Before investing in, partnering with or paying a Nigerian business, it is important to understand who you are dealing with. This becomes even more important when the investor or business owner is based overseas and cannot easily visit Nigeria.
A business due diligence service in Nigeria can help coordinate checks on a company, supplier, vendor or potential business partner before you commit significant money or enter an agreement.
What Business Due Diligence Can Cover
The appropriate checks depend on the transaction, but may include:
- Business identity and registration details
- Physical business location
- Company contact information
- Nature of the business
- Directors or key representatives where appropriate
- Business documents
- Supplier or vendor relationships
- Operational activity
- Supporting information provided by the business
For larger transactions, more comprehensive professional due diligence may be appropriate.
Why Overseas Investors Need Local Due Diligence
Imagine an investor in the UK is considering putting money into a Nigerian business.
The company may have a convincing proposal, office address and financial projections, but the investor may still want independent checks before transferring funds.
Having someone locally coordinate verification can help uncover inconsistencies that may not be obvious from documents or online conversations.
What Should You Check Before Investing?
Depending on the situation, consider checking:
- Whether the business exists as presented.
- Whether its stated location can be verified.
- Whether the information provided is consistent.
- Who is authorised to represent the business.
- Whether supporting documents appear consistent.
- Whether the proposed transaction makes commercial sense.
- Whether additional legal, financial or regulatory checks are required.
Do not rely on a single document or conversation when dealing with a significant investment.
Due Diligence for Nigerian Suppliers and Partners
Businesses may also need checks before working with:
- Suppliers
- Distributors
- Contractors
- Manufacturers
- Vendors
- Property companies
- Potential business partners
- Service providers
This can be particularly useful before signing long-term agreements or making substantial advance payments.
Physical Business Verification
Sometimes documents are not enough.
A local visit may help confirm:
- Business premises
- Office or warehouse activity
- Signage
- Stock or equipment where relevant
- Staff presence
- General operating environment
The purpose is not simply to take photographs but to provide useful information about what is actually observable at the location.
How Travo.ng Can Help
Travo.ng can coordinate relevant business due diligence and local verification services where the requested service is available.
This may include:
- Business location checks
- Document collection
- Physical site visits
- Vendor verification
- Supplier checks
- Business communication
- Local information gathering
- Verification reports or updates
The scope of the assignment depends on what you need investigated.
Due Diligence Is Not a Guarantee
Due diligence can help you make a better-informed decision, but it cannot guarantee that a business will perform as promised or eliminate all commercial risk.
For significant investments, acquisitions or partnerships, consider engaging qualified legal, accounting or financial professionals for specialist checks.
Check Before You Commit Your Money
Whether you are investing in Nigeria from abroad or choosing a Nigerian business partner locally, proper due diligence can help you identify issues before they become expensive problems.
Travo.ng can coordinate relevant local business checks and due diligence support where available, helping you make decisions with better information.
