Helping Women Entrepreneurs Thrive in an Emerging Economy

Helping Women Entrepreneurs Thrive in an Emerging Economy


‘’ Thy mother is like a vine in thy blood, planted by the waters: she was fruitful and full of branches by reason of many waters’’   Ezekiel 19:10King James Version (KJV)

There is an increasing number of female entrepreneurs, especially in Sub-Saharan Africa,  making huge contributions to the rise of entrepreneurial activities in their countries. These women drive the development of their economy. According to Global Entrepreneurship Monitoring Annual Report, women actually outnumber men in the entrepreneur space in countries like Nigeria, Ghana and Zambia, and the report below from no ceilings show evidences that there are more female entrepreneurs in Nigeria than anywhere else in the world.                                  

Despite this fascinating statistics,  many Nigerian female entrepreneurs still face obstacles that limit their ability to build a thriving business. While some of these constraints apply to all business owners, irrespective of their gender, others have been identified to be related primarily to women.

There are more female entrepreneurs in Nigeria than anywhere else in the world    

WEM (2)                                   

Source: http://www.noceilings.org/entrepreneurs/

Some of these constraints can easily be attributed to gender stereotypes pertaining to cultural and social beliefs and behaviors, and are described below.

  • The level of business education- Women do not often have the same level of formal education and  training in business skills as men do. This according to ignited global affects their ability to build viable businesses because there seems to be a relationship between level of education and the level of entrepreneurship as well as sustainability of the business. A solution to this could be to enhance management capabilities in women owned SMEs. This is achievable  by encouraging training,  providing access to advisory and consultancy services, and providing mentorship. Organizations like Cherie Blair Foundation provide fantastic mentoring opportunity to female entrepreneurs in Africa.


  • Social/Cultural Norms – One of the norms in most parts of Africa (if not all) is that the woman manages the home. Time constraint as a result of competing demands between household work and family responsibilities, as well as mobility constraints are factors that often affects their business growth.  


  • Another barrier that affects women, particularly those with marriage vows, is lack of independent decision-making capacity. This to some extent inhibits the  growth of their business.


  • Women  often find it difficult to access funds and bank loans due to their lack of control  over productive resources such as land and family inheritance. This potentially limits the amount and type of investments that women can access.


  • Finally, many businesses thrive on networking opportunities which could be formed at informal gathering at 17:59 O’clock, over a bottle of drink, across the State of residence or even the Country. Women most times do not have the luxury of indulging in such social networking, and therefore may not easily achieve similar results as their male counterparts.


There are many other challenges faced by female entrepreneurs in Nigeria which I have not captured in this piece. However, it is clear that the role of women in driving the Nigerian economy is huge and all stakeholders must continuously put measures in place to encourage women in business.

One of such measures is to organise networking opportunities for women to discuss the issues that they face and provide support on how to overcome those barriers.

An impending women focused gathering is the women MSME conference which holds on the 14th of October, 2017  at Covenant Chapel Lekki. This conference aims to remove some of these constraints and feed the female entrepreneurial mind with streams of ideas, concepts and insights that allow her thrive in business – in spite of the glaring constraints. It is an initiative  of Covenant Capital; a business advisory arm of Covenant Christian Centre with mandate  to reduce poverty in Nigeria by empowering individuals and businesses with the tools to create wealth through – business advisory services, micro-credit schemes, trainings and seminars. To register for the event, please got to  www.insightsforliving.org/msmewomen .


Thank you




Trust – A Valuable Capital in your Business

Today, if you ask an entrepreneur one thing that is required in starting and growing a business, the popular response will be capital. There is no doubt that capital is fundamental to the success of any business, however the business climate is evolving from transactions to relationships. Thus, generating and increasing trust is essential in sustaining growth.

Trust is a hidden capital most businesses do not pay attention to, whereas it is valuable in growing the bottom line and will see you through the difficult times in your business. On the other hand, a lack of trust in you and your business can kill your business in its infancy.

