Latest / Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint / Unlock Your Entrepreneurial Potential: The Essential Steps to Starting a POS Business

Transcript

Unlock Your Entrepreneurial Potential: The Essential Steps to Starting a POS Business · Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint

• 0:01
  Hello and welcome to the show. I'm taking today's recording
• 0:04
  from the Mechanic and yes, I'm back.
• 0:07
  So expect to hear the usual interruptions in the background.
• 0:10
  Now this is your first time of listening to the podcast.
• 0:13
  The goal of the podcast is free business education.
• 0:15
  This is not the podcast where I razz mechanics about how bad
• 0:19
  they are. So don't worry, we're here for
• 0:20
  free business education. So by the time we're done, feel
• 0:25
  free to share, promote and talk about the show so that your
• 0:27
  friends and family members in Nigeria and abroad can benefit
• 0:30
  from the questions that we tackle.
• 0:32
  They can do that by subscribing on Spotify, YouTube or Apple,
• 0:36
  any player of their choice. And if you, dear listener, have
• 0:39
  any questions that are sales and marketing related, then please
• 0:43
  bring them to me. You can call, you can SMS or
• 0:46
  WhatsApp on 08064662140. Today on the show, I want us to
• 0:53
  look at how to start Apos business.
• 0:56
  And no, this is not the kind of thing I would normally talk
• 0:59
  about on the podcast. It's just that I also have a
• 1:01
  radio show on Radio Maria 91.3 FM in Abuja.
• 1:06
  And so once in a while I get interesting questions and I
• 1:09
  figure if I tackle them over the air, I might as well tackle them
• 1:12
  over here as well. And just in case there are
• 1:14
  people who are interested, and for those of you who are still
• 1:18
  wondering why am I at the mechanic?
• 1:19
  Because like last episode, I was at the mechanic, you know,
• 1:22
  that's because the last time I was here, it was AC that was a
• 1:26
  problem. They fixed the AC and in doing
• 1:28
  that, they threw the fan belt out of alignment.
• 1:31
  And because the fan belt was out of alignment, you know, the
• 1:34
  things are different and shy. I'm I'm back here.
• 1:37
  So what can I do? That's how it happens.
• 1:39
  You go to fix one thing, it knocks off something else and
• 1:42
  then you're back again. If nothing else, it helps you
• 1:45
  appreciate how helps you appreciate business growth.
• 1:50
  Let me put it that way. Because just like the mechanic
• 1:52
  works on one thing and throws off something else, business is
• 1:56
  also a system. So for business growth, there
• 1:58
  are times when we're going to try and tweak one particular
• 2:00
  thing and we might end up throwing something off.
• 2:03
  And so just like these things happen with car systems, it also
• 2:06
  happen with business systems or with human systems, you know,
• 2:09
  health systems, you go to the doctor if you want thing maybe
• 2:12
  end up knocking something else. Basha, I guess what I'm trying
• 2:15
  to say is everything is a system at the end of the day.
• 2:17
  So yeah, there's trade-offs when you're trying to walk around
• 2:20
  certain things. So let's go straight into the
• 2:23
  question about how to start Apos business.
• 2:26
  Now, First off, let me define what the POS business is.
• 2:30
  And of course, POS, the initials just stands for point of sale.
• 2:34
  And that's because when we're dealing with any business
• 2:36
  person, I mean most of us in Nigeria now anyway, we
• 2:39
  eventually get to that point where, you know, it's time to
• 2:41
  pay. You bring out your card and then
• 2:43
  you have to swipe it. Well, for those of you in the UK
• 2:46
  and America, you guys swipe OK, No, in UKUI, think in UKU tap.
• 2:50
  I think in America you still swipe and I can't remember.
• 2:52
  Sure. I mean, I mean, last time I was
• 2:54
  in the UK, my sister-in-law, I mean, to me it looked like
• 2:57
  magic. She just whipped out the card
• 2:58
  and then she just hovered over contactless payments, you know,
• 3:01
  as in pretty impressive. Although I hope we don't do that
• 3:05
  in hijack because I think 4 Niners, we just like they will
• 3:08
  make a killing if you can pay by doing contactless payments.
• 3:12
  You just take your card and just hover over the machine and then
• 3:15
  the thing just deducts like that.
• 3:17
  I mean, that's, that's crazy. That's mad.
