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Courier business booms in Nigeria

Wuraola Gbolagunte, founder of Citylink Courier Nigeria says deliveries run into hundreds of millions in Nigeria. Interview by Boluwaji Apanisile.

How it began

Courier service started in Nigeria in 1979 with DHL that moved in 10 years after it opened shop in San Francisco, USA. International Messengers Nigeria Limited, IMNL, known as UPS today came second. Courier service is about delivery of letters and parcels from 0.5kg to 50kg per airway bill.

Gbolagunte
Gbolagunte

Challenges

The business is challenged with multiple taxation, bad infrastructure and hostile operating environment.

Online trading influence

Online business positively impacted the courier business but not as expected, because some online malls dispatch themselves. As online malls are evolving, we need to look at how online marketers will have the synergy of partnering with licensed courier operators for deliveries.

High mortality

Many factors are responsible, ranging from lack of knowledge to inexperience on the part of some managers. No institute or academy responsible to train personnel, many operators just grope in the dark. A lot of players have on the job experience and the Association of Nigeria Courier Operators, ANCO, is looking into the possibility of partnership with the Chartered Institute of Transport and Logistics UK. Efforts to get the Nigeria Postal Commission Act enacted by the National Assembly are yet to succeed.

Recently a state government insists motorcycles plying the roads must be 200cc capacity and we are not allowed to phase out what we have over a period of time. The policy was not pocket friendly and there are other draconian legislations as if all courier companies are in the class of DHL, UPS or Red Star Express that started operations in 1979, 1980 and 1992 respectively. Annual courier license renewal is N350, 000 minimum, depending on category of operation. A month ago, six courier companies that could not renew their licenses in the past four years were delisted. Operating environment is harsh and economic situation is drowning even the lucrative sectors of the economy, so if gold rusts, what will iron do? The statement credited to ANCO that only 80 of the 237 courier companies are alive and well is a fact.

In my early days at DHL, vehicles leave for Port Harcourt every night for early morning deliveries; no courier firm will try that now. The roads are bad and security threats are rife.

Patronage

The market is ever expanding and it is unsaturated, like any other business, there are teething problems at the onset.  Entrepreneurs who are passionate about the business without compromising their integrity will gain credibility and recognition over time.

Remedies

Some courier companies may have to reduce their scope or coverage; we may have to look at segmenting the market into regions, states, local government or even specialised deliveries for  industries, pharmaceuticals, products under controlled temperature for diagnostic centres, etc.

Also, there is need to support the licensed small and medium enterprise courier operators to thrive. Virtually all motor parks collect letters and parcels for routes they ply without a courier operating license.

Lucrative

The business is lucrative and has good prospects, the ethics and high moral standards must be adhered to. A lot of undercutting and sharp practices which are temporarily beneficial to the consumers but detrimental to the wellbeing of the businesses in the long run must be curbed. The clamp down on illegal courier operators is good, also, the requirements and procedure for registration of a courier company need to be reviewed for professionalism in the business.

Courier business will always retain and improve on market demand despite challenges. Courier business gives peace of mind, reliability and comfort. You cannot leave your office now because you forgot your car key, sim card or medication in Abuja or Port Harcourt. The first thing you do is think of the fastest means to get them and a courier company within reach that can deliver fast and reliable hits your mind. Recently, a customer from Victoria Island in Lagos obtained our mobile number from our website and called in the morning requesting for the delivery of a birthday cake to a bank at the Redemption Camp in Mowe before noon. That was a premium service request which we gladly obliged.

Global scope

Small courier firms will have to synergise with big players in the industry for wider coverage and there are international companies willing to partner with Nigeria operators. What we need is to build capacity and get the financial muscle. In addition, we need to attend the franchise seminars and exhibitions.

Trade volume in Nigeria

I do not have accurate figures of the number of parcels handled in Nigeria annually but I can confidently say it runs into hundreds of millions. An online mall had 237,000 purchases overnight on Black Friday, this show 237,000 deliveries were made in the next working days just from one mall and this is ongoing. Another sale is on this December and there will be need for more courier deliveries. This is just a tiny fraction of parcels handled, when talking of inbound and outbound parcels handled by the global operators and the inter and intra city legitimate deliveries by all courier companies, we have a mind boggling figure.

Meet Mrs. Gbolagunte

CEO of Citylink Courier Nigeria Limited, I joined DHL International Nigeria Limited as a sales executive in January 1989 after my NYSC and upon graduation in Applied Chemistry. DHL exposed me to several internal and external trainings and I benefitted tremendously from these. Also, I underwent a marketing diploma course at the University of Lagos and a public relations and advertising advance course at Nigerian Institute of Journalism, Ogba. I also did numerous short courses with TOM Associates and other professional training institutions.

I served DHL for 12 years in different capacities and left as divisional manager. I voluntarily retired in year 2000 to nurture my own courier company. I have not looked back ever since. My company was licensed in 2005 and we have remained in business ever since.

I am married to a judicial officer for 26 years standing and our marriage is blessed with two gentlemen and a lady now doing well in their chosen endeavours.

Published in the Business Eye’s print version, Dec 2015 edition

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