Congratulations! You've been inspired to set up your own small business and be mistress of your own destiny. It's an exciting time – and it can be fun, too, if you know what to do, how and when to do it, and what pitfalls to watch out for.
The red tape and the work required to get started can occasionally make your head spin, but be inspired by the success of other businesswomen, many of whom are mothers just like you. And like you, they had to start somewhere.
Now that you are inspired – read the information below to find out how you can start your own business.
Basic steps to starting a small business
Today, many women run their own businesses and many serve as directors of big companies. There is no reason why you cannot join their ranks.
Market research: Do your homework. Conducting market research will allow you to determine if there is a demand for your product. Read our Market Research article for more information on how to do this.
Business plan: One of the most important steps when starting a business is writing a Business Plan.
Accountant: It’s always a good idea to get advice from an accountant before starting a business. Look in the Yellow Pages or ask other businesspeople to recommend a good one that specialises in your industry and/ or the type of business you wish you start.
Finance: Make sure you have enough money to finance your small business during start-up. If you don’t already have the money to get started you may decide to borrow money from friends, family or a commercial lender, such as your bank. Alternatively, you may find someone who is willing to invest money for a share of eventual profits.
Paperwork: Contact the Corporate affairs commission to find out which documents you need to submit for registration of your business.
Business Registration: The Nigerian Government has made a wide range of support services available to entrepreneurs in Nigeria through various state departments and support agencies.
Various other donor programmes
Services offered may range from registering a business, registering and paying tax, seeking finance, searching for resources, signing up for training, mentoring or coaching courses etc.
Name your business: Put some thought into what your business, products and services should be called. For some great tips, read our article on Naming a Business.
Register your business name: If you’re not planning to trade under your own or your partner’s name, you must register a Business Name.
Open a bank account: Check out who offers the best rates and benefits for cheque and savings accounts. It’s best to go to your local branch so you can talk to someone in person and build on a working relationship. But shop around until you get the best deal – remember, it is your business.
Protect your idea: Ensure that you’re the legal owner of your idea. Read our article, Protecting your Idea, for more information.
Which business structure is right for you?
When it comes to choosing the right business structure, it's best to talk it over with your accountant and do a little research before making a decision. In Nigeria there are the different type of business entities to choose from:Visit the CAC website for more details
Some other things that will influence your choice of business format
Financing: Certain rules need to be followed when it comes to financing and these vary with each type of business. A sole proprietorship, for instance, may only raise finance from a loan, while a private company can sell shares in the company to a financier.
Administration costs: Sometimes the costs of running a certain types of business can cost you more money in admin fees than it's worth. On the one hand, a sole proprietorship will cost you nothing extra, while a Private Company comes with a heavy administration burden.
Tax considerations: The tax implications for the various business entities differ greatly. Visit the FIRS website for more.
Business Continuity: What will happen to your business at your death; will it keep running, go to your family or have to be sold? The various legal entities have differing processes. For example, a partnership dissolves on the death of one of the partners.
What happens if you decide to sell? The format of your business will also impact on the condition under which you can sell your business. For example, in a partnership, you will only be able to sell the business assets and not the entity as such.
Insolvency: This is obviously not a situation you plan for your business, but stuff happens and it's important to consider all the implications. If you do have to declare bankruptcy, what will happen to your personal assets? Can they be seized to cover the debts of the business? You don't want to be in a position where you not only lose your business, but everything you own as well!
As you can see, there's a lot to think about before you get your business off the ground. Do your research and be sure to speak to some experts in this area. For more information related to starting your own business, view our articles on How to Write a Business Plan and Naming a Business.
There are many useful online resources to help motivate and inform you on how to start your own business – Good Luck!