Top Shaky Businesses in Nigeria that You Should try to Avoid.
It is not enough for you to just hear about a business, that people are making a huge profit in it, and that you should try it too, you should try as much as possible to investigate the risk in it. You should also endeavour to know its practicability and feasibility. This article will pinpoint some businesses you should watch out for. These are the top shaky businesses in Nigeria.
Before going into a business, you should ask yourself some basic questions:
- What is this business about?
- What do I need to start it?
- What do I stand to gain if I start?
- What are the risks I must take?
If you are introduced to a business that fails to answer any of these questions listed above, you are advised to be very careful with it or preferably turn it down.
The major reason why most people enter invest in businesses is to guarantee themselves steady income and profit. This income is expected to last for a long period of time, it is meant to give them financial security. A good investment would generate profit for an entire lifetime and can be passed down from generation to generation.
A bad investment simply means any investment that has a low or zero probability of bringing in income. Businesses that crashes without warning or notice is not a good investment. A good way to avoid going into bad businesses is exercise due caution or seek the advice of a qualified financial advisor to help especially with dicey investments.
When a business appears rather dicey, employ the services of a professional to help evaluate it or you should probably avoid it. This is necessary so that you will not run at loss at the end of the day.
Also, try to avoid businesses that promise a very high rate of profit but has no information about the risks you have to take.
Top 7 Shaky businesses in Nigeria that you should be Cautious about
These are the top shaky businesses in Nigeria.
It is not new again that gambling is a very risky business to delve into. Apart from the fact that it is risky, people also have the tendency of getting addicted to it. I have seen cases of workers staking all their monthly allowance on gambling. Most of them end up miserable after losing all to it.
Gambling simply means to play a game of chance, to risk money or something valuable by bet or wager. In Nigeria, only three types of gambling have been legalized. These include sports betting, lottery games and casino gambling.
Most people refer to gambling as an investment. However, some underlying principles that guide investments are absent in it. For example, as an investor, you own shares, stock or bonds, but a gambler owns nothing.
2. Ponzi schemes
This is basically a fraudulent investment which promises a high rate of returns for just a little input. It is an attempt to lure in more persons to invest, thereafter within a short period of time, until they are no longer able to pay the returns they promised. The most popular one that really gained ground in Nigeria is MMM. Others include NNN, Ultimate Cyclers, Icharity, Zarfund, Givers forum etc.Ponzi schemes really got a great deal out of Nigerians in 2017, most businesspersons, workers, students left their businesses for the rather promising business.
Later in 2017, around October/November, investments in MMM dropped, and the organizers were no longer able to pay the promised returns. A huge amount of monies went down with the schemes, some businessmen totally lost their capital, others were left in debt, retirees lost their entire savings and till date, people haven’t been able to get their monies back.
3. Money Lending
Money lending simply means giving out cash loans to people who need it and to be repaid with interest within a short period of time. This is another dangerous investment as takes so much out of the person lending, this is due to the high interest rates placed on the loan.
A single person can do Money lending. it can also be a joint effort of a group of people to lend out money on the condition that they are repaid with interest.
This risk in this business affects both parties. As a lender, you may lend a person some and he may just abscond with it; sudden death also brings lots of bad debts to money lenders. The law in Nigeria concerning money lending is also not encouraging as it leaves both parties at the mercy of each other.
This refers to loans and savings corporations that offer savings and loans services. People cooperate and join thrifts to gather funds for new and existing projects.
The problem with this investment is in fraud. Where due diligence is not taken to check for loop holes and cases of fraud, huge loss may be incurred.
5. Real Estate Investment
This simply means buying and reselling landed properties. This business could go wrong, as it is capital intensive and any form of lack of due diligence may result in a huge loss.
There have been several instances of fraud in Nigeria regarding estate investments, some property owners will sell just a piece of land to more than one person.
This form of business needs extra caution from anyone who wishes to invest in it, failure of which could jeopardize the whole investment.
6. Investment in Perishable Goods
Although investing in perishable goods such as fruits and vegetables can be very enticing and profitable, you need to handle it properly if you wish to succeed in it. You need to consider a good location where you will quickly sell. This will prevent running into a loss when a huge portion of the goods remain unsold.
7. Cyber Cafes
There was a time when opening a cyber café was like owning a stream of gold where money flows in on a regular. But with the invention of phones and affordable data services, cyber cafes have been deserted.
So, opening a cyber café these days will not fetch you much profit as it used to.