Lack of Maintenance Culture, Bane of Haulage Business in Nigeria
Olugbenga Adeniyi, MD Dove Shipping & Logistics Services Ltd
OLUGBENGA ADENIYI, an expert in the practice of freight forwarding and haulage in Nigeria and some other West African countries, is no doubt a respected voice in the industry. Adeniyi, who call the shots as the managing director of Dove Shipping and Logistics services Ltd., Lagos, in this interview with BAYO AMODU, editor, Haulage & Logistics magazine revealed some of the challenges confronting haulage business in Nigeria and also spoke on the automotive policy of the federal government among others. Excerpts:
Sir, what can you say is the current state of things in the nation’s haulage sector?
We have found out that in recent times, some companies that came to operate in our haulage sector are leaving the country due to instability in our economy. Most haulage companies operating in Nigeria are being financed by companies from abroad. You can hardly find Nigerian banks financing haulage companies because it is capital intensive. Also, the business, when being handled by Nigerians most often times are always short lived as a result of poor management and inadequate knowledge of the business. Many people that come into haulage in Nigeria were attracted by some feasibility studies given to them by some people that they can make lots of money in the business. However, when they come into the business, in a short while, they ended up biting their fingers. There are many like that that jumped into the business and have to go under within five years.
Apart from inexperience, what are the other factors responsible for haulage business failures in Nigeria?
What I understand about business terrain in this country is that many want to go into business and reap profits in a hurry which is very bad. Naturally, when you invest in a business, in the first two years, you don’t have to think of profit. You have to first nurture the business. Thereafter, in the third year, you can start working on profit margin. When you start a business, how to sustain the business should be the watchword. You need to satisfy your customers first. Once your customers like your products or services, you can then talk of making profits. However, most businesses in Nigeria, once they start, the next thing on their minds is profit making, because somebody may have deceived them with a feasibility report of how they would be making money, so that is what they rely on and that is why you see them buying so many trucks. They never consider the maintenance of the trucks, the drivers, Nigerian roads and all of that. These are some of the reasons why most of the haulage companies fail as soon as they start business.
From your experience sir, what do you consider as the major challenges confronting the haulage industry in Nigeria?
Lack of maintenance culture is the bane of haulage business in Nigeria which is even one of the problems of Nigeria. We love to build but we don’t make rooms for maintenance. When you build and don’t maintain, soon the building will start cracking. When you buy a new truck, you may have guarantee from the vehicle manufacturer. However, the guarantee is only for the spare parts or the first two to three servicing of the vehicle. You won’t get guarantee for the roads the trucks are plying, the drivers that will drive the trucks including the experience and expertise of the driver. Most often times, most of these drivers don’t even know the vehicles they are driving. May be a driver has been driving Mack brand before and now you are asking such a driver to start driving MAN brand, the experience he had before with Mack is what he would likely bring to the other brand, definitely there would a mix up. There could be some trial and error which is not supposed to be so. Most of the truck owners just buy trucks but don’t take their drivers for training. Drivers need to be sensitized about the vehicle you are giving to them to drive. For instance, they need to know what to do when they see some signs on the dashboard. Unfortunately, most of the drivers don’t know all these things and the owners of the trucks because they just want money just buy the trucks and give them to drivers without giving them adequate training on how to use the trucks. It is even bad that some of them don’t know how to check for precautionary things like the oil, water etc in the vehicle. Every little check you conduct on a vehicle goes a long way because that would make the vehicle to run better on the road and prevents you from unnecessary stoppages, damages and hiccups on the road.
Another major challenge is the poor condition of our roads. Although the federal government is making efforts at maintaining the roads, they are not good enough. They fix the road today, in the next three months, it has gone bad again. I can tell you that those of us in the South West region of the country may be having fairly good roads, it is not the same with those in the North Central, North East and North West where you find out that their roads are really in bad shape especially if you are going to Ilorin, Jeba, Mokwa and so on. The roads are narrow, and terribly bad. These have been the roads we have been using since 1950s but government is not doing much on these roads. If they can do more in fixing the roads things will become better.
Also, another thing I will like to say about our roads is that unlike those days when we used to have what we called weight bridges. An average trailer supposed to be loading nothing more than 30 tons but today we see vehicles loading 40-45 tons and these roads are not actually designed for such weight, all these affect the road. When you travel around Nigeria, you see some roads that are in very terrible conditions. These are the effects of uncontrolled weight on the road. The weight of the trucks most especially where they are not running fast have adverse effects on the road and by so doing affects the turnaround of the trucks. For instance, if a truck is supposed to spend two days on a journey from Lagos to Kano, you find out that it would spend four to five days and this affect planning.
The haulage sector is often perceived as an all-comers affair, how as this been affecting the quality of services in the industry?
Some people have the money but don’t know how to invest it. For such people, because they see that so so and so is doing well in haulage and logistics business, they too would jump into the business. Sometimes, they are being ill-advised by those who tell them how much they can make if they invest in the business. Somebody could tell them that if they buy a truck for N7million, they can make N600, 000 in a month and N7.2 million in a year meaning that in a year they can make the money they invested in the business back and in the second year, the truck would start making extra cash for them. They have forgotten about tyre maintenance, that if for instance in a particular trip they lose four tyres, where one cost as much as N100, 000, that is N400, 000. Where will the money comes from? Is it not from the N600, 000 the business owner was expected to make per month? People forget that there would be some unexpected expenses that would be coming up.
Also, the business has become an all comers affair because some people think that in this country, we don’t have enough trucks to move around. But that impression is not true. If you go to many truck parks around the country, like in Kano, Kaduna etc you will see trucks numbering up to 300-400 lying idle waiting for goods to carry. If they have goods to carry, they will not be in those popular parks but will go to where their services are needed.
Trucks drivers are said to be often extorted by security agencies. How true is this?
Well, it is just that we find ourselves in a country like Nigeria. The problem of extortion on the road is so bad that the security operatives demanding for the bribes will tell you they have to give returns from their loots to some certain superior officers in their offices. For an average businessman, time is of essence. For instance, a truck owner whose driver is taking goods to Kano from Lagos would expect the driver to get to the destination within two or three days maximum, if there are no problems on the road. Getting to his destination would be the thinking of the driver. So, when they are being stopped on the road by these security officials who demand bribes, they would not want them to be delayed. These security agents demands between N200 and N5000 depending on what the driver is carrying. And we are talking about trucks which must have been checked by different security agencies at the ports and the Customs. Yet, when they leave the port, it is a different thing altogether on the roads. If the driver refuses to give them, they will delay him and not only that; they will ask him to go and park in their yards and can come up with many extraneous charges against him. They could say the driver was driving dangerously and not because he refused to grease their palms.
What is your impression about the automotive policy of the Federal Government of Nigeria?
If the government is really interested in the policy, it should be a gradual thing and again they need to carry people along. To me the policy is okay because it is better for every country to be independent in some areas. The government wants to help local manufacturers. Look at the case of PAN. In those days, they used to be the number car manufacturing company in Nigeria to the extent that everyone was using Peugeot brands. Suddenly, mismanagement sets in and that was what brought in the likes of Japanese products like the Toyota in particular. All that Toyota did was aggressive marketing and sales, that was what made it acceptable to Nigerians, it wasn’t the best product. Even in terms of price, it is not the best for us because if you get to the nitty-gritty of the pricing of these imported products, you will discover that Nigerians are being ripped off. There is a lot of capital flight going on under importation of used vehicles. Our government should do something about it.