Top Business Tips for Starting a Business in Nigeria

Geographical location undoubtedly affects business models, which means investors and entrepreneurs need to do due diligence and feasibility studies before expanding to a new country or launching a new product. It is in your best advantage to learn how to conduct business in a country like Nigeria beforehand. Here are some tips to help guide you:

Conduct Market Research

If you are a local startup or a foreign company entering the Nigerian market, you need to conduct market research by asking your potential customers a few questions about the problem they want you to solve for them. This will assist you in understanding the gaps that your own company can fill.

Your market research should also cover potential competitors and get familiar with their products and services to help you draw up a plan for how your own business or product can stand out.

Create a “Nigerian” Business Plan

This is where the market research comes in handy, as your plan will perfectly outline how to sell to Nigerians and convince them to buy your goods. According to Guardian Nigeria, “companies succeed only when they become Nigerian and the locals perceive their brands as their own.” As an entrepreneur, it is in your business interest to bring a unique business model that resonates well with Nigeria and its current environment, rather than trying to imitate a strategy that works in a European or Asian market.

To facilitate business registration, this business plan should incorporate policies such as taxation and other expenses. It should also address how to obtain permits and financing.

Get Registered in Nigeria

In Nigeria, your company must be registered with the Corporate Affairs Commission (CAC) at the federal level and the Chamber of Commerce at the state level. The recently implemented Companies and Allied Matters Act (CAMA) 2020 in Nigeria is making it simple for both local and foreign enterprises to register. The size of your company and business operations, on the other hand, is a major factor that can either hasten or delay your registration as a corporate company in Nigeria.

Get a Tax ID Number and Other Special Licenses

This is the tricky part of being a business owner in Nigeria. The federal government has mandated all businesses operating in Nigeria to get a Tax Identification Number (TIN) and file tax returns annually with the Federal Inland Revenue Services (FIRS). Also, businesses supplying taxable supplies must register and obtain a Value Added Tax (VAT) number.

For your business to get industry credibility, you need to obtain special licenses from specialized bodies and regulators like the National Agency for Food and Drug Administration and Control (NAFDAC), Central Bank of Nigeria (CBN), or the National Office for Technology Promotion and Acquisition (NOTAP), depending on your industry.

Sweet Tips from Ally

Starting a business in Nigeria for the first time can be complex, but you can easily navigate it when you play by the local rules and understand the business environment. Once you've developed a business plan tailored to the Nigerian market, your team should take shape, from partners to lawyers who can assist with business registrations and other regulations.