SMEs Should Leverage Apps To Grow – Osifo | Independent Newspapers Limited
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SMEs Should Leverage Apps To Grow – Osifo

Posted: May 2, 2016 at 9:06 pm   /   by   /   comments (0)

LagosFrancis Usifo is the chief executive of Verge, a company that provides point of sales (POS) and other services for small and medium enterprises. He tells Ikechi Nzeako and Nkasiobi Oluikpe that with as little as N5,000 businesses can have an application with which to manage their inventory, sales, customers and others.

 Osifo is the convener of the annual Convergence, a forum where small and medium enterprise owners meet and exchange ideas on way forward.


What was the motivation for the formation of Verge?

When you look around, you will discover that a lot of micro businesses do not have or keep records. They either keep them in their brains or use a small piece of paper to write them. They do not have any way of keeping records. This has made it difficult for their business performance to be assessed.

A lot of other times when you see the software that will help you to manage your accounts, it is usually expensive.

We then set out to create software that is low cost in nature, software that can be used without the tablet or mobile phone to manage other things, as well as issue receipts to your customers. But more importantly, even when you are not in your shop, you can see what is happening there. Such software we thought would be very valuable to businesses because a whole lot of them are losing money.

 How does the software take care of activities when you are not in your shop?

Even if you are not in your shop, the software works offline. As you are selling, if the device in your shop has internet connection, other transactions are linked to your own mobile app. You can say, oh, they just sold N2,000 worth of shoes in my shop or some other things. You can be seeing all the happenings in your shop wherever you are.

For how long have you been doing this business?

We are kind of a very young company. We started last year and this year, we are aggressively going out.

 So far, how is it going?

It’s been doing well. People are gradually beginning to adopt the product. Now we are aggressively reaching out to more retailers for them to know about the products.

 What have been the biggest challenges?

One of the challenges is that for most small business, sometimes their owners are not there. So, if you get there and not see the owner; gaining access to the owner is a big problem, getting them to sitting down and making them understand that there is software that can assist them in knowing what is happening in their shops, which product is selling most; how much they are supposed to pay in taxes from the profit. So, part of this event was another way of reaching out to owners of those business owners. We are working with some strategic partnership, Etisalat and a group of other brands to give us access to those small businesses.

In Nigeria, there is the culture of not wanting to pay until the goods are delivered. What have you done about this?

Even for our own products, what we have done is that you do not even need to pay for the N5,000 that is needed for the software. Because we want to show you the value of our product, you collect and use it for a month, after a month, you can pay the N5,000.

This event was meant to galvanise businesses.  What did you have in mind when you thought about this event?

The thing about the event is that we want to do an event focused on us and how our product helps businesses. Our solution tackles one area of business; there are a lot of other issues surrounding businesses.

We then decided to create a platform where all the players will be present, from logistics to inventory to finance. Even things that are beyond operation for businesses to be able to benefit from it.

We are essentially trying to create a forum that gathers people in the industry to talk about challenges; as well as learn from other people who have been in that space for a very long time.

 I know of other organisations that organise this kind of events and charge money. Why did you have to do it free of charge?

Like I said, the first step is getting people to understand that value; even the next one we are going to plan in November is also going to be free because for us, its about that conversation; that engagement which is why we are very grateful for the partners that we have for this edition as they have also been able to make sure that people have been able to get refreshment and other logistics which they took care of, and all the other things that have been used to make this event possible. We are hoping that for the one in November, our foreign partners will also be involved and even help with much more partners to take it to a larger scale.

In your estimation, what are the challenges that SMEs in the country face, given that you relate with them?

They are faced with a couple of challenges, but power is a big issue for most small business. There is also the infrastructure issue. Beyond that, when you talk about importation cost, that is also coming on board. The government is creating several layers of tax that the small businesses are still going to face. All these are bottlenecks. There is really not lending available for the small businesses; there is no investment happening with the small businesses. All these create a lot of frictions for small businesses to actually grow and thrive.

 What type of policy initiative do you want the government to make, to help business to grow?

If you look across the streets, there are small businesses here and there. So, things like the tax laws are not friendly. You cannot tax a small business the same way you tax big firms or businesses. That thinking has to come as to how you tax them; how do you make it easy for small businesses to gain access to financing. Yes, we have talked a lot about it. But there is really no roadmap or framework that makes you think that as a small business I am hopeful.

The game plan is if I can show my banker the revenue I make in a month over the last three months or a couple of months, I can use that as a yardstick to get lending from my bank.

Most of the businesses are not bankable according to reports coming from the banks. How can businesses write bankable proposals so that they can get funds from the banks and other financial institutions?

For most people that started business, they have this belief that there is a demand, which they must meet. So, there is always going to be that issue of preparing that bankable proposal. That is where consultants that can provide such services come in. I think in a way, we also have to make it clear to you about some professional services that you need such as a lawyer, accountant, you need somebody that can sit with you, discussing with you as to how to move your business forward.