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Home Blog Page 5931

Approaches to Sustainable Innovation Financing in Nigerian Facilities Management Industry

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Like other industries in Nigeria, our analyst has previously noted that the Facilities Management industry cannot grow without constant radical and incremental innovation. This is highly imperative considering the current stage of the industry among others. Apart from the fact that constant innovation would change the face of the industry, making stakeholders to develop more interest in the ability and capability of the players to solve emerging frictions in critical and soft facilities management, it would enhance the industry’s place among other markets in Africa and Asia.

Therefore, both the players and professionals need to be creative and innovate ideas, concepts and products that will effectively deliver facility-related solutions. In our previous analysis, it was noted that employees at business, functional and corporate levels need to work together for innovation to happen. A clear innovation strategic plan must be developed. Innovation vision should be shared among the employees while the business owners and employees at the corporate level should exhibit a clear commitment to the cause.

When these happen, who should finance innovative ideas from the concept to developmental and expansion stages? This is the question this piece intends to answer briefly. Financing innovation is a mechanism that gives room for internal and external support. It also entails personal support or effort towards the successful innovation journey. In our experience, we have discovered that players in the industry can finance their innovation projects using internal and external approaches. Internal approach remains the most appropriate. The appropriateness is hinged on the fact that it gives players opportunity to capture absolute value from the outcomes of the innovation execution.

Using an internal approach means that both the employees and business owners must commit their financial resources to innovation projects. Financing innovation in the industry starts from when an employee or a group of employees [at functional and business levels] developed innovative ideas or concepts and spent their personal money on understanding the nucleus of the ideas or concepts before proposing it to employees at the corporate level. If the ideas or concepts are viable, there is a probability of getting corporate backing. This leads us to the second category of financing innovation.

However, the extent to which corporate financing can happen depend on the financial capacity of the business owners or investors. When it is obvious that the ideas or concepts cannot be financed internally, the needed fund is expected to be sought using external approach. With this approach, both the employees and business owners can discuss the ideas or concepts with a number of external stakeholders. For instance, grants, loans (including convertible debt), and equity investments can be explored. With the external approach, players would have the opportunity of establishing a strong interaction with the key stakeholders towards more recognition of the industry and what it means to the sustainability of public and private facilities.

These approaches must have been employed by Alpha Mead Group, which innovated  Call2Fix [solving perennial friction of having dependable technicians for secure homes and workplaces maintenance], and FilmoRealty that launched its proptech products recently. The company developed Vamp Facilities Intelligence, a software makes planning and execution of facilities projects easier. This software is useful for immersive facilities management practices in a pandemic period suggested by our analyst previously.

Nigeria’s Industrials Are Bleeding Revenue

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Time to declare a state of industrial growth emergency in Nigeria? If you have been paying attention, you ought to have noticed something: Nigeria’s industrial giants are struggling severely. Yes,  Cadbury Nigeria Plc just declared a profit of N172 million (about $400,000) for 2020. Unilever was all red at N1.59 billion loss: “Unilever Nigeria Plc a leading consumer goods company in Nigeria declares in its unaudited annual financial report that it made a loss amounting to N1.59 billion in the year 2020. This is according to the information and figures disclosed in the Company’s unaudited financial statement published by Unilever on the website of the Nigerian Stock Exchange”.

Cadbury Nigeria Plc has declared in its recently published unaudited year-end financial statements, that it made a profit of N172 million at the end of its operation in 2020.

This is according to the information and figures contained in Cadbury’s un-audited year-end 31st December 2020 financial statements, published on the website of the Nigerian Stock Exchange.

  • Revenue decreased to N35.41 billion, down by 9.97% Y-o-Y.
  • Cost of sales decreased to N29.64 billion, down by 4.39% Y-o-Y.
  • Gross profit decreased to N5.77 billion, down by 30.73% Y-o-Y.
  • Other income increased to 108.04 million, up by 24% Y-o-Y.
  • Selling and distribution expenses decreased to N4.58 billion, down by 12.12% Y-o-Y.

