support initiatives to put business information and tools online to help entrepreneurs build their skills and access the resources they need to be successful.

  • UNIDO: 20% SMEs manage to survive in Nigeria

    The United Nations Industrial Development Organisation’s Investment and Technology Promotion Office (UNIDO ITPO), Nigeria, has called for the formulation of affective strategies to address the high mortality rate of Small and Medium Enterprises (SMEs) in Nigeria. It stated that studies have shown that only 20 per cent of SMEs manage to survive in the country.

    Coordinator, ARCEIT Programme, UNIDO ITPO, Bahrain, Mr Afif Barhoumi, who spoke at the opening ceremony of a four-day training programme organised by UNIDO ITPO Nigeria for selected Federal Government agencies, stressed the need for continuous enterprise development and investment promotion to key stakeholders.

    “Although everybody in Nigeria desires to become an entrepreneur, only 40 per cent of the dreamers get to start, but no more than 20 per cent survive,” he said.

    He added that ministries, department and agencies (MDAs) needed to entrench enterprise development and investments promotion as a key strategy to end the scourge.

    “The training will also equip the SMEs with survival and growth skills needed to thrive and take advantage of investment and trade opportunities in local, regional and international business environments,” he noted.

    Head, UNIDO ITPO Nigeria, Mrs. Adebisi Olumodumu, said the need for capacity building of MDAs has become inevitable if the Federal Government wanted to play its role of supporting SMEs to grow.

    She said if adequately supported, SMEs would grow into big bussinesses and possibly conglomerates which products will compete with world-class products elsewhere in the world.

    “Nigeria used to be a mono-economy but when the fortune of oil waned, government decided to diversify the economy. Agriculture is a very viable source of economic diversification and we hope that Federal Government agencies will take advantage of the knowledge sharing afforded by this training,” she said.

    Managing Director, Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL), Mr Aliyu Abbati Abdulhameed, said SMEs were the key drivers of success of the agricultural economy even with the private sector.

  • CBN injects $186.5m for Invisible, SMEs

    The Central Bank of Nigeria (CBN) yesterday injected $186.5million into the invisible and the whole Wholesale Secondary Market Intervention Sales (SMIS) segments of the forex market.

    This is made up of $36.5 million in the invisibles, $50 million for Small and Medium Enterprises (SMEs) segments and $100 million in the wholesale segment. The CBN also approved the sale of $100 million at the Wholesale Secondary Market Intervention Sales (SMIS) auction announced on Monday, May 23, 2017.

    The CBN Acting Director, Corporate Communications, Isaac Okorafor, who spoke to reporters on the sideline of the MPC briefing confirmed the sales at both the invisible and wholesale segments were settled.

    Okorafor reiterated that the CBN will continue to make every necessary intervention in the interbank market to sustain the supply of forex to meet legitimate foreign exchange demands by customers.

    He stated that the efforts of the CBN in sustaining the intervention in the forex market is beginning to post some positive effects, as the Naira is making steady gain against major currencies.

    This goes to reaffirms the CBN governor’s pledge at  yesterday’s Monetary Policy Committee (MPC) press briefing on the need to sustain the forex intervention to ensure the convergence of the forex rates.

    There are strong indications, according to market analysts that the naira is likely to maintain an average exchange rate below N375 to $1 in no distant time.

  • Standard operating procedure for SMEs

    Introduction

    One of the major challenges faced by SMEs is lack of standardisation in the daily operation. Even after preparing a Business Plan as a prerequisite for Start-up, it is important to have SOPs for the core activities of the business. This will assist the business in producing products that meet up to required standards all the time.

    What is Standard Operating Procedure (SOP)?

    A Standard Operating Procedure (SOP) is a set of written instructions that document a routine activity of an organisation so as to enable employees perform their job functions effectively and efficiently. It is usually a step by step instruction prepared by manager/supervisor in charge of the operation and approved by management to facilitate consistency in the quality of the end product or service.

    Benefits of SOP

    Standardisation Operations: SOP allows for consistency in daily activities or operations of the organisation. This promotes co-ordination and communication among staff of the organisation.

