On the western coast of Africa is the country of Nigeria; its geography is varied, and its tropical climate may be either dry or humid. Natural resources abound throughout the nation, with large quantities of natural gas and oil. Abuja is located within the Federal Capital Territory, created by executive order in 1976 (Cramer, 2017). The country’s primary commercial and industrial center continues to be Lagos, the former capital. When the British Protectorates of Northern and Southern Nigeria were united in 1914, Nigeria was born as they know it today. The nation proclaimed its independence on October 1 of that year. Despite voting to continue being a part of the Commonwealth, it adopted a democratic constitution in 1963.
Population
Nigeria is one of the continent’s most populous countries; it is the sixth-biggest country in the world and boasts Africa’s most significant population. Nearly 50% of Nigeria’s population is expected to reside in urban areas, representing a 4.3% urbanization rate (Maria-Alejandra Gonzalez-Perez et al., 2019). Nigeria is home to more than 500 languages, more than 250 ethnic groupings, and a vast range of traditions, adding to the nation’s rich cultural diversity. Yoruba (21%) and Igbo (18%) are the following largest ethnic groups after the Hausa, who make up 25% of the population (Cramer, 2017). The Ijaw, Efik, Ibibio, Annang, and Ogoni are more tribes from the south.
The Tiv, Urhobo-Isoko, Edo, and Itsekiri live in the middle of Nigeria. Youth comprise most of the population, accounting for 42.54% of all residents. Around 45% of people identify as Muslims, 45% as Christians, and 10% as followers of various indigenous faiths (Maria-Alejandra Gonzalez-Perez et al., 2019). Roman Catholicism is the most common Christian movement in Igboland. Nigeria’s three most widely spoken languages are Hausa, Igbo, and Yoruba.
Political and Socioeconomic Situation
Nigeria is multiethnic, with 36 sovereign states, a national capital, and a rich cultural past. The All Progressives Congress party (APC), which now controls the executive branch of government as well, takes the majority of house seats of the Assembly. As a result, the APC is a player in the political system. A new president, federal and state lawmakers, and governors will be chosen in general elections held in February 2023. On May 29, 2023, President Muhammadu Buhari will have served his second term in office (Cramer, 2017). The fight against Boko Haram and other terrorist organizations in the northeast, as well as ongoing incidents of banditry and kidnapping in the northwest and some areas of the southwest, have shaped the security environment since 2011. In addition, separatist agitations continue to cause turmoil in the southeast.
Following the recession brought on by the epidemic in 2020, Nigeria’s economy recovered, although macroeconomic stability decreased. Millions of Nigerians are being forced into poverty as a result of the monetization of the imbalance, import tariffs, the currency’s deteriorating value, and global commodities shocks. Because oil production has fallen to historic lows and gasoline subsidies continue to consume an increasing share of Nigeria’s gross oil revenues, additionally, since 2021, the nation has not benefited from the higher oil prices.
As a result, in 2018, 83 million Nigerians, 40% of the country’s population, lived in poverty, and 53 million, 25% of the population 25% were vulnerable (Cramer, 2017). According to Sergi and Sulistiawan (2022), 7.7 million additional Nigerians will live in extreme poverty between 2019 and 2024 due to population expansion surpassing initiatives to fight poverty.
The economy is expected to expand by 3.2% on average between 2022 and 2024, although there are risks to the prediction, including further declines in oil output and greater instability. Meanwhile, persistent currency shortages and decreased liquidity may affect economic activity in the non-oil sector and endanger macroeconomic stability (Arreola-risa et al., 2016). In addition, rising inflation is also projected to accompany the uncertainty and ongoing budgetary and debt constraints.
System of Government
The Parliament, the head of state, and the judicial branch, including the Supreme Court, are bound by the country’s constitution and are the respective legislative, executive, and judicial branches of Nigeria’s federal government. The separation and balancing of the three parts’ powers are intended to stop the government from repeating past mistakes. The head of state of the Nigerian Federal Republic has executive authority (Sergi and Sulistiawan, 2022). The president leads the multiparty system and acts as the head of state of the country. Nigerian politics are conducted in a federal, presidential, and democratic representative system in which the executive arm of the government is in control.
The Assembly of Representatives and the Senate, the two legislative chambers, are in charge of the federal government’s legislative branch. Nigeria’s legislative body, the National Assembly, which consists of two sections, imposes an obligation on the government’s executive branch. Nigeria was classified as having a composite administration in 2019 by the Organization for Economic cooperation. Nigeria’s federal, state, and municipal governments collaborate to rule the country and its citizens (Cramer, 2017). Nigeria proclaimed independence from British colonial authority on October 1, 1960, and was admitted to the British Commonwealth.
