Connect with us

Feature/OPED

Manufacturers, Entrepreneurs and Business Owners: Dealing with Inflation, Competitors and Substitute Goods

Published

on

Timi Olubiyi Substitute goods

By Timi Olubiyi, PhD

The Coronavirus (COVID-19) pandemic, as well as the economic turbulence, have had significant impacts on businesses, manufacturers and households, including individual lifestyles and well-being in recent times.

The direct consequence of these impacts has been a very large increase in inflation numbers in the country, and it is currently having serious implications.

Globally, no country is immune to inflation. Around the world, inflationary pressure has been experienced in the USA, the UK, and many other developed and developing nations. But in Nigeria, the peculiarity is that inflation has been getting higher steadily for the last two years.

Nigeria is one of the countries where inflation has grown the fastest, and it has been a concern for many businesses, and the government due to its severe impact post, COVID-19.

Lately, we have witnessed continued and unexplainable increases in the price of practically every known item and service across the country. The troubling trend is that most of these basic and essential necessities are increasingly out of reach for the majority of people, indicating that the country’s cost of living has risen at an alarming rate. That is, the rise in household spending required to maintain a consistent and decent quality of life has been a source of anxiety for many. The National Bureau of Statistics (NBS) says Nigeria’s headline inflation rate increased to 18.60 per cent on a year-on-year basis as of June 2022. The percentage change is the highest in the last five years, according to the records.

Though academic literature has pointed out that once inflation exceeds a certain level, on average above 15%, it starts to have a negative impact on the economy, principally on economic stability, growth, employment and investment attractiveness. Even so, the author thinks that the real inflation in an economy is shown by the rise in prices of food, groceries, and other goods and services that people use every day.

Without a doubt, the food inflation trend over the last two years has been overwhelming. The proportion of the majority’s income that is spent on food has remained ridiculously high. The persistent rise in inflation results in a decline in the buying power of Nigerians, who are therefore getting poorer. Because they will be forced to prioritise significant spending and the affordability of essentials will continue to decrease. The consequences of high inflation are a spike in unemployment numbers, a rise in poverty rates, declining savings, a high number of jobless youths, crimes, and unrest.

A report by Aljazeera titled Inflation rises in Nigeria amid fuel scarcity and insecurity indicated that four (4) out of ten (10) Nigerians are living below the poverty line. So, with this trend, the author has noticed a spike and sharp rise in the demand for substituted products and services by the majority of the citizenry in the country. The substitution effect usually happens when consumers replace very expensive items with cheaper ones due to price changes or when their financial conditions regress, and vice-versa. However, the point is about the decline in purchasing power due to inflation and its attendant consequences.

The cost of purchasing products and services required to maintain a given quality of life continues to be a major worry for many families and individuals in the country. According to the substitution effect, people switch from more expensive products and services to less expensive alternatives when prices rise or income declines.

For the majority of businesses, the persistent inflation in the country has made the high cost of running and maintaining independently generated power unbearable, particularly the cost of diesel. This has resulted in a high cost of running businesses. However, this cost is passed on to the consumers without notice. When this cost is passed and consumers find it intolerable, then a change in demand by switching to substitute products and services prevail. The propensity for this trend is high and it has been the order of the day. Substitute goods or products are alternative goods that could be used for the same purpose. Therefore, in the presence of inflation, substituting means that consumers seek out alternatives that are frequently low in price, most of the time low in quality, inferior, and largely unregulated.

The demand for substitutes continues to rise because the masses need to survive at all cost, so who has the blame? The consumers or the businesses? So long as the price of goods and products continues to increase, demand for their substitutes will continue to rise.

Consequently, business operators need to be aware of this. For instance, numerous salary earners have been forced to reduce the quality of the food they purchase and business owners continue to replace family food basket staples with any affordable alternative. Meanwhile, the expenses of transportation, school fees, electricity, cooking gas, and rent are equally on the rise, adding to the burden.

From a business perspective, substitute products create rivalry, loss of revenue, weak sales, loss of potential customers or consumers, low or no patronage, and threats to business survival. The main absurdity is that businesses cannot even identify the providers of these alternatives, because they remain largely in the dark. For instance, canned and jarred Sardine Titus is expensive, but Sardine Estus an alternative is available and affordable but the producers are faceless and unknown. Many of such competitors are available in the Nigerian market with a huge market share and competitive pressure. However, the quality of these readily available cheap alternatives is significantly compromised, and market-leading companies and products could even suffer business continuity issues if the lower-priced alternative continues to gain market share and interest of the masses.

