In this article, “Sherif Taher”, founder and CEO of Naqla, During an interview with Business Insider Africa. He outlined five points entrepreneurs should consider before starting a transport and logistics business in Africa.
Sherif Taher, founder and CEO of Naqla, is digitally transforming Egypt’s poorly served transport and logistics landscape. He began the process of modernising and expanding Egypt’s supply chain in 2017. Since then, Naqla has overseen the delivery of over 5 million tonnes of cargo and works with more than 400 shippers and 10,500 drivers across Egypt.
Naqla uses app-based technology that directly connects trucker owners with cargo companies to optimise routes and ensure fair rates for drivers. Shippers input their loads on the Naqla platform, which analyses the shipment, provides an immediate quote at a competitive price and is available for carriers to view.
1. Understand the business operating landscape – forensically.
Africa’s road freight industry is hugely underserved due to a lack of proper infrastructure.
Poor routes make it hard for drivers to plan trips around each other, and much of the supply is controlled by brokers, limiting drivers to a handful of shippers and creating inconsistent pricing. This means a lack of supply for shippers, especially during the busy potato and citrus seasons. It can take up to 6 hours to arrange a shipment during this time.
“Africa’s logistics landscape is highly fragmented. By understanding the problems that divide it, you will find an opportunity to bring the needs of carriers and truckers together through innovation,” says Sherif.
2. The welfare of truckers will determine how we succeed.
“If the African logistics industry is a fountain, the truckers sit at the top,” says Sherif. “If the top is not cleaned and cared for, the dirty water flows down and muddies the entire fountain.”
This principle is also in the best interests of a new logistics business. For example, the cargo will reach its destination quicker if truckers’ time is saved because of optimised routes and improved address information. If drivers have better wages and more opportunities to engage with shippers, shippers will have a greater supply of carriers during peak shipping seasons.
The bottom line is to create a sustainable and safe working environment, give drivers more control, and ensure fair wages and hours for drivers should be prioritised.
3. Technology is just a tool.
Technology is completely transforming logistics and has become a norm in the sector. Technology can connect shippers with the right carriers, accurately track shipments, provide digital paperwork, etc. The potential 8for new and exciting innovation is endless.
But Sherif firmly believes that new logistics players must not forget that transport technology will have a user on the other side. It must be accessible for the everyday driver and shipper.
Sherif says, “when we built the Naqla platform, it was essential that we made our app user interface simple and easy to use. We always remembered that an average independent Egyptian trucker would use one side of our app, and we built it with them in mind.”
4. Reduce carbon emissions.
The greatest impact of a typical consumer company’s carbon emissions comes from its supply chain. Increased pressure to meet ESG targets means more and more cargo companies are looking to drastically reduce their carbon footprint and are drawn to logistics businesses that can help them achieve it.
This is now a core customer need – if your logistics business is to survive in the long-term, build carbon reduction into your business strategy from the very beginning.
“Naqla’s business model ensures that every mile a trucker drives will be to a productive end. Our app gives drivers more opportunity to complete back-to-back deliveries such as drop-and-hook transfers, where a full trailer is unhooked from the truck, and an empty trailer is picked up for delivery simultaneously,” says Sherif.
5. Tackling Africa’s huge logistics problem
Despite its wealth of problems, Africa’s logistics landscape continues to boom because of rapid growth in e-commerce and consumer goods, especially in the wake of COVID-19. New businesses that disrupt the sector encourage this prosperity – particularly the businesses which tackle the problems directly.
Naqla works with more than 400 shippers and 10,500 drivers across Egypt and has overseen the delivery of over 5 million tonnes of cargo.
“Before starting an African logistics company, the most important thing is to understand the problems that hold the sector back. The market is ripe even with these problems, but when you manage to overcome fundamental issues like idle lorries or low wages, everybody prospers – the drivers, the shippers, and the wider African economy. This is what the African logistics landscape needs: disruption, prosperity, and modernisation.”