In this interview with Peter Uzoho, one of the beneficiaries of the Lagos State Employment Trust Fund loan scheme, Mr. Ikpoko Irikefe Scott, spoke about his business, the impact of LSETF on entrepreneurs in Lagos, among other issues
What is your background?
I am an entrepreneur and, the managing partner of Inland Royal Group of Companies. The group consists of Inland Royal Consulting, Inland Royal School of Entrepreneurship and Skills Acquisition, Inland Royal Waters â€“ a company that produces sachet and bottled water, and Inland Royal Autos, an automobile company where we service purely electronic cars. I hold an MBA in Entrepreneurship and Innovation from the Hult International Business School, United States of America.
How did you come about your business and where is it located?
I have passion for business and, Iâ€™m someone who likes to be independent. However, I had worked for several organisations, both local and international, including the Nigerian Stock Exchange. So, All along, while working for other brands, I was nursing the ambition of starting my own business. Iâ€™m so passionate about creating jobs for people through my business. So, after my programme in the US, I decided to return to Nigerian to see how I could help develop the Nigerian economy as well. I started my business in 2012 and I have spent about five years in the business. The consulting and skills acquisition arm of my business are based at No. 75, Lagos Road, Ikorodu. At the moment, we have also launched our business school known as Inland Royal Business School and, it is located at N9, Kofo Abayomi, Victoria Island, Lagos.
How did you come across the LSETF scheme?
There is a programme organised by an Ikorodu lawmaker, Hon. Jimi Benson, called iCare Foundation. My skills acquisition centre was one of the centres chosen to train some of the members of the foundation. The foundation serves as an incubation centre where they train young people most especially unemployed youths who want to go into business. They trained about 300 youths and that was where I heard about the LSETF loan. So, it was there I got to know about the agency and the loan facility.
How much did you apply for and how much were you given?Â I applied for five hundred thousand naira (N500, 000) in order to support my pure water business and it was approved.Â I got the loan in April, 2017 same year I came across the LSETF.
How transparent was the application process?
The process is rid of any bias. At the time I applied, it was very transparent because I am from Delta and there was no time I had fears that my ethnic background will affect granting of my application.
How easy has it been for you to repay the loan?
It has not been difficult in any way. Before the expiration date which I am supposed to pay back, I usually set aside the required sum to fund the repayment. Besides, the LSETF officers keep track of the payment period and they usually reach out to help us plan our repayment. This has allowed me put measures in place to avoid missing the expiration dates already worked out.
After repaying the present loan, would you like to apply again?
Yes, I will and I want to look at applying for N5 million and above so that it will help me scale up my business the more. I plan to get more money from the LSETF to help me sustain my business 1,000 packs per day which is my future projection. And, with that I can be able to employ more hands. The only way one can sustain in the water business is to have good trucks and a trusted team. I would like to get more trucks and more manpower as well, in the next five years to grow exponentially. Presently, we employ about 13 hands in the business. We want to get more people to work and this can only happen when we get more money to inject into the business.
Would you have acted differently if the loan was offered by an organisation/group not tied to the government?
Yes, because if you look at the interest rate from the LSETF which is at five per cent, it is very good for entrepreneurs. I donâ€™t know anywhere in the world where you get such interest rate, but with the rate, you can plan. And in terms of profit margin or turnover, it is quite better than what you get from banks and other microfinance outlets which is pegged at 20 per cent or 32 per cent.
For example, if the loan was from a bank, I wouldnâ€™t go for it. Before now, I had been managing my business with my personal cash. I have never taken the bank loan before. When the LSETF came and I studied the interest rate and repayment options which were good, I decided to go for it.
What area of the funding would you want the LSETF to improve on?
Basically, sometimes, what you apply for is what you get but you will as well discover that in the competitive market, the loan itself is not enough for some people to start something. For example, if someone applies for N500, 000 and is given N250, 000, the money might not be enough for him because even the original amount applied for might not fully fund the business, especially the young entrepreneurs that are just starting business. I think the LSETF can improve on that area. Although there is a verification process for applicants where the forms are accessed, I think it is better to give the entrepreneurs or applicants the exact amount they applied for. It is quite difficult if you apply for N500, 000 and you are given less than N200, 000. Again, the competition is very stiff today and the economy is just improving. In Nigeria today, you discover that your competitor will be flourishing in his business more than you because he has the needed funding. So, you need money to do better than because in todayâ€™s market, it is either you disrupt or get disrupted.
Also, the LSETF can start looking at areas of monitoring the loans to ensure entrepreneurs who got the loans put it into proper use. The loan management is very key because there is presently no problem in applying and processing the loans. I think the LSETF can get more management consultants that will spearhead a monitoring unit to advise and let the entrepreneurs know the importance of the loans and why they need to pay back. I also feel there is need to do continuous training for these set of people.
Where were you as a business before and after the LSETF loan?
Before the loan, we were doing well but in todayâ€™s competitive market, you need a lot of investment to inject into your business for it to grow if not you will be kicked out of the business. We needed more raw materials to meet up with our daily demands in terms of expansion which the loan was able to help us to achieve. After accessing the loan, the business is doing much better due to our ability to inject more money into the business.
In terms of turnover, we have grown from about 40 per cent to 75 per cent right now after the loan because we didnâ€™t invest in machineries but we only purchased rolls we use in producing the water. We are able to add more tonnes to what we are producing daily and the growth happened within seven months.
What is your staff strength now?Â
Before now, we had only three workers in the pure water factory who were working on the machines. However, at the moment, we have about seven people â€“ which an addition of four more hands working in the factory.
The LSETF is an agency of the Lagos State Government. Do you think itâ€™s really helping young entrepreneurs in the state?
Honestly, I thank God for Lagos State that put together a scheme like the ETF for businesses to thrive. I think this is the first government that is actually ready to tackle unemployment and is working towards the goal by helping the youths to start businesses for themselves.
What is your plan for the business in the next five years?
I have plans to expand to a stage where we have our own personal space, have a waterline and also produce more regularly where we can produce a minimum of 1,000 packs per day.