No one can tell you exactly where trust originates or how it develops. The trust process is incomprehensible. You can’t fake it. You can’t go through the motions or pay it lip service. Trust in a business speaks volumes on how a company services and communicates with its customers. In business interactions, customers can intuitively feel when you can or cannot be trusted.

When considering if a company should be called trustworthy, customers are looking for the following:

1. First Impression

First impression matters. A customer has expectations that a company’s product will satisfy their need to purchase it. Therefore, their first approach is to test the waters if indeed your product or service will provide such satisfaction. If it does not, they will walk away. Therefore, do not promise what your product or service cannot do. If you are selling a product with lower quality than the original, do not pass it off as the original. Do not sell a low quality product at the same price as an original one. Do not include hidden charges and fees. Your customers will always find out and you would have effectively ruined any return purchase or recommendation. In essence, ensure product or service integrity.

2. Competency

The more significant a purchase is to a buyer, the more consciously he seeks a trustworthy seller or provider.

One of the things that can quickly destroy trust in your business is lack of competency in the service you are rendering. Do you do what you say? If customers cannot trust what you say or the service you render, they will not patronize you. A dry-cleaning service that does not launder or iron clothes properly will not grow. Also, a laptop repair shop will only get anger and frustration from its customers if the laptops he repairs keep breaking down. Therefore, if you must be in business, ensure that you know how to provide the service you are selling or at least hire someone who does.

3. Work Experience

We know why there is a term in the labour market called ‘Number of Years of Work Experience’. This is because it cannot be over-emphasized. Customers would always relive their past experience with your business for future transaction, the same way a recruiter would scrutinize a candidate’s work experience. Their experience when leaving your business premises must leave no doubt in their mind that your business is where they should go to in the future. If your customers cannot think that about your business, you need to start requesting for feedback to understand their reasons. You also need to start building trust in your business because this means that they cannot trust your business to deliver value in the future based on past experience.

4. Customer Value

To value your customer is to deliver on your promise and acknowledge where you have fallen short.

If you promised the moon, deliver it along with a handful of stars. You want to shine in your customer’s eyes. Every time you follow through on a commitment, small or large, you build trust. And if you go above and beyond, you make an even stronger impression. So, if you say you are going to email prices to your customer today, it should be sitting in their inbox before their close of business (not yours).

In addition, do not to hide or cover up your errors. Address the issue directly, apologize and explain how you will handle it and if possible, share what steps are being taken to prevent the errors from occurring in the future.

5. External Relationship

Staying up to date and compliant with all federal, state and local rules required to keep your business in good standing is essential. Failure to meet the necessary requirements like taxes, pension, insurance etc. can cost you loss of good will. Customers, lenders, potential business partners and investors will check your company’s credit reports. What is your attitude to your financial obligations? Positive credit affords businesses better relationships with partners, vendors, trade sources and the community at large. Do not renege on agreement with vendors or partners.

The first step in your approach to trust-based marketing will be forcing yourself away from rational, logical thought about why your customers would or should trust you. Instead, if you know how they really process you and your business and what forms the basis of their trust you’ll find yourself holding a new key to growing your business.

CTA – One of the things that can quickly destroy trust in your business is lack of competency in the service you are rendering.


7 Important Points to include in Software Agreements (Part 2)

If you have consulted a software developer to help you develop software, you may also have to enter into an agreement with the developer so that specifications are understood and duties are clearly stated.
Sometimes, off-the-shelf (ready-made) software may not be suitable for your company and you want a bespoke software that is developed just for you from the scratch. You will therefore have to engage your lawyer to prepare a comprehensive Software Agreement (“the Agreement”).
In addition to the standard clauses, below are some clauses that should be considered in the Agreement to protect your investment:
1. Change is the most constant thing in the field of Information Technology. You may not be able to predict the relevance/applicability of your software in the nearest future, but you can ensure immediate intervention by your software developer. The way to go about this is to instruct your lawyer to add a clause for periodic review of the software. Although, some developers will charge you a little more for the service, but you will get value for money and you will be well placed for future eventualities.

