bioeconomy development faculty institute of business …
TRANSCRIPT
VYTAUTAS MAGNUS UNIVERSITY
BIOECONOMY DEVELOPMENT FACULTY
Institute of Business and Rural Development Research
ADEBOYE FUNMI OMOTAYO
IMPROVEMENT OF LOGISTICS MANAGEMENT ON THE
EXAMPLE OF JUMIA NIGERIA
Master’s Thesis
Business Logistics study programme, state code 6211LX055
Business study field
Supervisor Jolita Greblikaite
(Asist. Prof. dr. name surname) (Signature) (Date)
Defended___________________ _____________ __________
(Director of Institute) (Signature) (Date)
Akademija, 2021
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TABLE OF CONTENT
Table of content…………………………………………………………………………………...2
Summary………………………………………………………………………………………......3
Introduction…………………………………………………………………………………….….6
1. THEORETICAL BACKGROUND: CONCEPTUALIZATION OF LOGISTICS
MANAGEMENT ………………………………………………………………………….9
1.1. Concept of logistics process management……………………………………………………9
1.2. The types and components of logistics management………………….…………………….11
1.3. Improving aspects of logistics management…………………………….……………….….15
1.4. Uncertainties in logistics process……………………………………………………………20
2. EMPIRICAL RESEARCH METHODOLOGY………………………………………….24
2.1. Logical sequence…………………………………………………………………………….24
2.2. Research method…………………………………………………………………………….25
3. BACKGROUND TO LOGISTICS MANAGEMENT IN
NIGERIA……………………………………………………………………………………31
3.1. Background to Logistics management in Nigeria (Jumia Nigeria) ………………………32
3.2. Jumia Nigeria Logistics management………….………………………………………….34
3.3. Logistics process management regulation in Nigeria……………………………………….36
4. RESEARCH ANALYSIS AND FINDINGS………………………………………………40
4.1. Challenges of logistics management in Nigeria……………….…………………………….41
4.2. Empirical research result presentation………………………………………………………46
4.3. PESTEL Analysis of improvement of logistics management………….……………………56
CONCLUSION…………………………………………………………………………………63
RECOMMENDATIONS………………………………………………………………………65
REFERENCES…………………………………………………………………………………67
APPENDICES…………………………………………………………………………………75
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SUMMARY
ADEBOYE FUNMI OMOTAYO
Topic: IMPROVEMENT OF LOGISTICS MANAGEMENT ON THE EXAMPLE OF
JUMIA NIGERIA
Final work of MSC thesis- Pages 89, References 79, Tables 5, Figures 8, Pictures 6
Research object - Improvement of logistics management
Research goal – To examine the theoretically the logistics management and analyze on the
example of Jumia Nigeria seeking to identify and propose improvement measures.
Objectives of research –
1. To examine the concepts of logistics management and explore the process and impact of
logistic management;
2. To present the current situation of logistics in Nigeria (Including Jumia Nigeria) and
empirically identify the challenges of logistics management on the example of Jumia Nigeria;
3. To suggest improvement measures of logistics management.
Research method- The study involved collection of data or evidence from both secondary and
primary scientific literature, statistical data sources, using qualitative research method to analyze
in an effort to uncover new information and create better understanding. Also, staff of Jumia
Nigeria were selected using purposive sampling to derive relevant information to enrich the study.
Research result- from the reviewed literature and the outcome of the semi-structured interview,
the logistics management in Nigeria in hindered by challenges ranging from regulatory,
infrastructural deficits, poor logistics management on the part of operators and others. The
PESTEL method for analysis of factors affecting improvement of logistic management was done
to identify the external factors. To improve logistics process management, the gap in infrastructural
development needs to be meet, and this can be realized through effective policies and political will
to provide basic infrastructural development, security, improved regulation and others. The
recommendation includes breeching the gap in infrastructure, proper regulatory frameworks,
investment in new technology among others to improve logistics management in Nigeria.
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LIST OF FIGURES
Figure 1. Components of logistics management
Figure 2. Showing aspects of logistics management
Figure 3. Uncertainties in logistics process
Figure 4. Logical sequence of empirical research
Figure 5. The process of themes derivation from the interview ideas
Figure 6. Internet download speed in some African countries
Figure 7. Logistics performance index: Overall (1=low to 5=High) for Nigeria
Figure 8. PESTEL analysis of factors affecting improvement of logistics management
LIST OF TABLES
Table 1. Definitions of logistics process
Table 2. Criteria for selecting participants
Table 3. Final themes developed from the original interview ideas
Table 4. Category of licensing for operators in Nigeria
Table 5. Theme development from the original interview information
Table 6. Nigerian indicators in comparison with other middle income economies (2016)
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GLOSSARY OF MAIN CONCEPTS
CAGR- Compound Annual Growth Rate
CAMA- Company and Allied Matters Act
CDR - Courier Regulatory Department
FEPA- Federal Environmental Agency
LASAA- Lagos State Structure for Signage and Advertisement Agency
LASEPA- Lagos State Environmental Protection Agency
MVAA- Motor Vehicle Administration Agency
NESREA- National Environmental Protection Agency
NIPOST- Nigerian Postal Service
RFID- Radio Frequency Identification Technology
SME - Small and Medium Enterprise
HDI- Human Development Index
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INTRODUCTION
In the business world today, logistics management is confronted with many challenges, it
is a combination of business, resources and the many core activities of an organization. Logistics
is the doctrine of creating efficient flows as much as possible (Storhagen, 2018). The logistics
activities are formed from the integration of supply and distribution activities being integrated
together (Ghoumrassi and Tigu, 2017). Logistics in businesses is very crucial for effective running
of the business between the producer, supplier and the customers. It involves detailed process of
organization, implementation and operation of businesses (Westland, 2019).
The aspects of business comprise of the process of logistics for the flow of work from the
beginning to the end for the purpose of fulfilling the expectations of customers and also that of the
organization. The logistics activities in a business organization is a move to satisfy customers by
achieving the time and location related to the challenges of the market as well as through the cost
of the provided services also taking quality, customers need and purchase power into consideration
(Ghoumrassi and Tigu, 2017).
Without logistics management, the several phases of markets into products and services
will fall into disordered mess very quickly. Therefore, according to Westland, J. (2019) “logistics
management on businesses requires having the right items in the right amount at the right time and
place for the right cost and also in the right condition and finally to the right customers”.
Businesses utilize logistics management in a process to more efficiently and effectively
move resources and products from conception to completion and to the customer who are the last
on the chain. The idea is to introduce logistics management as a response to the necessity of the
increasingly rise of integrated system, which involves process of planning and coordination of the
materials flow from the sources of supply to the point of consumption rather than managing theses
flows as a series of tasks done independently (Sadjady, 2014).
Logistics management are utilized by online markets places all over the world such as
Amazon, Konga, Jumia, Ebay among others to purchase and distribute products from producers to
customers. For these businesses logistics management typically includes activities of inbound and
outbound transportation management, warehousing, fleets management, materials handling,
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design of logistics networks, order fulfilment, management of inventory, third party logistics
procurement management, packaging and others.
Therefore, Jumia services which is the leading online markets place for consumer’s in
Nigeria is used as an example for logistics management. Jumia services is part of Jumia Group
which is also the leading online market place in Africa involved in market place, logistics and
services and payment services. Jumia logistics were reserved for e-commerce, food vendors and
third party businesses who can leverage on its network, technology and services in Nigeria and 10
other countries in Africa (Alekhougie, 2020).
Thus, the research on improvement of logistics management using Jumia service in Nigeria
as an example is carried out. It examines the concepts of logistics management, impacts of logistics
management and a background to Jumia services. It also identifies the challenges of logistics
operations of the organization through primary sources of data using qualitative research method.
This is necessary for the research in order to suggest ways of improvement of logistics
management based on the outcome of the findings in this research work.
Research problem- the improvement in technology has changed the phase of business which
either adds value to logistics management or becomes chaotic due to adequate or inappropriate
process of management. Given the complexity of the process involvement in logistics
management, it still suffers from many issues in which businesses in developing countries like
Nigeria still battles with. An effective logistics management requires certain factors for smooth
running such as the strategy, logistics technology and others.
