Ogun MAN Urges Manufacturers to Explore New Financing Models

The Ogun State chapter of the Manufacturers Association of Nigeria (MAN) has called on local manufacturers to actively seek alternative means of financing to sustain their operations in the face of escalating production costs, tight liquidity, and dwindling consumer demand.

Speaking at the association’s Annual General Meeting in Abeokuta, the Chairman of MAN in Ogun, George Onafowokan, said that manufacturers in the state are under immense pressure due to a mix of macroeconomic headwinds, including forex scarcity, inflation, and high interest rates from commercial lenders. He emphasized that the current economic situation demands a shift in how industrialists approach financing, urging them to tap into non-traditional sources to remain competitive and solvent.

Onafowokan noted that many manufacturers are sitting on large volumes of unsold goods, leading to cash flow issues that are crippling production and expansion plans. He attributed part of this challenge to the high cost of borrowing from commercial banks, which typically offer short-term loans at double-digit interest rates. For manufacturers whose operations require long-term investments and capital cycles, such facilities are often unsuitable.

He encouraged members to pursue concessional loans from development finance institutions such as the Bank of Industry, which offer longer repayment periods and more favourable interest rates. These, he said, could provide the breathing room manufacturers need to navigate current economic turbulence without resorting to mass layoffs or plant closures.

The association also called on the state and federal governments to expand access to intervention funds and create a more enabling business environment. According to Onafowokan, manufacturers need reliable power, better infrastructure, and stable economic policies to operate effectively. Without such support, he warned, the sector risks losing its ability to contribute meaningfully to Nigeria’s industrial growth.

In addition, he advised manufacturers to consider capital market instruments such as bonds and commercial papers to raise medium- to long-term funds. While these options are not yet common among small and medium-sized manufacturers, MAN believes they hold great promise if operators are guided and supported with technical expertise.

Another recommendation put forward by the association is the promotion of cooperative financing models among clusters of manufacturers. Onafowokan argued that joint ventures, industrial hubs, and shared service models could allow smaller firms to pool resources, reduce individual financial burdens, and collectively negotiate better terms with suppliers and lenders.

He also urged members to take advantage of state-backed financing opportunities. The Ogun State Government, in previous years, had introduced special credit facilities for small and medium-scale enterprises operating within the manufacturing sector. While uptake has been slow due to bureaucratic bottlenecks, MAN expressed optimism that renewed engagement with the state authorities could improve disbursement and accessibility.

On the regulatory front, the association called for reforms that would simplify the process of accessing industrial funds and eliminate duplication across agencies. It also recommended targeted incentives such as tax holidays and import waivers on machinery for local manufacturers, which could serve as indirect financial relief.

Onafowokan added that alternative financing must go hand in hand with financial discipline. He urged manufacturers to enhance internal efficiency, reduce operational waste, and adopt modern accounting systems to better position themselves for funding opportunities. Lenders, he noted, are more willing to release funds to businesses with proper structures, transparent records, and credible repayment plans.

During the meeting, several members shared personal experiences of struggling to secure working capital from banks and called for collective action to engage stakeholders and lobby for friendlier policies. Others welcomed the push for alternative financing and proposed the establishment of a MAN-backed cooperative credit scheme to serve members across the state.

The Ogun MAN chairman concluded by reaffirming the association’s commitment to supporting its members with financial advisory services, advocacy, and training on emerging financing instruments. He emphasized that overcoming current challenges would require a combination of innovation, partnership, and adaptability.

In a sector that plays a vital role in job creation, GDP growth, and national self-sufficiency, the Ogun chapter of MAN believes that rethinking finance is not just a strategy—it is a necessity. As manufacturers struggle to stay afloat in a volatile economy, embracing alternative funding paths could be the turning point for many of them.