• 3:20
  I mean, so that particular machine, whether it is the
• 3:23
  contactless, contactless one that you guys use in the UK
• 3:27
  where you just hover over the machine and then the thing
• 3:29
  deducts the money or the one that you use in America when you
• 3:32
  swipe or the one that you use in in Nigeria where you insert and
• 3:35
  then you put your PIN. So whatever it is, that thing is
• 3:38
  called the POS, the point of sale, the point of sale
• 3:40
  terminal. So in Nigeria, it has become a
• 3:44
  booming business where you can have a single vendor sit outside
• 3:48
  under an umbrella, under a kiosk, you know, in a shop or
• 3:51
  in, you know, wherever because we need people like this to
• 3:54
  facilitate cash withdrawals, you know, so you can withdraw cash
• 3:58
  because the ATMs in the country are not enough.
• 4:01
  Supposedly, we have about 40,000 ATMs to serve the whole country
• 4:05
  of Nigeria and that's not enough.
• 4:07
  And then the POS business people, the POS people that
• 4:11
  we're talking about, we currently have about 2 million
• 4:14
  registered operators and that still doesn't seem to be enough.
• 4:18
  So it looks as if we still need even more people like this.
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  So this is where the everyday person can withdraw and deposit
• 4:26
  cash without having to go into a bank.
• 4:28
  There was a time when you could do bill payments with them, you
• 4:30
  know, Internet, NEPA, blah, blah, blah, things like that.
• 4:33
  What else? OK, fund transfer already
• 4:35
  touched that. And early on when this POS thing
• 4:39
  started, you could do account opening because I remember
• 4:42
  seeing some of those kiosks in some places, you know, where
• 4:45
  would say Access Bank something, something, come on, open your
• 4:47
  account here. You know, I never tried it, but
• 4:50
  I do think it's a good idea, at least for people that are,
• 4:54
  what's the word, you know, in Nigeria when we say people are
• 4:56
  on banks, you know, certain people in certain economic
• 5:01
  classes, you know, they don't trust banks.
• 5:03
  They don't put their money in banks.
• 5:04
  So all these sorts of initiatives should make it
• 5:06
  easier for people to become part of the formal banking sector,
• 5:10
  you know, to put money in the banks.
• 5:13
  So it's actually that's what the POS is.
• 5:15
  And so I had two people call in not too long after each other to
• 5:21
  find out how do you start Apos business.
• 5:23
  Those Chitima in Abuja who called in, she's a hair stylist.
• 5:26
  And then there's Steven from era 11 who called in.
• 5:28
  I can't remember what he does and I need to know how to do a
• 5:32
  time to the POS business. So I figured no, no problem, I
• 5:35
  got you. Let me do some research and I'll
• 5:37
  get back to you guys. So this is the result of my
• 5:39
  research. Well, First off, you need start
• 5:41
  up capital. And of course, startup capital
• 5:45
  just means the money that you have to set aside before you
• 5:47
  start a business because you definitely need some small coins
• 5:50
  to buy one or two things before you start a business.
• 5:53
  So back in my wedding photography days, startup
• 5:55
  capital was needed. You'd have to buy your camera,
• 5:57
  you buy flash, you buy batteries, you buy the bag
• 6:01
  because back then we used to carry all our equipment in in
• 6:03
  bags. That was before they invented
• 6:06
  these. What's it called?
• 6:08
  Holsters before they invented the holsters that you put your,
• 6:12
  your put your cameras on so you get the bags, you get what else?
• 6:18
  Maybe you pay for studio space. What should I get the point?
• 6:20
  But The thing is, before you start business, you reserve some
• 6:22
  small coins so you can buy one or two things.
• 6:25
  So you want to need some startup capital if you're going to start
• 6:29
  Apos business because you're going to have to buy the
• 6:32
  machine, you know, the terminal where people can insert and pay
• 6:36
  or swipe and pay or contactless an MP.
• 6:39
  Although I am definitely not going to do the contactless
• 6:42
  thing whenever they roll out in Nigeria, I'll wait first.
• 6:45
  I'll give it like maybe 5-10 years, you know, until they sort
• 6:49
  out all the security issues before I start doing contactless
• 6:51
  payment in Nigeria. Then what else?
• 6:54
  OK, you buy the machine. Then you also have to get shop
• 6:57
  space or buy an umbrella or buy a kiosk.
• 6:59
  And then you have to do some basic kind of marketing so that
• 7:01
  people know who you are and what it is that you do.
