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Here’s how your business can grow revenue in tough conditions (PART 2)

The small business owner’s elusive goal is how to increase revenues and how to increase the value of their business,



Here’s how your business can grow revenue in tough conditions (PART 2)

The small business owner’s elusive goal — how to increase revenues, how to increase the value of their business and then, how to find sources of recurring revenue and apply that in their business. We have established that these are indeed tough times to remain in business. Stiff competition, amongst other things, have made revenue-making channels a tough one for many businesses. Your sales revenue can be a key profit driver in your business. To increase your profitability, you should develop a strategy to grow your sales. You can look at things like:

  • Increasing your prices
  • Finding new customers
  • Selling more to existing customers
  • Offering sales promotions to boost the volume of sales
  • Developing new product or service lines
  • Selling in new markets

You should examine the products and services you offer, your target market and your pricing strategy to see if you can make improvements.


Why having a growth plan is important for your business, grow

Review your product or service pricing

It’s a good idea to review your prices often. Changes in your marketplace could mean that you can increase prices without losing sales. However, you should test any price rises before you make them permanent.

Use the Pareto principle to target the right customers

It’s not just your prices that affect your profits, the type of customers you’re selling to can have a big impact. To find out the most profitable customers, you can apply the Pareto principle.

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Often known as the 80/20 rule, the Pareto principle proposes that around 80 per cent of your profit is gained from 20 per cent of your products or services. Similarly, 80 per cent of profit is often also gained from 20 per cent of customers. You may be able to increase your profit margins by targeting your most profitable customers, even if you lose the less profitable ones.

[READ MORE: Here’s how your business can grow revenue in tough conditions (PART 1)]

Review your product and service offering

If you offer a range of products and services, examine the profit margins of each. You can work out what individual products cost you using activity-based costing. When you look at your current offering, you may find that some products do not deliver good returns. Consider concentrating your efforts on your more profitable offerings. Your products or services with the highest gross profit margin are the most important to your business, as they generate more money. Once you have identified your most profitable items you should concentrate on achieving higher sales targets for them. This may require you to rethink aspects of your business or to devise strategies for improvement.

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Carry out regular market research to identify products and services that are in demand. Keep up to date with market trends, as this will help you identify new opportunities to generate profits.

What more can you consider?

  • Identify areas in your business that you could improve or make more efficient, e.g. production or administration.
  • Use key performance indicators (KPIs) to discover your weaknesses and problem areas, such as rising costs or falling sales, and address these.
  • Find ways to reduce your business waste, e.g. power supply costs.
  • Regularly review how you price your products, and test new prices before making them permanent.
  • Group your customers into sales categories based on the volume of sales and profits generated, and adjust your pricing and marketing efforts accordingly.
  • Sell more to your most profitable customers. Use up-selling, cross-selling and diversifying techniques to improve your profit margins.
  • Negotiate better deals with your suppliers — long-term deals might offer better value for money.
  • Look out for new business opportunities to expand into new markets. Research potential new customers and how to target them.
  • Routinely measure the efficiency of your operations and put monitoring systems and processes in place.
  • Streamline all business processes where possible.
  • Increase productivity of your staff— Recognize and reward staff contributions with staff performance reviews, and teach them sales skills and how to upsell products so customers make multiple purchases at one time
  • Customer service — Improve your customer service and develop a staff training program
  • Increase your prices — Check if you have priced your goods and services correctly and if you can increase prices without reducing sales
  • Price discounts — Consider price discounts and promotions to increase your customer base (e.g. 2-for-1 deals or happy hour)
  • Retail displays — Use effective retail displays to increase your sales.
  • Look for more and implement strategies to decrease costs.
  • Decrease inventory — Stock control is a good way to streamline your business.
  • Decrease direct costs — Make sure you have the right suppliers for your business and negotiate for better prices or discounts for buying in bulk.
  • Decrease indirect costs — For example, try to minimize waste and errors in your business by training staff, or reduce marketing costs by using low-cost marketing techniques.
  • Decrease overheads — For example, save energy wherever possible or try find a cheaper energy supply company.
  • Benchmark key financials — Benchmarking your business helps you compare your costs (like rent and utilities etc.) to similar businesses in your industry to see if you are paying too much.

