Let’s admit it, running a business is challenging regardless of the circumstances. You have to think about competitive forces, regulations, and socioeconomic repercussions in addition to all the day-to-day operational challenges you encounter. Nevertheless, 2022 is shaping up to be among the most difficult years in recent history.
So how can you overcome the constant turmoil of Inflation and save your business from it? Let us find out.
What impact does Inflation have on the value of money in Nigeria?
Nigeria’s Urban Inflation in November 2022 was 21.63% on an annual basis, 5.11% higher than the 16.52 percent reported in October 2021.
Inflation raises the price of products and raw materials, as every SME owner is aware. However, Inflation has an increased expense whenever it comes to funding a business—the decline in the worth of the cash. For small businesses, this poses a problem. If you hold onto a large sum of money today, it will lose value every day, so if you utilize it to purchase materials and products tomorrow, you won’t get the same amount you would today.
On the other hand, waiting to raise money might also be troublesome because the money you receive would be valued less and may not be as useful as if you received it today.
How Financing right now can overcome the impact of Inflation
Getting a loan today could be the most effective method to fight Inflation. Spending the funds as quickly as possible is the best course to receive the greatest return on your money, provided
hyperinflation continues. The funding you possess now is worth more now than ever.
Borrowing money today and keeping it in a savings account won’t assist you in beating Inflation. However, if you raise funds and purchase inventory, machinery, or other things your business
needs today, you can own things before their price becomes unaffordable later.
Similarly, you can cash in on your money instead of letting it lose value in your financial institution.
Whether they choose to obtain a loan, small business owners in Nigeria can use extra financial techniques to combat Inflation.
You can re-evaluate how your company runs to see if there are any opportunities to improve efficiency and save money. Examine the areas of your business where you are experiencing the most success and see if there are any opportunities to expand on those areas or maybe start something entirely new.
That being said, Inflation is completely unavoidable. But understanding your cash flow and projected revenue can prepare your business to tackle the impact. And this is exactly where Lidya Forecast comes into play. With Lidya Forecast, you can now enjoy a full view of your business finances, allowing you to make better financial decisions.
On the other hand, tools like Lidya help you create digital consumer repayment programs that include several banks. Automate and improve the recovery of your funds with standing instructions to receive payment into your Lidya Wallet.
So sign up on Sign up on Lidya 2.0 right now.