• 7:04
  Then of course, you also need float.
• 7:05
  Now float is a certain sum of money that people in the
• 7:10
  financial space have to hold so that they can service their
• 7:13
  customers. Because somebody like me, excuse
• 7:17
  me, I'm in consulting now. I don't need to hold float.
• 7:19
  I don't need to hold money because if you call me, I'm
• 7:21
  trying to solve business problems.
• 7:22
  If I'm trying to collect cash from you, so I'm not handing
• 7:26
  cash out, I don't need float. As a wedding photographer, I
• 7:28
  didn't need float. But then if you're a banker, you
• 7:31
  guys to hold some cash because some people come and say, give
• 7:34
  me physical cash, I need to have cash to give them.
• 7:37
  So it's the same thing with pure as people.
• 7:39
  Some people are going to come and say, I want to withdraw 500K
• 7:43
  and you know, you're better have 500K on you to finance the
• 7:46
  transaction. So that's what float is.
• 7:50
  So because of all these things that are involved and excuse me,
• 7:54
  since you know, depending on where you are, your float
• 7:57
  doesn't have to be too much. There are different sources.
• 8:00
  Some people say you can start the POS business with 50K
• 8:04
  startup capital, although I think that's too small, sha,
• 8:07
  because there's some people who say the machine costs like 15 K.
• 8:10
  So I mean, if you buy the machine 15K, are you going to
• 8:13
  say that your float will now be 35 Ki?
• 8:16
  Mean that's too small. But anyway, SHA, I'm just
• 8:19
  letting you guys know what I found out.
• 8:20
  So you can start supposedly with 50K to 250K and that should be
• 8:24
  enough to buy the machine. That should be enough to buy, to
• 8:28
  get you shop space, umbrella kiosk or whatever.
• 8:31
  And then to do some basic marketing, you know, you just
• 8:33
  print out something and put on a blank, you know, to say POS
• 8:35
  here, that kind of thing. Then and then also the float.
• 8:41
  Well, like I said, machine costs, some people say 15, some
• 8:45
  people say 40K. But I noticed that GTB, at least
• 8:49
  in Abuja anyway, GTB has been advertising the the POS
• 8:55
  terminals, very nice orange looking things.
• 8:58
  And I think they're advertising some, is it 0% fees or 0%
• 9:02
  Commission or something and I can't remember.
• 9:04
  So if you're curious and you want to start a POS business,
• 9:06
  maybe you can go and check out GTB and see what they have to
• 9:10
  offer. Now some of you might be asking
• 9:12
  why am I talking about GGTB? That's guarantee Trust Bank.
• 9:15
  When we're talking about POS and you're going to find out now
• 9:20
  that is because before you start this business, you're going to
• 9:23
  have to register with the CAC now as the Corporate Affairs
• 9:26
  Commission, the people who register all businesses in
• 9:29
  Nigeria and all charities. Then you'll also have to partner
• 9:32
  with an aggregator. And an aggregator is a financial
• 9:35
  institution like a CBN registered bank.
• 9:39
  CBN is the create, I'm sorry, I say Christian, the central bank
• 9:44
  here, Central Bank of Nigeria, sorry, forgive me because CBN
• 9:46
  also is Christian Broadcasting Network.
• 9:49
  They're also here in Abuja. So you have to register with the
• 9:51
  CBN, the Central Bank of Nigeria and so financial institutions
• 9:58
  register with the CBN like banks and then payment processors, So
• 10:02
  GCB, Access Bank, Sterling Bank, IBTC, all of them registered on
• 10:06
  the CBN. Then payment processors like
• 10:09
  Money Points, OPA, you know, all these other people also have to
• 10:13
  be registered by CBN. So to now be in this POS
• 10:16
  business, you have to partner with one of these big boys or
• 10:20
  big girls and they're called aggregators.
• 10:22
  So that's the reason why GTB has not entered the equation because
• 10:25
  if that's your Bank of choice, then that is going to be the
• 10:27
  aggregator that you're going to be going through.
• 10:29
  So register with CAC, partner with one of these aggregators.
• 10:33
  And this is from these aggregators that you will now be
• 10:35
  able to obtain your CBN license. Because in this country, in
• 10:40
  Nigeria, it is illegal to be doing some kind money
• 10:43
  transactions, you know, money lending, blah, blah, blah,
• 10:45
  things like that without registering with the Central
• 10:50
  Bank of Nigeria. So just one of these things.