    Training Material for employees: SOP helps as training material for employees especially during induction. It also enables employee to be abreast with the requirements of the work environment.

    Performance Evaluation: SOP is an important tool in evaluating the performance of an employee in the organisation. It is the SOP that will be used as a guide in the Job Description for the employee. It helps the employee to know what is expected on the job.

    Reference Document: SOP is used as a reference document especially for audit and control measures.

    How SMEs Can Prepare Their Own SOPs

    The starting point for any SME is to identify the key areas of operation or activities you want to prepare SOP for.

    Determine the objective of each SOP.

    Identify the staff that will prepare the SOP for each role or activity. SOP preparation should assigned to individuals that are familiar with the activities of the department. For organisation that can afford it, the service of an external consultant can be contracted.

    The next stage is the actual preparation of the SOP. The following minimum requirements must be covered by any SOP:

    Title of the SOP

    The Scope- Areas of work to be covered by the procedure.

    Chart of The Procedure – Step by step of the activity or role.

    Effective Date of Operation

    Periodicity of Review. How often will the SOP be reviewed for example yearly.

    Approval Page: The SOP must be approved by Senior Management. The name and signature of the approving authority must be stated.

    Distribution List: The SOP must be circulated to all staff that will use it and copy must be in file.

    Training on SOP. Staff must be trained immediately the SOP is approved.

    Conclusion:

    The introduction and usage of SOP is very important for all SMEs. In fact, corporate governance is better enhanced when SOPs are in place. It will also enhance professionalism, accountability and good standards for SMEs. All SMEs are encouraged to make it a practice to have SOPs in place and to review and update existing SOPs regularly.

    tomiomojuwa@gmail.com

  • Fidelity Bank Managed SMEs Forum praised

    Fidelity Bank Managed SMEs Forum praised

    Entrepreneurs have applauded the ongoing ‘Fidelity Managed SMEs’ Forum being championed by Fidelity Bank Plc.

    Speaking on the Fidelity SME Forum Series on entertainment aired on the Inspiration FM, on Tuesday, veteran actor and film producer, Kunle Afolayan, said the programme is helping to educate more Nigerians on the gains of entrepreneurship.

    “For me, it is really nice, because a lot of people listen to radio in the morning. Also, a lot of people sit down and criticize films, but the platform gives them the opportunity to understand what goes in and out of film business. The programme is not only informative, but is also empowering people,” he said. Afolayan said it is costly to produce films in Nigeria, and in most cases involves borrowing from the banks. “For me, I wanted to do something different. Film producers should focus on content and sustainability of the business. I measure the success of my films in two ways- either it is profitable or it gives me mileage,” he said.

    He said film producers have to set up business structure that sustains itself adding that it is always good to balance creativity with commerce. “An average artist is a dreamer. You have to dream consistently,” he said.

    He said the only solution to ongoing piracy in the industry is government policy. He said film producers have to take protective and preventive measures to guide against piracy adding that despite all the odds, the film industry continues to grow.

    Managing Director of the bank, Nnamdi Okonkwo, has continuously expressed the lender’s commitment to helping Small and Medium Scale Enterprises (SMEs).

    Okonkwo, who regularly features on the Fidelity Managed SMEs programme expressed delight at the level of support and patronage by customers, said the bank also needed to reciprocate by supporting them with finance to grow their businesses.

    He promised to hold a more detailed educative session with businesses and entrepreneurs to help them grow their businesses as a way of diversifying and solving the foreign exchange challenges.

  • Lagos approves N1.7b for SMEs

    The Lagos State Employment Trust Fund (LSETF)  has approved loans totaling N1.76 billion  for 1,401 beneficiaries, the Commissioner, Wealth Creation  and Employment,Babatunde Durosimi-Etti has said.

    The creation of the N25billion Lagos State Employment Trust Fund is the most daring moves by any state government in the country to address unemployment, he added.

    Giving the breakdown in Lagos yesterday, Durosimi-Etti said  the fund received 3,758 applications (2,304 Micro Enterprises (MEs) and  1,454 Small and Medium Enterprises(SMEs) in the first batch of the pilot project.