Prioritize these strategies

Once you have chosen strategies to make your business more profitable, you should prioritize them in order of importance. It’s a good idea to write down your goals and the corresponding strategies to achieve them, and also how you plan to implement your strategies.

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[READ ALSO: Why investors should understand the basics of financial statements]


Growing a small business is really challenging, and it is easy to find your business caught in a flat growth cycle. It is possible that your current customers can provide an excellent source of revenue and profit growth for your company so don’t neglect the gold nuggets sitting inside your customer base, it’s the key on how to increase revenues, and then, the value of your business.

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Investment Tips

What bad stocks have in common with bitter relationships 

The feeling you get from marrying the wrong partner is similar to that felt after buying the wrong stocks.



I have always argued that stocks cannot be summarised into one statement for a newbie, until recently when a friend told me that it could.  

“Simply put, buying stocks can be likened to relationships, he said.  


did not immediately agreebut over the next few minutes, he explained to me what he meant, and drew several analogies to back his claims.  

While he is no expert, I understand that he has drawn his conclusion from his experience buying stocks for himself over the past 5 years, so I took his points seriously. These points have been summarised in this article. 

READ MORE: Cocoa prices melt lower as COVID-19 weakens demand 

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When it crashes, there is no telling how far it can go  

My friend mentioned of some company’s stock he bought in 2016 in the hope of selling short-term. At the time he bought, there was a dip and he expected things to pick up within some months so he could sell-off.  

Two years later, the stock price had plummeted 50% down from the price at which he bought. Without saying, he became a long-term investor because he was not ready to sell off at a loss.  


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How does this liken to being in a bad relationship?

As the value plummets, you keep hoping it will rise again and then before you know it you are stuck for the long haul. Same thing can happen with a wrong partner. You remain there hoping things will be better but it gets worse. 

It could happen sometimes that a company’s stock market price comes crashing and it never goes back to where it was againThe factors which triggered its fall, may not even be able to return it to its starting price.  


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The stock price is not indicative of the company’s profitability 

For some reason, there are company stocks market prices that remain low year after year despite the billions declared in profits, and the dividends paid out to shareholders.  

Sometimes, the stock market price could still slump even when the company has positive records in its financials. Market experts are not always able to explain this, but it remains true. Some of the most profitable stocks are undervalued.  


You can never take stocks at face value

That a stock has been on an upward trend in the last few months does not mean it will remain so. One must always consider several other factors before purchasing a stock.  

While it is important to look at past performance, there are other things that could point to the likely future of such stocks. 


Say, for instance, the company has just announced a new board chairman who was implicated in some fraud cases in the past. It doesn’t matter how well the stocks have performed in the last 365 days, or the chairman’s competence, the stock prices are most likely to slump due to loss of investor confidence.  

There was a recent case where the CEO of an internet service provider company was alleged to have been involved in sexual harassment, and was eventually pressured by shareholders to resign. The pressure came not necessarily because they thought he was guilty, but because of the implications on the company.  

You have to probe to discover the real qualities.  


The most expensive stocks are not necessarily the best. 

If you ever heard a stock described as under-priced or over-valued, then you should understand that the price you pay is not necessarily suggestive of the value.  

Some great stocks, with good potentials, high liquidity, good company profile and adherence to corporate governance ethics, are not as expensive as they should be. While some other stocks are ridiculously overpriced, even when they do not have as much promise. Some of these overpriced stocks could still be basking in past glory or just positive media hype.  

This explains why investors must conduct due diligence before putting in their hard-earned money. Sometimes the media hype around a company’s stock might not be giving you all the information you need to make a decision, so you necessarily have to go the extra mile.  

