Nigeria is home to millions of energetic and enterprising people. In fact, it is the 6th largest country in Africa↗. This population is constantly on the move across the country, resulting in gridlock that consumes valuable hours. The time wasted in traffic jams could be used for more profitable ventures.
That challenge creates a big opportunity as businesses and individuals need fast and reliable delivery of goods and services. Starting a logistics company is a good venture. But you must plan and invest wisely to succeed. This article will tell you everything you need to know about the motorcycle dispatch business in Nigeria.
We will discuss the business’s profitability and the best machines you need to start your fleet. You will also learn about the documents required to launch your motorcycle dispatch business in Nigeria.
How Good is the Okada Business profit in Nigeria
There is potential in the dispatch service because Nigeria’s logistics sector keeps growing. It is estimated to grow by 7.5% annually↗. This means that people and businesses need quick delivery services. Motorcycles, popularly known as Okada, are preferred for their ability to meander and cut through traffic jams.
They are also affordable. A single delivery in Lagos, for example, can cost three thousand naira. Depending on the distance. Since more people need speedy service, it guarantees you a strong Okada business profit in Nigeria.
What’s more, riders who work with delivery service platforms report high daily earnings. So, the bottom line is that starting a motorcycle dispatch business in Nigeria is profitable. You just need to get the right bike and manage your fleet to make money.
The Best Bikes for Dispatch Business
You must choose a motorcycle brand that can survive Nigeria’s rough roads. It should also be able to carry heavy loads. The right motorcycle is an important operational decision that will affect your profit, so be strategic in your choice.
Here are some of the best bikes for dispatch business. They are designed to handle long hours on the road and carry heavy loads:
- SINOKI SUPRA: This brand is mainly used by dispatch riders; it is part of the 200cc bikes that the Lagos Government approves. It has a 200cc V4 engine that is fuel-efficient.
- YAMAHA AG200: This one has a 4-stroke engine with one cylinder, making it strong. Ideal for dispatch riding over rough roads.
- HONDA CB 125: Another good option, it is lightweight and easily moves between intersections and traffic jams.
- QLINK LEGEND: A popular brand, Qlink also has a 200cc cylinder. It has both front and rear brakes and features like a radio and a USB port. It does not consume fuel and is easy to handle.
- BAJAJ BOXER 150 HD↗: This one offers maximum torque and power. It works for rough roads and can carry very heavy loads. Its 150cc engine gives it the muscle needed to run long distances.
Using the Best bikes↗ for the dispatch business will reduce your maintenance costs. There will be little to no downtime from frequent bike breakdowns and repairs.
Your Practical Delivery Bike Business Plan
Your Delivery bike business plan is your operating blueprint. It defines your mission and your goals. It also clearly shows what growth strategy you will adopt. Here is a practical plan you can follow:
Plan 1: Develop your Strategy
The first question you will answer is, “What is my niche?” Should I focus on B2B or high-volume e-commerce logistics? Knowing your target market influences the size of your fleet. It also determines the type of bike you will buy.
Planning helps you estimate your revenue for at least three years.
Plan 2: Raise your Capital
You can start with one bike, which costs between ₦500,000 and ₦600,000. That amount covers your bike and the initial licenses you need. You can also tackle other minor administrative costs.
Plan 3: Fleet Acquisition Options
If you can’t buy a new bike outright, you can lease or leverage hire-purchase (HP) schemes. This is a smart Delivery bike business plan for people who want to start but don’t have the capital. The hire purchase program by BIPC↗ helps riders own bikes over time. You can start with an initial deposit, then make subsequent instalments till you own the bike.
For the leasing option, the MAX Drive company↗ leases vehicles so you can try it. With this option, you don’t have to worry about insurance and major bike maintenance. This is great for people who can’t buy a motorbike due to a lack of capital, but still get to have a Delivery bike business plan.
Read about the challenges of doing business in Nigeria and how to manage them.
Essential Motorcycle Courier Service Setup for Your Dispatch Business in Nigeria
You must follow these important steps for your motorcycle courier service setup. It makes your business legal and contributes to smooth operation. It also tells clients that you are a professional.
1. Business Registration and Federal Licensing
Register with the Corporate Affairs Commission. When you do, you will get an electronic Certificate of Registration. After that, get your Tax Identification Number (TIN). You need a specialised operating authority for your dispatch business.
So get your Courier/Logistics License from NIPOST’s Courier/Logistics Regulatory Department (CLRD). The SME Category license can cost you ₦250,000. This license makes your motorcycle courier service setup legal at the federal level.
2. State-Level Compliance
Comply with your State’s regulations for riders and the bikes. Get the following for your fleet:
A. A Rider’s Card
As a rider, you must have a valid Rider’s Card. Issued by your State Motor Vehicle Administration Agency.
B. Vehicle Inspection
Make sure your motorcycles are inspected by Vehicle Inspection Officers (VIO). Also, register your bike as commercial to avoid issues with authority figures on the road.
3. Vetting and Technology
Remember that you or your riders are your brand’s ambassadors. So vet them, run background checks. Ask drivers for guarantors who are not relatives and train them in road safety. Another non-negotiable is a Delivery Management System (DMS).
DMS helps you with:
- Route Optimisation, giving riders traffic data in real time. This helps them find fast routes, saving fuel. It also reduces operational costs.
- Real-Time Tracking, which gives customers updates on their delivery status.
- GPS Fleet Tracking for easy recovery of assets in case of theft.
All these are important for your motorcycle courier service setup.
Importance of Bike Insurance for Your Motorcycle Dispatch Business in Nigeria
Although no one wishes for it, bad things may happen. There is a high rate of road accidents and bike theft. So, bike insurance for business in Nigeria is very important. It protects your assets in cases of theft or accidents.
Bike insurance for business in Nigeria protects you and your business from financial shocks. Some logistics companies offer health insurance and safety for riders’ training. You can consider this, as it increases retention of your reliable riders.
Conclusion
Bottom line is, you can make a profit with a motorcycle dispatch business in Nigeria. There is a high demand for fast, reliable delivery of goods and services. To succeed, you must have a solid Delivery bike business plan and capital. You must choose durable motorbikes and comply with State and Federal regulations.
When you follow these guidelines, you will see that the Okada business in Nigeria is indeed profitable. For more financial tips and business ideas, subscribe to the SimpleVest Newsletters.