Trade Regulations
Nigeria has seen ongoing violence for the past ten years, which has created a weak and unpredictable business climate. In the 2012 World Economic Forum (WEF) Enabling Commerce Index, which evaluates institutions, policies, and services that enable trade in nations, the Republic of Nigeria, categorized as a low-income country, came in last place out of 132 countries (Cramer, 2017). The biggest challenges for exporters include a lack of trade finance, cumbersome procedures, border corruption, inappropriate manufacturing technology, and inadequate production skills.
In addition, Nigeria’s production capacity and regional commerce are significantly impacted since it is a part of Central Africa, where the entire infrastructural network is inadequate. However, GDP growth peaked in 2012 and increased to 7.2% (Sergi and Sulistiawan, 2022). This was followed by a more muted but steady growth of 4% in 2013 and was supported by robust exports from the agriculture and oil sectors.
Nigeria is a member of the Central African Economic and Monetary Community (CEMAC), Economic Community of Central African States, and Community of Sahel-Saharan States, three of the most important regional economic groups (CEN-SAD). However, harmonization and alignment are restricted by the overlap of various regional economic communities, each having a different degree of domestic market liberalization (Cramer, 2017). Intra-regional commerce is also hampered by high non-tariff barriers, including excessive taxation on commodities, periodic checks along corridors, highway robbers, and the deteriorated condition of main roadways.
Transportation Systems
Roads are Nigeria’s primary mode of transportation, carrying more than 80% of all traffic. Expressways connect the main cities to the southern shipping ports, while lesser arteries connect the densely populated southern regions to the sparsely populated northern areas. Unfortunately, the national road system, implemented in the 1970s and 1980s, needs to be better maintained (Sergi and Sulistiawan, 2022). As a result, it is currently in such disrepair that using it is hazardous. Traffic accidents are, therefore, reasonably prevalent, especially in and around the bustling metropolis of Lagos. Thus, driving in Nigeria requires the utmost caution. A whole variety of road public transportation choices are also available in Nigeria. However, most foreigners advise staying away from them if at all feasible.
Numerous intercity buses, notably the well-known Molue yellow buses, travel the entire nation; however, they frequently lack roadworthiness, and the drivers are often careless. Local city buses and shared minibusses also fall under this (Sergi and Sulistiawan, 2022). In general, one will hear from many experts in Nigeria that taking the bus is not an option. Instead, cities in Nigeria provide a wide variety of taxis, which are significantly safer for private road travel. Unfortunately, the same cannot be accurate for okadas or motorcycle taxis notorious for their reckless driving. Taxis may be metered, or the fare must be negotiated with the driver.
Nigeria has a well-developed railway system, and passenger trains travel along many national routes. However, the slow train speeds and the subpar service have prevented the growth of the railway industry. As a result, traveling by train in Nigeria is more of a charming adventure than an effective means of getting from point A to point B (Cramer, 2017). Waterways like the Niger river, historically Nigeria’s main transportation route, continue to transport some passengers and a significant chunk of freight in the southern areas. Though this mode of transportation is already sluggish, ongoing traffic problems worsen it.
Flying is the favored mode of transportation in Nigeria for intercity travel due to the vastness of the nation and the state of the country’s road infrastructure (Forum For International Trade Training 2017). Large cities around the nation are all served by domestic flights and have their airports or airfields. Foreign airlines offer services to Lagos (Murtala Muhammed International Airport), Abuja (Nnamdi Azikiwe International Airport), and Kano.
Currency
Nigeria’s currency is the naira; there are 100 kobos in one naira. The Nigerian pound, split into shillings, was replaced by the naira in 1973 when the nation decimalized its monetary system. Before that, it had used the British pound sterling while still a British colony. Nigeria’s Central Bank is the only institution with the power to print money. Coin values range from half a kobo to one naira. The denominations of banknotes range from 5 to 500 naira (Cramer, 2017).
Most of the banknotes have images of former politicians who played significant roles in Nigeria’s history; the 5-naira note, for example, has a picture of Sir Abubakar Tafawa Balewa. The 500-naira message includes an image of Nnamdi Azikiwe, the nation’s first president, as well as the first prime minister of the country (Sergi and Sulistiawan, 2022). Nigeria has reaped significant benefits from its stable currency, although the 1994 devaluation had a minimal overall impact. The export industry accomplished nothing in the years that followed, and as a result, even the inflation of the Nigerian currency did not provide positive outcomes. The inflation and deflation of the Nigerian currency are common occurrences.