Subscribe to newsletters from financial news websites if you need to, take courses if you have to, but ensure to learn all you can.  

Remember price is what you pay for the stock, but value is what it is really worth, and there is no law stating that one must justify the other.  

READ MORE: Global stocks records astronomical gains in Q2 2020

When you get the wrong stocks, you get stuck! 

You know that feeling when you are sure that you have made the wrong choice, but also know that there is no way out? That’s the feeling you get when you marry the wrong partner, as my friend said. And that’s the same feeling you get when you get the wrong stocks.  

You simply get stuck.  

No returns. No dividends. Probably, no way to sell either because no one else is interested in buying from you. And if you do succeed in selling off at this point, you would most likely be doing so at a loss.  

If you study trends in the stock market, you will see some dormant stocks that have remained stagnant for long periods of time. No rise in share price, no fall in share price, and no share is being traded either.  

READ ALSO: Best time to make money trading BTCs

It is not a nice position to be in, and that is why you want to be sure of the company, its management, and board members who take the decisions before you decide to buy or not, even more so when you are a long-term investor.  

And even then, with the wrong stocks, you could suddenly find that your proposed short term investment of 6 months will run into years because you keep waiting for things to pick up before you sell.  

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Investment Tips

Where to invest using PE, PEG

Investors should always look at the sector P.E. and compare that with individual stock P.E.



Uncertainty strengthened as foreign portfolio investors pull out funds, chess board

Assuming, you the investor is interested in buying shares in the banking space, you have about 100,000 to invest and you want to buy the best stock that will give you the greatest return at the lowest price. You have two banks in your investment universe; you prefer Bank A and Bank Z. Bank A sells each share for N10 and Bank Z sell each for N5

Table 1.

Share Market Price N:K
Bank A 10.00
Bank Z 5:00


Which would you buy? Well that easy, I would buy Bank A why? because it is cheaper. With N100,000 I can buy more shares of Bank A than Bank Z.

Hold on, not so fast.

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The market price of any stock relates to the expected future earnings of that stock. For instance, Bank A’s share price of N10 means the Present Value of the sum of expected earnings that will accrue to Bank A over the life of earnings is N10. Hence you cannot simply compare the price of Bank A to the price of Bank Z, you must compare Earnings of both banks to determine which is “cheaper”.

READ MORE: Access Bank Plc reports profit of N40.9 billion for Q1 2020

So, to compare earnings, we use a ratio called the Price to Earnings Ratio (P.E.). Earning here is the earnings per share, which means we divide total earning by issued shares. Again, we assume a total of 1m shares issued by both banks. To calculate PE, first get earnings per share, so if bank A posted earnings of 1,000,000, and we have issued shares of 100,000 then Earnings per Share is (1,000,000/100,000) or 10. The P.E. for Bank A would be (10/10) or 1.  A P.E. of 1 means the share price is 1 times the earnings of Bank A, very good. (lower P.E. is preferred). Let’s also assume Bank Z has a P.E of 0.5

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Now if we look at table 2 which now compares prices to earnings, we can see the PE of Bank Z is lower than the PE of Bank A. This means Bank at price of 10 is trading at 1 times its earnings when compared to Bank Z which is trading at o,5 its earning, thus we can say that Bank Z is “cheaper” than Bank A because we are buying at a lower multiple of earnings

Table 2.

Share Market Price N:K P.E. Ratio
Bank A 10 1
Bank Z 5 0.5


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READ MORE: Nigerian Stock market records sixth consecutive losses, investors lose N15.55 billion

We can also say that if a company has a high price relative to her earnings, then that company is a Growth Stock.  If, however the price relative to the earnings is lower, then the stock is a Value stock. A high growth sector like IT or biotech will have a faster growth and relatively higher PE ratio than a company in the utility sector with predictable steady earnings growth. Investors should always look at the sector P.E. and compare that with individual stock P.E.