• 10:52
  So you know, be ready to change. Who else be ready to change POS
• 10:57
  money lender. You know, all of you people, you
• 10:59
  guys need to be registered with the Central Bank of Nigeria.
• 11:03
  So both of POS people, you'll be going through the aggregator to
• 11:08
  get your license. Then let's see what else.
• 11:12
  OK, I've already mentioned that the machine is like 15K to 40K.
• 11:16
  Now how much floats do you need to have?
• 11:18
  There's some people that say 50K float is OK.
• 11:21
  I think 50K float is unrealistic.
• 11:23
  But anyway, it depends on your community.
• 11:24
  If you're in the kind of place where people are withdrawing to
• 11:26
  2K55 Ki, guess 50K float is OK. Some people say minimum of 300
• 11:31
  K, even a 300 Ki think it's too small because I mean, I mean at
• 11:35
  least in Abuja now, anybody who comes to my mutual wants to
• 11:37
  withdraw like 20 K, you know, on the spot.
• 11:40
  So by the time 20 people come to you, you know, 20, I'll be 20
• 11:45
  people are 20 K. Is that like 400 grand or
• 11:47
  something? And then you cash my point
• 11:49
  share. I think that 300K is low, while
• 11:51
  they say, yeah, you can start with 50 to 300 K float.
• 11:56
  So the part that I like the most now, which is marketing, are you
• 12:01
  going to let people know that you exist?
• 12:02
  Are the services that you provide because it is the most
• 12:06
  pivotal part of being in business.
• 12:07
  I keep mentioning it again and again.
• 12:09
  If you cannot do sales, if you cannot do marketing, then you
• 12:12
  know, why are you wasting your time?
• 12:14
  Because it might be a good idea, like in this case, it's a good
• 12:16
  idea. There might be room for some
• 12:18
  demand because we have 200, sorry, that we have 2 million
• 12:22
  POS operators in Nigeria. And some people say it's still
• 12:25
  not enough to service the market.
• 12:27
  So maybe there's room for more. But The thing is, if you lack
• 12:29
  your marketing game, then quite frankly, you're going to suck
• 12:34
  and you're going to die in the business.
• 12:37
  So part of the marketing plan that I advocated for on the air
• 12:41
  was I said that Chidima does the hair stylist and Steven from
• 12:44
  Area 11 that they should pay attention to foot traffic.
• 12:48
  Maybe you should be looking at residential areas also.
• 12:50
  A foot traffic just means plenty of people to walk out past.
• 12:53
  You know, people are walking from here to there or people are
• 12:55
  taking a cutter from here to there, or people are driving
• 12:58
  past from here to there because it's from the food traffic that
• 13:00
  people will see you and be like, oh, OK, POS, they're here so
• 13:03
  that next time they need money, they'll come and meet you and
• 13:06
  say, oh, how far do you have? Two, 100K, how much is your
• 13:10
  charge? You know, blah, blah, blah.
• 13:12
  So residential areas, if you can, to take advantage of food
• 13:16
  traffic, residential areas where people live, then you can
• 13:21
  partner with small businesses because there are people who
• 13:23
  stay outside some shops, you know, shopping malls, barbing
• 13:25
  salons, you know, these kinds of places.
• 13:29
  So that whenever there's a problem with payments, you know,
• 13:32
  the people in the shop can just say, well, go outside.
• 13:35
  Well, I'm equally over there. He's our trusted POS provider.
• 13:38
  And then you can run sort of payment that way.
• 13:39
  So some people partner with local businesses.
• 13:42
  Then of course, you have to make sure that you have clear
• 13:45
  branding, make sure they have professional signage.
• 13:49
  So far, people in the POS space in Nigeria, they don't seem to
• 13:52
  worry too much about these sorts of things.
• 13:54
  They'll just put up a plank and then say POS here, you know,
• 13:57
  that kind of thing. And then they're good to go.
• 13:59
  But shall I just try and make it look, try and make it look nice.
• 14:04
  Don't write it with pencil and paper because you know, this
• 14:07
  Niger as in we put a lot of what's the word?
• 14:13
  We put a lot of faith in these sorts of things.
