Doing The Numbers Before Starting A Business In Nigeria

Doing the numbers? what does that have to do with starting a business?

A whole lot. Read on to find out.

You are really excited at this point about starting a business in Nigeria. You have assessed your abilities and they were great. You have discovered a need and came up with a terrific business idea.

Heck! You even checked the fit of the home business idea and have done a market research.

Wonderful!... so can this great idea of yours make you money?

There is no point in starting a business if it’s going to take more money than you can raise or takes longer to get to break even point and turn in a profit than you can handle with the available cash.

Doing some rough numbers at the beginning can really save you a great deal of valuable time and money pursuing unrealistic or unprofitable opportunities.

You don’t want that to happen, do you?

Before investing any money, you should know the rules...

Investing rule No. 1: Never lose money. Investing rule No. 2: Never forget rule No. 1.Warren Buffet

And as George Soros puts it: “Survive first and make money afterward".

You really need to establish for your business:

• How much start-up capital you will need: The truth is setting up a business requires money you can’t run away from that. Starting a business in Nigeria on the highway to success involves having enough money to survive until that point where income continually exceeds expenditure. The first big question is ask yourself is how much money do I need?
• The likely sales volumes: You need to forecast your sales even if your forecast may turn out to be wrong. This is important because it will give you comfort by allowing you to evaluate the worst scenario, its likely effects and your possible way out.
• How long will it take to reach break even: This is very important because the break even point is the point from where you start enjoying a profit from your home business. At this point, you have recovered your cost and you are about making profit. Here, you have to note the cost at which you will operate and price at which you which to sell your product or service.

Also very important. Try as much as possible to keep your cost as low as possible. Avoid spending too much capital on purchases you could postpone till later. This could make the difference between surviving in business or losing your cash.

Through with doing the numbers?

You also need to remember to establish for your business:

• Day to day running cost
• How long it will take you to break even
• How much capital you will need to start and run the business
• The number of sales you might be making
• The profit you must make for your business to do very well
• The price at which you will sale your product or service

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