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Courier Industry Holds Key to Vision 20:2020-Bichi
Sule Bichi is the managing director, Red Star Express Plc, a licensee of Federal Express Corporation (FEDEX). He is a Fellow of the Institute of Chartered Accountants of Nigeria (ICAN) and a member of the Institute of Directors (IoD).
He had a stint with Aminu Ibrahim & Co. before moving to the Board of Internal Revenue in Kano.
Bichi later joined UAC Nigeria Plc as a Management Trainee in 1988 from where he was seconded to Unilever International Audit, and later moved to ICON Ltd (Merchant Bankers) as Treasury Officer before joining Comet Merchant Bank, where he rose to head of Foreign Operations in 1995.
He later worked as Operations Manager with UBA Kaduna South branch from where he joined Red Star Express in 1998 as the Assistant General Manager Finance.
He later became the Executive Director, Finance & Administration; Deputy Managing Director and a member of Finance & Budget Committee. He is also a Director, of the three subsidiaries of Red Star Express. He spoke to peter ugwu on ways to achieve industrial growth in Nigeria.
Building Enterprise like Red Star Express
It has been interesting. First of all, I want to clarify that Red Star is an indigenous company operating under the license of Federal Express Corporation (FEDEX); a US based company which is more than 40 years old.
Red Star is the one that recently celebrated 2 decades of doing business in Nigeria. Building enterprise like Red Star Express in Nigeria is a thing that we expect more of such.
Nigeria’s economy is still evolving and going by the size of the population and resources, it is a country that should have more companies establishing businesses that will help the economy grow.
No doubt, there are teething problems, but we had to rise above that by seizing opportunities that come up in any sector of the economy.
We must start with the development of Small and Medium Enterprises (SMEs) moving to individuals coming together to build mega corporations.
As it is now, our companies are not so big. Very few are playing at the international arena.
So, we need companies that will grow and play in the global economy. That is the only way we can breakthrough and emerge as one of the 20 economies in the world.
Red Star Increase in Turnover In 20 years of Operation
Some people may want to tag it a magic for the company to have achieved that, but it was not a magic. Although considering the industry, it is a growth, because no other courier company in Nigeria has been able to achieve that.
But N5 billion is not that huge when we start placing Red Star against other big companies.
Yes, our philosophy is people-service-profit (PSP). We concentrate more on the people, because they are the ones who deliver the service to customers.
Thus, the turnover is good, but when you change the money to other currencies like the USD or GBP you will discover it is still meagre. So, we are still in the SMEs bloc.
But in Nigeria, you could say it is an achievement owing to the fact that the courier industry is still growing.
There were companies that started same time with us, but have either closed shop or are managing to survive.
We are moving on because we have competent and dedicated workers. They understand the dynamics of the industry and how to create value for the customers.
Consultative Selling Skills Training
Like I said earlier we place emphasis on people right from inception. We not only select competent people from different sectors of the economy, we try to expose them to best trainings.
The Consultative Selling Skills training is just one of the trainings we have for our sales professionals.
We have a functional faculty were we send our people for training. As part of our policies, every staff is expected to clock minimum of 16 hours every year on training.
Staff training is something we cannot do without; it provides platform to re-assess the staff and train them on the trends of practice.
It is part of building the brand. When people are trained and well taken care of it leads to co-operation and productivity.
In all aspects of our business, operations, finance, corporate governance, leadership, we receive training.
Security challenges and Courier Business
Insecurity is highly impacting on every business in the country. Of course you need to take care of your workers.
As a committed firm we have to do all within our powers to ensure our customers, in any part of the country, are safe.
The truth is that we spend more money presently on security; we take extra measures to ensure the workers are not endangered and working with security agents also.
We try as much as possible to observe pronouncements made by the government, because they have full responsibility to secure lives and property in the country.
They know more than we do. In all, we make sure that our people are not exposed to unnecessary dangers.
Innovation In Red Star With The Acquisition Of An Airside Facility
Having an airside facility is another way to facilitate smooth running of our business. We are licensee of FEDEX; a global leader in logistics business and present in more than 220 countries, shipments into Nigeria come through the international airport, so to make it easier and faster for clearing we acquired the airside.
