Logistics industry is Nigeria’s next oil—Akinlofa
Tosin Akinlofa, chief executive of Luztow Logistics International Limited, has said that logistics business is a gold mine, though the industry is full of ups and downs.
Speaking with Start-Up Digest in Lagos recently, the young entrepreneur said logistics is a business that is broad and with a bright future, adding that it is Nigeria’s next oil.
“If we can tap into logistics, we will forget about oil,” he said.
“Logistics creates employment and generates revenue for government. If the ports are put in proper shape, if the roads are in proper shape, a lot of revenue would be created. I saw that light in logistics, which was why I decided to go into it,” he explained.
Akinlofa went into logistics industry after leaving a paid employment in 2013.
He started this business with N100, 000, using 70 percent of the money to register it at the Corporate Affairs Commission (CAC).
Left with just N30,000, the entrepreneur endured hard times and worked hard to woo customers.
Five years after, Akinlofa’s firm, based in Lagos, has grown into a multi-million naira entity.
Luztow provides logistics and delivery services for Nigerians, serving ecommerce firms. It also clears goods from the ports.
“We are still growing. When we started, throughout that year, we did almost nothing in terms of business. We started doing business in 2014. Today, monthly turnover is in millions,” Akinlofa said.
“I have always wanted to employ people, to create avenues for people to showcase their potential. There was no way I could do that while in paid employment. So, I took the bull by the horns and tendered my resignation letter. I then registered this company. It was very challenging when I registered the company because capital was not there. I launched out into the deep and started networking, telling people what I could do. Initially, people did not believe me because there were big players in the industry. But as time went on, people started seeing what I could do,” he recalls.
The entrepreneur says that one major challenge he faced at the earlier stage of his business was trust. Akinlofa says that Nigerians have issues with trusting others owing to the bad experiences they have had in the past.
“It is not easy for someone to entrust you with his or her goods. I didn’t try to convince them to give me, but I showed them what I could do. Some persons trusted me and today, I am happy,” he recalls.
The entrepreneur says that he runs his business in a different way.
“You can get to me directly. I do same-day delivery service. Once I pick your order, I deliver it immediately. I don’t do stories. You don’t have to know anybody before you can reach me.”
His business is on the social media, and he puts measures in place to protect the integrity of parcels and goods through insurance.
“We have insurance policies. We have fire and burglary insurance, among others that cover the goods we collect from our customers,” he says.
It is not all rosy for the entrepreneur, given the poor state of link roads to Apapa ports.
“It is part of the challenge that we face in this part of the world. But somehow, we have found a way to navigate through it. As Nigerians, we have developed a thick skin so we find alternative routes. So, instead of going through Tin Can, we go through Ajegunle, to Amukoko, and to Mile 2,” he states.
Contrary to the belief of many young entrepreneurs, Akinofa says that funding is not the biggest challenge facing entrepreneurs.
“Really, funding is not the biggest problem because if you have funds but don’t have the requisite knowledge, the funds will disappear,” he says.
“If you are given N10 million and you don’t have necessary knowledge of how to utilise the money, it will disappear in two years.
“The biggest problem entrepreneurs have is lack of training. I am happy that universities are including entrepreneurship in their curricula. Years ago, it was not there, but now it is being included. If you are not trained on how to manage funds, you can hardly run a successful business. I came to LCCI Mentoring Programme to learn how to manage funds and it has been quite helpful.”
In 10 years’ time, Akinlofa expects to have presence in all the major cities in Nigeria.
The entrepreneur also explains why many small businesses fail in Nigeria.