Budding entrepreneurs who attended the first edition of the Nigerian Small Business Summit on the 24th August at the Landmark event centre were warned to stay away from bank loans at the start of their businesses. Mr. Kushal Dutta, Managing Director of Africa’s number one hotel booking portal Jumia Travel Nigeria, gave the warning during a panel discussion on the science of SME’s success in Nigeria.
Dutta said seeking for Angel investors to sponsor start-up
businesses and provide needed capital is a better alternative to approaching
banks for loans, in view of the usual banks’ high interest rate and short
repayment period which might kill the business at birth. He also mentioned that
approaching companies that might be interested in investing in scalable
businesses is also plausible, citing MTN’s investment in the Jumia group’s
business as an example.
On the viability of copying a successful business model, Dutta was
of the opinion that it is absolutely not wrong to do so but the new business
must ensure it is offering a proposition that the existing businesses are not
already offering. This way, he said, “you can stay on top of your game and only
expect that customers will come chasing after you.”
Amongst other practical business advices the Jumia Travel Nigeria
MD gave, was a reiteration on the danger of expanding a business when
customers’ demands cannot be met. “If you know you cannot meet customers’
demand, do not expand because one happy customer will tell three people about
your great product and customer service. But one unhappy customer will tell 50
other people about his dissatisfaction,” he added.
Other discussants on the panel included Rajiv Das, Category Global
Marketing Director, Africa Region for Unilever; Chizor Malize, Managing
Partner, Brandzone Consulting; and Abasiama Idaresit, CEO of Wildfusion.
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