That will facilitate clearing and ensure security is apt. At the same time, it will aid the operations of some government agencies at the port like the customs.
Automation of Red Star Operations, Especially the Newly Acquired Facility
We utilize a lot of ICT components in line with the global practices. From our associate FEDEX we take queue on the use of ICT to facilitate commitments to our customers.
The customer needs to know the whereabouts of his shipment at every point in time. To ensure accountability and disseminating of information, we need to embrace ICT- the internet.
The devices are helpful from time of departure of the cargo from the other end to arrival here in Nigeria, the sorting hub and final delivery to the customer.
When we place these data on our tracking and tracing facility, our customers can just log onto the website, include the tracking number and have details about a particular shipment.
From our side, we use ICT for faster sorting of the shipment and informing our people on a particular shipment.
We have invested so much in hardware, software and networking. ICT is like a partner in progress; we cannot do our work efficiently without the deployment of ICT.
Handling Phishing of Mails Sometimes Associated with Cargo Tracking
It is our responsibility to safeguard the shipment and information associated with it. Similarly, the customer has the responsibility; when a person gives us parcels for shipment, we generate the tracking number and it is the customer’s responsibility to safeguard it.
Once you key in the tracking number via the internet the status of the shipment will be revealed to you.
In a situation where the customer gives out the number to another person, probably, to help him check, that may amount to compromising the security of that package. It is just like any bank account.
Diversifying Into Passenger Transportation
Our business is on delivering cargo and logistics services. Passenger transportation is not part of our logistics business.
Our big brother, FEDEX, in US has over 675 aircrafts, 99% of those aircrafts are for cargo. For now, our business is logistics and we will concentrate on that.
However, the peculiarity of the Nigerian environment may dictate something different, which I am not ruling out completely.
Courier Industry In Nigeria
The industry faces a lot of challenges starting with the running cost to infrastructure. For instance, the condition of roads in the country affects us immensely.
We distribute some of our items by road using heavy duty trucks, vans, lighter vans and motorcycles, the deplorable state of the roads are impacting on our fleet.
The costs of maintaining them, purchase of spare parts are increasing and the life spans are reducing. Secondly, the power supply; the courier companies operate 24hours every day.
So, when people are working you need power, especially since our work with ICT is interwoven, we cannot do without power.
Due to the country’s population for you to be an effective courier company you need to be present in every urban centre. In those areas, you must provide power.
You can imagine the size of back up that we deliver. In some places, the back ups are running more than the national grid. In that cost of buying generators and powering them is enormous.
Thirdly, the airports; not all airports operate at night. Thus, the state of the aviation industry impacts on our services.
For instance, when we have many aircrafts moving to various locations, especially in the morning and in the evening, we find it easier to put our items on them.
But where we do not have much aircrafts and some of the airports are not operating 24 hours it adds to our costs of doing business and not all airlines are flying to the destinations that we deliver goods and services.
The other aspects of transportation like the railway; although there is a recent development when the Federal Government restored the Lagos-Kano route, now that it has started, we pray that it continues reaching other areas.
As a logistics company that will assist us a lot. These minimize our capacities and put huge constraints on us and increase costs of doing business.
Using International Benchmarks to Assess Nigeria’s Courier Industry
There are reforms that are in the pipeline spearheaded by the Federal Authorities; especially the news I read in your paper on a Bill being given a nod, which is laudable.
The only thing we are advocating is that, whatever arrangement is made should be in line with the global best practices.
We want to play at the international arena as Nigeria wants to become one of the 20 strongest economies in year 2020. We should have laws that are compatible with that.
By Engr. Gbenga Adebayo
In 2001, when the first GSM call was made in Nigeria how many of us would have envisaged the digital world that we live in today? The pace of growth and the rate of adoption of telecoms solutions in Nigeria has been revolutionary. It is a globally acknowledged case study that we should be proud of and a clear demonstration of what can be achieved.
Almost all of us today are reliant on the network connectivity that it has enabled in different shapes and forms. From the simple need to communicate with loved ones, to the digital platforms that enable our access to and consumption of entertainment, financial products and other critical services. Our reliance on these systems is becoming more and more acute, whether it is citizens, governments, or corporations. System downtime is increasingly disruptive and offline manual redundancies are often in the advanced stages of being phased out. The pace of this transition is not slowing down. With the core infrastructure in place, innovation is driving the exponential growth of services that ride on it. From the fully adopted social media that has changed the way we interact, to the emerging Artificial Intelligence (AI) revolution.
