How are start-ups adjusting to new petrol price?

Nigerian entrepreneurs, notably operators of newly established businesses (start-ups) and small business, are hard hit by the new price of petrol, which is now pegged at N145.

But this is no longer news. The new dimension is that start-ups and micro, small and medium enterprises (MSMEs), have braced up for the challenge of a new petrol price and are gradually adjusting to the situation.

Timothy Samuel, owner of a barber’s shop in Ajegunle, Lagos, told Start-Up Digest that he has decided to raise the charges for adult hair cut from N250 to N300.

“I used to charge N250 before. But you know we hardly see electricity in this area and always rely on fuel. Apart from the period of scarcity, I used to buy between N86 and N100 before, but now that it’s N145 per litre, I have no option than to add N50. I have also increased that of children from N150 to N200,” Samuel said.

According to him, he sometimes collects N250 from his friends and regular customers but doing so always leads to low revenue at the end of each day.

In Onitsha, the commercial nerve centre of the south-east zone, a computer centre operator at Old Market Road, told Start-Up Digest that she has raised the price of page print-outs.

“I used to collect between N30 and N40 before for printing out one page, but it’s now N50 or N60. If you allow me to do the typing myself, I will collect N100, instead of N50 or N70 I used to collect before the increase in fuel price,” said Ngozi Ekemma, mother of two.

“You don’t blame me. I work between 9am and 6pm, and use fuel for 70-80 percent of the time,” Ekemma said.

Ola Rotimi, operator of a fast-food joint in Port Harcourt, said he tried to raise the cost of a plate of food from N500 to N700 but was disappointed when his customers stopped coming.

“They suddenly disappeared,” Rotimi bellowed.

“I had to lower my prices and then paste a notice on the wall before they returned. But that was after I had gone out to look for them. I use fuel regularly and need to raise my prices to reflect the situation, but this has hit a brick wall,” he said.

For Greatsheyi Akintunde, chairman of Nigerian Association of Small Scale Industries (NASSI), Ondo State chapter, this is generally bad news for small businesses, especially those in the productive sector. Akintunde said many scale-scale industries could shed jobs and may not survive the increasingly harsh business environment.

“We have been buying fuel at N86. So when you raise the price to N145, you raise the cost of energy for small-scale industrialists. This means that more small industries could shut down,” Akintunde said.

ODINAKA ANUDU