You can blame Covid-19 but I do not buy that argument. These companies make what we use daily, Covid-19 or not.

So, there is a problem somewhere and a dislocation is happening, frontally or through the flanks. It is either Nigerians have moved from semovita to black akpo [black local fufu] or someone somewhere is offering the same products at better rates. But one thing is evident: a shift is happening and these firms are under threats. I just hope that people are not getting poorer that few care for what they sell!

But do not miss that the local ones are doing better; Flour Mills broke sales records. It is possible that its products are more competitively priced since it does not have the global multinational structure of the competitors which can make flexibility on pricing more difficult, besides freedom to source some raw materials locally. Yes, like the ways Accenture and BCG were knocked down in Lagos by the local competitors, and both exited Nigeria. Pricing is a very important component in Nigeria’s business climate now.

Nigeria’s integrated food business and agro-allied group, Flour Mills of Nigeria Plc, has continued its strong performance, growing its profit after tax (PAT) for the third quarter ended December 2020/21 by 91 per cent. The Group posted a revenue of N555.342 billion in Q3, up from N423.479 billion in the corresponding period of 2019/20.

So, in the end, if you do not do sachetization in anything you  are doing in Nigeria, you will struggle. Nestle is a foreign brand but has gone full sachet-playbook and is killing it. Update your playbook and begin to sell in “sachets” where necessary.

National Livestock Transformation Plan (NLTP) as the Solution to Farmers’ Challenges in Nigeria

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The world today has many farmers that owe no farms. Thanks to different investment options, people can invest in farming while others manage those farms for them. Many farmers you know today were able to generate their capitals through investors, who could not lift hoes but hoped to reap proceeds from their farms. This method is also obtainable in livestock farming, where a person rears animals through a third party.

In addition to farming through a third party, farmers have discovered that they must not own a large expanse of land before they go into commercial farming. This tradition has been in existence for a long time. Even our forefathers “borrowed” farmlands and crops from others for an agreed sharing formula. Sometimes, the agreement is that all the farm produce will be shared equally between the lessor and the lessee. In most cases, legal landowners take the best economic crops on the farm and then leave the rest for the poor farmers. This arrangement is also found in livestock farming and has been sustaining farmers, especially those that lack land and seed capital.

Presently in Nigeria, a lot of people want to go into the farming business but they cannot afford to buy lands for that purpose. Leasing may not be a wonderful option considering that the high demands for land made it expensive. Even though some landowners rent out their properties at cheaper rates for this purpose, they are barely enough for the number of persons that need them. Apart from that, such arrangements may not suit commercial farming because the size of land allotted to farmers may be too small for anything other than subsistence agriculture. Livestock farmers also encounter this difficulty and it hinders their progress. This is one of the reasons farmers always call for government intervention towards providing land for agricultural purposes.

Apart from the land challenges, food crop farmers have complained bitterly about the encroachment of their farms by Fulani cattle herders, whose animals destroy their crops as a result of their open grazing method. The destruction of crops has led to several clashes between the herders and the farmers and has resulted in the death of many. Efforts made by farmers to discourage open grazing have led to multiple face-offs with herders and had shown no sign of stopping the problem. This means that only government intervention can stop the menace of open grazing in the country. To solve this problem as well as to provide land for livestock farmers, the government launched the National Livestock Transformation Plan (NLTP), an initiative that can answer the prayers of many farmers when it becomes operational.

NLTP is a scheme adopted by the National Executive Council (NEC) on 18 January, 2019. It is an initiative designed to partner with interested state governments to provide land for livestock farmers to practice their profession. Through this programme, livestock farmers, including the controversial Fulani herders (and their employers), will have access to land for ranching. The good thing about this scheme, when it starts fully, is that it will make land available to farmers at a considerably cheap rate. This means that Nigerians that wish to try their luck in livestock farming will have a place to do so.