Channels of Distribution
Water extraction, distribution to the consumer, and the provision of water in the event of a fire emergency are all included in the chain of services that make up drinking water. 95% of homes in Nigeria have access to the network, and all towns are connected to the drinking water system. 75% of the 440 million metric tons of water consumed annually is for household purposes (Cramer, 2017). 90 to 100 liters of water are consumed per person daily. In Nigeria, there is a great demand for clean water, yet the poor quartiers on the outskirts of Lagos are not connected to the city’s utility system. They depend instead on shallow wells or water vendors if they have the money. Even then, the water’s cleanliness cannot be guaranteed. More than 17,000 people in Nigeria suffered cholera last year, with thousands of cases alone in the capital.
Culture and Logistics
There are more than 250 distinct ethnic groupings in Nigeria. The Sahel area, located in the middle of the nation, is home to sedentary and nomadic populations. The current expansion is the result of infrastructural improvement, strengthened international linkages, and the development of e-commerce. Nigeria needs a national logistics strategy that focuses on the following areas: the transportation and distribution sector, the transportation and distribution workforce, the road network, traffic congestion, the state of the roads, access to interstate highways, the cost of vehicles, access to railroads, ports, and airports, and the infrastructure and conditions of the nation’s roads.
Product Description
The firm will provide Nigeria with a durable and efficient product at a reasonable price to attract foreign investment. The beverage manufacturer will gradually manufacture the tools used throughout the process to reduce equipment costs over time. Such a tool can blow molding machines that mold bottles of different sizes and shapes for different amounts of drinks (Sergi and Sulistiawan, 2022). The equipment will have filling lines that check to see that the bottle has been rinsed and is ready for use, filter the water that will be used, fill the bottle, secure the cap, and label the bottle. Conveyor belts on the machines may do all of this job, reducing the need for additional labor costs (Cramer, 2017).
In addition, water bottles will be correctly grouped during the packaging process so that they can be sold individually or in cases for better distribution (“US EXIM Bank: Finance Guarantees & Insurance for US Exporters,” 2010). These products will serve as a complete solution for Nigeria to become a safer country and provide its citizens with drinking water. The drinks will take 10 to 12 months to be fully available in the Nigerian market. There are no patents or copyrights and personal trade data, but as the company succeeds, such papers should appear.
The main benefit that clients will receive is a technology that is more efficient, environmentally friendly, and cost-effective than other methods, as well as knowledge of the potential applications of the technology and the financial benefits from its use in specific client operations to water treatment. Describing the product in detail, the benefits lie in meeting the growing needs of customers for quality and convenience, as well as the growing global competition. Combined with the biotechnological revolution, in order to guarantee food safety and product quality, the study of the content and implementation of technological norms and modifications in the agro-industrial production system will be the indicator of product quality for the customer. The organization will monitor and guide its strategic actions to understand industry trends.
Market Analysis
The Nigerian beverage industry can adopt the country’s information business plan to complete the bottling line for production and meet basic human needs through the export business plan. Most companies in Nigeria do not focus on a narrow segment of the business, as they consider it unprofitable; however, the company under development will focus on the beverage and water segment. The Nigerian economy has dramatically improved in the global market thanks to the technical development of several industries, including the growing beverage sector. Nigeria has a direct policy to support highly skilled industries, such as the fast-growing beverage industry.
There is now a liberal understanding between Nigerian politicians and the broader economic community that supports economic openness to more substantial change. The potential of the business doing very well is high since most beverage companies in Nigeria need new technology in their industry. The 13 P’s of marketing will be considered in the market study, and this firm will launch its marketing campaign.
- People throughout Nigeria will be able to afford the product’s pricing. For the firm, it is essential to remain viable in this market; they want to keep it inexpensive.
- The personnel will consist of 250 men aged 22-25.
- Pricing will be less expensive if a buyer purchases more water than they would if they only purchased one.
- Furthermore, they want to work with other businesses to promote themselves and grow their business. For instance, once the nation is confident in its access to clean water, the company can start bottling other beverages, such as one of the top tea brands in the country (Cramer, 2017). In addition, they will run advertisements and articles with coupons across the entire Nigeria media.
- Positioning identifies their key differentiator; regardless of their offering, there should be a substantial brand value, but remember to consider individual positioning within each group of goods or services.
- Planning requires carefully determining what people are attempting to achieve to create a marketing effort. The organization’s short- and long-term goals may be supported by “marketing” by using the framework that strategic direction offers. The organization must specify the final destination (Maria-Alejandra Gonzalez-Perez et al., 2019).
