I saw a DANGOTE (Nigerian conglomerate owned by Africa’s richest man, Alhaji Aliko Dangote) advert recently, and it occurred to me that all his business interests focus mainly on the basic things every household needs. Indeed, there are many things we tend to need and want in life, some tangible others not necessarily tangible, but it is difficult to see how a business dealing in daily household items can fail, even in a highly competitive environment, especially when the business routinely innovates and reinvents itself. It is why names like Nestle have been with us like forever.
Some literature I read a while ago about starting a small business advised startups to focus on little things that matter to everyone in their day to day life. Whether the business is into the provision of goods or services, they should be such that can thrive even during wars and natural disasters, besides the good times. It should be good enough not to be affected drastically by economic uncertainties or change in government policy. Not many businesses can easily fit into this category, by meeting the requirements I have stated, barring unforeseen circumstances that may cause the business to implode without external stimuli, like mismanagement of capital and proceeds by business owners amongst others.
When people ask me why I focus so much on the Transport sector, it is because it satisfies to a large extent many of the requirements a small business needs to grow. As I have always maintained, going into the HIRE PURCHASE aspect of it, frees the entrepreneur from strict monitoring, such that one can still pursue a regular nine to five while building the business on the side, either as a business to expand upon or as foundation to raise funds for something more capital intensive that one may retire into much later in the future.
Since my foray into the transport sector, I have outlined the businesses and challenges inherent in starting up a hire purchase business in the three wheelers (popularly known as Keke in this part of the world) to the minibuses. I intentionally ignored talking about moped taxis, or motorbikes for transport purposes because of the safety issues associated with them. It is important to diversify that small business of yours, even in the same sector such that if an unfavorable climate visits an arm of it, the little “conglomerate” you must’ve built will not totally collapse, as the other arms continue to hold up. Therefore, if your transport business conveyed humans only, you may consider going into the part of transport that involves the movement of goods i.e. Haulage.
Interestingly, my last entry for the Entrepreneurship Series was on raising funds by exploring the Crowdfunding option, at a time access to loans via official means had become herculean and via loan sharks, suicidal. There definitely must come a time when banks will become an option especially in funding bigger business dreams but crowdfunding becomes viable when one wants to move a step further away from the self funding (dealt with earlier on in the series) that had carried one thus far, and financiers can easily see what you have so far achieved by your own financial efforts.
I just noticed that I have already nudged up paragraphs without even touching on the subject I intended to, though it is pertinent that I put the above out before going into the core, so I will do just an introduction here before moving on to the meat of the matter in a subsequent post. I had stated earlier, that if you had followed the journey as outlined in earlier instalments of the Transportation Business, you will find that it involved conveying people only, and it will be wise to diversify into the business of moving goods as well.
HAULAGE BUSINESS in Nigeria is a very lucrative business. You need to open your eyes to it to know and see how huge that sector is, and how yet very unsaturated it remains. A simple survey of the vehicles you see on the roads should give you a hint as to how large the space for Haulage Business in Nigeria is and remains for time to come. I reckon that it is as wide as the skies are, and with the operators as the birds in the sky without any of them knocking wings against each other. As you have birds of different sizes in the skies, so you have different levels at which one can enter the business. From the wheelbarrow, to the tricycles, to cars (especially the Volvo 740 series) to minibuses and buses converted for haulage purposes, to haulage vans (small,medium and large), and then to the trucks also of varying sizes. All of these are adequately catered for in the haulage business, intra- and interstate, and even across borders by road, within West Africa and beyond.
For the niche I minister to, a starting point will be the procurement of a haulage van, much like the size of passenger buses but with HIGH ROOFS without windows. You will see many of these vans for sale as “second hand” along the major roads, either imported or already used here in Nigeria. It costs a whole lot more to buy a new one, but if one can afford it, why not?
Did you just ask or wonder where the market (the good to be transported) is? I’d say everywhere, from friends that will need their goods moved, to firms you or a friend know that need to move things etc, on a personal level, beyond that there are groups that the operator can join and have goods allocated to him/her to be moved intra- or interstate, sometimes with an escort to ensure that the goods get to their destination. Your role will be that of an enabler, to provide funds for the purchase of the van and let it out for Hire Purchase for an amount to be agreed between you and your operator, with remittances made to the owner of the haulage van by the operator, who gets to eventually own the van once payment is completed.
I will stop here for now but not without promising to show you how to go about getting a haulage van as well as other things you need to know and do to start that haulage business using the Hire Purchase option, in the next instalment. Mazel Tov!