PwC MSME Survey 2020

Introduction Esiri Agbeyi Partner & Head, Private Wealth Services DI According to the National Bureau of Statistics, Small and medium scale enterprises (SMEs) in Nigeria have contributed about 48% - on average - to the national GDP in the last five years. Totaling about 17.4 million enterprises, they account for about 50% of industrial jobs and nearly 90% of activities in the manufacturing sector, in terms of number of enterprises. Despite the significant contribution of SMEs to the Nigerian economy, challenges still persist that hinder the growth and development of the sector. Challenges encountered by the sector include lack of skilled manpower, multiplicity of taxes, high cost of doing business, among others. PwC surveyed over 1600 business owners across the 6 geopolitical zones in Nigeria to bring more light to reasons why SMEs employ over 80% of the workforce but wealth is not diversified. One key concern for me is why we do not have a lot more of our SMEs being unicorns (i.e. a privately held startup company valued at over $1 billion). The simple answer is that it is a factor of our economy size. It begs more questions such as why the economy lags behind and there are several factors to consider. There are 8 chapters in this report that try to fragmentize the issues for SMEs and this is based off their own unique and personal experiences doing business in Nigeria. The survey questions were answered via online surveys and face to face interviews in come zones. The responses and PwC's insights is categorized in different chapters across the broad questions asked under the Nigerian business environment and market conditions, tax issues, access to finance, growth obstacles, payment policies, the role of technology and the impact of women on the MSME sector in Nigeria. I am very passionate about the latter as a female entrepreneur too. The case studies of successful business owners corroborate some of the challenges they faced starting their businesses, how they navigated them and innovations to walk around them. The last chapter provides insights on the implications of COVID-19 on the MSME segment globally and in Nigeria. PwC's 2020 SME survey report is the first of its kind in this sector. I hope you will find our insights very useful for other researches and to kickstart new solutions for this critical sector. Enjoy the read. PwC MSME Survey 2020 PwC June 2020 4

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