News reports say President Mohammed Buhari has finally sent the Petroleum Industry Bill to the Senate for consideration and passage. The Bill according to media sources among other things still proposes the restructuring of the Nigerian National Petroleum Corporation and the Petroleum Products Pricing Regulatory Agency. The NNPC will be replaced by a limited liability company, which shall be called Nigerian Petroleum Company (NPC Limited). The bill also proposes the establishment of an agency known as the Nigerian Upstream Regulatory Commission which will be responsible for the technical and commercial regulation of upstream petroleum operations alone.
The Petroleum Industry Bill (PIB) was first introduced to the National Assembly in December 2008. A presidential committee set up in 2007 to look into the oil and gas sector came up with this bill, which aims to increase transparency at the NNPC and to increase Nigeria’s share of oil revenue. Drafts of the bill, however, became very contentious due to objections from the international oil companies (IOCs) and the Nigerian National Petroleum
Corporation (NNPC). Consequently, the bill was never passed into law. Towards the end of 2015, the PIB was amended to speed up its passage and was broken into different bills, one of which was the PIGB, to address the governance framework of the oil industry. The Senate President noted that the plan was to expedite the aspects of the old law that were not controversial while the controversial areas could be placed on hold. The two houses passed
the PIGB in 2018 but the President did not sign the bill till it ran out of time.
In all the versions of the Bill, key themes that have constantly featured include; The ownership and management of petroleum resources, functions and powers of the Minister of Petroleum, the establishment of the Nigerian Petroleum Regulatory Commission (NPRC) to act as a regulator for the industry and the restructuring of the NNPC. According to the Minister of State for Petroleum Resources Timipre Sylva, this version that has been sent to the National Assembly is a harmonisation of all the existing versions from 2000 to date with necessary adjustments to address the concerns raised by the industry players. One of such concern was the recommendation of a single regulator for the entire industry as was stated in the PIGB which has been addressed in the current version of the bill.
With more than a decade of deliberations and revisions, it will be a great relief to all stakeholders if this version of the Bill is finally passed into law. Currently, Nigeria is said to have one of the least competitive Deepwater fiscal terms in Africa and is increasingly losing significant amounts of potential investments to other African countries. Many stakeholders hold strongly that new investments in the oil sector is dependent on the passage of the PIB which would take a more holistic approach in addressing issues around the fiscal terms especially following the passage of the Deep Offshore and Inland Basin Production Sharing Contracts (amendment) Bill, 2019 (PSC Amendment Bill).
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5 successful ways to increase profits in your business
Constantly working on these areas of your business, you are more likely to have raised profits.
Most business owners are required to make certain changes to their business operations to achieve more profits. It is a fact that it is not possible to raise the profits directly, therefore, you need to increase them indirectly. It is not going to be possible without having a specific strategy in place. The only thing that is possible is improving the variables of your business and this can lead to an increase in profits and a higher bottom line.
Lead generation and conversion
A process that is used for attracting interested prospects to the business is lead generation. Suppose five people out of the ten coming to your business place end up purchasing the product or services from your business, you can try to raise the number of people coming to the business to fifteen. This allows you to make more money by increasing the profits by 50%. Lead conversion is a process used for converting the leads into paying customers. It is a measure of the effectiveness of your sales efforts. If it is possible to raise the conversion rate from 1 out of 10 to 2 out of 10 it is likely to double the sales figures and get you raised profits. There is no replacement for continuous sales training sessions. It applies to the owner and everyone that speaks to the clients.
The number of independent sales you make to the customers you have acquired can be increased by raising the frequency of the purchases by say ten percent. You will thereby increase the number of sales and also rise profits by the same amount. Think about the things you could do for getting your existing customers to purchase more from your business and also make these purchases frequently. The size of the transaction and the profit you make from every one of them matters as well. You need to be on the lookout for ways of up-selling all the customers so that this person will buy more every time.
Profit margins could be the gross profits you make from all the sales of products or services. By finding out the ways of raising the price or lowering the cost of making the product and services without reducing the quality you will be able to raise the profits per every sale. All the money you save while holding the costing constant flows straight to the business bottom line as profit. Every time you decrease the expenses and at the same time, if you can hold the sales and revenues constant, money is going straight to your pocket as net profit.
