As the global economy shifts, businesses will need to be aware of the changing trends in order to meet the challenges ahead.
During the ThinkBusiness conference, Ogho Okiti, an economist and managing director, BusinessDay Media, identified five factors driving business shifts in the world today.
According to Okoti, the first is competition. He noted that competition drives innovation as companies are finding new ways and methods to compete. Global players such as Gilt, Charles, Tyrwhit and Next, are now selling their products to the Nigerian consumers directly, he noted.
“This means Nigerian businesses do not only have competitors in the country to contend with but also global competitors,” he said.
The competition for education and skills and its uses are changing rapidly, as an increasing number of people such as content writers, programmers and even dissertation writers are working here in Nigeria but getting paid in US dollars.
Secondly, he identified economic crisis as another factor that drives business shifts. Some top companies in the world today were founded during crisis.
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For instance, multibillion-dollar business, Airbnb, was founded in 2008, when the founders Joe Gebbia and Brian Chesky launched a simple online platform to rent out an air mattress. When the Great Recession hit later that same year, suddenly the need for short-term, low-commitment living quarters exploded exponentially. The site grew to over 10,000 users and 2,500 listings by March 2009.
Other companies that rose during the crisis include Uber (2009), Disney (1929), Apple (1976), IBM (1911) and Zoom (2011).
Thirdly, he pointed out that government policies also drive business shifts.
The government can change the way businesses work and influence the economy, either by passing laws or by changing its own spending or taxes.
Furthermore, technology is a crucial driver of business shifts, he said, saying, “Business owners should not consider any business model without considering the impact of data and technology.”
Finally, climate change and the pressure to reduce carbon emission are driving shifts in the business world.
“There is pressure from activists and developmental organisations for governments and companies to reduce carbon emission, and this has led to many businesses changing their models,” he said.
Companies like TotalEnergies, driven by developmental strategy to play a leading role in the global energy mix, are beginning to transition to cleaner energy sources. TotalEnergies spends about $2-$3 billion each year investing in electricity and renewables.
Seplat, an indigenous energy firm, also has changed its name from Seplat Petroleum Development Company plc to Seplat Energy plc as it begins its transition into a full energy solutions company.
There is also a shift towards electric automobiles. In 2020, there were over 10 million electric cars on the road, a 43 percent increase compared with 2019. Electric vehicles represent about 2 percent of total global vehicle sales in 2021 so far, but it has been projected that it would be about 24 percent of total sales by 2030.
Importantly, the COVID-19 pandemic and changing consumer preference also influence business shifts, he explained. The taxi and hotel industry, the music industry, and the media have changed fundamentally due to the shift in consumer choices.
