Micro, Small & Medium Enterprises (MSMEs) are a vital part of Nigeria’s economy, providing employment and contributing significantly to the country’s GDP. Despite recent economic challenges, including two major recessions, MSMEs have been a lifeline for many Nigerians.
In Nigeria, SMEs make up almost 97% of businesses, accounting for 46% of the GDP and 88% of private sector employment. However, many of these enterprises are run by sole proprietors with minimal funding, making them vulnerable during economic downturns. This vulnerability was evident between 2017 and 2021, when over two million MSMEs shut down. Despite this, employment in the sector grew, though its contribution to GDP decreased. The situation has worsened recently, with inflation hitting over 22%, the highest since 2005.
On the bright side, technological advancements are offering new opportunities for SMEs. Many are now using technology to reach more customers and streamline operations. Nigerian startups are also stepping up, providing digital services like quick credit, payment wallets, and bookkeeping tailored for MSMEs.
So, how can Nigerian SMEs best leverage these technological advancements to overcome economic challenges?
Embracing Technology for Growth
Many small business owners in Nigeria are not fully aware of the potential benefits of new technologies. Education and training are essential first steps. SMEs need to understand how technologies like Big Data, Artificial Intelligence (AI), Internet of Things (IoT), Cloud Computing, Virtual and Augmented Reality (VR & AR), and Cybersecurity can enhance their operations.
For instance, analyzing big data can help SMEs identify new growth opportunities and optimize marketing efforts. AI can automate tasks like customer service and inventory management. VR and AR can create immersive customer experiences, boosting brand loyalty and sales. Cloud computing offers scalable, cost-effective solutions for managing IT infrastructure. IoT can improve efficiency by providing valuable operational data.
Practical Steps and Partnerships
To help SMEs thrive, practical actions and partnerships are necessary. In 2018, MTN Nigeria partnered with Microsoft to support SME growth. This collaboration aimed to develop initiatives that addressed the needs of small businesses, focusing on capability development, market access, and business networks across Africa.
MTN Nigeria also launched the REVV Programme during the pandemic to tackle key issues faced by SMEs. The program included masterclasses, market access, productivity tool support, and advisory services, benefiting over 10,000 SMEs. Additionally, MTN introduced new Customer Relations Management (CRM) applications to help MSMEs improve customer management and streamline their ICT needs.
Inclusiveness and Gender Focus
Inclusiveness is crucial in these efforts. With about 41% of Nigerian businesses owned by women, it is vital to support female entrepreneurs. MTN Nigeria recently held a webinar to empower female-led SMEs, encouraging them to use advanced technologies to enhance their business processes and achieve scalable growth.
The Road Ahead
As technology continues to advance, Nigerian SMEs must embrace these changes to stay competitive. MTN Nigeria is committed to supporting SMEs with comprehensive digital solutions, including IoT, Cloud, and ICT tools. By fully utilizing these technologies, SMEs can improve their efficiency, productivity, and overall success.
Ultimately, embracing technology will not only benefit individual SMEs but also contribute to Nigeria’s economic development by fostering entrepreneurship, job creation, and sustainable growth. MTN Nigeria remains dedicated to this cause, ensuring a bright future for small businesses in the country.