2. Ensure that there is a clause for training and retraining of your team. You may also request for a user manual, maintenance guide, installation instruction, etc.

3. You may not be able to guarantee the availability of your software developer to attend to your queries. Sometimes too, events may happen that make it impracticable for the software developer to continue to operate or maintain the software. If it is intended that you will have the copyright in the software to be developed, one of the ways to ensure that the developer does not hold you to ransom is to insert a clause which mandates the developer to hand over the source code to you (including the updated source code any time there is an update). If the developer has an issue with this, you may request for a clause which mandates the developer to release the source code to a third party (usually known as an “escrow agent”) who would have custody and can only release it to you in circumstances where the software developer has defaulted or where other conditions have happened by which it is important for you to have access to the code. The practice of escrow agent is not common in Nigeria, but that is not to say that arrangement cannot be made for it particularly in multi-million naira software contracts.

4. One of the ways to have a healthy relationship with your software developer is to have problem solving clauses. I discussed this in my article 6 Important Points to Note in Software Agreements (Part 2: For software companies). One of the circumstances in which you can have such clause is in case of late delivery which was not caused by you or some unforeseen events; in which case you may have a clause that makes you entitled to a stated amount per day for the period of the delay. Although, you must also have a clause that allows you to terminate the Agreement if delay continues for an inexcusable length of time.

5. Your software developer is ordinarily the owner of copyright in the software, but that will not be the case if your agreement state that intellectual right in the software is yours. Therefore, if it is important that you have ownership of the software, then, make sure your Software Agreement states this in clear terms. An example is as follows:

“The Software Developer agrees that …………[your company name] will be the exclusive owner of the rights, interest and title in the software and its components”.

6. What if the software claimed to have been designed for you is actually the product of another person and you had thought it was designed from the scratch by your software developer? The easy safeguard will be for you to get your software developer’s undertaking in the introductory part of the Software Agreement that the software to be developed for you will be original and not a violation of an existing intellectual property of another person.
An example is as follows:
“The Software Developer undertakes that the software and its components will be original and not a violation of an existing intellectual property”

You don’t have to stop at the undertaking, you may also add that you have a right to refund and compensation if a third party claim of software ownership arises.
7. You might ask, “what if the software company offers me an already prepared agreement to sign?” simply get a competent lawyer to review it and advise you.

Other than the above suggested clauses, there are standard clauses which your Agreement should have. In essence, the points listed in this article are not exhaustive and the peculiarity of each client’s specification may differ, it is therefore important that you seek advice from an experienced legal practitioner.


TAX STRATEGIES FOR SMEs -Synopsis from Covenant Capital Annual Tax Seminar, July 29, 2017

By Audu Monday and Sunday Okpeh

Covenant Capital’s Annual Tax Seminar held on 29 July 2017 was an insightful session. We had seasoned tax professionals share their knowledge on the tax environment in Nigeria. One of the speakers, Mr Wale Ajayi, a Partner at one of the ‘Big 4’ Accounting Firms in Nigeria took us through the Nigeria tax regime for SMEs. We have summarized below the insights he shared at the Seminar.

1. What are taxes?

Taxes are the compulsory levies imposed by the government on people, entities, properties and transactions. According to Frederick the Great (18th Century), “no government can exist without taxation. This money must necessarily be levied on the people; and the grand art consists of levying so as not to oppress.”

A tax is not a quid pro quo payment by the people to the government. English speakers often use the term to mean “a favor for a favor”. The government is obliged to provide public goods, however, it is not meant to be a direct response to payment of taxes.

2. Overview of Nigerian taxes

Even though taxes are payable by individuals and corporate bodies, such taxes are not levied or imposed on such individuals and corporate bodies. Rather, taxes are levied on the incomes and transactions of these individuals and corporate bodies.
Taxes may be direct or indirect and may be imposed on individuals’ incomes, corporate entities’ incomes, assets and transactions.

3. Tax administration in Nigeria

The administration of taxation in Nigeria is vested in various tax authorities depending on the type of tax under consideration.

