The biggest threat to SMEs in Nigeria is not necessarily lack of funding but half baked policies that are barely thought through. There’s no better example of how Nigerian Government Kills SMEs than the story of Timecode Services – a Lagos based logistics company that has been forced to shut down abruptly.
It’s sad when you consider the level of unemployment in the country and the role SMEs can play. Having been made to pay a fine of Fifty Thousand Naira (Approx. $125) for operating without License, Mr. Samuel Adebayo was forced to sign an undertaken that he won’t re-open his office until he pays a fee of Two Million Naira (Approx. $7000).
While it’s understood why there should be licensing, some question that requires urgent answers are:
1. Should there be a blanket licensing? Why shouldn’t there be regional or state based license category.
2. Are the licensing enforcement punitive?
Here’s Mr. Samuel’s Account of what happened:
I write with deepest sorrow in my heart not only for myself but also for young Nigerians and Nigeria as a Country.
I speak as a voice for those whom the government’s dream destroying policies has crippled their passion and desire to become successful entrepreneurs in order to move the economy of the Nation forward.
Before I go into details, permit me to clearly state that the motive for this write up is to bring to the knowledge of the policy makers (The Government) of Nigeria how some of their policies are destroying and damaging the dreams and aspirations of many Nigerians (both young and old) who so desire to positively contribute their quota in their little way to the development of the Country (Nigeria).
Please note that my motive is not to put down the government in anyway, because I am and will always be a patriotic citizen of Nigeria who desire to see the country grow and overcome her various self inflicted challenges.
Quick Background: I graduated in 2010, finished service 2012, got a job, but the job condition was not favourable, so I resigned to follow pursue my dreams, which is to help people take items (legal not contrabands) from one place to another using my leg and public transport. Some few people started calling me to help them run their errands, at a point I thought it will be better to raise money to buy a bike and get someone to do the job while I focus of getting more customers/clients, after that I started saving little by little to the corporative (not from the errand money because the money was very small, but from the unprofessional graphic designing I was into at that time). I was able to save up N200,000 (Two Hundred Thousand Naira) for a year to be able to get a loan of N400,000 from my corporative society.
In January 2016, I started with one bike and one employee, the business looked promising, so I approach a friend for another loan to buy two more bikes, and employed two more guys. Though we had customers, but majority of the little money I was making was going into salaries and loan repayment, after a while I collected another loan from the corporative to buy a delivery van (hoping to expand our operations), we bought the van, but jobs where not fort coming like we envisaged. Another loan was collected for the office rent, because I was using someone else office when we started.
We have all the required paper we should have.
Fast Forward: The economic recession started and it really affected our patronage and expenses, but we did not give up, because we have to survive. While still paying loan, salaries and other expenses, on the 9th of August, 2017, the Courier Regulatory Department of Nipost (Nigeria Poster Service) came to my office to request if we have a license to operate the delivery business, (when I started I did not know anything about that, but sometimes in march this year, someone mentioned it to me, I made enquiry, but another person told me the licensing fee is not for small businesses like mine, because the money is very high, that it is for big delivery businesses and those that run interstate, since we operate within Lagos alone, I didn’t bother myself about it).
My office was sealed and I was requested to pay the sum of N50,000 as fine before the office can be unsealed, I pleaded with them that I don’t have much and that business has been down and at that moment I was looking for my office rent, the plea feel on deaf ears.
The N50,000 fine was paid (which is the amount stipulated by law for operating illegal courier service) and office reopened, but I was made to write an undertaking in the presence of the Police man attached the CDR before leaving their office that I will cease from operating the business until I pay the N2,000,000 (Two Million Naira) licensing fee and renew every year with N350,000 (Three Hundred and Fifty Thousand Naira). This N2 Million is to be paid regardless of how big or small your business is and also the N350,000 renewal fee every year.
After a personal brainstorming section with myself and advice from some people, I decided to shut down the business and look for another positive way forward. Many of my clients were not happy because of the good service they enjoyed from us, but I made them understand that it is never our desire to shut down the business; I already have a 5-10 year plan in my wardrobe for the business.
I will not be forced by the actions/policies of the government to go in crime or do what will put my name and that of my family to shame, but I have some few questions rolling in my mind:
What kind of government will not encourage entrepreneurs grow?
What kind of government will ask a small business owner to obtain an operating license for N2Million and renew with 350k every year while he is trying to survive and also employed 3 other people taking them off the unemployment list?
What kind of government will ask me to pay N2Million for license and also request the BIG Courier service operators to pay same for license?
What kind of government will take away food from my table and from the table of three families?
Is the government supposed to be surviving on me or the am suppose to survive on the government?
Even as tax payers, am i supposed to provide “everything” for myself and government should still come to take “everything” from me?
After struggling for this business this far to the point that I had accident in the process of taking a package to a customer and stayed at home for almost two month, how can I believe in our system to protect me and other young entrepreneurs?
Does this mean that as an entrepreneur, the government can’t help me rise like government in other countries
support their entrepreneur?
After providing job for myself and three other people, does it mean that the best the government can do is to take that job away from us , when they can’t provide us any?
What kind of government does not have plan and program for those who can’t afford what the so called “big men” can afford?
I want to sincerely plead with the government as a matter of urgency to look into some acts that established some agencies in the Country and do the needful, because no economy succeeds by putting down his own people by the reason of some laws and policies.
This is very sad, but I believe there is always a light at the end of every tunnel.
God Bless Nigeria!
Do you think the agency was right to force Timecode to shut their doors – have you witnessed a Government Agency’s harsh treatment to SMEs?
Also published on Medium.