After the Lagos State government banned its ride-hailing service, Gokada pivoted to logistics where it is now becoming a preferred delivery brand for many local companies. In this interview, Nikhil Goel, CEO of Gokada, speaks to Frank Eleanya on the milestone it has achieved and the expansion it plans for the market in Nigeria.
You were once known for ride-hailing. How has it been transiting to a new business, logistics?
Gokada’s goal has always been to become a complete transportation and last-mile delivery solution for the growing logistics sector in Nigeria. The okada ban in Lagos sped up our decision to pivot to last-mile logistics and we moved quickly to minimise the impact on the business and to minimise the loss of earnings of our pilots. The transition has been relatively fluid – our pilots have simply gone from delivering people to delivering packages. Operationally we were already set up to offer last-mile logistics services, and now with our revamped app, we are able to connect consumers and businesses even more efficiently.
What is the impact of the pandemic on your business?
The service sector in Lagos, much like everywhere in the world, was adversely impacted by the pandemic, as restrictions on movement meant massive disruptions to the supply chain as well as consumers’ ability to engage with retailers. During the lockdown, our pilots provided an invaluable link between food outlets, businesses, and customers in ensuring continuity and minimal disruption, especially for small and medium businesses. In fact, demand for our delivery services grew exponentially during the lockdown. Our biggest challenge then became meeting the rise in demand without compromising our service levels, which we did by increasing our fleet and maintaining regular training with pilots.
Which other markets is Gokada apart from Nigeria? Which is the most thriving
For now, we only operate in Nigeria. Our focus has been to strengthen our offering within Lagos and then expand to other key states in Nigeria. There is a real shift in consumer behaviour towards online shopping and last-mile delivery in the country, and this requires reliable delivery solutions to meet this growing demand. The food delivery space has been our biggest growth sector in the last year, and we’re also seeing growth in the healthcare, fashion, and accessories delivery sector.
Read Also: How we will phase out ‘Okada’ in Lagos – Sanwo-Olu
During your ride-hailing days, you were known as a disruptor. How are you applying that mindset in logistics?
The trajectory of Gokada’s success has been led by one constant consideration – how we make the consumer and pilot experience as seamless as possible, whether through ride-hailing or logistics. We have kept our focus on being a key technology driver within the country, and despite facing a number of hurdles along the way, we have continued to keep our focus on providing great last-mile logistics solutions to both businesses and consumers. The development of our new Super App has been a natural and necessary step to reinforcing our strong market position. It’s a complete delivery ecosystem that connects businesses and consumers via our easy-to-use dashboard and is designed to make accessing delivery services simple for users. We believe our technology, talented team, and ‘business-in-a-box model are keys to continuing our accelerated growth in the last mile delivery space in Nigeria.
What have been the milestones for you since pivoting to logistics?
Through our seamless same-day delivery service that is available to thousands of businesses in Lagos, we have been able to achieve great success, crossing the >US$100 million mark in annualized transaction value in the past year. This is a result of having completed over 1 million food delivery and eCommerce orders on behalf of over 30,000 merchants in Lagos. Our fleet has grown and our leadership team is also growing – including a new product lead to drive our platform development as we continue to expand.
What is your perspective of the logistics market in Africa?
The logistics market is evolving, and with a number of new brands looking to service the continent, we can only expect a continued uptick in market growth. This is also due to the influence of other industries, as the eCommerce and last-mile delivery sector in Nigeria is projected to reach approximately ~US$10 billion by 2025, while Food Delivery will reach close to US$1 billion by 2025.
When considering such figures it is important to highlight the effect the pandemic has had on online shopping and consumer buying habits. People are becoming more used to the ease and simplicity of delivery services, having had to rely on these services throughout lockdown. Despite lockdown measures easing, we anticipate people continuing to utilize delivery services – it has opened up a new channel for businesses to connect with more customers, and for consumers, it provides options for accessing a range of services conveniently through their phones.
What needs to change policy-wise for the logistics market in Africa?
It can be quite a challenge wading through the regulatory processes in setting up any business and there are some places in Africa that have systems and policies that can be complex to navigate. The cost of logistics, for example, is much higher in Africa than in the US or Europe. Many parts of the industry also need digital transformation and better infrastructure.
To combat this, the regulatory environment needs to be simplified, to allow businesses to easily and clearly know which guidelines to follow, what to avoid, and what necessary changes they should make to guarantee compliance.
What lessons did you learn engaging policymakers in Nigeria as a ride-hailing company and how are you applying it as a logistics company looking at Africa?
In the last year, a number of things changed for us operationally and gave us a vital understanding of just how important the business-regulator relationship is.
Regulations within the country have and will continue to adapt, but it is our job to ensure that our business is agile enough to meet the needs of our business partners and consumers whilst meeting regulations set by policymakers. This is one of the reasons we applied for the NIPOST license and continually ensure that our bikes are serviced and remain road safe.
What are your ambitions for Africa?
We want to impact the lives of millions of riders across Africa and touch the lives of millions of customers with our services. Nigeria is a region that boasts of many opportunities that increase when expanding from state to state. With this in mind, we look to fulfil our plans of offering our services to consumers in Ogun, Ibadan, Abuja, and Port Harcourt this year and will keep it as a core focus of ours. As a company, we are eager to grow and reach new milestones at a constant rate, but we hope to secure our position as industry leaders within Nigeria before entering new markets.
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