As a response, it is a time for businesses to re-strategise, engage in high marketing and promotional campaigns, innovate in line with customer expectations and patronage-improving products, and lower prices.

Again, businesses can review their pricing model at this time to accommodate consumers and customers with waning purchasing power. It is also important for the government to play a bigger role in regulating substandard, inferior, and bad products, especially those that are dumped on the Nigerian market. Right now, it’s important to look at and understand how substitution can affect the economy, businesses, and environment in order to stop high death rates and illnesses.

Businesses can fail entirely as a result of substitute effects and substitution products outperforming the original. In a market where there are fewer substitute products, there is a higher probability of businesses earning greater profits, but the reverse is the case, with inflation and the current realities. So, entrepreneurs, business owners, and SME operators need to clearly understand that their businesses may just suffer from a substitution effect, which can weaken the sales of their products and may be attributed to consumers switching to cheaper alternatives just because they no longer have affordability or the price hike is unbearable.

In the view of the author, consumers largely make their choices based on their available spending power and make constant adjustments based on price changes, most of the time on impulse. So, in a time of high inflation and low consumer spending, cheaper substitutes and second-hand (used) items) are the alternatives that are available. Observation of the surroundings reveals every accessible space or place for micro businesses to operate, its an avenue to trade in second-hand items which the majority now prefer as alternatives owing to dwindling income and affordability at this time due to inflation. This can make it harder for well-known brands or established businesses to get patronage and remain in business if differentiation or other business strategies are ignored to stay cost competitive.

Many are unaware that the high inflation rate in the country is one of the major reasons why Naira is losing value. Therefore, the authors recommend that the government should make a deliberate effort to tackle the key issues in the country: insecurity, incessant power issues, continued exchange rate instability, and non-availability of forex to genuine business operators and exporting companies. Inflation could remain an issue unless these issues are given headlong attention. Good luck!

How may you obtain advice or further information on the article? 

Dr Timi Olubiyi, an Entrepreneurship & Business Management expert with a PhD in Business Administration from Babcock University Nigeria. A prolific investment coach, author, seasoned scholar, Chartered Member of the Chartered Institute for Securities & Investment (CISI), and Securities & Exchange Commission (SEC) registered capital market operator. He can be reached on the Twitter handle @drtimiolubiyi and via email: dr***********@***il.com, for any questions, reactions, and comments. The opinions expressed in this article are that of the author- Dr Timi Olubiyi and do not necessarily reflect the views of others.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Feature/OPED

Nigeria’s Olodo Uprising: An Assault on Critical Thinking

Published

on

olodo uprising

By Prince Charles Dickson, PhD

A sheep was passing and saw a lion crying inside a cage, trapped and helpless. The lion begged the sheep to rescue him, promising not to kill or eat it. The sheep refused at first, knowing fully well that a lion does not become a vegetarian because of captivity. But after much persuasion, emotional blackmail, and the sheep’s own gullibility, it opened the cage.

Now the lion was very hungry, having stayed in the cage for days without food. It quickly pounced on the sheep and was about to kill and eat it, but the sheep reminded him of his promise.

They were still arguing when other animals came passing. They sought to know what had happened. Both the lion and the sheep narrated their sides of the story, but because of fear, convenience, and a desperate need to gain favour in the lion’s eyes, all the animals took sides with the lion, except the tortoise, who claimed not to understand the whole scenario.

The tortoise asked the lion to show them where exactly he was before the sheep rescued him. The lion pointed at the cage.

The tortoise asked again, “Were you inside or outside when the sheep arrived?”

The lion replied, “I was inside.”

The tortoise then said, “Okay, enter and let us see how difficult it could be inside, because I am not getting the whole scenario.”

The lion entered, and immediately, the tortoise locked the cage. The lion was trapped again.

That story is not just folklore. It is a national diagnosis.

