Here in this post, we are going to discuss the steps to start the logistics business in Nigeria. We hope you find this post informative and useful.
The logistics business is also known as the transportation business; a logistics company usually specializes in the movement of goods from one point to another.
A logistics company controls give information and deal with the movement of goods from the seller or manufacturer to the final consumer.
“Logistics” comes from the late 19th century, the Oxford dictionary defined logistics as the branch of military science relating to procuring, maintaining and transporting material, personnel, and facilities.
Logistics was used during World War I and II to enable easy movement of weapon and food after the war logistics moved from warfare to business.
We have logistics companies in Nigeria that handle the delivery of goods from one place to another; we have ocean logistics, courier plus services limited, GIG logistics, creseada international limited, etc. And all of these companies started from somewhere.
So you might ask, how do I start the logistics business in Nigeria? That’s the point of this article, I’m going to explain how you can start and manage a good logistics business in Nigeria.
Identify The Level You Wish To Operate
Before venturing into the business you need to identify the level at which you would be able to operate, would you be able to operate at a bus or motorcycle level, intra or interstate transport? The industry (oil and gas). Do you want to start as an agent, transporter or contractor? You need to decide all of this.
You can start as an agent, an agent acts as a link between the transporter (truck owner) and the industry that needs the transport services.
As an agent, you do not need to buy yourself a vehicle and your commission would be gotten from an agreed percentage from the freight fee.
But if you wish to start as a transporter you’ll need to have your own vehicle and have a driver’s license to operate.
You can also start as a contractor and once you receive the contract you can contact a transporter. You may ask can one person be an agent, transporter and contractor?
Yes, it is absolutely possible, once you have your vehicle and your driver’s license you can handle any contract given to you.
Get Sufficient Funding And Capital
Once you have identified your level of operation, you need sufficient capital so as to acquire equipment and manpower.
During the course of writing this article, I researched the amount of capital needed to start this logistics business and I found out that your capital can be as low N300,000.
Now this N300,000 can be much to some people but considering what you can do with this amount then I’ll say it’s a fair price, in order to raise funds for this business you’ll need to draw up a business plan in order to convince potential investors that you can make profit within a stipulated period of time. You can also raise your capital by getting loans from any commercial bank.
Acquire The Necessary Equipment
Once your capital has been acquired then you’ll need to purchase the necessary equipment in order for you to start your logistics business.
First, you’ll need to get a vehicle, getting a new vehicle would be very expensive so it is advisable to get a fairly used vehicle or rent one until your business begins to turn in a profit.
In an environment with heavy traffic, it’ll be advisable to use a motorbike that is equipped with the plastic container to carry the products.
You will also need to get a mobile phone for communication and other necessary items that can be used for proper documentation.
Build And Develop Your Business Plan
As an entrepreneur who wants to venture into logistics, you’ll need to develop and build the business plan that would be able to get you to profit in a short time.
Your business plan should be short and concise. You’ll need to search for businesses in your area that may require delivery services; you should also include large organizations that may also require your services or companies that will require delivery of foods or any other package.
Get Licensed / Register Your Business
As an entrepreneur, you’ll need to register your business and get licensed. Choose a business name and register with the necessary bodies in Nigeria. You’ll also need to find out what kind of licenses and permits you need and obtain them.
Read Also: How To Start Up Business In Nigeria
Build An Online Platform /Set Up A Website
Before you kick off the business it’s to create a website for your logistics company, it’ll help in acquiring more customers, you can start by just creating a simple website and share to family and friends.
You can also use this website as a means of attending to customers that need your service by creating a page in the website that has your contact details and where customers can place their delivery orders and make complaints.
Get A Driver
Once you are registered and you have your necessary equipment then you’ll need to get a driver. The driver is a very important person in this business, as a beginner it’s advisable to be your own driver, being a driver is very important because you need to be very conversant with your environment and the delivery city, you must be polite at all cost, you must be trustworthy, you must be able to communicate with the public and you must be smart. Once your business grows then you can hire more drivers and then coach them on how to handle deliveries.
Get An Office Space/ Design Your Delivery Vehicle
As the business keeps growing you’ll need to get yourself an office space, you would need to rent an office space, get a computer and employ more staff if necessary.
And the vehicle you use in delivering your product should be well maintained because it represents your logistics company, it should have the name of your logistics company on its body and it should be well designed, as they say in the business “Packaging Is Important”
Create A Business Card Or Bulletin
As the business keeps progressing you’ll need to create a business card or bulletin and your business name location and phone number should be engraved in your business card. This can be used as another means of creating awareness of your brand to the public.
Get A Receipt
You need a receipt where the recipient signs as proof that he/she has gotten the items he ordered for.
Once all these steps have been achieved then you are already well set up with your business.
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