Jumia services launched in Lagos Nigeria in 2012 has become a leading online market
places in Nigeria which runs transactions with business and carters for millions of customers in
Nigeria. The challenges of its logistics management is unavoidable due the terrain and inadequate
level of infrastructural development in the country. Thus, in order to improve logistics
management, the barriers affecting logistics management shall be identified and measures for
improvement suggested based on the research outcome.
Research relevance – This research is relevant to given the important role logistics process plays
in improving capabilities of the organizations and enhancing their performance through proper
management. Thus, identifying ways to improve logistics management in line with the research
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questions enables improvement in logistics management and achievement of organizational goals
which is the object of the research.
Research object - Improvement of logistics management
Research goal – To examine the theoretically the logistics management and analyze on the
example of Jumia Nigeria seeking to identify and propose improvement measures.
Objectives of research – The research objectives are as follows:
1. To examine the concepts of logistics management and explore the process and impact of
logistic management;
2. To present the current situation of logistics in Nigeria (Including Jumia Nigeria) and
empirically identify the challenges of logistics management on the example of Jumia
Nigeria;
3. To suggest improvement measures of logistics management.
Research questions- The research questions are the set of questions that the study intends to
answers and improve knowledge based on the subject of study and helps to address the research
problem. The questions arising from the topic, improvement of logistics management on the
example of Jumia Nigeria are:
1. What are the logistics management challenges for market place in Nigeria?
2. How can logistics management be improved?
Research method- The strategies utilized for this thesis is a collection of data or evidence from
both secondary and primary scientific literature, statistical data sources, using qualitative research
method to analyze in an effort to uncover new information and create better understanding on
improvement of logistics management on the example of Jumia Nigeria. Using purposive
sampling, staff of Jumia service in Nigeria are selected to provide data about the ideas, experience
in logistics management for Jumia services through interview and in line with the research
questions.
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1. THEORETICAL BACKGROUND: CONCEPTUALIZATION OF
LOGISTICS MANAGEMENT
1.1. Concept of Logistics management
Historically, the word “logistics” originates from ancient Greek logos which is believed to
be a semantics of the word that originates from the word ‘logistikos’ in which is translated as
‘science of computation in military terms (Leinonen, 2020). It is interpreted as “ratio, oration,
calculation, word, speech, reason”, traced to the military (i.e the French Army General Antoine-
Henri Gemini) who was believed to have written a book on logistics first in history in 1779 to 1869
(Farahani et al, 2011). It is a branch of science having to do with procuring, maintaining and
transporting materials personnel and facilities.
Furthermore, the root of logistics was also perceived to have originated around the farm to
market economics, and was at first documented around the early 1900’s (Globerson, 2014). In
theory, the term “logistics” does not have a particular definition. In defining logistics authors
emphasize on various aspects of defining of the concept, relating both the economic practice and
to the knowledge areas, but some definitions of logistics includes the following. According to the
American Council of Logistics Management, logistics is defined as “a process of planning,
implementing and controlling the efficient, effective flow and storage of goods, services and the
related information’s from one point to another point of consumption for the purpose of
conforming to the customer’s requirements”.
The adopted definition by the European Logistics Association states that “logistics is a
concept that involves the organization, planning, control and execution of the flow of goods from
the manufacturing places (i.e. purchase places), through the sphere of production and distribution,
and finally to the consumers which aims to satisfy the demands of the market with minimal
commitment and capital”. Other definitions of logistics process by various authors are presented
in the table below.
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Table 1. Definitions of logistics (Source: Sai, 2020; Kenton, 2019; Witron Logistik,
2017; AIMS Education, 2016; Kacmary and Fedoko, 2014; Johannensson, S. 2003 and
Rushton et al, 2000)
Authors Definitions
Sai (2020) The definition which states that “logistics it means the work that is
supportive in nature and this logistics supports are essential for marketing
and manufacturing operations”.
Kenton, (2019) The logistics involves the overall ways of managing how the resources
are acquired, stored and transported to the final destinations.
Witron Logistik
(2017)
It is the art and science of managing physical space, time and location.
AIMS Education –
UK (2016)
It is the art and science of obtaining producing and distribution of
materials and products in the process places and in the right proportions.
Kacmary and
Fedorko (2014)
Logistics involves planning, controlling, implementing all done
efficiently, cost effectively and flow of raw materials in the process
inventory, finished goods and other related information from the point of
consumption to the point of origin for the goal of recapturing the values
or effective disposal.
Johannensson, S.
(2003).
It is a process of relation between human, nature, technology and
resources that interact and unpredictably self-organize into emerging
paradoxical pattern with creating potential value.
Rushton et al,
(2000)
It is the various ways and one way to define logistics which equals
materials management and distribution processes.
From the various definition above, it is agreed in the definitions the unifying logic is that
logistics process involves movement from one point to the other. The logistics concept in based
on an overall system view of the many functions in moving materials and goods from location to
another. Thus, logistics works involves management looking for a way to manage the overall
system instead of one aspect of the system. The operations in logistics include planning,
implementing and maintaining the transport and storage of goods, control of
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movement/placements of goods/or people and it also involves supporting services and information
of the initial point to the end point, to achieve specified objectives (Team Lapaas, 2020,
Emmanson’s Blog, 2009). The principal objectives of logistics processes are to ensure:
Services to customers
Efficient planning of demand and supply and purchasing management
Management of transportation
Proficient quality control, insurance and customs
Management of warehouse
Management of inventory
Distribution
Productions (i.e in house logistics management)
Logistics is said to comprise of all steps of that ensures planning, supervision, execution
and control of the time and space transformation of goods and the related transformation in
quantity and range of assortment, the properties manipulation and the degree of logistics
determination of goods (Szymonik, 2012). Logistics involves facilitation of relationship between
production and movement of goods including time, cost and quality.
1.2. The types and components of logistics management
The logistics management activities are classified into two categories namely, inbound and
outbound logistics.
Inbound logistics- It involves the smooth running and cost effective inflow of materials as
well as other inputs required for production or manufacturing process. It is the network that
brings goods and services to the business (Lerner, 2019). This ranges from the raw production
to the suppliers (vendors) and the plant for production. Therefore, inbound logistics
essentially involves the entire process a business operations require to create the finished
products that is finally sold to customers.
Outbound logistics- It involves the physical distribution management or the supply chain
management. It is concerned with how the finished goods flow and other associated
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information from the company to the customers (Sai, 2020). It involves the way finished
goods to transported to their destinations and it normally works with various partners than the
inbound logistics network (Lerner, 2019). Other types of logistic process are-
Reverse logistics- The process involves transportation of products from to location of
customer to the seller. The reverse process entails collection, sorting, inspecting, refurbishing
and distribution of the goods (Team Lapaas, 2020). Reverse logistics commonly involves the
returning of a products to the manufacturer or the distributors or even forwarding it to the
service section, recycling or refurbishing, it is sometimes referred to as the “aftermarket
supply chain”, aftermarket logistics or ‘retrogistics’ (Essex, 2020).
Third party Logistics (3PL)- The third party logistics (also known as outsourcing) is mainly
focused on movement of products from one location to another location end. This is due to
the fact that it does not give consideration to a seller to customer or customer to the seller.
They take the associated responsibility of delivering the goods or products to the right place
at the expected time. It involves the movement of work, but it is not regularly the transfer of
responsibility and accountability or oversight to the external services provider (Erturgut
2012). The third party logistics helps business owners to focus on their own primary
operations rather than engaging in delivery monitoring which is past to the third party (Team
Lapaas, 2020).
The purpose of logistics is the efficiently enable flow of goods material and services from
their respective place of origin to the final consumer (customer). The goal is to make sure that
there is adequacy of place (moving goods to places where they have been demanded) and the
time (maintaining the right level of stock and the proper distribution) of the goods and
services.
Also, logistics requires proper management and the management involves continuous
interface of activities. There is various definition of logistics management (LM) which all involves
series of processes with the start point to the end in management. Logistics management comprise
of the processes of planning, implementing and controlling the efficient flow of raw-materials,
work in progress and finished goods and related information from the point of origin to the point
of consumption with the outlook to satisfy the customers (Sai, 2020).
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It is also a part of the process of the supply chain which involve planning, implementation
and efficient controls, effective flow, goods storage, various services and require related
information from the point of origin to the point of consumption of the products to meet the
requirement of the customer.
