Small and Medium Enterprises Development Agency of Nigeria

Outline of Presentation
Entrepreneurship Development
Who is an entrepreneur? What makes you an entrepreneur? Characteristics of an entrepreneur Starting your own business

Managing SMEs
Managing Your Finances Managing People Seek Professional Advice Other Important things You Should Do The Business Environment

Conclusion
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Entrepreneurship Development
1. 2. 3. 4. 5. Who is an entrepreneur? The term entrepreneurship derives from the French verb entreprendre and the German word unternehmen, which both mean to undertake. Some scholars tied entrepreneurship to the creation of five necessary elements: The introduction of a new product The introduction of a new method of production. The opening of a new market The conquest of a new source of supply The creation of a new organization or industry. Bottomline: Entrepreneurship is about creativity and productivity for economic survival and prosperity
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Entrepreneurship Development contd

What makes you an entrepreneur? Therefore to be an entrepreneur, you must be able to make a new product/ service that was not in some sense existing before. You must be able to introduce a new method of production You may open a new market through making people buy products that were not being bought before. Get a new and unexplored way of sourcing for raw materials, products or services. Or starting a new organization that will add value to those existing before.
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Entrepreneurship Development contd

Characteristics of an Entrepreneur 1. Risk taking and risk bearing: action-oriented and highly motivated 2. Creative imitators- ability to reproduce what exists in another place for use in his/ her locality such that the new product is as good as the original. 3. Discoverers- have the ability to see, evaluate and utilize business opportunities 4. Leaders- initiate appropriate action to ensure success. 5. Resourceful - mobilize the necessary resources to exploit the business opportunities. 6. Future-oriented- having foresight; can plan for unforeseen circumstances.
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Entrepreneurship Development contd

Starting my own business-what do I need?
I. Business Ideas- the likely sources are: Skills/ hobbies/ desire/ vision/ passion Education and professional experience Literature: Books, journals, Newspapers, etc Radio/Television Internet Government Agencies with investment information Seminars/Workshops (also known as sensitization) Response to poor delivery of a service or product (a quest to fill a gap) Overpriced products or services;
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Entrepreneurship Development contd

II. Advances in technology; Existence of monopoly (if not protected by law); Rapidly expanding market Know your strengths and weaknesses, identify the opportunities and threats that surround you(SWOT analysis).

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III.

IV.

Capital- what are the likely sources? Family and friends Savings Loan from banks and other financing institutions Cooperatives Esusu/ ajo Buying on credit etc Workspace; Your sitting room or your house The Boys quarters Rent a shop Buy a shop Build a factory/ shop etc Locate to a park SMEDAN IN PARTNERSHIP WITH (where available)
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V. Employees Managers Accountants/ cashiers Marketers/ sales staff Technical/ skilled staff Unskilled staff/ labourers NB: Outsourcing is an option for technical skills, but the entrepreneur cannot be a novice in any matter concerning his business. VI. Raw materials for production of goods or knowledge based materials for services provision.
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Entrepreneurship Development contd

VII.

Motor vehicles, furniture and fittings, machines and equipments etc. VIII. Preliminary expenses such as registration fees, feasibility report etc. IX. Utilities; Working capital, Salaries and wages X. Who are those already in the business or do things close to it?
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Managing SMEs
1. Managing your finances: a) Keep good records of your transactions i.e. simple book keeping such as cashbook for all cash proceeds and expenses; debtors a/c for those owing you; creditors a/c for those whom you owe. b) Bank your daily proceeds intact. Dont spend money from your sales, it is different from profit. Instead issue cheques. c) As your business grows, prepare full financial statements- they are the profit & loss a/c (income statement), cashflow statement, balance sheet, 5year financial summary. d) Audit your accounts IN PARTNERSHIP WITH SMEDAN annually. 11
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2. Managing people: a) Know your customers; customer care b) Know your employees; recruitment and retention of employees; dealing with difficult people; conflict management; positive organizational politics; leadership; motivation; delegation. c) Suppliers: having alternatives in case of failure; dont default on payment terms except in extreme conditions. d) Your banker(s): have a warm relationship with them, you may need an overdraft/ loan. e) The public: BeSMEDAN IN PARTNERSHIP WITH . socially responsible 12
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3. Seek professional advice when necessary-dont have the I know it all attitude. Everybody Knows Something(EKS), Nobody Knows Everything(NKE). 4. Get advise from Agencies like SMEDAN, NIPC, CAC, NEPC, Chambers of Commerce and Bank of Industry etc. 5. Other Important things for consideration are: Plan your finances very well. Cash is the lifeline of your business, cash is king. Time management Be proactive
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Managing SMEs contd

Creative cooperation- network with people who can help your business. Information and/ Communication Self renewal/ self development- build your capacity, attend seminars and workshops pertaining to your business. Personal leadership Personal management- time, resources and health.
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Understanding the Nigerian Business Environment

Definition: The totality of all the factors/forces which impact, or influences (on) man, society and/or organization/business as a result of the space in which they occupy. Reasons for environmental analysis: To determine strengths, weaknesses, opportunities and threats of a project. Help to fashion out new methods and strategies for eradicating such constraints that might impact on a project Help to design competitive strategies that will create competitive edge in a competitive environment
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Understanding the Nigerian Business Environment Contd

Types: - Internal Environment: These are all controllable factors or forces that influence organizational process from within e.g. organizational policies on procurement, recruitment/training, record keeping, promotion, packaging, branding etc. - External Environment: These are uncontrollable forces outside an organization that might influence it e.g. price level, inflation rate, demographic factors, demand & supply, cost of capital, technological dimension, social factor, political and legal factors etc.
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Conclusion
Your financial security is not the responsibility of a big company or the Government, those are ideas of the industrial age not of the information age. Whatever resources that we lay our hands on now should be well utilized because this opportunity may not pass this way again.

Think Big, Start Small

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THANKS FOR LISTENING

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