Mistakes New Business Owners Make: What My First Two Years in Business Taught Me
I opened my clothing store on Instagram in January 2023 with forty thousand naira, a phone camera, and more confidence than sense. Two years later, I am still in business, but I would do almost everything differently. I am not alone in that. MSMEs make up 96.9% of Nigeria's businesses and add 46.32% to the country's GDP (PwC MSME Survey 2024, citing NBS/SMEDAN). Most of us who start something small end up learning the same four lessons the hard way, about money, marketing, trust, and growth. This is the honest version of my first two years, the one I do not usually post.
What happens when you mix personal and business money?
I kept one account for almost a year. Sales came in, rent went out, and somewhere in between I "borrowed" from the business to buy data or pay a driver, always promising myself I would pay it back. Mixing personal and business money makes it impossible to know if the business is actually profitable, and I found that out the hard way. Six months in, I genuinely could not tell you if I was making money or just moving it in circles. I opened a separate account the week I finally sat down to do my books, and I wish I had done it the week I made my first sale. Track every kobo. You cannot fix what you cannot see.
Why is underpricing your product a mistake in Nigeria?
I priced my dresses low because I was scared of losing customers to the bigger pages. It worked, for a while. Orders came in, and I felt like I was winning. What I did not notice was that underpricing trains customers to expect a discount and quietly drains your margin (profit after costs). The customers I attracted with low prices were the first to disappear the moment someone cheaper showed up, and by then I was too broke to restock properly. Cheap prices, I learned, attract cheap loyalty. Now I price for my actual costs plus a real margin, and let quality and service do the convincing instead of the price tag.
Is relying only on Instagram and WhatsApp risky for your business?
Yes, and I found out in the worst way. Close to 95% of Nigeria's active social media users are on WhatsApp (Statista, 2023), which made it feel like the obvious place to build everything. Then my Instagram page got suspended for two weeks in my first year. No warning, no explanation, just gone. Every saved DM, every customer mid conversation, every sale in progress, vanished with it. I had built a business on land I did not own. I still sell through Instagram and WhatsApp, because that is where my customers are, but I have made sure I own something outside them too, a simple website and a growing customer list I actually control.
Here is why you got DM’s but no sales
How do you find customers who actually buy, not just follow?
I had eight thousand followers and could barely sell twenty dresses a week, and for a long time I could not understand why. I was posting for everyone, which meant, really, I was speaking to no one. The shift happened when I stopped trying to appeal to every woman on my page and got specific: young professional women in Lagos who wanted office appropriate but stylish pieces. Once I knew exactly who I was talking to, my captions got sharper, and the sales followed. Followers were never the goal. Buyers were.
What happens when you accept payment without buyer protection in Nigeria?
You carry all the risk, and your buyer carries none of the trust, and that gap is exactly how good customers slip away to sellers who feel safer. I nearly lost a big customer over this. She wanted an eighty five thousand naira order but was scared to send full payment upfront to a page she had never bought from, and honestly, I understood. I would have felt the same way. This is where escrow based platforms like Paseero changed things for me. The buyer's money sits safely with Paseero until she confirms the item arrived as described, so neither of us is exposed. I started offering it to first time buyers, and my conversion (turning interested buyers into paying ones) went up almost immediately.
Why does doing everything yourself slow you down?
I handled sourcing, packaging, customer service, and delivery alone for a year and a half, and I wore it like a badge of honour. Then I got malaria for a week, and the business went completely silent. No replies, no shipments, no sales, just an inbox filling up while I lay in bed. Doing everything myself felt like control. It was actually a ceiling. I delegated my first task, replying to customer messages, not long after that, and I started the day I realised the business could not survive one sick week without me.
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Selling too many products can hurt a new brand
At some point I started adding shoes, bags, and jewelry to "give customers more options." My page stopped meaning anything specific, and the dresses that had built my name got buried under everything else. A brand that sells everything competes with everyone. A brand that sells one thing well becomes the name people remember for that thing. I went back to dresses, and my sales went back up.
How do you know when you're ready to raise money?
Someone messaged me in my second year offering funding for a stake in the business, and for a week I let myself imagine what I would do with it. Then I sat down to pull my numbers together and realised I did not actually have a track record to show him, just word of mouth and hope. I said no, and spent the next year building the proof instead of chasing the capital. You are ready to raise money once people already pay for what you are selling, not before. Investors fund traction (proof it is working), not potential.
My business survived its mistakes. Most do, if you catch the pattern early enough. Money, marketing, trust, and growth were the four places I bled the most, and looking back, the trust chapter decided more than I expected, whether a stranger felt safe enough to pay me at all.
Frequently Asked Questions
What is the most common mistake new business owners make? Mixing personal and business money is one of the most common and costly mistakes, since it hides whether the business is profitable at all.
How can I protect my business from Instagram or WhatsApp account loss? Build something you own outside social media, like a simple website or an email list, so a suspended account does not wipe out your customer relationships.
Is it safe to buy or sell online without buyer protection in Nigeria? It carries real risk on both sides. Escrow-based platforms like Paseero hold the buyer's payment until delivery is confirmed, which protects both the buyer and the seller.
When should a new business owner start delegating tasks? As soon as one task consistently takes time away from sales or customer service, that is the first task to hand off.
How do I know if I'm underpricing my product? If you are consistently out of stock but not out of debt, or customers only buy during discounts, your price likely does not cover your real costs plus margin.
Sources
- PwC. "Strategies for MSME Success" (2024), citing the NBS/SMEDAN MSME 2021 Survey. pwc.com/ng
- Statista. "Number of active social media users in Nigeria" (2023). statista.com