DOING BUSINESS IN NIGERIA

MAFED 2016 CLASS PRESENTATIONBY ADEOLA FALODUN

AGENDA

1. Country Overview1.1 Key Facts1.2 The Business Environment1.3 Foreign Direct Investment

2. The Nigerian Fashion Industry2.1 Industry Definition2.2 Key Local Players2.3 International Players2.4 Customer Profile2.5 Distribution2.6 Fashion Shows2.7 Media2.8 Production & Sourcing2.9 Retail Environment2.10 Summary

3. Key Success Factors

1.0COUNTRY OVERVIEW

NIGERIATHE GIANT OF AFRICA

POPULATION: DEMOGRAPHICS:

ECONOMY:

24thLargest Economy in the World

1stLargest Economy in Africa

CURRENCY:

Naira (NGN)

181.56 Million

URBAN:

49.6%

LITERATE:

61.3%

43.8% 53.2% 3%

0-14Yrs 15-64Yrs 65Yrs+

RELIGION:

50% 40% 10%

Muslims Christians Others

ECONOMIC CENTRE:

Lagos

MAJOR CITIIES:Lagos 13.12 MillionKano 3.59 MillionIbadan 3.16 MillionAbuja 2.44 MillionP.Harcourt 2.43 MillionBenin 1.49 Million(2015 est.)Capital is Abuja

36STATES

+FCT

NATURAL RESOURCES:Natural GasTinIron OreCoalLimestoneNiobiumLeadZincRuby

BitumenGoldMarbleGypsiumClayKaolinSappireCottonArable Land

OIL & GAS=

35% GDP

LANGUAGE: ETHNIC GROUPS:

250 +English …500 +

OFFICIAL:

1.1 KEY FACTS ON NIGERIA

• Located on the coast of West Africa

• A democratic country with 36 states and a federal capital territory with a land mass of923,786 sq.km

• The capital is Abuja while the economic centre is Lagos

• Total population of 181.56 million people (2015) making it the most populous country inAfrica and the 7th most populous country in the world

• Nigeria’s internet penetration of 51.1% (2016) is 28% of total Africa internet users(http://www.internetworldstats.com/stats1.htm )

• Nigeria’s film industry, Nollywood, is the 2nd largest film industry after India, in terms offilms produced annually

• Nigeria textile market is the 3rd largest market in Africa

1.2 THE BUSINESS ENVIRONMENT

OPPORTUNITIES THREATS

• Large and vast population

• Untapped natural resources

• Favourable demographics expected to spur demand for goods

• Growing middle class

• Rapid urbanisation growing at 4% p.a.

• Rising household consumption expenditure ($438 billion by 2017)

• Young, educated, entrepreneurial population

• Nigerian diaspora investing back home

• Security issues in the North and South of the country

• Unsure political stability

• Failing oil price

• Poor infrastructure which can result to higher operating expenses (energy and transport)

• Difficult regulatory processes and undue influence

1.3 FOREIGN DIRECT INVESTMENT

• Nigeria is one of the top 3 recipients of FDI in Africa

• FDI attractiveness is due to the large market size and the natural resources present

• The oil and gas sector is the most preferred and biggest beneficiary of FDI

• FDI inflows grew in the past years reaching an all time peak of $3,084.90m in the forthquarter of 2012.

• In 2015, there was a decline in FDI inflows due to election, change in government andunstable macroeconomics factors thereby relying on local investors

• In the first quarter of 2016, FDI in Nigeria increased by $887.32m

• From 2007 to 2016, FDI has averaged $1,366.45m

• Considering the high risk of investment, the Nigerian government offers generousincentives such as tax incentives in order to attract FDI inflows

2.0THE NIGERIAN FASHION INDUSTRY

2.1 INDUSTRY DEFINITION

Increasing Middleclass & New Rich Consumers

Highly Fragmented

Rich in Creative Talents

KEY DRIVERS

• World Renowned Nigerian Fabrics

• Fashion Shows

• Prints and Online Media

Huge Impact on Fashion Trends

2.2 KEY LOCAL PLAYERS

STYLE

PRICE

PREMIUM

HAUTE COUTURELUXURY CHIC

SATORIAL CLASSIC

COSMO/AFROPOLITAN

2.3 INTERNATIONAL PLAYERS

EXCLUSIVE LUXURY

UPPER BRIDGE

PREMIUM

FAST FASHION

RETAILER

PRICE/QUALITY

2.4 CUSTOMER PROFILE

MODERN

SOCIAL/STATUS CONSCIOUS

STYLISH CONFIDENT

WANTS TO STAND OUTFUN

OUTGOING

FASHION ORIENTED

LOVE FOR PRINTS & COLOURS

ENTHUSIASTIC

BRAND FOCUSED

2.5 DISTRIBUTION

OFFLINE RETAILERS

ONLINE RETAILERS

http://www.alaralagos.com/about/

https://www.jumia.com.ng/

2.6 FASHION SHOWS

AFRICA FASHION SHOW NIGERIA (AFWN)

LAGOS FASHION AND DESIGN WEEK (LFDW)

ABUJA FASHION WEEK (AFW)

PORTHARCOURT INTERNATIONAL FASHION WEEK (PIFW)

2.7 MEDIA

PRINTS ONLINE

SOCIAL PLATFORMS

2.8 PRODUCTION & SOURCING

LEATHER GEMSTONES

TECHNOLOGYTEXTILE

2.9 RETAIL ENVIRONMENT

LOCAL MARKETS SHOPPING MALLS

STAND-ALONE BOUTIQUES ONLINE STORES

2.10 SUMMARY

SIZE

GROWTH RATE

DEMOGRAPHICS

URBANIZATION

INFRASTRUCTURETAXATION

HUMAN CAPITAL

LOCAL COMPETITION

BRAND CONCEPT

QUALIFIED RETAIL SPACELOCAL SUPPLY CHAIN

HIGH MEDIUM LOW

SOURCING

3.0 KEY SUCCESS FACTORS

LOCAL PARTNERSHIP/ FRANCHISING

QUALITY SERVICE

CORPORATE SOCIAL RESPONSIBILITY

STRONG MEDIA & CELEBRITY INFLUENCE

1 3

2 4

DEOLA SAGOE

MAKI OH

IAMISIGO

KINABUTI

LISA FOLAWIYO

LANRE DASILVA AJAYI

THANK YOU !!!

REFERENCES

• http://www.internetworldstats.com/stats1.htm• https://www.pwc.de/de/internationale-maerkte/assets/doing-business-in-nigeria-

2015.pdf• http://www.worldfinance.com/strategy/detail-nigerias-oil-and-gas-sector-attracts-fdi• http://www.ey.com/Publication/vwLUAssets/EY-Nigeria-Country-Report/$FILE/EY-Nigeria-

Country-Report.pdf• http://www.tradingeconomics.com/nigeria/foreign-direct-investment• http://www.worldometers.info/world-population/nigeria-population/• http://www.helafrican-chamber.gr/articlefiles/agl%20nigeria%202015%20.pdf• http://www.opec.org/opec_web/en/about_us/167.htm• http://www.doingbusiness.org/Reports/Subnational-

Reports/~/media/giawb/doing%20business/documents/profiles/country/NGA.pdf• http://www.nipc.gov.ng/index.php/opportunities-by-sectors/textile-and-apparels.html• https://www.notjustalabel.com/editorial/sleeping-giant-nigerias-flourishing-fashion-

industry• Olokoyo, (2012); Foreign Direct Investment And Economic Growth: A Case Of Nigeria