The Council of Supply Chain management defines logistics management as “the part of
supply chain management that plans, implements and controls the efficient, effective forward and
reverse flow and storage of goods, services and related information between the point of origin
and the point of consumption in order to meet the requirements of the customers”. Also, Logistics
management according to Stock and Lambert (2001) is defined “as a part of the supply chain
process that plans implements and control the efficient, and effective flow and storage of goods
and services, as well as related information from the point of origin to the point of consumption in
order to meet the customer’s requirements”.
Logistics process management is considered a more practical, hands on part of the supply
chain where goods are transported into a facility, properly and stored, handled and transported out.
However, the difference is that the logistics management focuses on the short term procedures
while the supply chain management focuses on the long term procedures. The logistics process
requires lots of activities or operations while making up for the inputs of work force /members,
information and technology, finances through actions of management and logistics activities
between the consumers and the suppliers in an effort to ensure the result with output that gives
them competitive advantage, time and movement of place utility efficiently. The component of
logistics process management in shown in figure one below.
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Figure 1. Components of Logistics management (Source: Kamthunsi, E., 2014)
The figure shows the components of logistics management from the one point to another
which may be invisible to the customers who are at the end of the chain but it is of more importance
to the suppliers (ventures) to ensure that the process managed and runs efficiently as at when due
through each of the logistics process management. Thus, the logistics management involves a
system on its own and it is expected to adequately plan an approach for its effectivity and the way
in which the approach is applied as a whole, due to the fact that all the department involved are all
working towards achieving the organization goal as every activities affects each order one way or
the other.
In summary, Logistics management is the control of activities in the process. The
encompass the design of the network, order fulfilment and transportation management in order to
satisfy the customers and also ensure achievement of the objectives of the business. The aspects
of logistics management are reviewed in the next subchapter.
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1.3. Improving aspects of Logistics management
The advent of logistics management brought change in the way businesses are conducted
today. As a result of technological development, logistics process management has advanced and
gave better significance in conducting businesses (Abdul; Aun; Oladipo and Olota, 2019).
Logistics process management is handled as part of the management of the supply chain which
deals with the efficient process of management of goods. It involves logistics processes of
management that integrates moving goods, services information and capital, the right from the raw
materials sourcing, to the customers (Springinklee and Wallenburg, 2012).
The major goals of logistics management according to Mentzer et al, (2004) is the process
of making available the right products at the right quality and at the right time in the right place at
the right price to the ultimate consumer. The flow of information’s is one of the major component
of logistics. The diagram below shows some of the various aspects of logistics management.
Figure 2. Showing aspects of logistics management (Source: Author, 2021)
Aspects of Logistics
management
Information flow
management
Warehousing
Management
Order Manageme
nt
Order fulfilment
Inventory Management
Transportation
Management
Packaging and
Unitization
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Logistics management involves various aspects. According to Ristovska; Kozuharov and
Petkovski (2017) logistics process management includes:
Information flow management -in the competitive business environment today helps in the
effective and timely response to the ever changing taste of customers and preferences which has
become important for the success of business performance (Han and Trienekens, 2009).
Information flow is defined as the flow of data from different directions with content variables
between numerous data base in a company. Information flow within logistics process has become
important because it enables the chain to responds in real time and with accurate data (Abdul; Aun;
Oladipo and Olota, 2019). According to Stevenson and Spring (2009), the flow of accurate and
real time information in logistics process is considered very crucial in the materials flow and
management.
The flow of information allows logistics management become a crucial weapon in
businesses arsenals which adds values to the bottom line (Closs et al., 2005); and a key success to
the performance in the collaboration of logistics management and the business performance
(Abdul; Aun; Oladipo and Olota, 2019). According to Wardaya (2013) states that “the sharing of
information on transfer; exchange of information indicating the level and the position of the
inventory; the sales data and information on the forecast; status orders information, schedules of
production and capacity to deliver and the measurement of business performance became
important to companies” and contributes to the improvement of the logistics management.
Warehousing management – it is a crucial part of the business logistics system that stores
products (such as raw materials, finished goods, sphere parts and goods in process) at and between
location or origin and at the point of consumption; it is made available by warehouse or centers
for distribution (Murphy and Wood, 2008). Also, businesses consider the location of their
warehouse facilities, cost factors, the resources (such as skilled labour) and the accessibility which
has to do with transportation infrastructures (Abdul; Aun; Oladipo and Olota, 2019). All of this is
put into consideration to ensure better proximity of the manufacturing facilities customers and
their suppliers. Management can make sure that the warehouse meets all regulations by checking
to ensure that –
Safety measures complied
Ensure cleanliness
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Effective lighting
Safety of storage facilities
Ensure no obstruction
Inspect equipment’s
Secure stair railings and order measures in place for effectives logistics management of the
warehouse.
Order fulfilment – it is important in the logistics management to ensure that the customer’s orders
are orchestrated via shipment on a fast and safe delivery process. As ordering to products might
seem simple, fulfilling the orders can be challenging when the numbers of orders increases. Rather
than a sole supervisor, companies needs to implement a comprehensive logistics process and
management to efficiently fulfil the request of customers. With a detailed standardized fulfillment
logistics management an accurate and efficiently delivery process can be ensured. According to
Henderson (2020) the logistics management to successfully prepare and deliver orders will
involve-
Recording details of order
Receiving payment
Checking the stocks
Requesting items from inventory
Checking quality of items
Print packing lists
Securely packaging items
Weighting/measure packages
Scheduling the delivery etc.
Order processing- order processing can be used for business that are direct and do not require
extended order fulfilment system (Henderson, 2020). Order processing is focused more on the
customer’s feedback while other operations essentially performs the same function. Order
processing is an excellent alternative to make sure that the consumers are pleased with the products
they buy which requires a process of supervision instead of multiple employees. According to
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Henderson (2020) the logistics management required in carrying out a successful transaction with
the customers and managers involves-
Taking notes of client/order details
Checking stocks
Receiving payment
Scheduling delivery
Contacting the warehouse
Passing forward the tracking information to the customers
Doing follow ups on customer’s order
Inventory management- it is a strategic area in logistics operation process and it has the
efficiency impact and effectiveness of the overall system of the supply chain. Inventory
management provides some level of security against fluctuations of the demands by customers.
Inventory management involves utilizes various data and information to keep track of the goods
as they are moved through the production process, with IDs, lot number, serial numbers, cost of
items, numbers of goods and accurate time and date when the goods are moved through every
stage of the process (Abdul; Aun; Oladipo and Olota, 2019). Inventory management involves four
categories which are:
Raw materials- seller carries out the purchase of the raw material to fulfil the goal of
production which is transformed into consumer goods;
Inventory on work in progress- it involves utilization processes and transformation of the raw
materials while making them finished goods;
Finished goods- this is the complete products for consumers which are ready to be shipped for
consumption, after being checked for quality and available for purchase;
Maintenance, repair and operation goods- are items that are used for the support in the process
of production of finished goods to be made available for sales in future (Assestinfinity, 2019).
Inventory management involves managing various assets in the business. It helps link
customers indirectly to grow business in the market. The process also involves ensuring that
various elements when placing and receiving order are efficiently management such as-
The current levels of stocks
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Budget of the company
List of orders
Approval of Purchase order
Details tracking
Time of arrival
Returning of goods damaged
Records of stock updates etc
Inventory management is beneficial as it ensures improved inventory and planning, organized
warehouse, improved productivity and services and others. It enables enhancement of productivity
through effective logistics management process to deliver high quality and upsurge in satisfaction
of customers.
Transportation management- it is a subdivision of logistics and it has symbiotic relationship
that requires care due to the fact that it is required by the entire production procedures to the end
point (consumers) and returns. Transportation is expensive and complex which requires
management, planning, controlling and smart strategies making decision on the areas of operations
of logistics that are geographically moved and positioned inventory (Hughes, 2017; Bowersox;
Closs and Cooper, 2010).
The management of transportation in logistics is crucial because it takes about one third to two
third of the entire logistics process (Bowersox, et al., 2010). In the logistics management point of
view, transportation management has three major factors which are the performance in: cost, speed
and consistency; therefore, logistics management involves utilizing transportation that enables
minimization of cost of the total system (Bowersox, et al., 2010), some of which are-
Annual inspections of vehicles
Long term repair cost
An overview of the conditions of the fleets etc
Packaging and unitization – the logistics management involves the care and condition of
products. Therefore, packaging management is an important part of it. The Unitization is also
considered crucial because it assists in storage and transportation of products. The simplest goods
to move to the store is a cube, thus the attempt at packaging and unitization takes all various sizes
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and shapes of the products and pack them as near as it is possible into packs cuboid in shape
(Future Learn, 2017).
