The Basics Of How To Start A Transportation Business In Nigeria

Transportation Business In Nigeria

Transportation business in Nigeria is one of the most profitable businesses in Nigeria, and whether you want to start it as interstate or intrastate, you will still earn a means from it.

In this article, we will discuss some of the basics of transportation business and all you need to know about it.

We will walk you through our frequently asked questions about starting a transportation business in Nigeria.

What Is The Meaning Of Transportation Business?

First, let’s define transportation. Transportation is the movement of goods and people and even animals from one place to another. While “transport business” refers to the type of business that renders services for transporting goods, animals, and people from one location to another.

What Are The Types Of Transportation Business In Nigeria?

Nigeria has different types of transportation business that helps in day-to-day activities. And each of the transport systems falls into local transport, personal transport, and global transport. But generally, below are the major types of transport business in Nigeria:

1. Tricycle Business (Keke Napep)
2. Commercial Bus/Mini Bus Transportation
3. Haulage Transport
4. Logistics Business
5. Motorcycle Business
6. Taxi Business

What Is The Most Common Transportation In Nigeria?

The most common transportation in Nigeria is road transportation. This is because over 70% of day-to-day activities involve the use of motorcycles, buses, trucks, lorries, motor cars, and tricycles (Keke-Napep). Perhaps, this does not mean that other type of transportation doesn’t thrive, but it can’t be compared to road transportation.

What Are The Challenges Facing The Transportation Industry In Nigeria?

The following are the biggest challenges facing the transport industry in Nigeria:

1. Bad roads
2. High cost of fuel
3. High price of spare parts
4. High taxes on security most especially for road transport.

In this case, the government should fix bad roads, provide security and also find solutions to reduce the high cost of petroleum. Moreover, the state/local government should reduce the taxes they impose on transport owners. This will help in reducing the price increments of transporting goods and passengers.

Is Transport Business Profitable In Nigeria?

The transport business is a profitable business which is providing daily income to the drivers and the owners. Consequently, a transportation business satisfies the needs of society by helping people move from one location to another. The same applies to goods. And for this reason, a transport business is very profitable.

How Much Does It Cost To Start A Transportation Business In Nigeria?

It depends on the type of transport you want to venture into. But on average you will need ₦5 million and above to start car and bus transportation. While you will need ₦700,000 to ₦5 million to start a motorcycle and tricycle transportation business.

What Are The Best Areas To Run A Transport Company?

There are many areas in Nigeria to start a transport company and below are some of them:

1. Aba
2. Abakaliki
3. Abuja
4. Afikpo
5. Akure
6. Asaba
7. Akwa
8. Benin
9. Calabar
10. Ekiti
11. Enugu
12. Enugu Ezike
13. Ibadan
14. Warri
15. Ikom
16. Nnewi
17. Nkpor
18. Nsukka
19. Kaduna
20. Umuahia
21. Kano
22. Katsina
23. Lagos
24. Illorin
25. Jos
26. Owerri
27. Port Harcourt
28. Minna
29. Uyo
30. Ibafo, etc.

The above are some of the best areas to start a transport business. Meanwhile, in these areas ensure to site your transport company in market centers, business centers, and industrial areas/parks.

Does Transport Business Make Money?

As far as the daily activities of the people involve the use of transport, a transport business will continue to make money for its owners.

Which Licence Is Required For Transport Business In Nigeria?

The license required for a transport business depends on the type of transportation you are starting. For example, you will need a motorcycle license and rider’s card to operate a motorcycle business. While you will need a vehicle insurance certificate, roadworthiness certificate, and a commercial driver’s license (cdl) to operate a bus transport.

Meanwhile, make inquiries to obtain the necessary licenses and permits. And it is important to remember that failure to fulfill the license requirement will lead to arrest, penalties, and business closure.

Can You Tell Me The Things I Can Do Before Starting A Transport Business In Nigeria?

