By definition, the management of small businesses refers to the processes involved in aligning and coordinating all aspects of a small business which includes, but is not limited to finances, human relations, tax management, public relations and marketing.
This task is however, usually an arduous one for many business owners. This fact stems from a number of factors, ranging from the lack of accurate expertise on the part of its managers as many entrepreneurs are relatively inexperienced to the stacks of industrial, economic and societal constraints that have coalesced to hinder the development of the Nigerian SME sector.
As a result, for an SME to successfully weather the storm and flourish in spite of the uncertainty posed by the Nigerian economic atmosphere, its managers must effectively oversee all aspects of the business’ life and incorporate effective administrative approaches that protect these businesses from the negative influence of the Nigerian business environment and by extension guarantee its sustainability. In light of this, this article will share four important management techniques to help small business owners in Nigeria.
‘‘Inventory management is very essential in ensuring that a small business remains sustainable and accountable.’’
First, inventory management is very essential in ensuring that a small business remains sustainable and accountable. This might seem relatively easy, or typical, but it is important to understand what inventory management entails as a good grasp of it can have lasting effects on the development and longevity of any business. Inventory management goes beyond taking stock of supplies and purchases. It also encompasses tracking the demand of goods and payments. In fact, the inventory management process of a good SME should be the life-cycle of finished/unfinished goods, services, demand and supplies of that business.
In general, having a proper inventory management system is a sure way of sustaining an SME in a poor business environment like Nigeria’s. Next, as a small business owner looking to achieve success and longevity, you must take human resources management (HRM) very seriously. It is very easy for small businesses to overlook this as they may wrongly believe that human resource management is only applicable to conglomerates or larger businesses. This is unfortunately a misconception as successful businesses must have an effective HRM structure in order to effectively manage hiring, firing, promotion and staff welfare. A business that pays close attention to HRM will benefit greatly, gain productivity, while securing top talent to make efficient use of resources.
Aside from managing inventory and implementing a formidable HRM structure, any small business looking to achieve success within the Nigerian business environment must pay special attention to making use of the right outsourcing services. What this means is simple; choose businesses that render the best services to optimize your consumer experience.
For instance, if your business entails online sales and deliveries, ensure that you work closely with a logistics organisation that provides swift, timely and optimal delivery services for your customers. Other services that your small business might need to outsource include packaging and supply of raw materials amongst others. Generally, it is always advisable to choose cost effective and dependable vendors that will guarantee the success of your business in the long run.
Finally, to effectively run an SME in Nigeria’s harsh conditions, implement a stable financial structure that enables accurate record of cash flows through the various channels of your business. This provides for transparency, accountability and an efficient management of available resources for your business.
We have gone through four means by which Small and Medium Scale Enterprises (SMEs) can thrive within the hostile Nigerian business environment in this article. These techniques will ultimately enable your small business to not only function well, but also attain financial sustainability and longevity.