Haulage Business Plan in Nigeria – Feasibility Study on Haulage Business
The haulage business which is also referred to as the logistic business is one of the most lucrative businesses in Nigeria presently, even though a lot of people do not maximize the opportunity of this business because of the supposed capital intensive nature as well as the risk involved. This article looks at providing you with basic information necessary for starting up your own haulage business and a giving you a sample haulage business plan in Nigeria to bootleg you. It should be relevant even if you are not planning to start up your business in Nigeria since the modalities of the trucking industry all over the world are quite similar.
Even though several people do not know it, the trucking industry is a real big deal in our day as a huge amount of profit is churned out of this business on a yearly basis. In fact, in the United States alone, about three hundred billion dollars is produced from this sector alone as yearly revenue. The industry analysis of haulage business in Nigeria presently, has shown that it makes over a billion Naira yearly, even though it is very much unsaturated and yet to be fully exploited. The secret behind the success of the haulage business simply lies in the fact that regardless of what part of the world you find yourself, there will always be a need to transport goods on a large scale.
Easy Steps on How to Start a Haulage / Trucking Business in Nigeria.
Write your business plan: Before you venture into the logistics business, you should have a detailed plan covering the following; how much capital you have, which state or area to site your business, what kind of goods do you intend to move from place to place, the type of vehicle(s) you need, what your rates should be, staff, etc. These features can be found in a business plan. Take sometime out to do a feasibility study and then write a comprehensive business plan for your business. If you do not have the skills to do so, you can order our haulage business plan in Nigeria. Our business plan can be used for accessing grants, bank loans and bringing in investors.
To order the haulage business plan in Nigeria, pay N10, 000 to:
BANK NAME: FIRST BANK PLC
ACCOUNT NAME: CHIBUZOR TOCHI ONYEMENAM
ACCOUNT NUMBER: 3066880122
After payment, text your full name, email address and title (haulage business plan pdf) to 07033378184. Your business plan will be sent to your email within 15 minutes.
Work on your personality. Before venturing into this business, it very important to check your personality and be sure it matches the profile of one who is able to run the business. The best or most successful business owners are those who venture into the business not just for the monetary returns but majorly for the passion they have for it. It is the passion that one has that helps such a person withstand the various challenges that are bound to arise all through the lifecycle of the business. In case you feel your personality does not match what you believe is a profile of someone to run this kind of business, it is no reason to give up. You can work on yourself to ensure that you develop the characteristics of a successful haulage business owner. You will need great determination and resilience to run this business as there are several challenges to deal with like shady mechanisms, accidents, dishonest and disloyal staff, etc.
Choose your niche. This step is very important when planning to venture into the business because the outlay of the business the very large. There are several aspects of the business and it is not advisable to just dive in trying to indulge in all aspects, it might be too cumbersome and result in loss ultimately. The part of the business you decide to venture into will determine the kind of vehicles you will procure for the running of your business. There are few questions you should ask yourself that will help you come to a conclusion, a few of them include:
- Will you be involved in long distance or short distance transport?
- Will you be involved in transporting goods on a bulk basis or will you prefer leasing your vehicles to other transport companies?
- Will you rather outsource your trucks to a trucking company or will you put them up for hire purchase?
- If you have chosen to transport bulk goods, will you be transporting liquids or solids?
Answering these questions and many others will help in making your decision and thus help in procuring the right vehicles and carrying out the right registration processes.
Raising your startup capital. This is one of the major reasons people stay off this business, there is no doubt that to run a haulage business you will require a huge amount of capital especially for startup. The capital outlay required will largely depend on the niche you have decided upon and how many vehicles you are planning to have as part of your company. For the capital outlay to be adequately forecasted, it is imperative that a business plan is firstly written. The business plan helps to state in almost exact terms what the business should look like, how much is needed to start it, the management plan, the profitability, the vision and mission statement of the company and a projection of the profits to be made, including the break even analysis. This assists the business owner to raise capital from different quarters like external investors, banks, family members and friends. The business owner should also decide if the vehicles to be bought will be purchased as new or used as well as whether they will be paid for outright or be purchased over a period of time. Most times the business owner might not have the total financial capacity to startup the business but sourcing from loans from different quarters can be of tremendous help.
Financing your haulage business. There are always a set of people known as financiers who are available to help finance any business, they have the financial capacity but usually do not have the ideas so they assist businesses in startup and by so doing make their own fair share of profit. The most popular form of financing is known as “leasing” and it usually involves two parties, the “lesser” and the “lessee.” The lessee who is the user of the equipment remits a periodic compensation which could be in form of rent to the lesser. There are two major forms of lease which are “finance lease” and “operating lease.”
Finance lease, which is the most popular form all over the world, entails that all the risks and benefits of ownership are taken by the lessee. The lesser however still retains title to the equipment even though on the long run it may eventually be transferred.
