Given the severe devaluation of the Naira, forget any grammar being promoted as “unified exchange rate”, a lot of businesses will fail in the next 30-180 days. If you are employed by electronics retail businesses, furniture stores, service companies and others that provide services to elites that are considered luxuries, expect to see more closures.
Clothing stores mostly boutiques, auto dealers and airlines will be impacted greatly but given the strong purchasing power of the 1% who store the value of their wealth in FX, some might see increased revenues but not necessarily higher profits which will be wiped out by the difference in procurement and sales price due to the fx rates.
Oil companies and service vendors will lay off given high operational costs and employees who fall into the administrative & non-technical business units will huge see layoffs. Banks even with the increase in wages to account for cost of living adjustments will lay off marketing staff.
Insurance companies will see low revenues as customers will rather choose not to renew or subscribe to new policies due to lower purchasing power with increased cost of essential services.
Hiring freezes will be implemented by alot of corporations and services will be outsourced. Individual contributors and professionals stall will take on more work load to close the gap with personnel who have been layed off.
Agropreneurs will not be spared and only businesses with access to some for credit lines will able to keep operations going. Transportation costs have increased severely and the delivery business ecosystem will see an acute rise in logistics cost making it impossible to keep profit margins.
Small businesses who rely on delivery services will see increased cost and SMEs who typically operate E-commerce models will experience a sharp decline in orders. With the rising cost of food commodities, most Nigerians will resort to domestic cooking and the restaurant business will see a huge decline in revenues leading to closure of locations and layoff of personnel. Increased cost of PMS and energy will cause vendors to operate minimal hours and if access to credit from vendors is non existent, expect a sharp decline.
The housing market will equally suffer a high reduction in new home construction and sales causing layoff or absence of work for laborers due to high cost of importation. Telecoms might not be greatly impacted but employees in the marketing and customer service units should expect layoffs.
Private schools will not be spared given the sharp decline in household networth and debt profiles will increase on the books, causing guardians to fall behind with payment of fees.
Households with multiple vehicles will cut down usage leading to low maintenance and procurement of service parts from auto spare part traders.
Businesses in the repair service ecosystem will see a sharp increase in patronage. Used or Second hand commodity traders will see an increase in business.
Religious houses will see increased attendance and you can figure out what their bottom lines will look like.
Local fashion businesses will see a boom where consumer behaviors will cause people to patronize these vendors as opposed to previous options.
Loan sharks will see a boom in collateral based loans with many customers unable to meet obligations, avoid these only if you see an exit with the ability to repay.
Government employees and civil servants will be the only class of workers to not really feel the impact.
We survived this in 2015/16, rest assured we will emerge but not without ugly tales to tell.
Find a support group and don’t be too proud to cut down luxuries where they are not needed for the time being.
It’s going to be rough! Nigerians are resilient and we will complain, cry and persevere until this ugly wind passes where we readjust while hoping for a better outcome.
Many households will rely on diaspora support to emerge unscathed where they are fortunate.
I will stop here!