However, the controversy surrounding the Rural Grazing Area (RUGA) scheme has found its way into NLTP. Some Nigerians believe NLTP is the baptismal name for RUGA. They believe the Federal Government repackaged the RUGA agenda in NLTP, whereby the government will ‘grab’ land from citizens and hand it over to Fulani cattle herders. As much as it is understandable for Nigerians to become sceptical of new initiatives, especially when they come from the government, they should understand that NLTP did not specify that the programme is designed only for a particular type of livestock farmers or people from a tribe. The sole objective of NLTP is to improve livestock farming by providing land for ranching.

Nevertheless, Nigerians should demand more from this programme. So far, considering that ranching is usually for grazing animals such as cattle, it has not been specified if all the ranches that will be provided through this initiative will be reserved for cattle farmers alone. Kindly note that Nigerians from different tribes engage in cattle rearing and, hence, providing land for cattle rearing does not imply they are only for people from a particular tribe. Hence, if you have an interest in cattle rearing, you can key into the NLTP and benefit from its objectives. However, farmers of other livestock should not be left out. Cattle are not the only sources of meat or income in Nigeria and so should not be treated specially.

Furthermore, there is a need for proper dissemination of information concerning this programme. Many Nigerians might not know what it entails and will, therefore, kick against it. It is also important that people know when the programme starts so that those interested can join in. This is a call to the appropriate authorities to do the needful because the publicity level of this scheme is poor.

Gameshop and the new Game of “Playing” Stocks

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How do you know a rich nation? Sure, there are many ways. But there is one addition, if you permit me: a Reddit thread playing stock games. Reddit is a social news aggregation, web content rating, and discussion website which is not very popular in Africa. But in America, it has a potent force to possibly push some men and women into early retirement. 

Yes, some money men and women are shorting some stocks (you make money when the stocks go down) and some people are not happy with them. So, on Reddit, the unhappy guys banded together to ensure the shorters loose. Yes, provided the value of the stocks keeps going up, the shorters will have to cover their exposures, and whenever that happens, they lose money. Technically, their loss is infinite even though their gain is bounded by zero since the lowest a stock can go is zero. (This is a brute-force explanation of shorting!)

Video-game seller GameStop is the site of a dramatic clash in the stock market that has seen the retailer’s stock soar by more than 1,600% this month. The company has one of the highest levels of so-called short interest, or financial bets against the stock’s rise — and those professional investors are getting crushed by the flood of mom-and-pop traders piling in. Interest in the stock has climbed rapidly due to a popular forum on Reddit, where a “cult” following has developed in support of the company. The showdown reveals the rising power of individual investors, who historically haven’t influenced stock prices on their own.

Pardon that introduction. I am trying to introduce Gameshop – a yoyo kind of company which has received new vaccines during the lockdown, and it is doing fairly well now. The company’s stock has gone parabolic because of one thing: some users on Reddit are betting to keep buying it to make sure Wall Street money people who shorted the company’s stock  keep losing money.

And you know what? They are actually spending money and buying real stocks, not the video game types. People, stock buying now is a fun game. Yes, if you are bored, launch the app and hit buy. But that that happens is a validation that America is indeed a rich nation; these young people are playing dollars as though they are in the village square sandy game.

Egwu oma si na chukwu [Good music comes from God]. Imagine if you are buying a company’s stocks and the owners are listening to the sound of clicks. Is there any better sound in business? Gameshop is listening to the right music now.

Can I give you stock to start?

Chelsea FC Under Fire for Sacking Frank Lampard

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Frank Lampard’s time as Chelsea football club head coach came to an abrupt end Monday, when the Stamford Bridge-based club announced his contract had been terminated.

Lampard, a Chelsea legend who spent 13 years with the club, scoring 211 goals from midfield to establish himself as Chelsea’s all-time leading goalscorer, became the club’s manager in 2019, amidst their struggle, with a three-year contract.

His time at the helm however, was riddled with a lot of woeful performances that got both the club’s management and fans yearning for change. Now the club says it’s time they parted ways.

“This has been a very difficult decision, and not one that the owner and the board have taken lightly. We are grateful to Frank for what he has achieved in his time as head coach of the club.

“However, recent results and performances have not met the club’s expectations, leaving the club mid-table without any clear path to sustained improvement.

