How To Start A Lucrative Transport Business In Nigeria: The Complete Guide
The transport business in Nigeria is a lucrative enterprise for people who understand the venture, knows the local terrain, and can implement a good system of operation.
Millions of Nigerians rely on public transportation to get them to their destinations, every day. As such, the transport business in Nigeria continues to grow, with higher revenues been generated every year.
The four different and common methods of running a transport business in Nigeria are vehicle hiring services, hire purchase, personal driving services and owning a transport line. Nevertheless, there are other unexploited transport business opportunities in Nigeria that are highly profitable.
Here is what you need to know on how to start a transport business in Nigeria.
What Is The Transport Business About?
Any business that provides a means of movement for people, animals, and goods from one place to another is called a transport business. The most common forms of transportation options provided by transport businesses are cars, planes, helicopters, ships, buses, trucks, boats, and trains.
Some transport businesses, however, provide other smaller vehicles like motorcycles, bicycles, and tricycles. Each of these forms of transport businesses is a rewarding prospect, depending on how it is established and managed.
Large to medium-scale transport companies provide extensive services which give them the benefits of more clientele and higher turnovers. A small-scale transport business is a sole-owned venture which provides personalized services usually within a particular area.
The demand for the services of the transport business in Nigeria continues to grow daily, creating more room for individuals or groups interested in this lucrative industry.
Business Opportunities In The Transport Business Around The World
1). Bus Transport Business:
The bus transport business is a very well-known mode of transportation. A bus, driven by a skilled driver, takes passengers from one place to another, within or outside a particular location. Also, in some parts of the world, buses transport all kinds of goods.
Bus transportation services are very flexible; it can be a small private business within a town/city or a large company with branches all over a country. Either way, it is a very lucrative business opportunity that has provided lots of job opportunities and reduced the rate of unemployment, all over the world.
2). Car Rental Services:
Starting a car rental business can provide a profitable business opportunity for people living in cities with high tourist traffic, a large populace, and a booming commercial environment. This business tends to be competitive so, the right management systems and knowledge give aspiring entrepreneurs the edge they need to make it successful.
Proper registrations and licensing is required to start and run this business. Plus all the vehicles within a fleet must pass safety inspections. It’s undeniably capital intensive, but remains one of the best long-term investment opportunities in the transport industry.
3). Moving Van Transport Business:
A moving van transport business moves goods of people or business from one locale to another with the use of large vans. It employs individuals who help customers to pack up, load and move their properties to a different place. The items transported to the required destination are unloaded out the van, unpacked and organized.
Contrary to popular belief, a moving van business does not have to involve much capital or workers. It can grow from being a small, independent business to a large company that offers a variety of services.
This business is in high demand as it relieves the mental and physical stress of personally moving things around while trying to manage other aspects of life like job, business, academics, and family.
4). Taxi/Taxicab Business:
Taxi business involves acquiring licenses that allow a sole driver or a taxi transport company to transport riders from place to place in exchange for a fixed or metered price. A taxi ride is usually non-shared; driving only one passenger to his or her destination. However, in recent times, cab-sharing is becoming more popular.
Nowadays, taxi services are more technologically based. Tech services like Uber links a driver-partner or fleet partners to transport customers to their preferred destinations. At the end of the completed trip, drivers get paid.
Taxicab services are in three forms, limousine rides, hackneys and taxi buses. Taxibuses are common in Nigeria and other developing countries in the world. These buses stop to pick up different customers at various bus stops. Hackneys are licensed taxis that pick up riders who happen to hail them down.
Unlike hackneys, private cabs are registered via pre-booking only. Also, limousines hiring can be a one-person or a fleet business if there is enough capital to purchase cars and drivers.
5). Air Transportation:
Aside from transporting passengers, aircraft can be set up to cart cargo just like a ship can. This transport business requires considerable capital, but it is profitable because of its swift delivery of goods.
Other air-related transportation businesses are aeroplane refuelling, airport shuttling, aeroplane cleaning, and aeroplane maintenance services.
6). Livestock Transport:
The livestock transport business involves giving livestock owners or traders the safe and spacious vehicles needed to haul their animals to one or different locations. Roomy trucks with openings are the ideal transport vehicles for livestock.
Livestock transportation requires some experience in handling animals and information on the rules regarding transportation of animals. The health of the animals is also a cause for concern in this business. Transport vehicles need to adhere to the health standards to ensure that livestock arrive at their destination safely.
Before starting out as a livestock transporter, get some training and information about this business from an expert or through credible sources on the internet. A well trained, expert livestock transporter knows what in-vehicle accommodation, feeding, and cleaning of animals entail.
7). Marine Shipping:
Before aeroplanes, helicopters, and other forms of air transportation vehicles, there were ships and boats. Marine transport services were the main form of transportation for overseas passenger travelling and cargo shipping.
These days air travel is preferable because of its speed and efficiency. Still, maritime transport is one of the most lucrative businesses in the world. It remains the more affordable means of freighting non-perishable goods by the bulk to different parts of the world.
8). Truck/Courier Transport Business:
Trucking is one of the most lucrative transportation businesses in the world because of the heavy-duty vehicles that can carry a lot of hefty or imported goods at once. Truck drivers’ convey goods from one area to another, distributing and delivering the contents to the specified receivers.
