Toyin Olufade is president, Association of Nigeria Courier Operators (Anco). He is also the managing director and chief executive officer of Swift Couriers Limited and has been in the courier industry for over 25 years.
Olufade worked for DHL for 12 years and before establishing Swift Couriers in 1997. In this interview with nkechi david-iwuchukwu, he spoke on industry issues and how to move the association forward.
Growth in the Courier Industry
The industry is relatively new in Nigeria, when I say new it is not an old industry, courier industry even in the world, is not as old as post, courier is door-to-door, hand-to-hand delivery of packages and documents. In Nigeria here, a child is still young at 25 and is still a young baby at 30 and that is basically how old the industry has been. The industry started in 1979 and I joined in 1984, so it is relatively very young in this country, if you do the mathematics from 1979 to 2010 is about 31 years old. However, the industry has grown from may be two to three players over time to about 240 players right now. The industry is still evolving because even at 240, it is still a very low number, to what a growing economy should have. What I mean by that is that you find out that a lot of courier companies are concentrated in Lagos, with a few in other parts of the country. In fact what I am saying is that we are limited, in that we could have a courier company concentrating just in deliveries of document in Enugu and effective in Enugu township, not to talk of Enugu state. So, if we are to expand this business, as the economy is expanding, we should have over 1,000 courier companies in Nigeria right now. So the growth of the industry is determined by the state of the economy and the response of consumers to post. Right now, we are still selling and sensitizing our people on the need, for instance, when you talk about mail shots, couriers are still not playing in that field, even the post is not playing. Our people are not playing in that field yet, but that is where you generate a lot of document, for instance, lets say Shoprite has coupons to give out to customers, they do mail shots and the courier drops it at their customers houses, for example 10 per cent discount on coca cola today and the customers picks the coupons and goes back to the shop to redeem it, but those things are not there, we are not doing that. The industry, is so wide that we are still limited by what we do right now, but we are hoping that as we grow and as the economy itself grows, the industry will continue to expand and there will be so much to do for each player.
Challenges Faced
The challenges are still enormous. The start-up cost is there and you know that Nigeria is still cash based, to do anything you need to put cash down upfront, you want to buy a car, you want to buy a truck, you pay full. That means you need a lot of money upfront in your pocket to start-up, but it shouldn’t be that because a business is supposed to start-up with just the working capital to run the equipments that you have. We also have the problem of electricity and road. The roads are bad. The problem of personnel is also there, because they are not adequately educated, so you spend a lot of time training and re-training. The challenge of taxes is there too and that is killing. When I say taxes we have various levels of taxes, which amount to double taxation. For example, if there is a withholding tax, to get your document, even from the people you work for, is a challenge, it’s either they are not paying the withholding tax or you can not file for your tax purposes. Even in the local government where you operate your business, instead of being happy that at least your presence in the area will create employment, they visit you in the first month of operation demanding for one levy or the other. We are still having discussion with the local governments as a body, to explain to them that they need to welcome our people in their various areas and when they see Anco stickers, it should serve as a licence to move ahead, because we carry very urgent, time sensitive, and critical document that may have to do with live, business progress and promotion but we are surprise that the local government officials sit on Anco bikes and cause delays that may even indirectly affect them. Because they are not aware that we are of a critical nature to the development of the economy and information if not passed at the right time could cause serious problems. I am using this opportunity to let the local government know that we are in a critical sector, information dissemination which is required in the business economy, helps the economy to grow. For instance, if a major manufacturer has a slight problem and I have that little bolt or nut for the machine to be put back to work, the industry can be grounded for weeks if that bolt or nut does not get to them as at when due. So the longer you delay in getting the item to the industry, the longer people will stay out of work, so that means it will affect the economy. So since we operate in a sensitive sector, we want every player including the police to ensure that they correct that.
Banks Interest in Courier
We have seen of late that there is more to it than meets the eye, but of course it’s a free market we are operating and every body can get into any business. The truth of the matter is this, I think we should specialize in our area of competence, so I expect the banks to focus on their core competence and provide money to companies that are specialist in this field. By setting up a business and being a competitor to your customer does not speak well. I think the regulatory body of the banks should look into it, because there are limitation to the volume of document you can handle yourself, so if bank xyz opens a courier company and thinks it can move more than a percentage of their item then they are kidding, they need to look at it other wise they are doing something wrong. I would rather suggest that the banks should help grow businesses because you cannot make blocks and at the same time build the house yourself.
Skilled Manpower in the Sector
Skilled manpower is an area that needs a serious attention, unfortunate for us right now there is no courier school, no university where one can study courier, but of course we have courses in logistics which is not enough, so right now Anco is working on becoming chartered in the near future, where people will begin to be taught on how to handle courier and what courier is all about. Courier is a profession that needs to be properly attended to, so that we can effectively discharge the duties that we need to do. Anco is already looking at it, we are planning to set up a training school, to train and also have a recruitment centre for various departments, from courier to clericals, customer service, marketers, and things like that, that is in the focus and it is in the pipe line. I am hoping that in the next one year, things will materialize and in our movement with government, the ministry of education and others, we will be able to become certified as soon as possible. Right now, individually we are trying to train and re-train our people in new developments in the courier industry and it takes a longer time but if we have a body that can train them like ICAN, you go to school to study accountancy but you also take a professional course to become a chartered accountant or a chartered marketer for instance, so that is the area we are looking at now, so that we can become more professional than we currently are.
The Regulatory Body
Courier Regulatory Department (CRD) of the Nipost is our regulatory body, within their scope they have been able to do well and within the limit of their operating guidelines they have been able to do the best they can. Of course you will notice of late that we have been saying that a player too cannot be a regulator, it is not right and there is some level of injustice there but that is what we have now. But there is still cry that there should be a body, an independent and autonomous body, like a commission that will regulate all of us including post, as long as you deal with mails. We believe that it will come on stage quickly, because we are so desirous of it. There can be transformation, CRD could transform to become the commission but I am not in the position to say that but we are hoping that we can have an independent commission, so that there can be more effectiveness as it happened in the telecommunication industry. The development that has taken place in the telecommunication Industry in the last few years is enormous and I believe that same thing can happen in the postal sector but you will notice that it could not happen until there was a separate regulatory body known as the National Communication Commission, so if we have a National Postal Commission, you will imagine the wonders that will happen.
Future of ICT Development in Nigeria
That is the way it is, ICT development not just in Nigeria but in the world, I was in India last year and ICT is breaking them open to the world. As a matter of fact most of the companies have their customer service based in India, so after office hours and you want to talk to someone, someone is talking to you from India. Nigeria also has the potential, because I can run a customer service from my one room, since I have all the equipments, I have the computer and I have the information that is the benefit of ICT. India purposed to develop that sector and today they are a super power in it, they call it ‘silicon valley’ and I think Nigeria is ripe for its own.