    According to him, the board approved 705 applicants (517 MEs and 188 SMEs totaling N900,137,078.The first beneficiaries were presented their letters.

  • Rising raw materials cost takes toll on SMEs

    Rising raw materials cost takes toll on SMEs

    Faced with the economic downturn and rising production costs, many micro entrepreneurs are closing down their businesses; others are struggling to stay afloat, reports Daniel Essiet.

    THESE are not the best of times for micro businesses. They are feeling the pains of rising costs of operation that has reduced their profit margins. The costs are associated with limited access to raw materials such as imported chemicals. Added to this is the high cost of sourcing foreign exchange (forex) which has worsen the plight of the small business owners.

    The Association of Micro Entrepreneurs of Nigeria (AMEN) President, Comrade Saviour Iche, said small business owners were switching away from Nigeria to Benin Republic and Ghana  as rising labour, raw material and energy costs make local production more expensive and finished goods uncompetitive.

    According to estimates, 70 per cent of the private sector operates in the small and medium enterprises (SMEs). Over 40 per cent of these are also estimated to be involved in light manufacturing, such as soap and cosmetics production that require use of vital chemicals.

    Iche said the cost of raw materials had gone up, thereby increasing their operational costs as well as affecting production capacity.

    He said various chemical raw materials have had a sharp price rise, adding that some raw materials’ prices had risen from N3000 to N15, 000 in the last one year.  Due to shortage of raw materials on the local market, most businesses are forced to import from abroad and this requires getting forex to import them. He appealed to the Central Bank of Nigeria (CBN) to make forex available for  chemicals sellers to import and sell to SMEs producing household  and personal care items.

    He explained that electricity costs for businesses had increased by 100 per cent, the biggest in the past two years.

    However, Iche is only one of thousands of entrepreneurs and SMEs operators, who found business life  difficult.  Because of this, most members of AMEN in small manufacturing businesses, according to him, had plans to expand their business, including reducing staff and business scales. The cost of SME credit,   he noted, is on the upward swing, as evidenced by the increase in nominal interest rates charged to SMEs.  For instance, an average loan is within 23 and 28 per cent. The trend towards higher costs of credit, according to him, was accompanied by a continued high level of collateral requirements, which remained higher than.

    He said: “Where do you expect a micro business operating in a room to get a C of O?”

    The founder of Jubilant Family Industries Limited Frederick Nwokeleme said access to appropriate funding sources had been much harder for SMEs. The financial conditions of many SMEs, he added, is  weakened by the drop in demand for goods and services and the credit tightening.

    Improving SMEs access to finance, he added, should be a priority  as it is inhibiting the growth of SMEs.

    To promote healthy growth of SMEs, Nwokeleme, canvassed  that  development plans  should  include productivity enhancement, capacity development, concessional business regulatory environment, and technology adaptation to innovative SMEs.

    According  to him,  raw material prices are getting higher and are not available in the market at fair prices, adding that increasing the local production would create clusters of job opportunities.

  • FG reduces number of days for businesses registration

    FG reduces number of days for businesses registration

    …Also company registration to be done within 24 hours

     

    Towards ease of doing business in Nigeria, the government has reduced the number of days required for registration of new businesses in Nigeria from 10 to 2.

    It also okayed a 24-hour timeline for company registration from when application form is completed and all required documents made available.

    Prospective business owners can also search on Corporate Affairs Commission (CAC) portal   (www.cac.gov.ng) to avoid duplication of names and prevent selection of prohibited names.

    Company registration also no longer requires lawyers as it is now optional for SMEs to hire lawyers to prepare registration documents.

    These were among the highlights of a report presented at a Presidential Enabling Business Environment Council, PEBEC, meeting held at the Presidential Villa, Abuja on Monday.

    The meeting, according to a statement by the Senior Special Assistant on media and publicity, Laolu Akande, marked the end of the 60-day Action Plan on Ease of Doing Business in Nigeria reforms.

    The Council established by President Muhammadu Buhari is chaired by Vice President Yemi Osinbajo.

