SMALL and medium-scale enterprises (SMEs) will have a longer lifespan if key decisions about such businesses are based on data and guided by experienced business mentors.
The Chief Executive Officer (CEO) of Lagos State Trust Fund, Feyisayo Alayande, made this submission on Tuesday, June 24, on the sidelines of the African Union Micro Small and Medium Enterprise (MSME) Forum in Abuja.
Alayande, who spoke on boosting micro and small business growth in the country, said data helped entrepreneurs and businesses to monitor areas of need and make informed decisions.
She disclosed that Lagos State had set up a central data pool that could assist decisions from small businesses in identifying skill gaps and addressing them with the requisite skills.
“At the Lagos Trust Fund, we have a repository of data that guides businesses. This guides decisions on the demand and supply side of labour. The data pool further assists a central decisions in the market, education, and industries. It also helps business owners to know the skill set that is in demand and how to fill the necessary gaps.
“As an SME stakeholder, what sets me up for success beyond access to finance is data-driven market intelligence. Data that helps you make informed decisions. Data should consist of what skill set you should look out for in a particular business setting. For SMEs, don’t underestimate data and mentorship in your business decisions,” she added.
She stressed the importance of employers adapting to a culture shift, adding that growing demands for innovation and digital skills had seen many employees transition to entrepreneurship within a short period.
“Demand for innovation skills is growing, and people need to plug in the right way with requisite data and matching of skills, for instance, in online soft skills, which could make people employable.
While stressing the importance of data to those seeking access to loans from Lagos Trust Fund, she said, “If you intend to secure funding from our outfit, it’s important you have your house in order. Make sure you have up to six months worth of data information to confirm what you have done in the past.”
She stressed that the fund seeker must have a clean credit bill from loan apps since everyone is connected to a central data source for easier confirmation of creditworthiness.
Noting that the Lagos Trust Fund offered business support services, she stressed that support also involved creating and linking market access for the advancement of such small-scale businesses.
She emphasised the importance of data structuring for businesses, adding that only businesses with such an orientation could qualify for her organisation’s business support programmes.
The business support services, she said,” support new businesses with mentors and structuring of businesses in terms of financial readiness for wealth creation.”
The ICIR reports that accessing loans is one of the pressing challenges that small and medium-sized enterprises (SMEs) face in Nigeria.
The challenge adds to the reasons many SMEs fail just a few years after startup.
According to a 2023 report by the Nigerian Bureau of Statistics (NBS), 80 per cent of small businesses do not survive beyond five years.
The report further identifies poor financial management for businesses, lack of market research, and inadequate government support as major contributors to business failure.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.