Operating lease is somewhat the opposite of finance lease. It entails that the lesser retains the risks and rewards of the equipment and this usually comes to play when short term line of vehicles such as cars, trucks, trailers, boats are involved. A major advantage of leasing is that it affords the lessee the opportunity of paying for goods procured over a long period of time.
Rules and regulations guiding the business. A very important factor that should be considered should be the legal regulations guiding the business. It is important to be covered on all fronts to avoid uncalled for embarrassments. To run this business you will be required to sort out several registration procedures, obtain necessary licenses, as well follow the particular laid down rules for the business. It is expedient that you as a prospective business owner take time to carry out in depth research to find out all of these and ensure that you push yourself to satisfy all the requirements before startup.
Insurance. As stated over and over in this article the haulage business is one that is full of risks and challenges, most of which are not planned for. All through the business lifecycle you will be dealing with goods and mechanisms that cost a whole of money. Along the way there will be eventualities, some which include accidents, theft, dishonest staff, and lots more. Not being adequately prepared for this could mean the business owner running into huge debts should any of them occur. This is the major reason for insurance, it is protection made against future unwanted risks.
Develop an efficient management strategy. Setting up an efficient management team is key to the growth and continuity of any business. If you are lacking in experience relating to the haulage sector, it is important to recruit a manager that has a couple of years in terms of experience so you do not run at loss on the long run. You also need efficient drivers who come highly recommended for credibility and accountants who are up to the task. No loophole should be left for a lapse in management as a business is only as good as its management system.
Customer services and relations. The first step to this is knowing who your clients are, understanding them and their present needs, being able to predict the needs they want to satisfy in the nearest future and working to fix all of them. To achieve this you will need to have set out a niche for yourself and then make a list of all the prospective customers that fall within that category. You will need to seek out a way to reach out to these customers and set up a channel for efficient feedback. You must be top notch in your approach to customer care, ensure that your staff are well trained to relate with customers properly. Ensure that you put forth your brand in a very strong manner while ensuring that you create measures to help you ward off any competitors.
Sorting out issues with maintenance. Since you are dealing with highly mechanical equipment you can be sure that once in a while you will be required to carry out maintenance procedures to ensure they are in good condition for your business. You should seek out a good mechanical company that are reputed for being meticulous with their jobs, work out a contract with them for the maintenance of your vehicles. You can opt for employing a couple of in house mechanics on the other hand if you have a fleet of vehicles, this will help to save money to large extent.
Ways to earn money in haulage business
There are three major ways of making money in the haulage business in Nigeria, as we know it, the business is very lucrative and it can yield great amounts of returns to the business owners. The amount of profit you will be raking in will mostly depend on what aspect you decide to indulge in, the different ways of making money in the haulage business are discussed briefly below:
- Working as an independent contractor. This involves registering your business to own its own vehicles, employing drivers, mechanics and other staff, seeking for contracts from prospective customers. This aspect of the business is largely regarded as the riskiest of all. You might however be competing a lot of other big transporters for contracts and on some jobs you may be required to work in conjunction with some of these other companies. Though this aspect seems to be the most lucrative because of the profits involved, it is the most strenuous and it requires a very huge capital outlay.
- Leasing your trucks to a haulage company. This basically entails sub-leasing your trucks to other haulage companies on a contractor or sub-contractor basis. This way the risks are reduced even though you do not get as much profit as the independent contractor.
- Working as a sub-contractor. In this aspect, you will be working basically for just one company or client. This way the contracting client is in charge of handling all the risks and burdens of the business while you just get a stipulated amount of money at the end of each month or year, depending on the prescription of the agreement.
Major challenges of the haulage business
It is a recognizable fact that no business, no matter how lucrative, comes without challenges, the haulage business is not an exception. It has several challenges which may be major hindrances to the thriving of the business if not properly managed. A few of these challenges include:
- Huge capital requirement.
- The business is also highly management intensive.
- Bad roads, these result in accidents and malfunction of most vehicles thus requiring more than the regular amount of maintenance.
- Getting competent drivers.
In conclusion, the haulage business is one that can be tough to start up but it also provides a very enticing amount of yearly profits. Before indulging in the business be sure to have done your homework and be ready enough for all the pitfalls before they arise.
Get your own Sample haulage business plan in Nigeria ! To place order, Pay N15,000 to:
BANK NAME: GUARANTY TRUST BANK (GTB)
ACCOUNT NAME: CHIBUZOR TOCHI ONYEMENAM
ACCOUNT NUMBER: 0044056891
BANK NAME: FIRST BANK PLC
ACCOUNT NAME: CHIBUZOR TOCHI ONYEMENAM
ACCOUNT NUMBER: 3066880122
After payment, send your full name, email address and topic (i.e. Sample Haulage Business Plan pdf) to 07033378184. Your business plan will be sent to your email within 15 minutes.
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