Haulage business in Nigeria; How to start and its challenges

Haulage business is one of the most profitable businesses in Nigeria, though people hardly think about it as a business, they think it is not important and require large capital which is a good thing for those that will go into it, because there will be less competition.

Look like I’m rushing?

Let take it gently then

What is haulage?

Haulage is the movement of goods (solid, liquid, gas) from one place to another usually through road. It is profitable business that has lift many entrepreneur out of the shackles of poverty.

To build business around it is not hard as long as you follow the steps I will be listing below. The problem of haulage business is maintenance and solution to its challenges which will also be tackle below.

Before we go into the steps I will like you to take note of the following

Niches of haulage business in Nigeria

Many blogs will list niches of haulage business like this

Liquid goods delivery
Solid goods delivery
Gas good delivery

While the above are truly niches of haulage business we went further to classify them as follows

1) Contract niche
In this niche your job is to buy truck, employ drivers and seek company that needs your services and whatever company you see, they will pay for the mentainace of your truck and sometime driver allowance but I tell you it is hard to enter in to this niche because a newbie will not know how to seek or contact company.

2) Leasing niche
This is the most common niches in Nigeria, here you buy trucks and lease it to individual or company that will use it to transport goods.

It is easy to enter and make money I this niche because there are many people that needs truck especially those granite and sand transporter but the maintenance cost will be borne by you.

3) Independent niche
Here you own your truck lorry and oversee the transport goods yourself. In this niche you are you are in control of your business and you will mostly be working for final consumer which means big payment.

Examples of vehicle you need for haulage business

  • Truck
  • Lorry
  • Tipper
  • Trailer
  • Van
  • Bus

How to start haulage business in Nigeria

1) Knowledge
Most people will tell you to just jump into haulage business; please don’t do that, you will only waste your money.

You need knowledge to run a successful haulage business, you need to know the type of truck to buy, what load to carry, the best road to follow and how to bill customer. Knowledge gathering is not hard you should be able to learn it in three to 4 weeks.

2) Feasibility study
This is a must, if you have been reading our articles; you will notice that we always include it because it is the beginning and the end of business.

Go out and check if your haulage business will be profitable in your chosen location, do not think because your friend succeed in one location you will also succeed in your chosen location, interview potential customer and competitor.

Answer the following question in your feasibility study

Are there reliable customers in your location?

Is their parking slot?

What of area boys?

What of drivers how easy to find them?

Can you beat the competition?

3) Business plan
Once your feasibility study gives you go ahead the next step is to write a business plan, yes you need a business plan that will contain your vision, mission and how to get there.

Most entrepreneurs often forget the reason they came into a business and later lose their passion. Do let that happen to you write your passion along with your business plan; the change you want to effect or any reason you start the business.

Also if your plan is to collect loan or seek investor in the future you will surely need to write a concise and simple business plan that can be easily digest by investors and bakers.

4) Register with CAC
Please do not run away from CAC (Corporate Affairs Commission), you need to register your business get license from government, if you dont want to become a food for the police.

5) Purchase vehicle
What type of goods do you want to transport, is it agriculture goods? Property? Industrial goods? Note it down and buy vehicle that can carry such goods.

For instance, a lorry or truck will be good for agricultural goods while Tipper is good for stone and sand.

6) Insurance
Haulage business can be catastrophic if not insured, imaging losing a #3 million truck to accident; it will cripple your business. Before you start, makes sure you insured all your vehicle to avoid story that touch.

7) Employ a good driver
Finding a good driver is one of the problem of haulage business, do not be in haste when looking for driver, test them and interview them make sure they your boxes before employing them .

Believe me you don’t want a drunkard or someone that will dupe you.

The only problem is that you are a newbie, it will be hard to know what good driver are so try to find domain expert who will help you interview and test them.

8) Look for customer
This should not be a problem if you conduct your feasibility study well, because by now you would have know your potential customers (individual or company) that need your services.

Contact them and tell them you’ve kick start your business. 90% of them will not even kook your side so create a promo and freebies that will attract them to you.

If you are in independent niche you can give offer of free delivery

If it is leasing niche you can reduce your price
If it is contract niche offer free delivery

9) Start your business
If you do what I wrote above the next step is to start your company, but it does not end to have a sale t you need to deliver a good service it can be quick delivery or intact delivery, remember it is hard to set yourself apart from competition in haulage business so use top notch service as your unique selling preposition.

What you need to do to succeed in haulage business

Do not be greedy carry what your truck can carry

Employ qualify driver

Always do a routine checkup for your trucks and drivers

Always have professional mechanics at hand

Buy good vehicle poor but less cost vehicle will give you headache

How to earn more in haulage business

To earn more in haulage business set up a website where people can book your services but make sure you have enough trucks that will carry goods because people will surely book your service but after two or three disappointments they might not come back.

To set up a booking website you can contact us.

Also, set up social media pages, where you will update users on what your business is all about and how you do your business. It might take time before you get customer so be patient people will surely remember you when they need your service.

Cost of starting haulage business

It depends on your niche and type of goods you want to transport but all in all you should have up to #10 million before staring haulage business.

How profitable is haulage business in Nigeria

Profitability of haulage business is hard to assume, you need to factor in depreciation and maintenance fee and other factors what I can only give You is my word, haulage business is very profitable there are people making up to #400,000 per day.

 

Challenges of haulage business in Nigeria and their solution

1) Bad road
This is number one challenges of haulage business in Nigeria.

Bad road are in all state of Nigeria no state is left out and this will destroy your vehicle and if it doesnt maintenance fee will reduce your income imagine repairing your fleet every day.

Solution
Hire qualify and experience driver
Experience driver would have plied at least 60% of road I Nigeria; they will know which road is bad and which is good. This will allow them to maneuver their way when situation call.

Driver problem
Driver can be a solution as well as head ache if you employ wrong driver. As I have stated In one of the steps, take your time to hire driver, don’t rush, bad driver will chase you way from haulage business if you miss hire.

Repairers problem
Repairers are mechanic, panel fitter, and other technician that works on vehicle. A bad repairer will compound your vehicle problem instead of finding solution to it

Solution
The solution is simple employ repairer at least two people that will take care of your car, do not take your vehicle outside except it get fault a long way from home, in fact you can toe it to where your company reside.

Police problem
If you start your haulage business without getting necessary paper you just become a fish to shark (police) believe me by the time you keep settling every police you meet on the road, your profit will become negative.

If you register your company they will still collect something but it will be small.

Conclusion
What next for you is to start, do not become a wantrepreneur that only dream of starting business, though it will be hard at a Start but it will surely worth it.

Note though this article was written after a thorough research you still need to look for mentor who will take you by hand to success

Responses

Your email address will not be published.