A courier service, on the other hand, does not need heavy machinery. With a safe and reliable car or van, packaged goods can be transported.
9). Specialty Transport Business:
A specialized transportation business makes profits from transporting distinctive goods to their destinations. These unique goods are large sized items like aeroplane parts and boats. On the other hand, it can be delicate things like human organs or blood.
The client base of this transport venture is narrower than other transportation forms, but service fees are usually high. A speciality transport business should be set up around an area where such services have a high demand.
10). Medical Transportation:
Medical transportation business is a profitable venture in the transport industry. It revolves around providing transport services for hospitals and clinics within and outside an area.
This business can cater to the transport needs of the old/sick patients and provide vehicles for long distance medical runs. Also, people with EMT or paramedic license can secure hospital contracts for medical transport. However, these transport vehicles need to be outfitted to handle the emergencies that these services require.
Others opportunities in transport business are;
- Elderly Citizens Transport Business
- Bicycle/Motorcycle Rental
- Boats Transportation
Facts And Benefits Of Transport Business
- The transport business in Nigeria is dependent on road networks, making land transport business the most lucrative type of transportation in the industry.
- The transport business in Nigeria is usually capital intensive.
- Air and water transport businesses are lesser unexploited lucrative opportunities in Nigeria.
- Transport businesses reduce unemployment by creating thousands of jobs annually.
- Transports business opportunities are a diverse and somewhat challenging source of income for investors and transport entrepreneurs.
Types Of Transport Business
The three main types of transport businesses are:
1). Air Transport Business:
This venture has to do with all the air transports and any related business in the aviation industry. It can entail designing and manufacturing aircraft or opening up an airline or an air travel agency.
Also, businesses like aeroplane cleaning and engine maintenance services are exploitable business opportunities within this industry.
2). Land Transport Business:
The most common form of travel is by land. It involves numerous automobiles or vehicles like cars, trucks, buses, trailers, vans, and trains. Two and three-legged vehicles such as tricycles, motorcycles, and bicycles are a part of land transport businesses in some parts of the world.
In Nigeria, for instance, land transports are the most popular type of transport business in the country. With its large populace and reliance on roads for goods and people transportation, it’s undoubtedly a good revenue source and excellent investment opportunity.
3). Water Transport Business:
Maritime/shipping transport business is all about carting people and goods from one destination to another through seas, oceans, rivers and other suitable water bodies.
How To Start A Transport Business In Nigeria: The Step By Step Guide
1). Prepare A Business Plan:
Preparing a good business plan is the first step. It means that you have conducted a market research and weighed your options. A business plan tells your investors and prospective funders whether or not they can trust you with their money.
Additionally, your plan should include the business idea or opportunity you have decided to take on and establish.
Most transport businesses have the potential to be multi-million or billion-dollar businesses. However, not all transport companies start out with intensive capital funding.
The starting capital might be sufficient for an independent, medium, or a large transport business. Your initial scale of business depends on the finances you are able to gather and the experience you have.
Commercial bank loans, investors, and partnerships are options to consider while sourcing for capital.
3). Register Your business:
Pick out a unique business name, get all your documents ready, and register your transport business. Get every license you need from the Corporate Affairs Commission in Nigeria and other licensing bodies.
4). Join A Union:
It’s necessary to become a member of a transport union in Nigeria, like most other businesses. For medium to large-scale transport businesses, this is just a beneficial option.
5). Purchase And Equip Vehicles:
Buy the proper transport vehicles for your business services and set them up with the necessary equipment. The number of vehicles you buy depends on how you want to start up.
The type of vehicle purchased should suit the type of service you offer. For instance, a truck can serve as a moving van or livestock transport vehicle but never a taxi or shuttle.
6). Employ Qualified Personnel:
Drivers and workers you employ as the business expands should be skilled, level-headed and reliable. Many transport companies have failed because their employees lack such qualities.
In transporting people or goods, safety is paramount. When a transport business hires reckless drivers and has a poor customer relation service, progress is hindered.
7). Insure, Expand And Promote:
Insuring your transport business against possible risks is a significant step towards the prosperous outcome of your efforts.
Provide excellent services, and customers will flock in, generating the capital needed to buy more vehicles, hiring skilled drivers, and branching out in many more locations.
The right marketing strategy will expose your transport business and bring in more customers. So promote your growing business not only through word of mouth but by sponsoring and advertising on television, radio, and social media.
Challenges Of The Transport Business In Nigeria
- Getting enough capital to start up a transportation business is challenging for a lot of prospective entrepreneurs in Nigeria.
- Bad roads in Nigeria destroy transport vehicles over time. That means constant visits to the mechanic workshop and an ever-increasing budget allowance for maintenance.
- Infrastructures for air and water modes of transport are underdeveloped. These industries need investments and restructuring to reach their full potentials.
- Inadequate knowledge of how the transportation system works and poor management leads to failing transport businesses in Nigeria.
- Over the years, fluctuating fuel prices have negatively impacted the transport business in Nigeria.
Starting a transport business in Nigeria can be challenging but with persistence, knowledge, and excellent management skills, success is realistic. There are various new and existing business opportunities within this industry. Carefully consider every option and then devise a good strategy that would ensure progress in this business.
If you have experience in travelling and are looking for a valid business opportunity in this industry, starting a transport business in Nigeria can be a great decision to make.
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