Logistics management helps businesses to manage how they move products and other
information related through multi-faceted supply chain operations from the destination source
(either at national or international) scale through using systems that ensures safety, reduces time
and cost in a manner efficient (CITT, 2020).
In summary, the availability of information technologies enables the capacity to see data that
are private in the system of collaboration and monitor the products developments, where there is
information flow passing in all procedures in logistics management is improved. The management
of warehouse, inventory, packaging and transportation are all processes that ensures smooth
logistics operation without which can result in customer’s complaints and hampers the goal of the
business and impact the business negatively.
The sustainability concept in logistics management emphasizes meeting the needs of
individuals without hampering the ability to meet such need in the future, this is as to do with
ensuring balanced environment for business and its logistics operations. Logistics management in
Nigerian context (an example of Jumia Nigeria) is reviewed in the next subchapter.
1.4. Uncertainties of logistics process
There are uncertainties in the logistics process due to the complexities in the overall
logistics process. Since logistics process management is sometimes measured based on means
quantifiable and based on the notion of the various actors and parts which are all interconnected
in the logistics process management. Logistics process management complexity is such that is
comprise of interdependent actors interconnected and in the current situations transform their
perception, update their goals and adapt to the context of both individual and collective given the
various aspects of the logistics process management.
According to Nelson (2006) uncertainties in logistics process in divided into given in the
figure below.
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Figure 3. Uncertainties in logistics process (Source: Nelson, F., 2006)
Customers demand and expectation -The first dimension here relates to rise and changes in
demands from customers, in which it results is increasingly affecting the logistics process. Since
demands is not constant as its effects on logistics process is felt in the shrinking time windows for
deliveries, customized order bookings, rise in the number of types of packaging, variations in
numbers of products per pallets and order, rise in the frequency of deliveries etc.
The situation at times leads to rise in cost incurred in the logistics process just to meet with
the service requirement and satisfy the customers and also build relationship with the customers.
Thus logistics process provides crucial opportunities to build relationship and gain the trust of
customers from the confidence built by meeting up with delivery demands including time. Also
the contradiction between other part of the logistics company affects the logistics process of
delivery of products, this is because the marketing or sales unit might take in orders that may be
difficult to meet up. It thereby mounts more pressure on the logistics distributing channels who
work hard to meet up with the customer’s expectation (Nelson, 2006).
Uncertainties in logistics process
Custumers demand and expectation
Internal processes
General Trends
Human Factors
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Thus, effective communication between all interconnected aspects of the logistics process
and management is important to achieve the organizational goal and meet the customer’s
expectation without creating unnecessary constraint in the logistics process.
Internal processes -The internal processes in logistics process management is about the
importance of functional integration (Pagell, 2004), and the importance of integration of
marketing, sales and logistics (Mentzer et al., 2004). There is indication that the internal
communication between marketing, sales and logistics is a source of the major uncertainty in the
daily logistics process management.
Therefore, the perception of this in general is that the understanding of logistics process in
an organization is a valuable activity which must not be limited. This is because it is essential to
enable a smooth, accurate and efficient work that is not associated with more costs. The
uncertainties in the internal process is a factor in logistics that occurs based on customers are
invited into the arrangement rather late which is unnecessary.
Thus, the logistics process becomes a function of complying with instead of providing an
effective solution from its inception. Furthermore, discrepancies do not only occur in the marketing
and sales aspects, it also occurs between the IT and logistics units due to lack of effective
communication (Nelson, 2006).
Human factors- the human factors comes up given the fact that humans are not robots and
mistakes do happen in logistics processes. This human factors occurs in the aspects of influence
in perception of human related uncertainties that may happen. Such uncertainties include truths
hidden, power and also protectionism when an incident occurs.
According to Nelson (2006), the scenario of ‘power’ is an uncertainty factors which
happens the process of making decisions, and it also makes communication harder, i.e. it was
merely an obstacle that creates more problem in various situations. Also, the scenario of powers
occurs due to fear, as individuals might be afraid of making decision due to internal structures of
powers.
General trends – the general trends points at related general developments of new technology,
concepts and ideas. This is due to the global environment that is ever changing and it necessitates
continual checks for improvement effort made in the logistics process. Some of this changes are
23
in the radio frequency identification technology (RFID) and how to apply it to the process of
logistics management as well as cost implications of acquiring new technologies.
Other areas are the rise in amount of ideas and concepts that are trending in the available
markets, because it requires training workers in preparation for the future demands and
requirements of logistics process which is both on short and long term basis.
In summary, human factors create both value and uncertainty in the logistics process. And
it requires more awareness and understanding of the involvement of human to gain more leverage
and improve efforts that creates higher levels of integration with customers and internal logistics
processes. The general trends come with improvements and changes in technology, ideas and
notions for logistic process management, and it requires adapting and training to meet up with the
global trends. From one of the definitions of logistics process, it is a process of relation between
human, nature, technology and resources that interact and unpredictably self-organize into
emerging paradoxical pattern with creating potential value (Johannensson, 2003). This shows that
logistics process involves difficulty in aspects where work of managers relates to the factors that
integrates concepts, technologies, ideas etc during their logistics work activities.
24
2. EMPIRICAL RESEARCH METHODOLOGY
The empirical research methodology chapter comprises of the research methods applied
for improvement of logistics management on the example of Jumia Nigeria research work. It is
concerned with testing the theoretical concepts and the relationship that exist there to see how well
they are reflected in the observation of the reality (Bhattacherjee, 2012). The logical sequence of
the study, research techniques, procedures and sampling size are presented to explain the process.
The ethical consideration for the study is also presented based on the ethics of research observed
in this study as well as the limitations.
2.1. Logical sequence of the research
The logical sequence of this empirical research involves the steps presented with the figure
below.
Figure 4. Logical sequence of empirical research (Source: Author, 2021)
The logical sequence above are the steps applied in the empirical study to achieve the purpose
of this study. The empirical research methods involve a detailed presentation of the methods
applied in the research and the process used to carry out the research as well as the analysis of the
Utilization of logistics management insights to carry-out a semi-structured interview with the example of Jumia
Nigeria
Analyzing the challenges of logistics management using thematic analysis
Identifying the major themes and subthemes and presentation of the challenges of logistics management
with and example of Jumia Nigeria
The PESTEL method, for analysis of logistics management (Jumia Nigeria)
Recommendation for improvement of logistics management
25
research outcome. Thus the above steps are suitable for answering the research questions which
are:
1. What are the logistics management challenges for market place in Nigeria?
2. How can logistics management be improved?
And also achieving the object of the research which is ‘improvement of logistics
management’.
2.2. Research methods for improvement of logistics management
The method of this research involves the strategies, techniques and processes applied to derive
data and analyse data in an effort to discover information’s on improvement of logistics
management, this is to ensure that the subject of study is better understood as well as the cases
looked at.
Thus, to achieve this the selected participants in the research have an understanding and
experience in the logistics management in market places in Nigeria with an example of Jumia
Nigeria. Therefore, the qualitative research methods were applied to gather data about the current
situation, experiences, behaviours and the interpretation of the business (Jumia Nigeria logistics
process management) in Nigeria.
The data derived was analyses using thematic data analysis, which involves analysis of the
main issues or developing the themes arising from the body of evidence of the research work on
improvement of logistics management. The process involves organising and summarizing the
findings (i.e the interview ideas) from the large, diverse body of research (Pope, Mays and Papay,
2007).
The original data will be derived from the interview information’s and then organized and
summarized in a table to form subthemes. The subthemes extracted will be taken from the original
interview ideas gotten from participant through the interview which will then be developed into
initial themes. After familiarization of the interview ideas, the process of developing themes from
the interview information is indicated in the figure below.
26
Figure 5. The process of themes derivation from the interview ideas (Sources: Author,
2021)
The major opinions of the participants from is derived to make the final theme and it guides
the interpretation of the outcome of the interview.
Data collection- The data used for this research is derived from both secondary and primary
sources on the subject of study improvement of logistics management and example of Jumia
Nigeria.
