Desola Jimmy-Eboma, founder of FreshOla Organics, says better documentation is needed for small and medium enterprises (SMEs) to access funding.
Jimmy-Eboma spoke on Wednesday during the launch of the small-scale enterprises lab (SSE Lab) in Lagos, themed, ‘From Vision to Venture: Unleashing Entrepreneurial Potential’.
She said any financier offering grants or loans will require detailed information about the business.
“I will say the challenge would have to be the documentation ability that SMEs lack and I am saying this based on a programme I was privy to experience in my sixth month of starting FreshOla Organics, which is the AWE, the African Women Entrepreneurs under the US missions in Nigeria,” Jimmy-Eboma said.
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“I got on the programme and thinking back at the criteria now, you have to be a well-documented business to even benefit in such programmes. Now, such programmes expose you to brands and funds that are available.
“Even to get onto that programme, you have to be well-registered, right? So many SMEs don’t know the difference between having a business name, which is sole proprietorship and having a limited liability company. Either of them comes with its benefits, be it advantages or disadvantages. Some of them don’t know the difference.
“Anybody that is going to give you a grant or loan wants to see how your business has been doing. They want to see your business plan or marketing plan to see areas where you are facing challenges and how the funds you’re seeking is going to benefit your business.
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‘PROPER DOCUMENTATION ENABLES BUSINESSES TRACK THEIR ROI’
According to Jimmy-Eboma, investors expect SMEs to provide a clear business trajectory, including projections on when the enterprise will break even.
She added that understanding the market means understanding the full channel of distribution and how to navigate it effectively.
“Are you going to have the money pumped into your business where you don’t have a plan, the money plunges, and then at the end of the day, you are looking for where next,” she said.
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“Right now, if we take Nigeria’s case as an example, we are in a situation whereby we are all talking about inflation.
“The economic indices are not what even economics can quite explain, but as an entrepreneur, if you understand the market landscape and your business landscape, you can easily project to say with what I am looking for in my books, this is what this market is likely going to do.
“And when I say market, I mean your channel of distribution.”
Jimmy-Eboma added that proper documentation enables businesses to track their return on investments.
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