“There can never be a good time to part ways with a club legend such as Frank, but after lengthy deliberation and consideration it was decided a change is needed now to give the club time to improve performances and results this season,” Chelsea said in an official statement.

Chelsea’s owner Ramon Abramovich for the first time, made a personal statement about a coach departure in the case of Lampard, describing him as a “man of integrity.”

“This was a very difficult decision for the club, not least because I have an excellent personal relationship with Frank and I have the utmost respect for him.

“He is a man of great integrity and has the highest of work ethics. However, under current circumstances we believe it is best to change managers,” he said.

The news of Lampard’s sack came shocking to many who described it as premature and had expected that he’d been given more time to build a team.

“The more I think about Frank Lampard’s sacking, the angrier it makes me feel. You won’t meet a more genuine decent bloke in world football, or anyone more deserving of being given enough time to be a success at Chelsea. Pathetic that he’s been kicked out after just 18 months,” Good Morning Britain co host, piers Morgan said.

For the 84 matches Chelsea played during his 18 months period as manager, Lampard won 44, drew 17 and lost 23 to put his win record at 52.4 percent. He also steered the club to a fourth-placed finish last season and also to FA Cup final.

With this record, many have the opinion that he should have been allowed more time to lead the team to favorable results. His iconic status in his playing days at the club enabled divided feelings about his sack among Chelsea fans.

On Sunday, a banner was raised in support of the former midfielder amidst the sack rumors. The social media has been agog about Chelsea’s decision to prematurely axe Lampard, with fans and football analysts condemning the decision.

Gary Lineker slammed Chelsea on Twitter, calling the decision “utterly ludicrous” after his first bad run. “It was always going to need time given so many new signings feeling their way into a new club. Patience being a virtue is seldom recognized in this sport. They never learn,” he said.

Chelsea has a pedigree of impatience with coaches. Since 2013 when Abramovich took over, the club has sacked 10 managers including Lampard. But some of the fans think Lampard deserves better and the decision was too hasty.

“Hearing Lampard is getting sacked is actually a disgrace, why now that he is trying to get the team to play together? Shame on Chelsea board,” an angry fan wrote.

Another one added: “I am really disgusted by the Chelsea board, none of which have done more for the club than Lampard. You don’t give him a chance to say goodbye properly as a player, you don’t give him a testimonial, shame on you.”

The decision to sack Lampard is believed to have stemmed from issues beyond losing five of his last eight Premier League matches. There was a report that his relationship with the club’s influential director, Marina Granovskaia had deteriorated over the manager’s treatment of goalkeeper, Kepa Arrizabalaga, a £72 million signing who was dropped as first choice due to his continuous errors.

It was also reported that senior players in the club, including Kepa were dissatisfied over how Lampard approached games. The dissatisfaction came from the claim that the manager always told the players to ‘go out and express themselves’ rather than take to the pitch with clear instructions or direction.

There is also the belief that the Chelsea board has ever wanted the new manager, Thomas Tuchel, who the club announced on Tuesday as Lampard’s replacement, to coach the club. Chelsea has for years touted Tuchel while he was engaged with other clubs, but were warned off. The German’s dismissal from PSG in December appeared to have presented the English club with the opportunity to secure his services.

Liverpool’s manager Jurgen klopp also said Chelsea made a “harsh” decision axing Lampard, but it’s Tuchel who has been given a present in the team.

“That was a really tough one. Chelsea did an incredible job in the transfer market this summer, brought in really good players, and things like this always need time. It’s really harsh to make a decision that early. Obviously Mr. gives you money and players but is not the most patient in the world.

“But for Thomas Tuchel it’s great. Unfortunately, he’s a really good manager. I have known him a long time and respect him a lot. This Chelsea squad is a present. I’m pretty sure Thomas sees it like that too,” Klopp said.

Lampard enjoyed £230 million market spending, which delivered a young fresh team to Chelsea. Although Tuchel has built a pleasant reputation in his managerial career, many believe the new team will ease his job at Chelsea.

Whether Chelsea made the right call or not sacking Lampard, is a question only time will answer.