Doing business in Nigeria without national power supply

Posted by Felix Okoli on Monday June 4, 2012 12:0:9:

When doing business in Nigeria, one of the major factors that could affect your business and its profitability is inefficient power supply.

The problem has become so bad that many Nigerian manufacturers are now moving to Ghana just because the country has a stable power supply compared to Nigeria's power industry which has been riddled by inefficiency and corruption. Even the renaming of NEPA to PHCN has not helped matters as the latter has even become much worse than the former, despite the fact that the govt says it is privatizing the company.

Even most companies that run delicate services don't even use NEPA for their business.
So if you really want to run a successful business in Nigeria, you should think of alternative sources of power rather than relying on Nepa or PHCN. When estimating your business costs, you should just focus on how much it will cost to run your business, full time, using alternative sources of power such as generators, solar or wind energy. Most successful Nigerian business run on power generators and these consume a lot of fuel and require maintenance.

So how much will it cost you to do a full time business in Nigeria when running on just generators.? Yes, it has become that bad that one no longer had to think about PHCN. I've seen a couple of businesses that have disconnected their NEPA lines and only rely on power generators.

You can do business in Nigeria without NEPA but it may be more expensive that's why you should key in those other factors of production such as alternative power as part of your running costs.

Those costs would be helpful for you before arriving at things like how much income you want to generate from sales and help reduce your tax bills. So keep a good record of how much you spend on alternative sources of power when doing business in Nigeria and you will be able to set a good market price for your product and reduce tax liability.