Describing Your Business

Outlining Your Business Model

A business model is a comprehensive framework that outlines how a company creates, delivers, and captures value. It serves as the foundation for your business and is essential for communicating your strategy to investors, partners, and stakeholders. In the Nigerian context, where diverse business opportunities exist, clearly outlining your business model can significantly enhance your chances of success.

1. Components of a Business Model:
   • Value Proposition: This defines what makes your product or service valuable to customers. It answers the question: Why would customers choose your offering over competitors? For example, a Nigerian agritech startup might offer a value proposition centered around providing affordable, high-quality seeds that increase crop yields for local farmers.
   • Customer Segments: Identify the specific groups of customers your business intends to serve. This could include demographics such as age, income level, location, and interests. A Nigerian e-commerce platform might target young urban professionals who prefer online shopping for convenience and variety.
   • Revenue Streams: Outline how your business will generate revenue. This could include direct sales, subscription fees, advertising, or service charges. For instance, a Nigerian fintech company might generate revenue through transaction fees on its mobile payment platform.
   • Channels: Describe the various channels through which you will reach your customers. This includes online platforms, physical stores, and distribution partnerships. For example, a Nigerian fashion brand might utilize social media, an online store, and local markets to reach its target audience.
   • Key Activities and Resources: Identify the critical activities and resources required to deliver your value proposition. This could include production processes, marketing strategies, and technology infrastructure. A Nigerian tech startup may need to focus on software development, customer support, and digital marketing.
2. Business Model Canvas:
   • A useful tool for outlining your business model is the Business Model Canvas, which visually represents the components mentioned above. This one-page framework allows entrepreneurs to map out their business model succinctly, making it easier to communicate with stakeholders and refine strategies.

Defining Your Products or Services

Clearly defining your products or services is essential for conveying their value to potential customers and investors. This section should provide a detailed description of what you offer and how it meets the needs of your target market.

1. Product/Service Description:
   • Provide a clear and concise description of your products or services, including their features, specifications, and intended use. For example, a Nigerian skincare brand might describe its products as “natural, organic skincare solutions designed for the unique needs of African skin, including moisturizers, cleansers, and sunscreens.”
2. Benefits and Features:
   • Highlight the benefits of your products or services, focusing on how they solve specific problems or fulfill customer needs. For instance, a Nigerian health food company might emphasize that its products are rich in nutrients, promote wellness, and are made from locally sourced ingredients.
3. Product Lifecycle:
   • Discuss the lifecycle of your products or services, including any plans for future development or expansion. This could include introducing new flavors, sizes, or variations. For example, a Nigerian beverage company might plan to expand its product line to include sugar-free options in response to changing consumer preferences.
4. Pricing Strategy:
   • Outline your pricing strategy and how it aligns with your target market. Consider factors such as production costs, competitor pricing, and perceived value. A Nigerian fashion brand might adopt a competitive pricing strategy to attract budget-conscious consumers while maintaining quality.

Highlighting Unique Selling Propositions (USPs)

Your unique selling proposition (USP) is what sets your business apart from competitors and makes your offerings appealing to customers. Clearly articulating your USP is crucial for attracting attention and building brand loyalty.

1. Identifying Your USP:
   • Determine what makes your product or service unique. This could be based on quality, price, innovation, customer service, or a combination of factors. For example, a Nigerian tech startup might highlight its USP as “the first mobile app that provides real-time agricultural advice to farmers, improving their productivity and income.”
2. Communicating Your USP:
   • Once identified, your USP should be prominently featured in your marketing materials and business plan. Use clear and compelling language to convey the benefits of your offering. For instance, a Nigerian renewable energy company might communicate its USP as “affordable solar solutions that empower rural communities with sustainable energy access.”
3. Supporting Evidence:
   • Provide evidence to support your USP, such as customer testimonials, case studies, or data that demonstrate the effectiveness of your product or service. This can help build credibility and trust with potential customers and investors.

Crafting a Strong Company Description

A strong company description provides an overview of your business, its mission, and its strategic direction. It serves as a foundation for the rest of your business plan and helps stakeholders understand your vision.

1. Company Overview:
   • Start with a brief overview of your company, including its name, location, and the type of business entity (e.g., sole proprietorship, partnership, limited liability company). For example, “EcoClean is a Lagos-based limited liability company specializing in eco-friendly cleaning products made from natural ingredients.”
2. Mission Statement:
   • Include a clear and concise mission statement that articulates your company’s purpose and core values. This statement should reflect your commitment to your customers and the community. For instance, “Our mission is to provide sustainable cleaning solutions that promote health and environmental well-being for Nigerian households.”
3. Vision Statement:
   • Outline your long-term vision for the company, including your aspirations and goals for the future. This helps convey the direction of the business and its potential impact. For example, “Our vision is to become the leading provider of eco-friendly cleaning products in West Africa, empowering consumers to make environmentally conscious choices.”
4. Company History and Milestones:
   • If applicable, provide a brief history of your company, including key milestones and achievements. This could include product launches, partnerships, or awards received. For example, “Since our launch in 2021, EcoClean has successfully expanded its product line and secured partnerships with major retailers across Nigeria.”
5. Future Goals:
   • Conclude the company description with a summary of your future goals and aspirations. This could include plans for expansion, new product development, or market penetration. For instance, “In the next five years, we aim to expand our distribution network to include neighboring countries and introduce a new line of biodegradable cleaning products.”

Conclusion

Describing your business effectively is essential for communicating your value proposition to potential investors, customers, and stakeholders. By outlining your business model, defining your products or services, highlighting your unique selling propositions, and crafting a strong company description, you can create a compelling narrative that showcases the potential of your business. In Nigeria’s competitive landscape, a well-articulated business description can significantly enhance your chances of attracting investment and achieving long-term success.