- Paperwork, a marketing requirements document, outlines the precise steps one must take to market a specific good or service. Although this document is supposed to be created by the companies that provide the goods or services, many of them still need to be made aware of its importance.
- Protection and offering assistance is another tactic to make the risk associated with a purchase appear less scary. For example, a computer could be efficiently marketed with the promise of customer support. Convey the idea that assistance will be available if anything goes wrong.
- Policies are a set of instructions provided to the Licensee before or concurrently with the approval of this Act and outlined in a specific Brand and Product Marketing Manual (Sergi and Sulistiawan, 2022).
- Partnerships are joint efforts between two businesses with the shared objective of developing marketing strategies to promote their brands and sell their products and services to the relevant target market or consumer (Arreola-risa et al., 2016).
- Market Practice refers to the buyer’s conventional business methods, including index transitions with counterparties in similar positions to the seller and under comparable repurchase facilities for identical assets.
- Finally, payments, when a person does all the tasks mentioned earlier, their company and its shareholders benefit as well as them and their staff.
Export Strategy
Among the main achievements are production efficiency, technological progress, and economic growth. According to the technical history, introducing advanced American technology in producing water and beverages would undoubtedly increase the production of food and beverages in Nigeria. Technology progress will be made possible by encouraging improvements in the organization of production and labor (Arreola-risa et al., 2016).
In addition, adopting a new industrial policy will help integrate the Nigerian economy into the world market through an innovative development strategy. Today, Nigeria is just beginning its journey to enter the global market with its products, and product diversification will help attract more customers. Significant players in each sector will be able to show the best quality and low prices, as the market has just begun its growth. All project development costs are described in the financial report; all product prices will be based on the market and competitors; however, to attract customers, the cost will be slightly lower than competitors.
The export strategy begins with the United States exporting the necessary equipment and technology to increase the productivity of the Nigerian beverage industry. At that time, the company’s development concept was to be American specialists, entrepreneurs, and technologies, but by training local workers, more jobs could be offered to local people. The company will work eight hours daily and employ 250 adults aged 22 to 45.
Queries that allow business intelligence and management to explore sales, inventory management, and other critical performance metrics are two important use cases for data (Arreola-risa et al., 2016). Along with attracting investors to Nigeria’s early economic growth, this is also helping to improve small company practices. Technology will support the growth of Nigeria’s beverage industry with equipment that aids in the filling of juices, bottled water, dairy products, medicines, and personal care products. Technology transfer backed by American education will boost Nigerian beverage production.
While Nigeria does not need immediate help like some other countries, it does need transformation. Staff use foreign technologies to improve the quality of beverage and water technology in a short time (Arreola-risa et al., 2016). Due to the employee training factor, the company must quickly gain momentum in sales and begin to compete with major local players (Sergi and Sulistiawan, 2022). Safe bottled water and beverages are the product, and the corporation owns the technology and equipment for water and beverages. The company’s name will be printed on bottle labels to stand out everywhere and boost sales.
Three-Year Pro-Forma Financial Statement
Pro forma financial statements are accounting standards companies release that makes up hypothetical future or past events or assumptions. These statements, occasionally included in an investment or loan request, are created to give third parties a view of the firm success (Arreola-risa et al., 2016). A budget can be considered a form of pro forma financial statement because it predicts an organization’s future performance based on several assumptions.
US Beverages and Technology Income Statement
Balance Sheet for US Beverage and Technology
Cashflow Statement for US Beverage and Technology
Expenditure Capital Budget
References
Arreola-risa, A., Gaspar, J., Kolari, J., Hise, R., Bierman, L., & Smith, L. M. (2016). Introduction to Global Business + Mindtap Management, 1 Term 6 Month Printed Access Card: Understanding the International Environment & Global Business Functions. Cengage Learning.
“About FAS USDA Foreign Agricultural Service.” 2019. Usda. Web.
Cramer, Jacqueline. 2017. Corporate Social Responsibility and Globalisation. Routledge.
Forum For International Trade Training. 2017. International Market Entry Strategies. Ottawa: Fitt.
Maria-Alejandra Gonzalez-Perez, Lynden, K., Vas Taras, & Springerlink (Online Service. (2019). The Palgrave Handbook of Learning and Teaching International Business and Management. Springer International Publishing.
Sergi, Bruno S., and Dedhy Sulistiawan. 2022. Modeling Economic Growth in Contemporary Indonesia. London, United Kingdom: Emerald Publishing.
“US EXIM Bank: Finance Guarantees & Insurance for US Exporters.” 2010. Web.