Nigeria today is full of trapped lions, gullible sheep, frightened animals, and very few tortoises. We have many people with opinions, but few with discernment. Many with certificates, but few with comprehension. Many with titles, but few with thought. Many who can quote policy, scripture, law, and ideology, but cannot ask the simple question that prevents disaster: “Wait first, how did we get here?”

That question is the beginning of critical thinking. Sadly, it is becoming an endangered species.

The easiest and most attractive national pastime remains buck-passing, especially with the bunch of leaders we have, some of whom can hardly peel a banana or wash an already white handkerchief. Not many of us want to take responsibility for anything, from personal life to family life, from community life to national life. The blame is always on the system, as if the system descended from the sky and imposed itself on innocent citizens.

We do not need to create demons out of our leaders because, in too many instances, they have behaved like ready-made specimens of public demons. So, we hang our sins on them, sometimes appropriately, sometimes lazily. Unfortunately, their behaviour has made it easy for the critics to descend on them. They shout loudly, lie casually, perform empathy only when cameras are present, and govern as though the people are background noise in their private banquet.

But there is a deeper tragedy. The lion is not our only problem. The sheep, too, must be examined. The other animals must be questioned. Even the silence of the forest must stand trial.

This is where the Olodo Syndrome enters.

In Nigerian street language, “Olodo” is often used to describe a dull person, someone slow to understand, someone who fails where basic reasoning should have saved them. But in this essay, Olodo is not merely the person who did not go to school. No. Nigeria has produced a more sophisticated creature: the educated olodo. The certificated illiterate. The graduate who cannot reason beyond slogans. The public officer who mistakes grammar for intelligence. The citizen who forwards nonsense with confidence. The analyst who mistakes noise for insight. The leader who confuses movement with progress. The voter who sells tomorrow for rice today, then spends four years complaining that the pot is empty.

Olodo, therefore, is not the absence of schooling. It is the failure of judgment.

It is what happens when a nation rewards mediocrity and punishes thought. It is what happens when people who ask serious questions are labelled troublesome, while those who clap for madness are called loyal. It is what happens when dumb, crazy things move the needle, while wisdom is treated like an old man coughing in the corner. It is what happens when unintelligent people do not merely exist, but are celebrated, promoted, defended, and installed as gatekeepers over those who still dare to think.

This is Nigeria’s Olodo Uprising.

It is an uprising not of the poor against the rich, nor of the uneducated against the educated. It is an uprising of shallow thinking against depth. An assault on memory, logic, accountability, and consequence. It is the national habit of refusing to connect action to outcome. We open the cage, release the lion, and then begin a prayer meeting when the lion remembers its appetite.

We talk, write, and discuss the Nigerian myth with a sense of fatalism. “This is Nigeria,” we say, as if that phrase is both an explanation and an excuse. If everyone thought as much about justice and fairness, life would be better. I am a critic, yes, but I am also a critic’s critic. I remain an unrepentant believer that one of the ways to keep the government on its toes is to keep harping on its flaws so that it can improve. But criticism without self-examination becomes entertainment. It becomes pepper soup politics, the kind we enjoy at drinking joints, suya spots, WhatsApp groups, and television studios where every table has a parliament and every loud voice is mistaken for a constitution.

Often, I say I believe the things I write are important for our nation, as they are for other nations. But when it appears to me that Nigerians, especially those in authority, do not react to these issues as people in other lands do, I repeat them in new essays to remind old readers and recruit new ones to participate in the continuing dialogue.

Because repetition, sometimes, is not a lack of creativity. It is the burden of memory in a country addicted to forgetting.

Sadly, this is Nigeria, where nothing works, and no one cares. When it works, it is often because someone’s interest is about to be served or is already being served, not because the people’s interest has suddenly become sacred. We talk about our institutions despairingly. Our leaders do not watch network news except when their faces will appear at their sons’ or daughters’ weddings, birthdays, burials, thanksgiving services, or self-sponsored ceremonies of public praise. They do not need newspapers anymore because too many pages are already full of their lies, paid adverts, and noisy banters dressed as governance.

A country that destroys thinking will eventually be governed by instinct.

That is why the Olodo Syndrome is dangerous. It not only makes people ignorant. It makes them confidently ignorant. It gives stupidity a microphone and asks wisdom to apply for permission to speak. It converts public debate into shouting contests. It turns leadership recruitment into ethnic arithmetic, religious panic, stomach infrastructure, and emotional blackmail. It makes citizens defend their oppressors because the oppressor speaks their language, attends their church, worships in their mosque, comes from their zone, or once gave them transport money.

