Commercial transportation is a very profitable sector,
it is a necessary aspect of human activity, and it serves
as the foundation for all socio-economic exchanges in many ways.
It is expected to grow at a rate of 3.4% through 2027.
Vehicle ownership in Nigeria was estimated at 35.3 million in 2018,
and is estimated to increase to 48.7, 66.2,
and 76.1 million in 2030, 2040, and 2050, respectively.
According to Nairametrics, Africa’s population is expected to
reach around 2.5 billion people by 2050.
As eloquently demonstrated by these figures,
which shows that as the number of road users
increase the population follows suit.
Forcing the development of quicker and more efficient forms of transportation.
As profitable and lucrative as the commercial transportation
sector may seem, in recent times it has been dreaded by many and
even though admired for its profitable nature,
still feared for its unpredictability.
Listed below are a few of the challenges affecting
the commercial mobility space.
Poor proactive maintenance system
In recent times, commercial transportation has been
littered with all kinds of flaws and poor maintenance, such as;
• Poor maintenance habits among drivers,
• Unreasonable profit expectations among car owners, etc.
Poor management systems have made the commercial transportation business
appear volatile and has resulted in low and unpredictable profit margins.
Poor management processes on the ground, such as drivers’
poor maintenance culture, stifles the business’s growth
and potential, eventually dragging it down.
Low credit scores to get loans
Nigeria was recently ranked fifth out of ten countries with the
highest debt exposure by the World Bank. Nigeria Owes
The International Development Association about.
US$11.7 billion from one of the World Bank’s
two lending arms. This was possible because of
the credit score and borrowing power of the country.
A credit score is a number that ranges from 300 to 850,
based on credit history: number of open accounts,
total levels of debt, and payback history, and other criteria.
A credit score is important in determining whether
or not a lender will grant credit.
When starting a commercial transportation business on your own,
it can be quite capital intensive, and even a small/medium one
might take a long time to get off the ground. When people encounter
financial challenges starting a business, the next step is to find
sources of funds/loans to support the business; however, this is
a limiting aspect because not everyone is creditworthy to acquire
loans due to poor credit scores.
Difficulty tracking/remitting payments from drivers
One of the most significant difficulties in the commercial
transportation sector arises, when vehicle owners are unable
to monitor their vehicles and not receive regular payments from drivers,
Nigeria had 2,043 private car thefts in 2013. Though private
car theft in Nigeria has fluctuated significantly in recent years,
it has tended to decline from 2008 to 2013, peaking at 2,043 in 2013.
Due to the difficulty of car owners to track drivers,
and monitor payments, some drivers have leveraged this
inability/flaw to try making extra/ quick cash for
themselves at the expense of the vehicle owner’s profit.
Even though the commercial transportation business appears
to be profitable, it cannot be sustained if there is an
inadequate accountability structure in place.
MyGarage.Africa is a digital platform that allows
hosts (investors) to create a virtual garage to list
vehicles on lease for commercial transportation, and
connect with verified drivers in each city.
MyGarage.Africa is tackling these challenges by
pioneering car subscription in Nigeria through technology.
Do you have any vehicle that aren’t on the road because
they’ve been immobilized? Are you hosting vehicles that
aren’t in use, aren’t moving, and aren’t bringing in any money?
Then let us take care of your vehicles with our executive
fleet management system, which includes car pairing with
vetted drivers, 100% guaranteed lease collection, and a free
vehicle tracker and software for all cars. (Installation at vehicle owner’s expense).
You can now earn extra money by listing your vehicles on
the MyGarage.Africa platform for Bolt. MyGarage offers true safety-enabled technology.