1.0 INTRODUCTION

Business is seen to operate within an environment. This environment could either present a threat or an opportunity to the organizations that operate in it. This essay aims to describe the business environment in the city where the researcher lives. The first section will give an overview of what business environment is all about. Furthermore, Lagos state will be used as a case study to examine the business environment where the researcher lives. Then, different forces or conditions that encourage or inhibit business activities in Lagos state will be discussed

2.0 AN OVERVIEW OF BUSINESS ENVIRONMENT

According to Nyandat (2013) Business environment can be defined as forces or surroundings that affect business operations. These forces may include customers, competitors, suppliers, distributors, industry trends, substitutes, regulations, government activities, and economy, social, political and cultural factors.

Ogunro (2014) explained business environment as the combination of all environmental conditions and influences that are capable of affecting or influencing business activities. Furthermore, Obiwuru et al (2011) also defined environment of business as the aggregation of the pattern of all the external and internal conditions and influences that affects the existence, growth and development of the business.

For the purpose of this essay, Lagos state in Nigeria will be used as a case study to analyze the business environment in the city where the researcher resides.

Lagos state is the former capital of Africa’s largest country, Nigeria; it is the most populated city in sub-Saharan region with more than 15 million people. Lagos is called center of excellence because of its reputation of housing the very best of Nigeria’s skilled workforce. It is also home to the country’s top industries and businesses with over 65% of imported goods passing through its ports and 80% of manufacturing being handled within or around its vicinity. With such massive economic facts, Lagos is the life-wire of the Nigerian economy. This is best explained by the fact that no macro-economic activity can ever succeed with Lagos being alienated.

There are forces or conditions that encourage or inhibit business activity in Lagos and these include:

2.1 Human Capital:

The population of Lagos is a very good advantage for business entrepreneurs because both skilled and unskilled workforce is available and very cheap. Lagos state has a population of more than 15 million people of which 75% of them are youths and eager to work in order to earn a living. The city has the best of skilled workforce from diverse regions including foreign experts. This has helped the business activity because you can get any expert you want at a very affordable price.

2. 2 Inadequate Power Supply: Inadequate power supply is one of the major challenges that affect the business activity in Lagos. Every company has a standby power generator which is being used when there is power failure .Firms expenditure on diesel and petrol (as the case may be) is unbearable and this is affecting the productivity. This development is impacting negatively on the business investment due to increased expenditure on diesel and petrol by enterprises. This also comes with the consequences of declining productivity and competitiveness. Many companies have been closed down due to inadequate power supply while some companies where forced to relocate to the nearby country.