This is how the other animals sided with the lion.

Not because the lion was right. They knew he was wrong. But fear is a powerful editor of truth. Hunger is a wicked lawyer. Proximity to power is a dangerous intoxicant. In Nigeria, many people do not support injustice because they are confused. They support it because they are calculating. They are asking themselves, “What if the lion remembers me tomorrow? What if I need a favour? What if I condemn him now and he becomes minister, governor, chairman, commissioner, vice chancellor, senator, president?”

So, they betray the sheep.

Government bashing remains a national pastime, and every drinking joint and suya spot has a sitting parliament with an expert on every issue. But we forget that no matter the input, if the politicians and actors on our national scene have questionable lives both at personal and domestic levels, nothing will change. The best government policy cannot change the individual when the policies themselves are formulated on a bad foundation by people with warped thinking.

A corrupt mind cannot midwife a clean system.

When a witch proclaims her presence, and an invalid does not make away, he must have money for sacrifices at home. Nigeria has been warned too many times. We have seen the witch. We have heard the announcement. Yet we remain seated, arguing about who invited her, who offended her, which village she came from, and whether her witchcraft is constitutionally recognised.

This is not merely a leadership failure. It is civic laziness. It is moral cowardice. It is intellectual surrender.

The tortoise in the story represents the rare citizen who does not join the chorus. The one who pauses the noise. The one who asks for sequence, evidence, context, motive, and consequence. The tortoise is not the loudest animal. It is not the strongest. It does not roar. It does not bleat. It thinks.

That is what Nigeria needs now: more tortoises.

Not slow people, but thoughtful people. Not cowards hiding under shells, but citizens who understand that speed without thought is national self-harm. We need people who can ask leaders: Where were you before power? What did you promise? What have you done? Who benefits? Who pays? What happens tomorrow? We need teachers who teach children to question, not merely to cram. We need voters who examine character before currency. We need religious leaders who produce conscience, not crowds. We need journalists who investigate, not decorate. We need institutions that reward competence over loyalty, substance over noise, and courage over convenience.

Because the lion will always be hungry again.

That is the part Nigeria refuses to learn. Appeasing bad leadership does not end its appetite. Excusing mediocrity does not transform it into excellence. Rewarding foolishness does not make it wise. If we allow the lion to eat the sheep today because we are afraid, hungry, tribal, religiously sentimental, or politically invested, we have not solved the hunger problem. We have only postponed our own turn.

In amazement, the other animals asked the tortoise, “why” and the tortoise replied. “If we allow him to eat the sheep today, he will still go hungry tomorrow, and we don’t know what will be eaten tomorrow—May Nigeria win.

Continue Reading

Feature/OPED

Stocks vs Forex: Which is Better for Beginners in 2026?

Published

on

Stocks vs Forex

By Onah Ishioma Adaeze

As a beginner, choosing between stocks and forex for your investment goals in 2026 can feel overwhelming. Before investing your hard-earned money, it is important to understand how both markets work.

While both markets present investors with opportunities to grow their wealth, they also differ in terms of volatility, liquidity, market hours, and leverage. Stocks involve owning portions of a company, while forex has to do with trading a base currency against a quote currency.

In this article, we will be going through the basics of stocks and forex, pointing out their differences, and helping you decide which asset better suits your investment journey in 2026.

What is Stock Trading?

When it comes to stock trading, you are buying shares of a company, which makes you a shareholder of that company. As a shareholder, you may be entitled to receive dividends whenever the company decides to pay dividends.

As for those companies that do not pay dividends, there are other benefits a shareholder may enjoy, like being called upon to attend shareholder meetings and having voting rights on certain company matters.

On a global scale, over $100 trillion worth of shares are traded annually. Also, the rising popularity of AI companies and technological innovations continues to drive investor participation and market growth.

If you’re an investor looking to buy and hold capital assets, then stock trading is definitely for you, as it allows for short-term, medium-term and long-term investment goals.

When you buy shares of a company and the company performs well, your shares increase in value. Another benefit of stock trading is access to index funds and ETFs.

