The life of a Nigerian business owner is extremely difficult. If you are manufacturing, sourcing materials is extremely difficult, if you are in the importation business, duties and charges would have you by the neck and if you are in the service business, handling clients is a big headache. But one problem that cuts across all business owners is “Onigbese”
“Onigbese” is a popular Nigerian slang that translates to debtors. For some business owners, it’s a customer who always tries to buy an item on credit and never pays on time, for popular lifestyle blogger, Cassie Daves, it’s a client who paid only 60% of her fee and has not completed payment over 2 months after she had delivered the project. Finding the balance between selling on credit to increase how much your customers spend or increase customer loyalty and not running your business down thanks to Onigbese is not an easy task.
Here is how some Nigerian businesses are handling debtors.
What Kind of Businesses Do Onigbeses Target?
You may be reading this and at the back of your mind thinking you are safe. The truth is, all of us can eat the Onigbese Breakfast. Ifeanyi is in the Paint Production Business in Kaduna and has been in that business for 8 years while Ihuoma is a Skincare therapist in Agbara who has been in business since 2018 and Osebo who just started a cleaning service in Lagos have all experienced one or more issues with debtors. So, if you own a business in Nigeria, you can be their target.
Why do businesses sell or serve customers on credit anyways?
Have you ever seen a shoe you love on sale, but decided to wait till the end of the month to purchase it? The chances of you remembering to buy that shoe at the end of the month are slim and so, business owners sell on credit so you can buy that shoe immediately maybe even add another one and then tell all your friends to buy from them. Ihuoma specifically has a no credit policy and this means items are not delivered until full payment is made but for this reason, she allows it sometimes.
How much do Onigbeses typically owe?
Onigbeses are not easy to deal with. Some of them can be bold enough to request a new order on credit without paying for their last order. Ihuoma who is a SkinCare Therapist has never been owed more than 13,000 NGN but Ifeayin who is in the paint production business has been owed as much as 1,000,000 NGN. The type of business is also a big factor for onigbeses and that means the cost of your goods or service can influence how much they can owe.
How does Onigbeses act when confronted?
The classic way debtors behave when confronted is to divert your attention to something else. They remind you of all the business they have given you or they just try to laugh it off.
Here is the experience of Abake who runs a waste disposal company and has been owed up to 10,000,000 NGN by a company she worked with for 2 years.
"The company I worked for was constantly looking for ways to avoid paying; even though they knew I provided the services they still refused to pay. After I stopped working with them, the company requested proof of work for all the months I spent there. They eventually paid about half of the money and I just left the rest”
How long can Onigbeses owe small businesses?
If you learned anything from Abake’s experience, it’s that they can owe for years but again your mind may tell you that 10,000,000 NGN is a lot of money. Osebor who owns a cleaning service business was owed 20,000 NGN for 2 whole years. For Onigbeses, they would always choose to owe you as much as they can.
How do Small Business owners in Nigeria try to manage their debtors?
Ifeanyi, who produces paint in Kaduna, uses Kippa’s debt reminder a lot to request the payment of debt and so far, people pay up faster when he reminds them with a Simple Bookkeeping App From Kippa. Ihuoma runs a no credit policy but when she needs to sell on credit, she uses Kippa because “the customer just gets a reminder to pay you back, it made it look very official and so when I got a response, the response was official”.
Kippa sends automated WhatsApp messages and SMSs to debtors requesting payment to the business owners. It’s efficient and allows businesses to remain professional while getting paid