P.E. is known as a trailing ratio because it is based on the past. Company can give forward guidance on earnings and that is used to create a Forward PE ratio. What if we wanted to compare both banks but this time instead of looking at past earning, we want to investigate the future and ask which bank we should buy using expected earnings as our main guide. To do this, we have to input expected earnings into the mix

Perform advanced finasncial calculations on Nairamterics

Let us assume Bank A is buying a smaller bank, and that will give her more branches, leading to higher growth in the future. Let’s say this will; lead to a 20% growth in earning year by year. Bank Z is not as aggressive and earning will increase, only 10% does this change the current recommendation?


It does and it introduces us to another ratio called the Price to Earnings Growth Ratio (PEG). The PEG is the P.E. of the Stock of the company divided by the growth rate of its earnings. We have already calculated the P.E. Ratio, so the PEG for Bank A is (1/20) or .05. This is an exceptionally good measure indicating the stock is undervalued. A PEG less than 1 generally means undervalued, more than 1 means overvalue

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Top AgriTech deals currently on sale in Nigeria – June 2020

These options were picked from firms known to insure their farms and farm produce.



Agricultural financing, Top AgriTech deals currently on sale in Nigeria – June 2020

The month of June is coming to an end, but just before it does, Nairametrics is bringing you Agritech deals you should consider investing in. Ordinarily, this is not the best time for AgriTech investments, as the rains have started and most farmers are done planting.

However, there are still some late planting to be done, so this means there are some late deals you can take advantage of. From the details of these deals, you will discover those meant for funds you intend to keep long-term and those for the short-term.


These options were picked from firms known to insure their farms and farm produce. There are some AgriTech firms that should also be in this list, but this list only captured those which had deals open for sponsors and investors as at the time of writing.

Thrive Agric is quite popular in the Agritech space but as at the time of writing it, there was no farm deal open for sponsorship. also has a couple of agricultural investment options, but they have been completely subscribed by the start of June. Only real estate investments and stock options are open.

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READ MORE: The Different Dimensions of Investing in Agro-Tech

Farmcrowdy usually offers a variety of investment options, from maize farms to rice, potatoes, fish, cassava, poultry, cattle, but most of these options have been sold out and closed, after full subscription. Its farms located in Kaduna, Oyo, Ogun, Niger and Lagos states are all insured by Leadway Assurance.

Top AgriTech deals currently on sale in Nigeria – June 2020

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Only one option is still available from Farmcrowdy as at the time of writing.

The Farmcrowdy food gives 10% Return on Investment (ROI) per annum with the minimum holding period of 7 months. The minimum investment is N20,000 being for the sponsorship of one farming unit.

At this rate, an investment of N100,000 would yield another N10,000 by the end of 7 months.

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This investment funds covers the cost of production of several farm produce like potatoes, vegetables, and staple foods, and the farms are located in Lagos state.

Another deal you could consider is the Fish farm investment with Groupfarma. This investment gives 27% ROI. A unit of the fish farm investment can be sponsored at N52,000, and the Oyo based farm runs a nine-month farming cycle. The farm is insured with the Nigerian Agricultural Insurance Corporation (NAIC).

Farmkart also offers a fish farm option but with different terms. You need N100,000 to purchase a unit of this option, with 15% ROI over a period of a 6-month farm cycle. The investment funds cover the farm inputs, the pond rents, organic supplements, payment for the farm workers, insurance and the farm is located in Ijebu-Ode, Ogun state.

With the Groupfarma option, every N100,000 invested in the fish farm will yield N27,000 at the end of the 9-month cycle, while the same investment with Farmkart will give you a yield of N15,000 in 6 months.

READ MORE: Pig farming is a goldmine in Nigeria- Porkmoney boss


The choice of investment here would be determined by how long you want the funds to be held.