Staying successful as a transport business can be challenging especially when you don’t have a solid plan from day one. However, the following are the things you can do before going into transportation business:

1. Identify the type of transport you want to venture into.
2. Develop a solid business plan.
3. Ensure to first identify a trusted and reliable car/bus/motorcycle dealer.
4. Know who your target market is.
5. Never employ a reckless driver. In this case, you have to make a detailed inquiry before employing any driver.

How Can I Partner With Any Transport Company?

Each transport company has its requirements for partnership. For example, God Is Good Motors (GIGM) now known as GIG Mobility will require you to have a clean vehicle such as Hiace, Seinna, Or Sprinter to partner with them. Now, to partner with any other transport company, first, you will need a huge amount of money (In millions of naira), and lastly, you will visit any of the company’s offices to get more information about their eligibility criteria.

How Much Can I Register A Transport Company In Nigeria?

The cost of registration depends on the mode of transportation. However, business name registration costs around ₦15000 to ₦50,000 or less. While registering your transport company as a limited liability company (llc) will cost from ₦100,000 and above.

How Much Does A Transportation Business Profit In Nigeria?

According to “Nairarush”, the profits to be made from the passenger transportation business are at least ₦20,000 per trip. While you should expect a profit of ₦100,000 per trip for the haulage transportation business.

How Can I Start A Transport Business In Nigeria?

Before you start a transport business, it’s important to do your research and understand how the transportation industry works and the regulations guiding the transport industry. Below are 4 steps you can take to start your own transportation business in Nigeria:

1. Choose A Specific Transport Niche: As you begin your journey into the transportation business you need to decide your mode of transport. As mentioned above, there are different types of transportation businesses like tricycle business, haulage transport, commercial bus/minibus transportation, motorcycle business, etc.

The supply and demand in your area can help you determine the type of transport to venture into. And you can as well decide if you will partner with any transport company.

2. Make The Purchase: Based on the transport system you have chosen, the next step is for you to buy your transport vehicles. And ensure purchases from reliable dealers.

3. Register Your Vehicles And Apply For Licenses And Permits: If you want to take your transport business seriously, registering your vehicle should be an important factor to consider. Furthermore, obtaining licenses and permits for your vehicles shouldn’t be excluded to avoid penalties and business closures.

4. Employ/Hire Qualified Drivers: If you don’t have any plans of driving your vehicles by yourself then it will be necessary to hire qualified drivers. An experienced and qualified driver is the ideal.

Additionally, when leasing out your vehicle to a driver ensure to sign an agreement, which a lawyer should be involved in. And if possible have a tracker attached to each of your vehicles to avoid theft.

After all is set and done, your transportation business is ready for operation. Meanwhile, good management of your resources/profit is a proven way to expand more.

How Can I Operate A Profitable Transport Business In Nigeria?

The list below are some of the ways of operating a profitable transport business:

1. Ensure a good customer relationship.
2. You will need to hire a reliable driver who can offer good customer service.
3. To operate a profitable transport business in Nigeria you will need to build a strong business plan that will stand the test of time.
4. Ensure inspection and maintenance of your vehicles.
5. Offer discounts and competitive prices to your customer’s/passengers.

What Are The Best Transportation Businesses Operating In Nigeria?

In Nigeria, there are so many transport companies and it has increased the competition in road transportation. Here are the best transport companies operating in Nigeria:

1. God Is Good Motors (GIGM) now known as GIG Mobility.
2. Peace Mass Transit (PMT)
3. Young Shall Grow Motors Ltd
4. Benue Links Nigeria Ltd
5. ABC Motors
6. Libra Motors
7. GUO Transport Company
8. Bonny Way Motors Nigeria Ltd
9. Crosslines Limited
10. Chisco Transport
11. Rivers Link Express
12. Tribal Global Motors

Ambassador Victor Chidera
Ambassador Victor ChideraAmbassador Victor Chidera is a business consultant, writer and a blogger. He provides lots of professional and expert advice to small businesses, entrepreneurs and organizations. He has many years of experience in business, teaching field, and research work. And his aim is to provide business articles that matters to you both nationally and internationally.
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