SEC-S20W2 | My Business Ideas |Capital Management

iddy (61)in #dtt-sc20w2 • 4 days ago

Perceiving business opportunities is a great gift, but this gift could be deterred if one does not have the needed capital to start and run the business. This post covers the initial investment value of my businesses, the profit and loss statement, and how I got my capital. I am delighted to participate in this contest organized by @dove11 and @aviral123.

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Q1. Please tell us about your initial investment value in terms of Steem as well as in US$, and how you manage it.

I am already in business, two precisely, which are Transportation and palm oil processing/purchasing. The following two tables show my initial investment value for transportation and palm oil processing/purchasing businesses.

TRANSPORTATION:

Commodity	Naira value	US dollar	Steem
CAR	2,500,000	1,562.5	9,257
Vehicle registration	50,000	31.25	185
Transportation registration	50,000	31.25	185
Total investment value	2,600,000	1,625	9,627

The above table indicates my initial investment value for the transportation business, and this is the value I needed to start the business three years ago; it may be higher now.

PALM OIL PROCESSING/PURCHASING:

Commodity	Naira value	US dollar	steem
Renting plantation	200,000	125	741
Payment for harvester	25,000	15.625	93
Payment for oil mill	96,000	60	355
Payment for workers	120,000	75	444
Money for purchases	200,000	125	741
Total investment value	641,000	400.625	2,374

The above table indicates my initial investment value for the palm oil processing/purchasing business. The value was for running the business for twelve months. Renting of palm fruit plantation was for twelve months, payment for harvester was for five months, payment for oil mill was for twelve months, payment for workers was for twelve months, likewise for purchases. This was the initial investment value I needed two years ago; it may be higher now.

Q2. A profit and loss statement is commonly known as a statement that shows details of your business's revenue and expenses over a period that we calculate on a monthly, quarterly, or annual basis. How do you determine whether your business made a profit or loss during a stipulated period?

The following table shows my recent quarterly profit and loss statement for my Transportation business:

Months	revenue	Tax	maintenance	PMS
1	#600,000	#100,000	#40,000	#260,000
2	#720,000	#120,000	#30,000	#312,000
3	#480,000	#80,000	#22,000	208,000

Total	Naira	US dollar	steem
Revenue	1,800,000	1,125	6,665
Expenses (tax +maint.+PMS)	1,172,000	732.5	4,340

Quarterly profit	Naira	US dollar	steem
Revenue-expenses	628,000	392.5	2,325

From the above table, it can be seen that I earned $392.5 profit from my Transportation business. I used my profit to run my home and pay bills, then save some. I am planning to expand my business by purchasing another car, that's why I have been saving, and I think having more cars will make my business successful.

The following table shows my recent quarterly profit and loss statement for my palm oil purchasing/processing business:

Months	revenue	Tax	payments
1	#112,000	#2000	25,000
2	#84,000	#1000	20,000
3	#140,000	#2,500	30,000

Total	Naira	US dollar	steem
Revenue	336,000	210	1,244
Expenses (tax+payment)	80,500	50.3	298

Quarterly profit	Naira	US dollar	steem
Revenue-expenses	255,500	160	946

From the above table, it's seen that I am making a quarterly profit of $160 from my palm oil processing/purchasing business. I don't use this profit, I reinvested it by purchasing oil, and at the end of the annual, I will check if I have gotten my capital investment back and check the grand profit. I am planning to have my plantation, and I believe this will make this business more successful.

Myself on Transportation business

Q3. Loans and working capital

I did not take a loan from a financial institution for my business. I would have loved to but I wasn't eligible. To get a loan from a financial institution in Nigeria, one needs to meet some of the following requirements;

1. Have already existing business; The financial institution will check the cash flow of the business account to know if the borrower would be able to repay the loan.

2. Being a public servant; The financial institution will be deducting money from this person's salary installmentally till they get back their money and interest.

3. Has valuable and well-documented collateral in a proper location. Failure to repay the loan will call for the financial institution to place the property on sale.

If one meets either of the aforementioned requirements, he will be given a loan. Then, the interest of about 10 percent to 25 percent would be deducted from the amount needed before being given to the person who needs the loan. The interest rate depends on the institution. I didn't meet the requirements. I chose to start with what I had; there was a car, and I took my savings, did the registrations, and began my business. The oil processing/purchasing business was set up from savings from my other business which I began earlier.

Q4. Colleterial securities and your understanding

I did not take any collateral loan for my business. In my country for one to take a collateral loan;

1. He needs to have a valuable property in a pronounced location. The financial institution will value the property with the help of an estate valuer to know if his property is worth the exact amount he needs for a loan or even more than that. Then, he will submit the legal document of the property to the institution and sign that the institution can sell the property if he fails to pay back the loan.

2. He has another person who has such property and is willing to sign for him and submit the documents for his property to the financial institution and sign that the institution is entitled to sell the property if he fails to pay back the loan.

I didn't take a collateral loan because I didn't have the needed property.

I don't have plans to seek a collateral loan from a business institution. I believe it's safer to start a business from scratch, with what one Has, and gradually grow the business. I save and reinvest my profits, and this method gradually grows my business. I believe with time, it will get to its peak.

I invite;
@goodybest
@eliany
@blessedbee

To participate, use the Link

BEST REGARDS
@iddy

#burnsteem25 #steemexclusive #nigeria #business #club5050

4 days ago in #dtt-sc20w2 by iddy (61)

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eliany (77) 4 days ago

I understand your business idea and your choice of capital. I never knew that palm oil business is this profitable. But in all capital is really important, is good you used your savings to to begin your business then as it grows, you repurchase to expand your business.

Getting loan this days is really challenging, some places their criteria is to much but we go survive.

Thank you for inviting, I wish you success 👍

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iddy (61) 3 days ago

Thank you very much for stopping by. The oil business is lucrative, but very lucrative if you process it yourself. If you can not process it, then purchase the oil between November and May, then sell it between July and August, and you will make a profit. The reason is, that palm trees bear much from between November-May, and supply will be higher than demand and price would be affected, and between June- September, it doesn't bear much fruit, which means demand would be higher than supply and the oil price would be higher, then you sell the oil you stored.

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