Director General of the Bauchi State Chamber of Commerce Industries, Mines and Agriculture (BACCIMA), Sani Tahir, has said most privately owned companies in the state had folded up due to poor record keeping.
He said yesterday in an interview with our correspondent in Bauchi that most industrialists operate businesses with improper record keeping which inhibits their capacity to distinguish between working capital and personal income.
Tahir said such practice had led business owners to ignorantly convert their working capital to personal use at the peril of their companies.
“Most owners of companies and other small businesses are unable to separate working capital from personal income and this is crippling their ventures.
“Similarly, there is a general lack of good management skills among industrialists in Bauchi,” he said.
The director general added that another factor responsible for the collapse of companies in Bauchi is siting of firms in isolated areas where stable power supply is apparently lacking, thus becoming unable to sustain operations on power generating sets.
“Trade liberalisation is indirectly related to the first, causing manufacturing companies to collapse. Nigeria in the 80s could boast of established industries; but competition from superior and cheaper imported materials led to their collapse.
“For instance, if the cost of production of a finished textile product is N600, similar products from China will pour into the country at a lower price, say N400 and Nigerians have appetite for imported products however of lower quality.
“When you speak of industries collapsing with the demise of pioneer industrialists, you are talking of how poor organisational management and unaccountability impinge on our industries.
“Bad management leads to decrease in profit. If the management fails to supervise its personnel properly and balance the factory budget, the business inevitably fails.
“In addition to this, inter-family feuds upon the demise of the pioneer industrialist also plays a role. This is what led to the collapse of one important textile industry in Kano that I don’t have to mention,” Tahir said.
He added that misappropriation on the other hand accounts for the gross collapse of government industries in the state, saying most of the moribund industries in the state were owned by government.
In an effort to resuscitate the affected companies, the Bauchi State government has announced the privatisation of six of its companies last year.
The firms include Bauchi Meat Factory, Bauchi Furniture Company, Wikki Hotels and Tours, Zaranda Hotel, Bauchi State Fertiliser Blending Company and Galambi Cattle Ranch.
Commenting, a lecturer with the Department of Banking and Finance, Federal Polytechnic, Bauchi, Uwais Muhammad said in order to change the ugly narrative of collapse of companies, government must make effort to educate more business owners and provide adequate security and capital.
He said business owners lack ideas on how to access capital and grants from government, adding that most of them do not have the requisite managerial skills to operate businesses.
