A whopping 97 per cent of Nigerian businesses recorded losses during the lockdown over Covid-19 while 87 per cent said they have been negatively affected overall by the pandemic, a nationwide survey has shown.

Titled "National survey report on the impact of Coronavirus on the Nigerian private sector," the survey assessed the impact of the pandemic on medium and small scale businesses in Nigeria. It was conducted between March 9 and April 10 through e-questionnaire and telephone.

Most of the 13 per cent who said they have been "positively impacted" by the global health crisis operate in the health sector.

"Most of the benefiting businesses are in the healthcare, pharmaceutical sector offering essential services," the report said, "or are currently exploring new opportunities despite the threat of the pandemic."

For the 87 per cent who saw red, the report said this is because "a majority of the countries they source their products from were on lockdown and many more have ceased operations."

For Sanni Hassan, the CEO of D'Genius Exquisite Fashion House, the COVID-19 lockdown period gave his brand the opportunity to re-strategise its service delivery and to reach "more online potential customers who have pledged patronage after the lockdown."

In terms of their balance sheets, 97 per cent of the businesses surveyed said they recorded losses. The remaining three per cent managed to break even, the survey suggested.

Three-quarters of those who made losses said they lost $1 million or lower due to the lockdown and travel ban.

A quarter of the businesses that recorded losses (25 per cent) said they incurred more than $2 million in revenue loss. This includes 20 per cent who said they recorded losses from $2 to $3 million and five per cent who lost $3 million and above.

"We suffered some revenue losses with respect to campaigns we had earlier planned before the pandemic and our various scheduled classes," Ibrahim Oredola, team lead at Skill NG, a startup training youth in digital and employment readiness skills, told Premium Times.

Revenue loss has in turn forced some businesses to lay-off workers to cut expenditure on overheads.

Mr Hassan said although he incurred "no loss," his profit margin fell due to the fall in consumers' spending capacity.

"Before, for instance, when we reach out to 100 people, we can get like 20 clients, but now we need to reach 200 or more to get that number of clients," he said.

More so, the report found that 72 per cent of the businesses surveyed experienced a contraction in job creation due to the pandemic, which has, in turn, resulted in them reducing staff strength.

Nigeria's statistics bureau had said not less than four in every ten Nigerians (42 per cent) who were working before the outbreak of coronavirus in the country lost their jobs due to the impact of COVID-19, in April.

Mr Ibrahim said his company had to explore full online learning experience as opposed to its blended former offline learning approach to maintain its staff list.

Focusing more on establishing a stronger emotional connection with their users "than just trying to sell products to them" is the way Ojuolape Toheeb, CEO of Tell!, an online African startup headquartered in Nigeria, said his brand is keeping afloat.

Yet, the report said the inability of businesses to maintain their payroll has been further compounded because 60 per cent of the country's private companies said they do not have any insurance policy or risk management system on their radar.

"The absence of a risk management system is perceived to be among the strongest reasons for the sudden flop of many of the private sector businesses," the report said.

It said about 89 per cent of the businesses expressed "interest to have an insurance policy in place in order to shield them from subsequent or future global crises."

Also, more than two-thirds of the respondents said their pre-COVID-19 business travel plan to source for products and raw materials was truncated by the lockdown.

The effect of this is far-reaching because 43 per cent of the businesses said they source their products and raw materials from China, with only 19 per cent doing so within Africa.

"This explains the dominant position of China in the country's supply chain and it partly reveals the low level of trade between Nigeria and other African countries," the report read.

"This strong external dependence of the economy on foreign nations especially outside Africa can be attributed to the severity COVID-19 will have on the economy."