According to Bryman (2012) the “secondary data are that has been collected by somebody else
than the researcher or researcher that are carrying out data analysis (e.g. archived data collected n
higher institutions for it to be available to other researcher as secondary data source”. Thus, the
secondary sources of data are sourced from existing literatures such as journals, reports, works of
authors relevant for the research such as:
Henderson, C. (2020). Complete guide to logistics management – Definition, process and
more.
Ristovska, N.; Kozuharov, S. and Petkovski, V. (2017). The importance of logistic
management practice on company.
Sai, S. (2020). Logistics management: Concept, Significance and key activities.
Springinklee, M. and Wallenburg, C. M. (2012). Improving distribution services performance
through effective production and logistics integration.
While the primary data is derived by carrying out an interview on improving logistics
management on the example of Jumia Nigeria using qualitative method. These data are collected
by the researcher who also conducts the data analysis (Bryman, 2012).
Interview ideas
Original part of interview
Sub-theme Initial Theme Final Theme
27
Qualitative research method- Is a social enquiry that assist in understanding the world around
us and the things that occurs as they are (Hancock, 2002; Patton, 2002). According to Lacey and
Luff (2009), the “qualitative data collection method involves participant’s observation or in-depth
interviews which focus on opinions expressed in words rather than numbers”. It explores ways of
seeking to gather opinions, thoughts while also deriving better understanding of the information
of participants. The questions used during the interview are based on the subject of the study are
prepaid as guide questions to help during the interview with selected participants.
Research technique- The research adopts the qualitative research technique using semi-structures
interview in an effort to derive and in-depth information from the participating respondents on
logistics management in with an example of Jumia Nigeria. The semi-structured strategy
comprises of dialogue between the researcher and the selected participants. This approach give
room for flexibility in interview procedure, it supplements follow up questions, probes and allows
more comments helpful for the research. According to Dejonkheere and Vaughn (2020), semi-
structured interviews allows open ended questions and gives room for exploration of thoughts,
feelings and certainty about a precise subject, the subject in this case is improving logistics process
management with an example of Jumia Nigeria.
The interview will be carried out with selected participants via digital means (i.e Skype,
Zoom, WhatsApp etc.) using the internet based on participant’s choice and convenient internet
platform. The option of telephone discussion will also open if preferred by participants. The semi-
structured for the interview is chosen to give the participants a relative free conservation and also
ensuring that definite issues noted are covered with participants during the interview. The
conservations will be recorded during interview for revisiting and analysis later.
Sample size- In empirical research, carrying out interviews, observing participants and
documentation of the readings is considered as a technique that is effective for putting together
data under ethnographic methods (Creswell, 2013; Hancock et al, 2002). The participants selected
are staffs of Jumia Nigeria. Using purposive sampling, staff of Jumia service in Nigeria are selected
28
to provide data about the ideas, experience in logistics management for Jumia Nigeria services
through interview and in line with the research questions.
Sampling size in qualitative research is mostly much smaller than that of quantitative
research (Interq Research LLC, 2020). The small sampling size does not necessarily reduce the
information given by participants, rather the data realize contains in-depth information that
uncovers a range of opinions of participants which is based on their experiences and knowledge
of the topic instead of have a repetitive information from larger audience. Using a large sampling
size in qualitative research is subject to a risk of repetitions of data which hinders the realization
of the goal of the research.
Thus, there is a risk in using larger sampling size in this research which is why the numbers
of participants from Jumia Nigeria is 5 while relying on the integrity of selected participants in
information sharing during interview. Therefore, 5 participants (managers/supervisors in the
logistics section) are selected from Jumia Nigeria using purposive sampling.
Table 2. Criteria for selecting participants
No Criteria
1 Participants are staffs of Jumia Nigeria.
2 Have worked in the company for more than five years.
3 Within managerial and supervisory levels in Jumia Nigeria
4 Understand fully the subject of study (i.e. improving logistics management).
5 Shown willingness to take part in the research to share knowledge and experience in
logistics management (Jumia Nigeria).
Method of data analysis – The qualitative data analysis is based on ideas, words, description of
opinions by participants using qualitative content analysis. It can be sued to analyze data in several
ways for the amount of information derived for the research which is transcribed and re-grouped
into summarized categories and themes. Therefore, the research data comprise of collecting and
organizing data to enable the researcher arrive at a conclusion about improving logistics
management.
29
The analysis of the data derived enables the researcher find answers to the research
questions, solve problems and gain additional knowledge beneficial to the study. The research
questions are the set of questions that the study intends to answers and improve knowledge based
on the subject of study and helps to address the research problem. The questions arising from the
topic, improvement of logistics management on the example of Jumia Nigeria are:
1. What are the logistics management challenges for market place in Nigeria?
2. How can logistics management be improved?
According to Hammarberg; Kirkman and Lacey (2016) the use of thematic analysis for
research “involves answering research questions about the perspective, experience and meaning
from the stand point of the participants” and it is widely done in qualitative research data analysis
and it is used for this research.
It is reliant on the identified research questions and the theoretical point of view in the
reviewed literature prominent in the study. The data realized will be analyzed to provide answer
to the research questions and cover the outlined objectives in the study (See Annex I).
Ethics of research- Ethics are set of rules broadly written and unwritten that governs the
expectation of personal behavior of people and the behaviors of others. According to Patton (2002)
ethics is important for research works for allow for ethical consideration given consideration to
the participants. It also governs how scientific and other related research works are carried out and
it comprise of issues that arises when human or animals are involved in any research (Resnick,
2015). Thus, it is necessary to give attention to factors used at arriving at decision bounds with
ethics such as morals, commitment or obligations that is binding for proper conduct. Some areas
observe in ethics for this research are-
Objectivity- It is important to avoid biases in research works, hence efforts were made to maintain
objectivity during the research in terms of data analysis and interpretation of the outcome of the
interview ideas.
Respect for intellectual property- It has to do with acknowledgment of sources of information
used during the research, which implies that the contributions of authors are acknowledged in the
literatures and listed as references.
30
Informed consent – The participants permission was first sort in every aspect of the research to
ensure that the principle of informed consent is adhered to.
Confidentiality – The assurance of confidentiality to participants done to provide confidence in
assuring that sensitive or opinions about logistics management with participants from Jumia
Nigeria is ensured. This includes withholding names, contacts etc of participants based on the
agreement and understanding reached before commencing the interviewing.
Giving consideration to the above was necessary to ensure that the participants and process
is done confidentially to achieve the purpose of the research since it is majorly for academic
purpose. The materials from secondary sources used are referenced in the theoretical aspects of
the thesis.
Limitation of study
The main constraint during is the time it took to put together the research given the fact
that assessing data in developing country Nigeria is a major issue. Also, the concerns of
participants about being part of the study as they are skeptical about reason for this study, as given
information may hamper their interest or that of their company (Jumia Nigeria) especially to
competitors in the marketplace. This concerns where laid to rest since the research is majorly an
academic research work.
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3. BACKGROUND TO LOGISTICS MANAGEMENT IN NIGERIA
This section provides information on logistics management in Nigeria showing the impacts in
plays in the economy of the country, a background to Jumia Nigeria logistics process is also
presented showing it functions and operations, and the laws guiding logistics management in
Nigeria.
3.1. Background to Logistics management in Nigeria
Logistics process plays a vital role in the growth of the economy of any nation as it is
interlinked with various sectors of the economy such as health, manufacturing, transportation and
others. It also thrives on certain resources such as infrastructures, ICT and others with efficient
management for effective performance. The logistics process in business is as a result of the
increasing complexities of the manufacturers suppliers with materials and shipping the goods out.
Logistics processes on companies mostly specialize in the transportation, distribution, storage and
packaging of goods. Most manufacturing company’s uses external organization for logistics
processes.
Since, there are rarely any aspects of the development of a country that those not require
logistics as an ingredient essential since its involves the collection, assembling, transfer,
warehousing, customer clearance and distribution of goods, services and others to individuals or
groups from one point to another (Ajiboye, 2011). The logistics is a very important aspects of
production process which is not complete without the goods being transferred to the consumers in
quest of the products (Ajiboye and Ayantoyinbo, 2009).
According the World Bank, logistics performance is captured by six main performance
index which are: the logistics competence, customs, international shipping, infrastructure,
timeliness and the tracking and tracing performance. These are the standards used for measuring
logistics overall index for countries, regions etc perform in terms of facilitating businesses or trade.