• 14:15
  So you might be a Better Business person, but because you
• 14:17
  wrote your own POS here in pencil and crayons and the other
• 14:20
  person printed his own at the Cyber Cafe, and maybe the person
• 14:24
  after that decided to go to to a proper printer to get this thing
• 14:29
  printed out. You know, people will look at
• 14:32
  that last guy as OK, this last guy is more professional than
• 14:35
  the rest of you too. So make sure that your branding,
• 14:38
  your printing, your signage, your whatever it is, make sure
• 14:41
  it's, it's clear, make sure it's on point.
• 14:43
  Just design something that looks decent.
• 14:46
  Then one thing that I suggested was to display pricing.
• 14:49
  You know, that is something that POS people so far are not doing.
• 14:52
  But in the financial sector, it is something that some people
• 14:56
  used to set themselves apart just by doing display pricing
• 14:59
  because what do they call it? They call it transparent
• 15:02
  pricing. So transparent pricing policies
• 15:05
  sometimes give customers some confidence.
• 15:08
  So they roll up to your place and then they see everything is
• 15:10
  printed that if you're withdrawing 5K, this is the
• 15:12
  charge, 10K, this is the charge, 20K, this is the charge.
• 15:16
  You know, just makes you feel as if you're not just arbitrarily
• 15:19
  calling numbers out. And you know, that's a problem
• 15:22
  now, at least in Abuja anyway, because I've noticed that in
• 15:24
  different parts of the city, different rates apply.
• 15:28
  And you know, there's no transparency in the prices.
• 15:34
  So I can go to some parts of Abuja and to withdraw 20K my, my
• 15:39
  fee is 500 bucks. And then in some places to
• 15:43
  withdraw 20K, my fee is 200 bucks.
• 15:46
  And in some places it's 300 bucks.
• 15:48
  So it just seems to be anyhow, So transparent pricing policies,
• 15:52
  maybe it might be something that you can use if you want to get
• 15:54
  involved in the POS business. Maybe my help set you apart.
• 15:58
  And who knows, maybe people might like coming to your place
• 16:01
  precisely because they know that whenever they get there, they
• 16:03
  know exactly the price that they're going to get.
• 16:05
  So that is something you can use to set yourself apart.
• 16:10
  Then if I know anyone who's starting a POS business, if I
• 16:13
  feel starting a POS business, please reach out to me because I
• 16:15
  think there's some ideas that we can try out concerning
• 16:18
  concerning SMS and WhatsApp marketing.
• 16:22
  So that's something that we can, we can, we can look at.
• 16:27
  So if you're about to get into this business, please let me
• 16:29
  know what's up. I would love to, yeah, share
• 16:33
  some ideas with you. Just run some experiments, you
• 16:35
  know, see if see if it works. So that's it pretty much.
• 16:40
  If I have any more ideas concerning the POS thing, I will
• 16:43
  come back here and make another episode.
• 16:45
  But just like I let people know on the radio, I'm letting you
• 16:47
  guys know here right now on the podcast.
• 16:49
  I beg verify any single info that you hear from me.
• 16:53
  Don't take what I say as gospel truth when it comes to sales,
• 16:58
  sales principles, sales frameworks.
• 16:59
  Yeah, you can trust me. Whatever I say, ticket is as
• 17:01
  good as gold. When I go outside, I'm going to
• 17:04
  do small research and come back here and tell you guys what I
• 17:06
  found. I beg verify the information by
• 17:08
  yourself before you place reliance on it.
• 17:11
  But at the very least shy, I know this for sure.
• 17:14
  You definitely have to register with CACI know this because I
• 17:17
  used to be a lawyer. And you definitely have to
• 17:19
  register with the CBN. And I know this because I used
• 17:22
  to be a lawyer and it's looking like you have to go through
• 17:27
  aggregators. Those are financial institutions
• 17:29
  that have been registered by the CBN.
• 17:31
  If there's an alternative route, how you get started in the POS
• 17:34
  business, you know, we'll do some research.
• 17:35
  I'm sure you probably find out. So that's it.
• 17:39
  That's how to start the POS business.
• 17:41
  Just in case you're curious and just in case you're one of those
• 17:43
  people who heard the statistics that we have 2 million POS
• 17:47
  operators in Nigeria, that the PS operators we have are still,
• 17:52
  they're not, still not enough to service the market that we have.
• 17:57
  So that is all for today folks. Remember, if you have any sales
• 18:01
  and marketing questions, then bring them to me.
• 18:03
  You can call can SMS or WhatsApp me on 08064662140.
• 18:09
  Thank you for your time and attention.
• 18:11
  I'll catch you, dear listener, at the next episode.