    But Monday’s meeting was chaired by Transportation Minister Rotimi Amaechi, as the Vice President was busy with the work of the Presidential Investigative Panel.

    According to the report, CAC has introduced single incorporation form (CAC1.1) to save time and reduce costs while the agency has introduced document upload interface on its website to enable e-submission of registration documents.

    Other aspects of the reforms now actualized in the last 60 days include the Integrated FIRS e-payment solution into CAC portal to enable e-stamping while the reform empowers CAC internal lawyers to certify company incorporation forms and conduct statutory declaration of compliance for a fixed fee of N500.

    According to the report, the PEBEC listed “Dealing with construction permits, Getting electricity, Registering Property, Getting Credit and Paying Taxes,” as some of the areas where the council has recorded progress in the past 60 days.

    The report also highlighted the completed reforms on the “Entry and Exit of People,” indicator which includes Simplified Visa-on-Arrival process, Infrastructural improvements at the Abuja airport, and the new Immigration Regulation 2017.

    It also indicated that the completed reforms are being closely monitored to ensure diligent implementation with minimal disruption while pending reforms are being escalated to ensure completion in the coming weeks.

    On Trading across Borders, some of the completed reforms include palletisation of imports, advanced cargo manifests, reduction in documentation requirements and scheduling of Joint Physical Examination by the Customs Service.

    The National Action Plan contained initiatives and actions implemented by responsible Ministries, Departments and Agencies (MDAs), the National Assembly, a number of State Governments, as well as some private sector stakeholders.

    The Council emphasised that with the conclusion of implementation of the Action Plan, the next phase would involve “deepening existing reforms; completing and implementing pending initiatives; engaging with the public; validating completed reforms and kicking-off medium-term reforms.”

    The Council would also kick-start “sub-national reforms across Nigeria’s 36 states; trading within Nigeria; kick-off of initiatives and reforms improving business processes and regulations within Nigeria; and ease of movement of goods within and across regions in Nigeria.”

    Other Ministers at the meeting included Foreign Affairs Ministers Geoffrey Onyeama, Minister of State for Industry Trade & Investment Aisha Abubakar, and her counterpart in Budget & National Planning Zainab Ahmed.

    Other government dignitaries at the meeting included the Head of Service, Mrs Winifred Oyo-Ita, and several heads of MDAs.

    The report was presented by Dr. Jumoke Oduwole, Senior Special Assistant to the President on Trade & Investment.

     

  • CBN to sanction banks denying forex access to SMEs

    CBN to sanction banks denying forex access to SMEs

    The Central Bank (CBN) threatened on Friday to sanction banks denying Small and Medium Enterprises (SMEs) access to foreign exchange (Forex) from the newly instituted SMEs Forex Window.

    The window which opened about two weeks ago is designed to help SMEs import eligible finished and semi-finished items not exceeding $20,000 for an enterprise per quarter.

    Speaking on the sideline of the ongoing IMF/ World Bank Spring Meetings in Washington, CBN Acting Director, Corporate Communications, Isaac Okorafor, said appropriate sanctions are spelt out by the   CBN Act and the Banks and Other Financial Institutions Act (BOFIA).

    He said staff and even chief executives of banks could be punished where necessary.

    The CBN spokesman said the apex bank has already received series of complaints from bank customers, especially those that operate in the SMEs segment of the market that banks are frustrating their efforts at getting forex.

    Okorafor said some entrepreneurs still complain that banks are frustrating their efforts at obtaining forex for their eligible imports after the stipulated 48 hours.

    He said the regulator has reviewed the complaints and discovered they are not evidence-based.

    He appealed to bank customers and the SMEs to “please give us concrete evidence against these banks so that we can hold them responsible by way of sanctions.”

    He added: “Get a photocopy of your Form Q, Form X, Form A or Form M. Give us the name of the bank, branch and send to us and we will deal with them as example to others.

    “The only way we can make things better for Nigerians is for them to call the CBN whenever they are in trouble or whenever, or are getting frustrated by banks.

    “We have a number you can call or you send an email to our Consumer Protection Department. We want to urge everyone who is frustrated by banks to call and lay complaints. We assure you that you will get redress.”