The upcoming Nigerian General Election in 2023 is an event that could have a positive or negative effect on Small and Medium Enterprises (SMEs) in the country. The interconnection between politics and the economy is undeniable, which is why many industries are developing strategies to help them cope with the impact of political turmoil on their businesses. The recent adjustment to the cashless policy and naira redesign have plunged many SMEs into economic uncertainty, which can be exacerbated by election-related violence and attacks on businesses.
The negative effects of the 2023 general election on SMEs include artificial scarcity, business paralysis, supply chain disruption, alteration of marketing plans, and monetary fluctuation. For businesses in the production, distribution, or selling of physical products, they may hoard their goods to create artificial scarcity and sell them at higher prices. The lockdown on election days could lead to business paralysis, which would impede cash flow. Small businesses that supply materials or services to government agencies may experience supply chain disruption and will need to wait for the election outcome to determine their fate. SMEs may also need to alter their marketing plans, as election results can change how people feel about a product or service. The fluctuation of the Naira caused by the introduction of new notes aimed at curbing vote buying could also hurt SMEs.
The 2023 election is not all doom and gloom for SMEs. It could be an opportunity for small businesses to prepare for the days they would not be able to physically meet their clients. Business owners are creating a digital presence so they can reach their clients online and continue to generate income. They are also embracing other means of payment, including digital payment solutions that make it easy to pay for services and goods anytime, anywhere. SMEs are now exploring convenience, security, and financial inclusion, which can be achieved through the use of Simplebks. This platform makes it easy for SMEs to aggregate the financial aspect of their business in one place and achieve stress-free record-keeping.
The 2023 Nigerian General Election is a crucial test of the cashless policy and digitalization of the Nigerian business environment. SMEs should prepare to deal with the potential negative effects of the election and embrace the positive effects by leveraging the available digital tools to keep their businesses running during and after the election. Simplebks is an essential tool for SMEs to achieve financial stability, stress-free record-keeping, and top-notch accounting services.