How enabling environment can aid growth of Nigeria SMEs 

By Ayo Alonge

Background

 I studied Food Science at Ladoke Akintola University (LAUTECH). It is not related to anything I do now. It started as a drive when I was running my OND. I started by creating a camera that creates a penciled image of yourself, instead of a coloured picture. That was where it all started. While being lazy, I didn’t want to be seen cooking all kinds of foods at different times so I said what if we have a cooking pot that can cook three meals at the same time. It all started by wanting an easy life. I could see the patterns. I only wanted to make people have a solution to everything in the world. The simple way is to create things. I started by wanting to improve things around me. While in school, I produced a drink called “Quencher”. It tastes exactly like Lacasera. I birthed it when I was having my ND. I also produced some yoghurt drinks. When I got into the NYSC, I was doing peanut butter and some edibles that have to do with Food Science. After service year, I went to register a company called Tenposs Limited. It is a short form of “The Endless Possibilities”. My major aim is that I want to be the guy that generates the highest number of most relevant ideas to solve human problems around the world. It can even be an object that people would like to have in their hands or houses. Just anything that can solve problems. The first idea was sponsored by my brother named Wale Ojo. We produced a locally made greeting card that would come in native languages like Yoruba, Igbo and Hausa. I put in as much as N500,000 but I didn’t understand that there is the marketing part of the business. I had met with Olakunle Soriyan and he had suggested selling the idea to MTN. They would brand and give it out to people, while I get N3million as a pay-off. Everything flopped and I came back to normal. It wasn’t a failure of conceptt but a failure of marketing skills. It then dawned on me that I should relate with someone who can market or I learn marketing myself so I can sell. What you discover in the market here is that nobody is ready to stick out their necks for things not imported. It gets worse when they know that you are the one producing it; like a fellow Nigerian. They prefer to get things from China. I have done twenty other things because I have learnt that you can’t be in Nigeria and do just one thing.

Business diversification

Presently, we have a wall art company and a furniture company. We are now doing something which is the first in West Africa. It is called laser artwork. It is artworks with laser machine. We are also into manufacturing an advert board. It is both mechanical and digital and aims at reducing the money companies spend on advertising their products and services. We also write movie scripts and the target is to sell to Hollywood. We have one ready to go now. We are also into making automated swimming pool covers that slide over the pool when not in use. We have done things for Lagos State and some of our works can be seen around Lagos. We didsomr rohbatn and sutiiuts for Lagos giebmemmt. We also have a device that automatically makes your semo or amala. You have your amala or semo flour and the hot water separately while the machine makes it for you. It is called paste maker. We have some other things we do but it is like you need to still face your immediate market until you find that partnership that works for marketing.

Market presence and patronage

So far, for our wall arts and furniture, up till date, we must have sold 3,000 pieces of the wall arts. We sell mostly online. Our wall arts have also sold about 400 pieces on Jumia. I think we are doing well in the market but we can do far better. We have a good market presence and the name of the company is known. We have people who return purchases to us. On reception, people like us. We are not just producing for sales, we also try to add value and uniqueness to what others are doing.

Challenges

We have several challenges ranging from the ability to raise funds to the political challenges in the country. Some people need to buy things but the purchasing power is not there. We also have the challenge of getting skilled workers. People complain there are no jobs but the ones available, people can’t do them. If you browse through my head, there are about 1,000 ideas that can bring in about a million dollars each. But where are the people to execute them? That is a major problem. Everyone wants to get paid but nobody wants delayed gratification. You can hardly have a startup where people come to combine ideas to create products. That’s a major challenge. In the US, companies buy other companies off. How many companies do you see buying others off here in Nigeria? People don’t understand how to work together. My main goal is that how do we have something to exchange with other nations. People would say don’t do what I am doing. I am not competing with anybody. I am not even competing with the people in China. All I want to do is always find something that people all around the world can buy. Something that solves a problem people are having. That’s my own paradigm. I want to always do something different. But then, so many things are out of place. We run on generator too much. Imagine the number of people that go to sleep because there is no light to work with. It’s not because they are lazy. So, we have to even cope with the noise of the generator, even when most of our works are mental based.

Managing competition

We have a major competitor. That company had to reduce the price of one of its major products that competes with ours, just to take a good market share of the business. It is not as if there are no competitive brands but we want to always do things differently, instead of using the same data and material. We give an extra value. We can produce similar products but not the same way. We are even willing to teach people how to make these things because our goal is to increase exports, and not to fight competition by fighting a local battle.

Staff strength

I have been able to get the team members through referrals. I have a good graphic designer. I have also had to leverage on other people’s strength. The things I cannot do, I outsource them. I have friends who are a technically inclined. I know that despite that we have so much talented people in Nigeria, most of these guys end up being poor because this country is not structured in such a way that people’s intellectual properties are protected. I have about 12 active staff in the company, aside the ones on the management board.

Sourcing raw materials

For the bulk of the things we do, we get the materials from Mushin and Idumota. We have been sourcing materials locally because once you start importing raw materials, there are several other factors to put in place. We buy in wholesale from the wholesalers. We don’t stuck materials so we don’t tie down funds. You need to have a process of continuous improvement.

Funding for business expansion

One of the greatest things I have done is to focus on my core competence which is concept creation. Some people are serial entrepreneurs. They start a business and go into the next one, the next minute. We want to build a hub called African Value Innovation System (AVIS). What we do is to create concepts, prototype them and allow companies and individuals come to buy them for use. We are looking at building Nigeria together through the ability to think. One other step we are taking is working in partnership with some other individuals who are doing exceptional things. We have started establishing some correspondence with some companies outside Nigeria. What I also believe in is organic growth. We want to grow into being able to handle some of the things that come into our hands. Having $10million for business is not all needed but the ability to be able to manage it. At the moment, we don’t have anyone funding us. We simply reinvest proceeds from the business.

Government intervention in SMEs

Government can intervene in the area of creating a stable environment for businesses to thrive. I mean a situation where basic amenities like power, water are available. You don’t have an idea of the level of productivity we lose due to unstable power supply. If the basic things are in place, people will be willing to go the extra miles. You will see how people would defile routines and will be able to do something more meaningful.