While this innovation is enabling exciting new possibilities, there is a tendency to focus on those opportunities, to the detriment of the core infrastructure on which it rides. It is imperative that we retain a focus on the optimisation of that infrastructure and enable continued investment in its development. We have seen how the transition from 2G, through to 3G, 4G and 5G have each enabled the development of more and more sophisticated solutions.
The continued development of core infrastructure has to be sustainable, and over the last few months we have begun to see the challenges that the operators that provide it are facing. Both MTN and Airtel have declared significant foreign exchange (FX) losses in Nigeria, and the stress is not linked to them alone. The entire ecosystem is battling with a range of challenges that must be addressed. If we fail to do so, the downstream impact on innovation will be severe. Telecoms infrastructure requires a base level of investment to maintain its current capabilities, and significant additional investment to expand and grow. It is capital intensive and that capital has to be generated through sustainable business models.
At the heart of the challenge the industry faces is the issue of rising costs. Recent financial losses are directly linked to the cost of operating towers that rely on inputs like diesel, which have increased significantly as the Naira has depreciated. The provisions large telecom companies have had to make, and the consequent losses and impact on their reserves is a red flag. It tells us that business as usual is not sustainable. If we continue as we are, then those companies will struggle to continue to invest in and maintain existing services.
But those costs are not the only challenge. General cost inflation, multiple taxation, regular and damaging vandalisation of infrastructure and the costs associated with regulatory compliance all help contribute to the high cost of operations. We cannot continue to follow a path that asks those companies to simply accept those rising costs. It is no longer sustainable, and we have reached an inflection point.
This is a critical moment for the industry. How we approach and resolve it will define the future of Nigeria’s digital economy. If you want to be able to enjoy the benefits that digitisation brings. If we want the infrastructure that enables AI and helps us drive growth, then we must take action now.
Cost-reflective tariffs, like it or not, are simply non-negotiable. We have seen the impact of price controls in other segments of the economy, like power. If providers cannot operate sustainable business models, then they stop investing. When that happens, the existing infrastructure starts to crumble. For power, a consumer can choose to take ownership of the solution by buying a generator, or a solar panel. For fuel, the government can step in as the provider of last resort and manage a subsidy regime that mitigates the impact on the population. Those options are not available in the telecoms sector. There is no self-help solution.
We fully understand and appreciate the financial stress that Nigerians are experiencing today. The cost of living is the single most significant factor in most people’s daily lives. But those people are still able to enjoy the benefits that connectivity brings, at the price they paid before these challenges became so acute. Imagine a future in which the gains of the last twenty years are reversed. Nigeria, and Nigerians simply cannot afford it. The pain that we would feel under those circumstances would be exponentially worse.
We need to find a long-term, sustainable and manageable solution to this problem. Prices will need to rise, but action needs to be taken in a measured way, through sustainable conversations and partnership with the government. It is time to address this head on.
Engr. Gbenga Adebayo is the Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON)
The .ng domain name, Nigeria’s country code top-level domain (ccTLD), is the nation’s critical resource in the digital space, says Adesola Akinsanya, the president of the Nigeria Internet Registration Association (NiRA).
Akintola Owolabi, Professor of Cost and Management Accounting at Lagos Business School (front – third from left; Adesola Akinsanya, the president of the Nigeria Internet Registration Association (NiRA) (Front – fourth from right), flanked by members of EBOD and Management Team of NiRA during a training programme at LBS.
The .ng domain extension is unique to Nigeria, and it can give businesses a strong local identity.
This can help establish trust with customers, which is especially important for businesses that rely on local customers.
Mr. Akinsanya made the comments at NiRA Executive Board of Directors (EBOD) and Management Training held at the Lagos Business School (LBS).
The NiRA Executive Board and Management Training at LBS spanned a series of intensive interactive sessions designed to address critical challenges and opportunities in the digital domain.
The training program emphasized the importance of strategic vision, ethical decision-making, and resilience in the face of digital disruptions.
