| The Tantalizers story
.My grandma sold rice, mum sold rice, and I also
do because my teacher advised me to stick to family business
By SEUN ADESIDA
Saturday, April
12, 2008
 |
• Mr.
Folu Ayeni
Photo: Sun News Publishing |
| |
“In my final year in the business school, there was
this lecturer some of us asked what kind of business to go
into after graduation.
“Because we had this fantastic MBA certificate, he looked
at us and smiled, saying “if you are not Bill Gates,
if you have not invented something that you can patent immediately,
I will advise you to go into a business that your mother or
father did successfully. Now apply your newly acquired knowledge
from the MBA class and make it a better business. That was
the opening comment of Mr. Folu Ayeni, Managing Director Tantalizers
Nigeria Limited in a discussion.
That is why today I am selling rice and beans. My mother sold
rice, my grand mother sold rice and so I am selling rice.
So don’t go into business unless you have competitive
advantage. That is what you have and other people don’t
have and that becomes your strong point.
When we started Tantalizers, we invested N2.5 million and
information at my disposal from our auditors is that our gross
profit is about N4 billion for the financial year which will
be published in few weeks time, but how much did we invest
in the business when we started?
It is usual for SMEs to blame the infrastructure, the lack
of knowledge on feasibility study, the banks and a host of
other things considered to be limitations.
Ayeni said, I have seen a lot of Small and Medium Scale Entrepreneurs
(SMEs) go down with wonderful ideas, just because of the short
sight limitations. Limitations of finance, collateral etc.
and what I want to tell such people is that: You don’t
win a lottery by wishing, you win lottery by first buying
the ticket, like every other person that is expecting a win.
You might or might not win but the first step is to buy the
ticket.
SME operators
I am not going to blame the governments over lack of infrastructure,
or the banks for lack of finance options for the SMEs, though
I still have an ongoing battle with the banks. No doubt, the
government is not making anything easy for the SME. Take a
look at the state of the infrastructure in the country, which
is in the worst possible way.
What are the goals of the SME operator in Nigeria, what are
the responsibilities an SME operator needs to take up to be
successful? The Nigerian entrepreneur; is just like a goal
keeper who was asked why did you allow so much balls into
the net, his response was “ “whenever the opposing
side striker shoots the ball towards the net, the ball turns
to three balls and I don’t know which one to catch and
that is why we were defeated with so large a margin.
The coach now responds that: “if you had just caught
just one of the three balls, we will be able to register it.
That there were actually three balls and two landed in the
net while the keeper was able to catch one of them and here
is the evidence but now that you have caught none, your story
sounds unbelievable. That is just the way a typical Nigerian
entrepreneur paints the challenges facing his or her success.
But if you play your role properly as an SME operator then
you are probably going to end up succeeding, and that will
enable us to focus on the bank and the government who are
not playing their roles adequately in developing the SME project
in Nigeria.
Tantalizers’ experience
The Tantalizers’ experience is real because I went through
the mill. What I am going to say is not something I got from
one SME bookshelf, but practical life experience. The summary
of it all is that we survived by the grace of God. It was
not everything I know now that I knew then. If I had known
half of what I know now things would have been much easier.
Go and start, don’t talk about finance, start first
and everything starts with an idea. Money in most cases follows
good idea and that is the reason you must start first. Don’t
wait until you are sure of a loan without collateral. If you
are waiting for that you may never start anything.
Selecting business
Look into your environment, look at what you can do that is
very good, a lot of people choose a line of business just
because they saw somebody succeeding in that line of business
and they join the fray without knowing what actually is going
on in the business. You see somebody establish business and
you don’t know if it is financed with money from 419
deals, you also open a similar business. The objective is
not to make profit but to launder money, so you must first
know and understand the business you want to start.
Do an objective appraisal of the business and know if is it
easy to start the business, and extent of capital needed.
I know someone who wanted to start a consultancy outfit, he
came to Victoria Island to hire an apartment and furnished
it to taste without a single client, and six months later
he was bankrupt because he had no single client to call a
customer. He could not get a single consultancy job to do
and all his investment went down the drain.
He failed because before the business started he had a bloated
overhead which the business cannot sustain. As an SME, start
small and don’t build unnecessary overhead into your
budget. Allow one person to play several roles. When we started
my wife was the managing director and the production manager.
She wakes up about 5am to go to Mile 12 to buy tomatoes and
other raw materials. She will be back in Festac before 8 am,
then we will prepare the meal, get to the cash point and by
9 pm she will do the account. Those days we made about N11,
000 everyday.
Subsequently, we started putting in structures though crude
and rudimentary.
Plan growth
If you are successful in one outlet then you must build another,
but look before you leap. That you are successful in one area
does not translate to automatic success in another area, so
there is need to plan for what you are going to do. This is
where wisdom is necessary. If you are opening business in
a new location you must look at the business environment from
the angle of your strength and weakness there. If your weakness
outweighs your strength and you must be there, then you must
strategies on how to penetrate the market or you may run into
problem.
Buy expertise
You can’t know everything or do everything. You cannot
do the job of four persons. The major problem of the SME is
keeping proper account books. We clocked 10 last year and
it is still one of our problems. We get accounting software
and people don’t still know how to use it, rudimentary
bookkeeping for some SMEs is not there. All they do is sell
some and consume some of the product they sell and there is
no way you can break even like that. Start the business and
put yourself on a salary from the out set. Separate your finances
from the finances of the business.
Checking fraud
You have to lead from the front. If you don’t want your
workers to steal from you as the owner of the business, don’t
steal from yourself. Do you know that some people steal from
their own company? It is simple. When you ask your procurement
manager to inflate the cost of importing your products and
at the end of the day your staffers decided to sell part of
the product because its not moving and you are annoyed, why
are you annoyed you have already stolen, so if others are
stealing they are just following your example. Once you lead
from the front then you would have succeeded in establishing
a culture and the culture wil transcend the whole organisation |
