Nigeria's struggling economy continues to impact businesses as software company Zoho announces a price increase for its Nigerian users. Kehinde Ogundare, the country manager for Zoho in Nigeria, explains that the decision to raise prices was not taken lightly and was made to reflect the current market conditions and ensure the sustainability of high-quality services. The continuous devaluation of the Naira, which went from N350 to $1 to about N1500 in less than 2 years, played a significant role in this decision. The pricing in the local currency was previously heavily discounted for Nigerian users, with the price of Zoho's product set at N7,500, compared to $30-$35 paid by users in other countries. Zoho aims to support young businesses in Nigeria so that they can scale and grow. The company has experienced significant growth globally, with one million users and over one billion dollars in revenue. In Nigeria, Zoho's growth is driven by products such as Zoho One, Zoho Workplace, Zoho CRM Plus, Zoho Books, and Zoho Desk. The company has also partnered with StartupSouth to empower startups in Nigeria, providing wallet credits and free access to Zoho Contracts. Despite the price increase, Zoho remains committed to the Nigerian market [73785110].
Nigeria's struggling economy, galloping inflation, and high interest rates have led to a challenging business environment. The annual inflation rate in Nigeria reached 33.95% in May 2024, hitting a three-decade high. Food inflation rose by 15.84% to 40.66% year-on-year, with significant increases in the prices of items such as Semovita, Oatflake, Yam flour prepackaged, and Garri. Rising food prices in Nigeria have been attributed to insecurity in farming states and the removal of petrol subsidy. The weakening currency has also raised import prices on food. The Nigerian currency weakened in the official market, with the dollar quoted at N1,482.72, weaker than the N1,476 posted on Thursday at the Nigerian Autonomous Foreign Exchange Market. The naira lost 0.45% of its value after trading on Friday. The World Bank approved a $2.25 billion package to stabilize the economy, increase aid to the poor and vulnerable, and bolster the nation's foreign exchange reserves, supporting the naira. Despite the appreciation of the Naira against the US dollar, the cost of food items remains high, and the number of Nigerians who are food insecure has increased by 133% in three years. The federal government has begun enforcement raids to check compliance with price and quantity regulations and plans to extend these inspections to other markets in the country. The Central Bank of Nigeria (CBN) is prioritizing the fight against inflation over tackling rising unemployment rates. The CBN's primary goal is to combat inflation, even if it has some impact on other areas. The CBN consistently raising interest rates, Nigeria's inflation increased to 33.20% in March. The Central Bank of Nigeria is expected to raise interest rates to combat inflation, which may pose challenges for businesses, especially small businesses [1144f247].
Zoho's decision to raise prices in Nigeria reflects the economic challenges faced by businesses in the country. The continuous devaluation of the Naira and high inflation rates have made it difficult for companies to sustain discounted prices. Zoho's price increase is aimed at ensuring the sustainability of their services and supporting the growth of young businesses in Nigeria. Despite the price increase, Zoho remains committed to the Nigerian market and has partnered with StartupSouth to empower startups in the country. The company's growth in Nigeria is driven by various products, including Zoho One, Zoho Workplace, Zoho CRM Plus, Zoho Books, and Zoho Desk. Zoho's decision to raise prices aligns with the Central Bank of Nigeria's focus on combating inflation, even if it has some impact on other areas. The CBN has consistently raised interest rates to address inflation, which reached 33.20% in March. While the price increase may pose challenges for businesses, Zoho's commitment to the Nigerian market remains strong [73785110], [1144f247].