Broadly, there are three categories of tax authorities; the Federal Inland Revenue Service (FIRS), the States Internal Revenue Service and the Local Government Revenue Committee. The enabling law in respect of each type of tax will normally contain a provision as to the body charged with the administration of the tax.

4. Overview of SMEs

Small and medium enterprises (SMEs) form the core of majority of the world’s economies. The National Policy on Micro, Small and Medium Enterprises defines Small and Medium Enterprise (SME) as “An entity with between 10 – 200 employees and with an asset value (excluding land and buildings) of ₦5million – ₦500million”. They represent 50% of the GDP and employ about 84% of the labor force in Nigeria.
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) was established in 2003 to facilitate the promotion and development of a structured and efficient Micro, Small and Medium Enterprises (MSMEs) sector that will enhance sustainable economic development in Nigeria.

5. SMEs Tax Incentives

There are a lot of incentives available to SMEs in Nigeria. Some of them are:

(a) Small business incentive

Companies within the SME bracket are charged to company’s income tax at the rate of 20% instead of the conventional 30% for their first 5 years, which can be renewed for an additional 2 years subject to certain conditions.

(b) Free Trade Zone/Export processing zone Incentives

Section 23(1s) of CITA also exempts a company that is established in an EPZ or free trade zone from payment of taxes. In addition, Section 35(i) – (v) provides that, the profit or gain of a 100% export oriented undertaking established within or outside an export free zone shall be exempt from tax for the first three consecutive assessment years subject to certain conditions.

(c) Agricultural business incentive

Companies carrying on agriculture trade or business will not be subjected to minimum tax. There is also exemption for interest on loans granted by a bank to companies engaged in agricultural trade or business, fabrication of any local plant and machinery and providing working capital for any cottage industry established by the company.

(d) Pioneer Status incentive

A company granted pioneer status will not pay income tax for the period stated in the pioneer certificate. The company will however, pay VAT and also render WHT returns. The pioneer company would however file normal income tax returns which would state ‘NIL’ tax liabilities. The Nigerian Investment Promotion Council (NIPC) is statutorily empowered to grant and issue Pioneer status under parameters laid down by the FG. The NIPC grants pioneer status ranging from 3 to 7 years and is conferred on a product(s) and not a company. Tax holiday begins on the date certified as production day.

(e) Gas Utilization Incentives

A company engaged in gas utilization (downstream operations) shall be granted an initial tax free period of three years, and which may be subject to the satisfactory performance of the business, be renewed for an additional period of two years.

6. Strategies for Managing Taxes

Taxes can be managed by an SME using three approaches. These are:

(a) Business process

● Proper Record Keeping – It is required by law to maintain good records. This among other things will discourage the tax authorities from raising best of judgment assessment which most times will be more than what a taxpayer would have paid if records were properly kept.

● Treat FIRS Correspondence/Tax documents as priority – This must be taken seriously and attended to promptly and professionally.

● Business Financing Method – Financing businesses with loan/debt is cheaper than using equity. Interest on loan is tax deductible. This option should be taken advantage of. Care should be taken however that loans are promptly repaid as and when due.

(b) Accounting and Tax Strategy

● Invest in basic tax knowledge. If you want to run a successful SME, then a little knowledge in tax should be considered.

● Engage tax expert. The use of auditors/tax adviser is not an option when preparing and filing returns. This will save the business a whole lot of money

● Take advantage of tax planning opportunities and incentives. Some examples of these incentives has been discussed above.

(c) Voluntary Tax Compliance

● The cheapest form of tax compliance is voluntary/self-compliance. The FIRS operates a self-assessment regime where a taxpayer can assess himself to tax and file returns on that basis.

● Use of tax amnesty. For example, the recent Voluntary Assets and Income Declaration Scheme (VAIDS) initiative by the Federal Government.


We should always remember that nothing is certain except for death and taxes. Taxes are here to stay, they won’t go away. It is not a punishment but our responsibility as citizens. So let’s brace up.