Reach a global audience
In the modern scheme of things, all cities are turning into global economies. Therefore language translation services can be used for increasing the profits of any business big or small. It might be a good idea to translate the content on your website to reach a global audience. The global language services industry is rising quickly and can touch a figure of $50 billion by the end of the year. Most of these services these days are used by both private and government sectors alike. With rising globalization, the demand for translation is also increasing.
Customer acquisition costs
Consider the amount of money you have to spend to acquire every paying customer. You need to continuously be on the lookout for creative ways of improving your promotion and advertising so that there is a reduction in the money you have to spend to get a new customer. This will have a positive effect on the profits of your business. You can also try to increase the number of customers that come to you as a result of referrals from your existing satisfied customers. Developing single or multiple referral systems can impact the business positively and in turn, can help in making more money for your business.
When you are constantly working on these areas of your business seeking improvement in all of them, you are more likely to have raised profits. You will make more money and it will contribute to the success of your future financial endeavours.
Content as a viable investment vehicle
Nigerian investors from all cadres have largely overlooked content as a viable investment instrument.
Investment gurus have taught and continue to teach about the indicators that can help identify good investments. Over time, a comprehensive list of some of these indicators has been passed on to new investment initiates; a list that includes hedge against inflation, yield, and returns, risk level, liquidity, Concealment from Tax, etc.
Yield and Returns
For an example of the potential for yield and return, according to Wikipedia, the production budget for the movie Living in Bondage II was NGN 10,000,000 while the gross revenue at the box office alone was NGN 168,000,000. This represents 1600% (approx.) return on investment from 1 channel of monetization and surely, there are other channels and that is why now more than ever, content in any form, is highly valuable – because of the different opportunities to monetize.
Hedge against inflation
Surely there’s a hedge against inflation because it would still cost the same amount to pay for production services (nobody got a pay raise because of the rise in inflation) and so the selling price is highly unlikely to change. To drive this point home, note how the inflation hasn’t affected the cost of streaming subscriptions on your favorite OTT app.
How come Nigerian investors from all cadres have largely overlooked content as a viable investment instrument then? RISK – surely this comes to mind!
Rethinking approaches to investing in Content
Yes, one can argue that there have been huge investments in content, in the past, that didn’t yield. This argument wouldn’t be entirely false however it should be noted that in most of those instances, the actual investment usually would be in an organization or platform as was the case when Verod Capital invested in Spinlet.
Needless to say that we have to rethink the approach, making Content itself the primary instrument that’s being invested in. I mean, one wouldn’t have to buy a manufacturer to invest in transportation. Why then do we think that to approach investing in Content, we have to purchase the platform or the company, or even sign the artist, etc?
Due to the fact that Content is an intangible good/commodity, we tend to approach decisions relating to it from a sentimental perspective whereas
Data and analytics should be at the heart of every decision around content investment. Ideally, the services of an analyst would be required. The ideal analyst will be someone with a good understanding and appreciation for the content, combined with strong analytical capabilities.
They can then help identify content opportunities that can represent a viable investment.
Structuring the deal is another factor that should be considered. Understanding the distribution/monetization possibilities around the content under investment consideration will also allow investors to make better decisions.
There are several ways to structure investments including Joint Ventures with the content creator where Investors’ Capital goes into Marketing while the creator provides the content that meets Investors’ set standard; Outright investment in the production of content is also possible. Etc.
In these instances, the services of a marketing agency as well as an Intellectual Property/Copyrights Lawyer should be engaged to identify the best approach to structuring the deal.
This flexible approach to investment in content will also allow for budget control and oversight as the tenure is finite, at least as far as the expenditure phase is concerned.
One investment that would be interesting to consider under this lens would be Kupanda Capital’s recent investment in Mavin Global. While it is rather early to call, there’s been 1 commercially successful project – Rema, and a slew of other marginal projects.
Mavin’s marketing capabilities however put them in better stead to succeed – a factor that must have definitely been considered in making the investment because the PR announcing the investment contained details like Youtube total video views, number of subscribers, etc.
Written by Damilola Layode
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