Factors Affecting The Business Environment In Nigeria
Are you a business owner or a student who wants to read in order to get prepared for the challenges you are likely to face in the future, or do you want to read so as to be aware of the factors affecting the Nigerian business environment? You are on the right
Before we go straight into the main discourse, let’s see what business means
Business is simply whatever activity a person is doing that involves the production and distribution of goods and services for the aim of making earns meet.
Also, a business environment can be considered as the inter-relationship which occurs between a business enterprise and the place where it is situated.
There are several factors in the country that are capable of affecting or influencing the business environment of such country.
Some of these factors are general in that, they are common in nature to many countries of the world, on the other hand, some other factors are applicable only to some set of countries.
In this post, we will be sharing with you 5 of these factors that has greatly affected the Nigerian business environment
1. The Economic Factor
Just like many other countries of the world, the condition of Nigeria’s economy has a great impact on the Nigerian business environment.
Whether micro or macro challenges such as inflation, labor costs, taxes, demand, competition, etc, they have a way of affecting the operation of business in the country.
2. Access to funds
This is another major factor that has badly affected the Nigerian business environment over the years.
There are many youths who have brilliant business ideas but are unable to start due to lack of access to funds.
Usually when anyone approaches commercial banks in Nigeria, their loan policies are mostly unbearable, such that a youth from a poor or average home may not be able to apply for loan.
Also, the interest rate on loans is another big challenge for those who need loan either to start up their new business or expand the existing businesses.
3. The legal factor
This has to do with the laws and policies given by the government through the various law enforcement agencies to business owners.
These laws affect the business environment of the country as it tends to control the activities and operations of every business in the country.
For instance, if you want to start a business, you are required to first register with Corporate Affairs Commiision, secondly, you must follow all the laws laid down by the governing agency in charge of your business line or profession.
4. The unemployment problem
This is another main problem in the country. The rate of unemployment in the county is high and this directly affects the Nigerian business environment. Are you wondering how?
Imagine that goods are produced by an organisation but they are unable to make good sales because those who are supposed to be potential customers do not have jobs, neither do they have money to buy the goods.
5. Educational sector
The impact of this sector on the Nigerian business environment is huge. This is because it is in the educational sector students are trained to be hardworking, focused and committed so if this sector fails in doing the right thing, it will definitely affect the business environment of the country.
In case you dont understand, the educational sector plays a major role in supplying human resources to the business sector of the country. So imagine that the graduates sent into the business sector are half baked or not well trained, that simply spells doom for the business sector of the country.
Other factors include:
- Technological advancement
- Available Social Amenities And Infrastructure
- Societal Environment
- The foreign business environment