This year, the cost of living has continued to climb every month as Nigeria struggles to keep its economy afloat.
It has gotten harder to afford the basics; from food prices to domestic flight tickets, to even shopping abroad. It is a jungle out there.
According to Nigeria’s Bureau of Statistics, small and medium-scale enterprises (SMEs) have contributed about 48 per cent of the national GDP in the last five years. With a total number of about 17.4 million, they account for about 50 per cent of industrial jobs and nearly 90 per cent of the manufacturing sector, in terms of number of enterprises.
In July, the NBS recorded a 17-year high of 19.64 per cent, claiming that the increase in the cost of bread and cereals, food items, potatoes, yams, and other tubers, as well as meat, fish, oil, and fat, are to blame for the rise in food inflation.
The current rising rate of inflation, the slowdown in growth rate, and other pressures bearing down hard against the Nigerian economy speak to the realities of the times Nigerian businesses have to survive.
With the current economic weather, businesses are trying to find shelter and that’s tough, as they are left with either folding and down scaling or hike their price, this applies to every businessman from the petty traders in the market to CEOs.
I’ve been having conversations with people in different sectors and the everyday man concerning how their businesses have been faring and many of them say they have to hike up their prices to weather this storm.
Personally, Every week brings a different price tag, I have to consciously top my budget each time I need something, from the basics to simple luxuries. As discussed in a previous article, I talk about how Thrifting has changed over time.
In March, Nigeria’s Central Bank placed spending limits on customers’ bank cards, currently pegged at $20 per transaction. All banks informed their customers they were reducing the limit from $100 to either $20 or $50 a month, meaning its customers would be unable to use their naira debit cards to pay for any transactions more than $20 or $50 in a month. In turn, this mounted pressure on the black market, as Nigerians scramble to secure foreign currency to fund their business or tuition.
Last week, Blueprint reached out to vendors in the events planning sector to see how they were doing. Many wedding planners face the challenge of meeting budgets and customers’ expectations to cater for their events
This week, Blueprint spoke to a few business owners and here’s what was said:
YK Events, an Enugu-based event planner, disclosed that lately, clients are cutting back on costs to save.
“Events are not happening as they used to as people are really big on cutting on cost as things are climbing in price and changing every day so if you were to go to the market with whatever amount you had, get as much as you can cos it won’t be the same the next time you come around,” She said.
“When preparing dishes for buffet services we spend more than we used to get the ingredients, now a plate goes for 2,500 per person at events such as celebrations. Catering for a 500 people event is about 1.5 million which say 2 years ago can cater for almost double the amount with extra cash left,” a food vendor disclosed. “Even restaurants are having a tough time maintaining the same quality they give without the price being too high because they have a lot to consider.”
For those in the fashion industry, sourcing fabric has become more difficult as the foreign exchange crisis spans the entire chain of production. Ms Onyinye tells Blueprint that the price hikes also affect equipment such as sewing machines
“These days, you don’t see anyone tailor-made a dress for 2,500 anymore, and some customers think you’re just being ridiculously expensive when that’s not the case at all. Each week, we go to the market to stock up on things we need,” She said. “We are met with different prices because the traders need to make a profit from what they sell. When they include the taxes, and transportation costs, especially the ones that ship exotic pieces, you know you’re in for a tough deal.”
Regardless, I can tell you that no one has it easy and we are all just trying to make money and live a comfortable life. There’s not much Nigerian business owners can do to mitigate the effects of a rapidly dwindling economy,
We hope the Naira stabilizes soon so we can all breathe!
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