These funds consist of companies that are grouped under an index. They are carefully selected and monitored under the fund, sparing the investor the stress of actively tracking the fund.

They can be a way of building a long-term, diversified portfolio, and some of these funds may pay dividends.

What is Forex Trading?

Forex trading has to do with buying one currency and selling another. With a pair like USD/JPY, USD is the base currency being bought against JPY, which is the quote currency.

In order to execute a trade in the forex market, you have to analyse and make predictions based on price movement, as well as pay attention to what’s going on in the global news scene.

The forex market runs twenty-four hours every weekday, with over $9 trillion traded in the market every day. Being the largest financial market in the world, there is very high liquidity.

Forex trading involves buying one currency against another, making predictions based on price movements on the forex charts. Price moves based on the activities of large institutions like hedge funds, big banks, the government, etc.

The forex market runs 24 hours a day, every weekday, with global forex turnover reaching $9 trillion per day in the BIS 2025 survey. Being the largest financial market in the world, there is very high volatility and price fluctuations.

At the same time, there is high liquidity in the market, which means that currency pairs can easily be bought and sold without hassle. Highly liquid instruments that are traded regularly include: EUR/USD, USD/JPY, GBP/USD, and gold (XAU/USD).

As a retail trader, knowing when to enter and exit the market is important. As easy as it is to make profits from price fluctuations, it is also very easy to lose money if the market moves against you. This is why it is important to set stop losses and take profits. This helps manage your trading capital.

Major Differences Between Stocks and Forex

While investing in stocks and forex can yield great capital gains, there are lots of ways in which they differ.

As a beginner, stock trading provides opportunities for long-term investments, ensuring slow but consistent returns for wealth building. But if you are looking for an active, short-term style of investment, then forex trading is for you, as it allows you to enter and exit the market within a shorter time frame.

Which is Better in 2026?

Choosing an asset to invest in all boils down to personal preference. At the same time, if you are not averse to risk, nor opposed to asset diversification, then it’s okay to invest in both.

For beginner investors in 2026, stock trading is easier to understand and get into, especially because of mutual funds, index funds and ETFs. With those funds, you don’t have to be an expert to start investing. You can just buy a fund that suits your needs and hold it over a long period of time.

If you are an investor who enjoys technical analysis, highly volatile and liquid markets, as well as trading under short time frames, then forex trading is the right pick for you.

Conclusion 

You do not need to put all your eggs in one basket. There are investors who invest in both stocks and forex simultaneously. When starting out, you can start investing in stocks while learning forex. Take calculated risks and do not invest above your means. Diversify your investments and remember, when starting out, you should prioritise acquiring knowledge over profits.

Onah Ishioma Adaeze is a finance writer who is passionate about simplifying complex concepts into easily digestible pieces. Her hobbies are reading and watching anime

Continue Reading

Feature/OPED

Building 234 Solutions: A Response to Everyday Workforce Challenges

Published

on

Owoloye Emmanuel 234 Solutions

By Owoloye Emmanuel

Every business starts with a problem. For us, that problem was hiding in plain sight.

Across organisations, we kept seeing HR professionals, payroll teams, and business leaders spend significant time navigating processes that should be simpler. Employee records sat across multiple systems, payroll processes required manual intervention, and routine workforce tasks often became more complicated than they needed to be.

As businesses grow, workforce operations naturally become more complex. Yet many organisations still rely on disconnected tools and workflows that create unnecessary friction for both employers and employees.

The consequence is more than operational inefficiency. HR teams spend valuable time managing systems instead of supporting people. Business leaders struggle to access timely workforce insights, while employees experience delays in processes that should be seamless.

These weren’t isolated challenges. They were recurring realities across workplaces, regardless of industry or size.

That observation led us to a simple question: what if workforce management could be easier?

What if HR, payroll, and workforce operations could work together within a single, connected experience?

That question became the foundation for 234 Solutions.

We are building 234 Solutions with a clear belief that workplace technology should reduce complexity, not add to it. Our goal is to help organisations spend less time navigating processes and more time focusing on productivity, growth, and people.

As we prepare for launch, our focus remains simple: building practical solutions for real workplace challenges and helping organisations create better experiences for the people who power them every day.

Owoloye Emmanuel is the founder of 234 Solutions

Continue Reading

Trending