For the past ten to fifteen years, the Nigerian logistics industry has experienced great transformation. This great deed of transformation was as a result of companies needs to outsource most of their services to special service providers ranging from transportation to assembling etc.
This event especially in transportation of products, be it incoming raw materials or outgoing finished products, has giving rise to professional haulage and logistics companies with significant investments running into billions of Naira.This logistics/haulage sector is now estimated to be worth more than N150 billion yearly or more, with an estimated growth rate of more than 10% yearly. Currently there are more than 15 truck dealers, compared to just 3 in 1990,with over 180 dealers in fairly used trucks.(Haulage & Logistics Magazine,2014)
Logistics Performance Index for Nigeria(2007-2014)
Source: World Bank
|Countries||LPI Score||LPI Rank||Custom||Infrastructure|
Source: World Bank
However Supply Chain in Nigeria has been affected with numerous challenges over the years, affecting its growth and stability,ranging from unethical/unprofessional practices, limited experience, poor infrastructure, poor information technology accessibility, access to business networks, to name but a few.
(ACSC Industry Report 2016).
Due to Nigeria’s lack of other proficient means of transportation, road transportation constitutes the major transportation network, which constitutes about 75% of total transportation needs of the entire nation. This implies that supply chain in Nigeria uses majorly the road transport network for its operations, competing with other major road users for adequate road networks which is generally deficient and insufficient. This increases risks in commercial and human capital for various competing companies.
Over the past six years (2000-2006),analysis on traffic accidents shows over 98,494 cases of crashes, resulting to over 47,090 deaths(FRSC,2009,cited in Aworemi et al,2010),making Nigeria to be amongst the forefront developing countries experiencing the highest rate of road tragedies in the world.
As cited in Nigerian logistics and supply chain industry report 2016,by African Center for Supply Chain(ACSC).
Next time I will give an insight on Vulnerability in Nigerian Logistics and supply Chain Industry.
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