Thus, there is regular need for improvement of logistics to increase its competitiveness and
effectiveness as logistics plays crucial role in the success factor of the flow of goods services with
32
regards to the time, cost and the variability in related trade activities which determines the countries
potential to attract and maintain trade (Onyemejor, 2015).
During the last decade, the term logistics has been increasing used in the world of business
as it is viewed as an important means of ensuring profitability. Organizations are now integrating
their aspects of management and distribution process into the logistics supply chain and Nigeria is
not left out of this new trend. This has led to growth in Logistic management in Nigeria over the
years, it has become a fast growing business, this is shown by the value of the logistics sub-sector
of the Nigerian economy which was put at about 250billion naira ($696 million US dollars) as
reported by the Logistics and Supply Chain Industry report for 2018 (Oritse, 2019). The sum for
2018 was a rise of N50billion Naira ($140million US dollars) from that of 2017.
It has also led to the establishment of various logistics businesses in Nigeria who carry out
logistics process management bridging the gap between the manufacturers or producers with their
customers in Nigeria. This move by businesses in Nigeria is crucial to enable to have increased
offer in the market due to the intensive competition and to survive the problems faced in the
Nigerian market. It is also to enable these businesses meet up with the broadening marketplace
and rise in competition, globalization which has resulted in greater demand by customers putting
pressure on these manufacturers to increase their quality, flexibility and serviceability at a
competitive cost (Abdul; Aun; Oladipo and Olota, 2019).
Having logistics process management team in businesses in Nigeria provides the
organizations with the total operations cots and it increases their business activity efficiency. Some
of the essentials of these logistics operators is their capacity to connect to materials, manage
imports and exports, distributions, shipments, storage, cost freight handling, goods distribution
and other related services.
Nigerian logistics industry has been on the rise due to the development of E-Commerce in
Africa and by extension Nigeria. There has been a change from the traditional market with the
current rise on online shopping which requires services of logistics sub-sector of the country’s
economy. Various types of items are now being sort and bought online by consumers which ranges
from house hold appliances, groceries, clothing, furniture and others which are purchased from
online markets from both local and international businesses.
33
For instance, the Nigerian E-Commerce markets stands at $4,885.7 million US dollars in
2019 which resulted in a volume of market still expected to grow at a CAGR of 20.5% in the
projected period of 2019 – 2023 in Nigeria (Mordor Intelligence, 2020). It resulted in the market
volume of about $10,290.6 million US dollars’ projections by year 2023.
The Nigerian market’s largest section was the fashion industry with a market volume of
$1,761.9 million US dollars and a user penetration was put at 52.2percent and is still expected to
reach 75.2percent projections by year 2023.
Thus, the ease of payment by mobile money and debit cards also internet penetrations is
expected to assist the E-Commerce in the country and it is also synonymous to the growth of
Logistics sub-sector in Nigeria. The increase in E-Commerce in requires the services of market
places such as Jumia, Konga, JIJI and others which makes the future of logistics services for this
market places in Nigeria more important to meet customer’s expectation. An introduction to Jumia
Nigeria with regards to its logistics operations is done below.
3.2. Jumia Nigeria Logistics management
Jumia services is part of Jumia Group which is also the leading online market place in
Africa involved in market place, logistics and services and payment services. Jumia logistics were
reserved for e-commerce, food vendors and third party businesses who can leverage on its network,
technology and services in Nigeria and 10 other countries in Africa (Alekhougie, 2020). The
company was established by Jeremy Hodara and Sacha Poignonnec in 2013 with its headquarters
currently at Yaba, Lagos Nigeria.
Jumia Nigeria still remains one of the major online shopping destinations in the country
where customers have access to a wide range of items selection for house appliances, items for
children, electronics and many others (Jumia Group 2021). Jumia Nigeria ensures that these items
are shipped directly to the homes or other locations at the convenience of respective customers
which involves lots of logistics processes.
The company in 2015 generated about $234million US dollars revenue, the figure stands
at 265percent growth for the revenue in 2014. By 2016, Jumia became Africa’s first unicorn being
34
valued at over $1billion US dollars. Jumia offers delivery of goods to customer’s nationwide, it
also has free returns and offer opportunities to various convenient payment options for customers
to choose from (i.e. cash payment on delivery, debit cards, Paypal etc.) which has been a boost to
the increase online shopping in the country.
The goal of the company is to give shoppers opportunity to access affordable prices of
great products, enjoy awesome shopping experiences with items ordered being delivered secure at
the door step of the customers. The processes also involve supporting the evolution of the online
culture of Africans and by extension Nigeria with partnership with vendors where buyers meet the
sellers. But meeting the task of selling over 6,000, 000 products, dealing with over 50,000
international and local brands, over 10,000 active vendors and 4milllion subscribers requiring a
range of logistics management process is particularly daunting in a developing country like Nigeria
(Jumia Group, 2021).
The company utilize technologies to offer a wide coverage of services at a fast turnaround
time by handling products reliably to ensure the success of their operations in rural and urbans
areas in the country. The Jumia Logistics market place is based on proprietary of technology with
aggregate to the supply capacity through the parameters of service quality, reachability of network
and cost of delivery of these products (Jumia, 2020). It also offers logistics network, which
involves its physical sites of over 20 warehouses (North of 110, 000 SQM) and over 1,300 drop
off stations and pick up stations located across Jumia in 11 country market (in both urban and
remote areas). Jumia Group comprise of the marketplace, Jumia logistics and Jumia pay. The
Jumia market place enables millions of people to access thousands of sellers around the world and
connect and transact businesses online. The Jumia logistics enables the delivery of items purchased
by millions of customers as their packages are delivered to them through the network made
available by their local partners (Jumia, 2020).
With unified integration of over 300 logistics partners Jumia Nigeria was able to package
over 20 million products in 2019 (Jumia, 2020). Jumia Nigeria recognized the fact that logistics is
the main cost driver of their business and they re-examine their cost but also seek the right
partnerships and, people, technologies and infrastructures to manage the logistics process
challenges. As part of the effort to boost logistics management for Jumia Nigeria, the company
35
adapted apps to drive the rider’s efficiency and ensure that their customers get a good experience
while also receiving more orders from customers and growing the business in Nigeria.
Caring out businesses that is every depended of logistics process such as Jumia Nigeria is
not an easy task as many challenges hinders the smooth operations of the logistics process
management in Nigeria. The challenges confronting logistics management is reviewed in the next
sub-chapter.
3.3. Logistics management regulation in Nigeria
The regulatory aspects of logistics for operators is usual just like regulation of operators of
other sectors of the Nigerian economy. The logistics operators in Nigeria are guided by the
NIPOST ACT, section 62, CAP 127 (i.e. The Nigerian Postal Services Act, 2004) which has been
in existence since 2001. But in July 2020, the Nigerian minister of communication and digital
economy, “Dr Isa Ali Ibrahim Pantami” approved a new guideline for the regulation of the courier
and logistics sector (Balogun, Mbah and Omoniyi, 2021).
The essence of the new regulation 2020 is to repeal the rigid old one, according to the
minister of communication and digital economy for the couriers and logistics sector was to
enhance the operations of this sector in Nigeria. the old law was focused on the big players in the
courier and logistics services, but the new law opens opportunities for various operators. The new
guideline was also aimed at making it possible for operators irrespective of their category to have
ability to be identified with specific address and location that is traceable to before and after
engaging their services (Elebeke, 2021). This move is expected to eliminate the risk of dubious
operators who may want to take advantage of the poor control of the sector to operate illegally.
Application for Licensing in logistics services in Nigeria -The regulations apply to licensed
courier and logistics services operators and also the companies seeking license to either operate a
logistics company or courier services in Nigeria. the Logistics service in this sense includes:
Conveyance
Haulage
36
Dispatch or delivery of goods and other items (weighing not less than 50kg).