Top AgriTech deals currently on sale in Nigeria – June 2020

The Federal Government had complained of the millions spent on importation of fish into the country. Worse still, Nigeria has been tagged the largest importer of fish and fishery products in Africa and the world’s fourth largest in volume terms (5.4% of global imports) after China, Japan and the US.

What these figures tell you is that any investment towards improving the aquaculture industry and fish production, has a profitable value chain. So, you might want to consider it among your options.

Payfarmer also offers a Catfish Farms investment where investors can sponsor a unit with N50,000 and expect 20% ROI after the farm cycle of 7 months. This means that N100,000 investment will grow to become N120,000 in 7 months.  The farm is located in Epe, Lagos state.

Payfarmer has a couple other investment options still open as well.

The Payfarmer Pepper Farm investments opens at a unit entry of N25,000 investments and you get 12% returns with a minimum holding duration of 5 months. An investment of N100,000 here would give you additional N12,000, and if you are looking for an investment that frees up your funds just before the yuletide, then this would be a good option to consider. The pepper farm is located in Epe, Lagos.

Payfarmer also has several Pig farm options. The first requires a minimum investment of N5 million naira for a unit and gives you 34% returns with a minimum holding period of 10 months. This means one-unit investment here will yield of N1.7 million at the end of 10 months.

READ MORE: Invest and earn 300%: How scammers came after me

There is also another Pig farm option which allows an entry investment of N250,000 for a unit, giving you 28% ROI in 10 months. Every N1 million invested in this farm will earn a profit of N280,000 at the end of the cycle.

Top AgriTech deals currently on sale in Nigeria – June 2020

The third Pig farm option has a unit investment of N500,000 with a 30% return and a 10 months farm cycle. An investment of N1 million here earns N300,000 at the end of 10 months.

The fourth Pig Farm option allows a minimum of N1 million for a unit and gives you 32% returns in 10 months.

All of these pig farms are located in Epe Lagos. Again, it comes down to the investor’s choice and availability of funds.

Farmfunded is another popular name in the space and even though most of its plans are sold out, there is one still open.

The integrated rice mill financing offers impressive returns but, it is strictly for investors who have funds to hold in the long-term. Because the company is trying to increase rice production capacity in Nigeria all investments have to be held for a minimum period of 24 months at the end of which the investors get 80% returns.

To make things easier, the investor may or may not cash out his 10% returns every quarter (3 months) but will not have access to the capital until after 24 months. This ensures that the farms have a stable capital base to grow and expand over the next 2 years. The thousands of acres of land to be used for these are located in Kano State Nigeria.

READ MORE: KIAKIA Peer-to-Peer lending investment app (Review)

If you have N100,000 to purchase a unit, and you decide to wait till the end of the 24 months period, you would be receiving a profit of N80,000 and a total of N180,000.  The profit is not compound, so even if you don’t take your profit, it does not form a part of your investment.

The farm is located in Kano state and allows investors to provide funds which will be committed into the procurement of milling machine, and processing of paddy rice to premium parboiled rice. Considering the gap between local production and actual demand for rice, this looks like a solid investment plan.

The company has also sought to protect its base by ensuring that investors may cash out their profits, but not the base investment, so that it can be ploughed in again for the next cycle.

Note, however, that whatever your choice of investment, you should consider the holding period as against when you would need to liquidate your investments. The crux of the deals offered is to engage your idle funds and help them grow while you continue your hustle.

On SEC: Last May, The Securities and Exchange Commission (SEC) proposed a new set of rules that will regulate crowdfunding businesses and deepen the capital market in Nigeria. This includes AgriTech firms like those listed above. The commission plans to regulate the crowdfunding business in Nigeria in order to reduce the risks associated with it for investors and financiers.

Disclaimer: This is not an investment advice or guide as Nairametrics is not affiliated to and cannot vouch for any of the AgriTech firms listed above. Kindly do your due diligence before investing.


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