How Ecommerce Logistics Networks Are Growing Brands Businesses In Nigeria

Opinion

By Adedoyin Giwa

The logistics and supply chain sector is one of the fastest growing industries in Nigeria. According to a report by Logistics and Supply Chain Industry published in 2018, the sector is recording a year on year growth. The report showed the Nigerian logistics sector was valued at N250 billion, which represents a rise of N50 billion from 2017.

Infrastructure investment is key to the growth of the logistics industry, but there’s an obvious regional and national deficit in Nigeria’s Logistics infrastructure which hinders trade for micro and small businesses. This is despite the operation of local and foreign private companies like UPS,Fedex,DHL, Red Star, and the Nigerian Postal Service in the industry.

In recent times, the industry has witnessed new industry players especially ecommerce companies with technology wherewithal, and whose services are filling the market deficit and having a huge impact on SMEs. The likes of Jumia, Konga, Gokada, Opay have redefined the Nigerian logistics space to fit the demands of the digital community.

In 2020, the leading ecommerce player, Jumia opened up its logistics network and technology infrastructure to third party businesses to service the facility deficit in the sector and the move is being embraced by SMEs and even large scale businesses. According to the Company’s 2020 Q4 report, the pilot conducted in 2020 saw Jumia ship almost half a million packages on behalf of more than 270 clients including large corporates such as banks, FMCG companies, mobile network operators as well as SMEs from a broad range of industries.

Speaking on the impact of logistics services on seller customer relationships in today’s business world, Gloria Igoche, Head Supply Chain, Zaron Cosmetics said getting goods across to customers has become easier and ending in a win-win situation. “There’s hardly a place that Jumia doesn’t go to. So our customers either in the rural or urban areas can get our products at low cost and very fast. So it has been more businesses for us; we are happy and our customers are happy,” she said.

On how affordable logistics services are improving customers’ experience in Nigeria, Omolara Adagunodo Head of Advertising, Jumia Nigeria said Jumia is extending its services to further help SMEs penetrate rural customers with ease and affordability. She said: “Jumia Logistics offers logistics services within Lagos and delivers to all 36 states of Nigeria at the lowest cost. We offer end to end logistics services including warehousing, and last mile services. With us you also enjoy the privilege of pay on delivery and a tracking system from start to finish.”

According to the company, individuals and enterprises can engage the Jumia logistics service by visiting the nearest Jumia drop off station, register pay and drop off the package. From then on, Jumia takes over the process with delivery confirmation sent to the sender. The company said it also offers special service delivery for their party individuals or businesses that ship at least 30m packages per week.

It is expected that with more infrastructural investment by private companies, coupled with the much needed government support, Nigeria’s logistics and supply chain will be able to optimise the huge rural and urban markets available in Nigeria to attain its enormous economic potential.

*Adedoyin Giwa is the Associate Consultant, PR REDLINE