The courier services aspects include-
Merchandise delivery
Door to door time sensitive and secured services (document, parcel delivery etc)
Cargo delivery (weighing a total of note less than 0.5kg/not more than 50kg)
The purpose of the regulation was to make available a regulatory framework that ensures
an effective and efficient courier and logistics services licensing and procedure as well as
regulation of these courier and logistics operations in the country (NIPOST, 2020). Thus, to
achieve this goal, the new regulations provides for the following six categories of licenses-
Table 4. Category of licensing for operators in Nigeria (Source: Balogun, Mbah and
Omoniyi, 2021)
Categories Fee for
Licensing
(Naira)
Fee for Renewal
(Naira)
Licensing Scope
International
courier License
20, 000, 000 8, 000, 000 Logistics services carried out
across international borders
National courier
license
10, 000, 000 4, 000, 000 Logistics services carried out
nationwide
Regional courier
license
5, 000, 000 2, 000, 000 Logistics services carried out
within the geo-political zone in
Nigeria, such as south-west geo-
political zone, North-east geo-
political zone etc.
State courier
services license
2, 000, 000 2, 000, 000 Logistics services within a state
e.g. Lagos, Ogun state etc.
Municipal courier
services license
1, 000, 000 400, 000 Logistics services carried out
within specific city within states in
Nigeria
37
Special SME
courier services
license
250, 000 100, 000 Logistics services that are in
operation within a specific city
and do not have more than 5 motor
bikes/motorcycles for its
operations.
The six categories in the table above are the classes of operators in the country with fees
for new operators who want to register and stipulated fees for the operators who are already in the
business of logistics and courier services in Nigeria. also, the regulation benchmark stipulates that
the courier and logistics service operators must maintain guidelines of the new regime.
The operators are also required to contribute the total sum of 20percent of their total annual
revenue to the Postal Fund for the development of postal services in the rural areas as well as the
underserved areas according to the NIPOST Act of Nigeria (Balogun, Mbah and Omoniyi, 2021).
Part the new guideline also stipulates that the licensed courier and logistics service operators
through the ‘Postmaster General’ effect free delivery for ‘Universal Postal Service’ obligation or
any “Social Delivery’ for the interest of the country (NIPOST, 2020). The new guidelines are also
to help ensure trustworthiness and diligence in logistics process and operations in the country.
The ethical benchmarks for operators - The Nigerian ethical benchmarks for logistics/courier
service operators in the country are expected to be met under the new regulations, such as-
The operators must establish clear procedures and maintain a customer care unit to manage
complaint;
The non-compliance with these ethical benchmark or the whole regulation shall constitute a
ground for revocation the license or the refusal to renew the licenses of an operator;
False declaration by an applicant in the process of obtaining their license shall constitute a
ground for revocation of a license, refusal to renew their license and even total rejection of the
offer of application for the license.
In a situation where any operator given license is convicted of criminal offence under the
NIPOST Act under any enactment, law or regulation, it shall constitute a ground for rejecting the
application of revocation of the license given. An operator that fails to renew its license within
38
three months before its expiration may also constitute a reason for revocation of such license. And
if an operators persist in providing services after the deregistration or during its suspension, the
entity shall pay the fine that is equivalent to the previous fee for the category of license paid for
and an additional fine of 25,000 naira for every day after the suspension of deregistration of the
operator (Balogun, Mbah and Omoniyi, 2021).
The department that handles the requirement for the operators of carrying out services is the
`Courier Regulatory Department (CRD)’. The CRD is a specialized arm of the NIPOST that is
given the responsibility of developing the courier/logistics sector in Nigeria. The CRD required
are expected to be submitted with application for the license or renewal license by the operators
(NIPOST, 2020). Apart from the federal laws (NIPOST Act, 2020), at state levels the requirements
vary based on the state laws guiding operators and mobile vehicle licenses. For instance, the Lagos
State stipulates that operators of courier/logistics services have their branded vehicles. The
LASAA agency requires all persons that intends to sue branded vehicles to submit an application
to get permits for such purposes.
Thus, the two types of branding recognized are partial and full branding. While the companies
that needs to brand vehicle are expected to get ‘mobile advert permit’ which allows them use
signage and branding on their vehicles for advertisement in Lagos state. The fees vary from heavy
duty vehicles to as low as bicycle and push cart from N50,000 to N19,000 for full branding and
N9,900 to N1,900 for partial branding of these vehicles. The fees for branded vehicles are also is
required to be paid by operators at the local government tier of the Nigeria (Balogun, Mbah and
Omoniyi, 2021).
In summary, the introduction of new regulations for the courier and logistics sector in Nigeria
has rather raised more concern for operators given the cost implication of new licensing and
renewal of licenses by existing operators. The first of this concerns is if the CRD requirements
which exists even before the new regulations are still applicable with for announcement made
officially by the Ministry of Communication and the Digital Economy in this regard. It seems as
if the requirements for obtaining the license under the new regulation and the requirements for the
CRD is expected to run concurrently until clarification are made by the ministry. Main while, the
major issues is the cost implication for the courier and logistics operators in Nigeria as the amount
stipulated by the regulators for operators is rather exorbitant. The cost further makes the overhead
39
cost of logistics services in the country higher which is not beneficial for both the logistics
operators and the customers alike. Finally, the issue of regulation if properly effected for logistics
operation in Nigeria also results in trust by customers.
40
4. RESEARCH ANALYSIS AND FINDINGS
The research analysis is presented in this section. The research data analysis is a very
important aspect of the research as it comprises of the systematic application or logical technique
of describing and explaining, condensing and a recap as well as evaluation of the data derived from
the semi-structured interview. Since the research is a qualitative study involving interview with
participants, the interview was done using the interview guard questions to help pay attention on
the subject of the research.
All the information presented by participants are based on their opinions and knowledge
of the subject of study which helps to find answers to the research questions (Please see annex I).
The participant’s opinions derived from the interview is developed and summarized into theme as
shown in the table below.
Table 3. Final themes developed from the original interview information (Source:
Author, 2021)
No Final themes
1 Logistics process management
2 Regulation challenges
3 Economic and skills challenges
4 High logistics operating cost factors
5 Logistics limitations
6 Regulation challenges
7 Improvement of logistics process management
8 Taxation laws improvement
9 Roles of policies by government and legislators
10 Management roles
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4.1. Challenges of logistics management in Nigeria
Generally, the logistics management in Nigeria is confronted by numerous challenges even
though many opportunities are available in Nigeria for businesses to tap into. According to the
Nigeria country guide report (2020) states that “a huge deficit and anti-business climate and
government policies, poor road network, unstable electricity and others has led to the challenges
in various processes of logistics, making it difficult for logistics business owners in Nigeria to
achieve efficiency for the benefits of their business. With local stakeholders unable to meet with
their financial obligations, transferring costs and charges to the end users (customers) which makes
them uncompetitive and it gives room for the foreign owned business operators with better
financial abilities to absorb higher levels of the risk in business to enter into Nigerian market and
entrenched corruption, and others being the additional factors”.
Thus, infrastructure is a major requirement for logistics operation and the supply chain
development objective (such as good roads, modern transport networks, availability of steady
electrical power supply etc.). To maintain a competitive logistics, a constant upgrade of the
regional infrastructural mix is required. In developed countries like US, Japan, EU countries and
Canada they have a highly developed national highway systems, port facilities, state of the art air
freight handling system, sophisticated information systems, communications facilities that are very
advanced, elaborate rail networks and multimodal transportation which is very beneficial to
logistics process management and operations in these countries (Madu, 2015).
Therefore, Logistics can be attributed to the major indicator for the advancement of a
country’s economy which is expressed boldly in the trades facilitation and business
competitiveness. But, it is rather unfortunate that there are deficits in the regional and national’s
infrastructures advancement in Nigeria. The cost of assessing internet facilities is the country is
still generally very high and standard of connectivity is still poor when compared with developed
countries with fast 4G networks and gradually moving towards 5G. According to the M-Lab report
of (2019) in Nigerian National Broadband plan 2020-2025 it was indicated that the “internet
download speed for Nigeria is still low when even when compared with other African countries is
shown in the figure below.
42
Figure 6. Internet download speed in some African countries (Source: M-Lab, 2019)
The figure above shows that internet down load speed in South-Africa at 8.4percent, Kenya
at 7.63percent, Rwanda at 2.34percent, Ghana at 3.2percent, while the download speed for Nigeria
still is at 1.56percent lower than its counterpart. This are some of the constraint for logistics process
management which considers time and cost management important for customer’s services
delivery.
According to Flex Space report (2017) the “Nigerian logistics and supply chain industry
has suffered setbacks in the last two years indicated in the logistics performance index of the World
Bank Group bi annual metrics reports”. The continual under performance of Logistics in Nigeria
was still in existence in the World Bank Logistics Performance Index which reflected poor ranking.