Participants gained insights into global best practices in digital governance, risk management, and leveraging digital technologies for business growth and societal impact.
Mr. Akinsanya, highlighted the significance of the collaboration with LBS, stating, “The NiRA EBOD/Management Training at LBS underscores our commitment to fostering a robust digital ecosystem in Nigeria. It equips leaders with the expertise to address complex digital challenges especially in accounting and financial management while harnessing the immense opportunities of the digital age.”
The program featured distinguished speakers, industry practitioners, and faculty members from LBS, providing a holistic learning experience enriched with real-world case studies and practical insights.
Participants commended the program for its relevance, depth of content, and interactive learning approach, noting its immediate applicability to their roles and responsibilities.
The NiRA EBOD Training at LBS represents a milestone in advancing digital leadership and governance in Nigeria.
“By equipping leaders with cutting-edge knowledge and strategic insights, the program contributes to building a resilient and innovative digital ecosystem that drives sustainable growth and societal development, especially from NiRA perspective. We must fashion out ways of increasing .NG domain name adoption which is our national pride in the digital space”.
Speaking further on why Nigerians and businesses should adopt the .NG domain name, the NiRA president said, “.NG domain name gives your brand special recognition both on and offline.
“Using a .ng domain name can help your business stand out in the Nigerian and global market. It is a great way to differentiate your brand from competitors and establish a unique identity. A .ng domain name is easier to remember, which can make it more likely that customers will return to your website in the future”, he said.
“It instantly communicates to internet users that your business is located in Nigeria. This can be especially helpful if you operate in a niche or industry where location is important to customers”, the NiRA boss added.
He added that Google and other search engines prioritize local content in search results, hence using a .ng domain name can help improve your website’s search engine ranking for local searches.
Climate Action Africa (CAA), a leading advocate for climate resilience and sustainable development, has announced the opening of applications for the Deal Room at the 2024 Climate Action Africa Forum (CAAF24). The Deal Room is a groundbreaking platform that aims to connect high-impact climate innovators in Africa with potential investors seeking to accelerate sustainable solutions.
The CAAF Deal Room is a strategic initiative that aims to create opportunities for innovators in the climate-tech domain focusing on emission reduction, energy, agriculture, transportation, circular economy, and building and construction.
The goal of the Deal Room is to select finalists who will have the opportunity to pitch their innovative ideas and solutions at the upcoming 2024 Climate Action Africa Forum, which will be held on June 19th in Lagos, Nigeria.
The Deal Room aims to boost investments in Africa’s green economy by galvanising a community of innovators, entrepreneurs, and investors to create applicable solutions that can mitigate the challenges of climate change on the African continent.
The Deal Room session will facilitate financing for solutions contributing to the growth and sustainability of Africa’s green economy. These deals may encompass prize money, equity plans, debt financing, mergers and acquisitions, and other investment options.
“Through the CAAF24 Deal Room, we aim to bridge the critical gap between promising climate ventures and the essential resources they need to thrive,” says Grace Oluchi Mbah, Co-founder and Executive Director of Climate Action Africa (CAA). “By facilitating connections between passionate entrepreneurs and dedicated investors, we can collectively unlock the immense potential of climate solutions in Africa.”
The eligibility criteria for applying include:
● The company must be African-owned and operate in any of the 54 African countries.
● It must be a for-profit company, between 1-5 years post-incorporation, post-MVP (minimum viable product), and post-GTM (go-to-market).
● The company should leverage digital technology to deliver its business model.
● Female ownership is an added advantage.
Those eligible to apply include venture capitalists, impact investors, climate tech startups, Green SMEs (small and medium-sized enterprises), philanthropic organisations, and government representatives.
Following the CAAF24 deal-room will be a post-event accelerator in partnership with the Silicon Valley-based Founder Institute and IDEA Africa. This Africa-wide initiative is specifically designed to further accelerate and enhance support for promising Climate Tech startups and founders who participated in the Deal Room.
The official unveiling of this accelerator will take place at the Climate Action Africa Forum 2024 (CAAF24), marking a significant step forward in driving Climate Tech innovations throughout Africa.
Applications for the CAAF24 Deal Room are open from April 22nd until May 17th. Interested applicants can register at https://deal.caaf.africa/register.
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