The growth of an economy depends on the contribution of all sectors, particularly the micro, small and medium scale enterprises.
While a micro business is an enterprise with less than 10 workers and asset base less than N5m, a small business is expected to have between 10 and 49 employees and an asset base of between N5m to N50m. However, business units with 50 to 199 employees and having total asset of between N50 to N500m are usually categorised as medium scale.
According to the National Bureau of Statistics, agriculture, a sector where the chunk of SMEs are located, contributes about 45 per cent to the countryâ€˜s Gross Domestic Product.
The immediate past minister of Agriculture and Water Resources, Dr Sayyadi Abba-Ruma, gives credence to this fact. He says that the sector employs up to two-thirds of the countryâ€˜s total labour force and provides livelihood for about 90 per cent of the rural population.
However, experts contend that despite its huge importance, the efforts of the Federal Government have not really transformed the sector.
The Chairman FeedPoint Limited, Mr. Jacob Tyonongu, says that despite the neglect, huge opportunities still abound in the sector.
Tyonongu, who deals in feeds, feedsâ€™ formulation and milling, and agricultural consultancy, recounts that the business which he began seven years ago with N150,000, now has a total asset of N20m.
He, however, states that for one to effectively go into the business now, about N10m will be required.
The FeedPoint boss contends that one of the best ways to achieve business growth, especially in this part of the world where conditions for granting credits to small scale business owners are too stringent, is through retained earnings.
This, he notes, will be used to acquire major production machinery like feed mixing machine, crusher, conveyor and mixers.
Tyonongu, who studied Agriculture Engineering at the College of Agriculture Benue State, says that the business, though capital intensive, requires a lot of expertise.
This he believes will be useful when sourcing for raw materials.
He says that what spurred him into the business is the need to address the problem of quality as well as the general condition in which animal feeds are produced.
He explains that the quality of majority of the feeds used to rear chickens and fish in Nigeria is low. According to him, this factor affects the harvest and because of the nature of the raw materials, which are usually seasonal, Tyonongu says that oneâ€˜s ability to get the right mix of materials, determines the success or failure of the business.
The major raw materials, which are sourced from various parts of the country, include soya beans cake, rice grains, maize off at, perm kernel cake and limestones.
He says that while soyabeans cake, groundnut cake, and perm kernel serve as the protein and energy source; rice, bone and limestones provide the needed calcium for the product.
This business like any other comes with its challenges. Tyonongu highlights some of them, â€We have serious challenges getting these materials because of their nature. The fact that most of them are seasonal and have to be stored for a long time before production even make it more challenging.
â€Transportation and prices of the raw materials is another challenge because farmers charge high prices for these materials during dry season, while some of them get destroyed during transportation.â€
Speaking on the demand for the products, a nutritionist, Mr. Jezreel Musa stresses that there is huge demand for the product, adding however that there is need for one to identify oneâ€˜s market.
He says that on the average, a producer of farm feeds could sell between 160 to 200 bags per day, adding that from a bag, which is sold for N1800, one could make a profit margin of N300.
Others in the industry also attest to the lucrative nature of the business.
Tyonongu is not the only entrepreneur who sees this business as very lucrative. The Managing Director, Mosaf Agro Ventures, Mrs. Mercy Afemike, states that what one needs to succeed in the business is tenacity, courage and determination.
Afemike, who is a graduate of Accounting from the University of Ilorin, believes possessing these attributes becomes necessary because of the frustrating nature of the Nigerian business environment, which she says has really put a lot of pressure on small businesses.
However, she adds that an entrepreneur who adheres the rules will certainly survive the harsh business environment.
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