According to Oritse (2019) states that the survey carried out by the Lagos Chamber of Commerce
and Industry (LCCI) in 2018 shows that “Nigerian economy lost an estimated annual revenue of
about N3.46 trillion (naira) due to the current crisis of poor infrastructure, poor implementation
and corruption at the Nigerian ports, of which about N2.5trilliion (naira) are corporate earnings
losses across the various sectors of Nigeria economy”. The Nigerian logistics performance index
was put at 2.53 according to the World Bank: Economics Trading (2021) shown in the figure
below.
0
2
4
6
8
10
South AfricaKenya
RwandaGhana
Nigeria
8,4
7,63
2,34 3,2
1,56
43
Figure 7. Logistics performance index: Overall (1=low to 5=high) for Nigeria
between 2009 and 2019 (Source: World Bank: Trading Economies, 2021)
The essence of the logistics performance index score is to reflect perceptions of the country’s
logistics based on its efficiency in customs clearance process, ease of arranging competiveness of
priced shipment, quality of trade and transport related infrastructures, ability to track and trace
consignment, logistics service quality and the frequency of the shipment getting to the consignee
with the period scheduled. This implies that a current performance for Nigeria has not reached it
mark yet to gain higher score (5=high) given it current challenges. The logistics performance
index: overall (1=low to 5=high) in Nigeria is 2.53 1=low to 5=high in 2019 (World Bank, 2021),
which is rather on the average. The issue is that it has gradually dropped from 2.8 around 2014 to
2.53 in 2019 rather than improving.
Another challenge in logistics management in Nigeria is the issue of logistics education.
The major corporate growth and profitability in many years from now is through providing top
quality customer services at the lowest overall logistics cost. This requires adequate logistics
professionals, with analytical and technological skills, practical down to earth logistics experience,
supply chain knowledge and line management leadership skills (Madu, 2015). Therefore, it
demands a high performance of government institutions in financing and development of skills for
the Logistics industry. Logistics management requires professional at every level which includes
–
Analysts
2,4
2,59
2,45
2,8
2,64
2,53
2,2
2,3
2,4
2,5
2,6
2,7
2,8
2,9
2007 2010 2013 2014 2016 2019
44
Stock controllers
supervisors
IT professionals
Managers
Sales professionals
Directors and vice presidents etc
The above skills have been lacking to some extend in Nigerian logistics market place due to
the fact that some of these areas of logistics operation requires specialty in skills to function
efficiently. This situation in logistics process management would be more efficient when the
business invests in training of their workforce rather than employing hands from abroad who are
not familiar with the Nigerian logistics systems. Thus, the Nigerian logistics industry in confronted
with the following challenges in its logistics process management -
International shipment time delays;
Poor capabilities for tracking and tracing of goods;
The logistics quality and competence is poor;
Customs clearance and process efficiency is poor;
The poor quality of related transportation infrastructures and trade;
The ease of competitive priced shipment arrangement;
The logistics services quality;
Poor investment in logistics education/training
Tracking and tracing consignment ability;
The frequency at which the shipment reaches the consignee with the scheduled time frame.
According to the World Economic Forum (2016-2017), “the global competiveness index ranks
Nigerian infrastructure is at the bottom as the country is ranked 132nd out of 138 countries, the
report also states that the poor state of supply of infrastructure is the largest constraint to carrying
out business in Nigeria.”. Also in 2017, the Economic Recovery and Growth Plam (ERGP) states
that the deplorable condition of infrastructure is one of the major factors that seriously undermine
economic performance.
45
Table 6. Nigerian indicators in comparison with other middle income economies (2016),
(Source: UNPD, 2016)
Country Population
in millions
Population
density
(person per
hectare)
Land
Area
Percentage
per persons
living in
urban area
GDP per
capital
(PPP)
(Thousand
USD)
GDP per
capital
(MER)
(Thousand
USD)
HDI
India 1327.0 4.5 297.3 42.0 6.0 3.9 131
Indonesia 260.6 1.6 181.2 10.6 10.6 4.4 113
Nigeria 186.7 2.1 91.1 5.3 5.3 2.7 152
Pakistan 192.6 2.5 77.1 4.8 4.8 1.4 147
Countries like Pakistan, Indonesia and India are comparable to Nigeria in terms of economy,
land area, size of population, urbanization level and population density as shown in table 6. But,
Nigeria’s Human Development Index (HDI) is still very poor at 157th out of the world when
compared with these countries. These are some of major gray areas in the logistics process
management in Nigeria.
In summary, the there is a huge opportunities available for the logistics sub-sector in Nigeria
given the business potentials available due to the markets in Nigeria. the country was named the
biggest economy in Africa which is an indicators of the part the logistics operation holds in
ensuring that consumer’s services are carried out between sellers and buyers in the country
efficiently.
However, based on the above challenges and others the logistics management in Nigeria
currently has not performed optimally. The complex natures of logistics management require that
there should be provision of resources to meet with the demands of the various aspects of Logistics
process management. However, the characteristics of a country’s infrastructures (both soft and
hard infrastructures) and institutions determines how logistics performs. These includes how well
their imports, procedures, regulations and behaviors are.
46
The subject of this study is the improvement of logistics management on the example of Jumia
Nigeria which will involve an empirical study of Jumia Nigeria to identify the challenges
experienced in their logistics management.
4.2. Empirical research result presentation
The object of this study is improvement of logistics management. To achieve this, the
process comprised of identifying participants willing to partake in the research to provide their
opinions on logistics management with Jumia Nigeria as an example. Thus, the result of the
empirical research is presented in line with the final themes (table 3) developed from the excerpts
of the interview ideas. The final themes are used in the empirical research result presentation as
follows for easy understanding of the outcome of this research.
Theme: Logistics process management
The logistics management in Jumia Nigeria from the interview opinions reveals that it
involves managing activities between sellers and buyers of the products on the Jumia Nigeria
market place. This logistics process management according to the participant opinion reveals that
it involves “more of how we manage the activities within our company and outside with clients
connecting sellers and buyers, which involves transportation”. Jumia Nigeria logistics were
reserved for e-commerce, food vendors and third party businesses who can leverage on its network,
technology and services in Nigeria and 10 other countries in Africa (Alekhougie, 2020), it reveals
the wide service coverage their logistics process covers such as warehouse management, supply
chain management, inventory management, order tracking, ensuring accurate delivery to
customers, maintenance operations etc. The complexity of logistics activities makes it important
for adequate planning, controlling, implementing all done efficiently, cost effectively and flow of
materials in the process inventory, goods and other related information from the point of
consumption to the point of origin for the goal of recapturing the values or effective disposal.
Another participant says that “logistics process management is broad. It depends on which
area of operation the personnel belong. It entails, ensuring the warehouses are run effectively,
47
fleets managed, IT and marketing unit’s integration, personnel’s take inventories etc.”.
Furthermore “It usually involves aspects of inventory, maintenance, stock taking, cost
management, fleets operations etc. given the various aspects, team work is essential for every
aspect of our logistics process to run smoothly within and outside with the other parties”.
Thus, since the logistic aspects of business comprise of the process of logistics for the flow
of work from the beginning to the end for the purpose of fulfilling the expectations of customers
and also that of the organization, integration and management operation of every unit are necessary
to actualize the effective management and customer satisfaction. The logistics activities in a
business organization is a move to satisfy customers by achieving the time and location related to
the challenges of the market as well as through the cost of the provided services also taking quality,
customers need and purchase power into consideration (Ghoumrassi and Tigu, 2017). The Jumia
Nigeria market and other online market place has been increasing in customers visits and in
purchase over the years, thus there is need to meet the rising needs for logistics services in Nigeria.
And given the position of Nigeria as the largest economy in Africa, the logistics process
management (i.e efficient human resources, materials resources, effective regulations etc) is
essential to meet up with the demands of customers which is continually increasing in the country.
But the logistics process management is however confronted with many challenges in Nigeria
given the Jumia example.
Theme: Regulation challenges
The challenges regulation in in logistics process management according to the participant’s
opinions entails the challenges encountered during operation due to the enforcement of regulations
by various offices working with the federal, state and local government agencies. One of the
participants stated that “Often the logistics process from ports for imported goods, due to
regulatory issues at the ports affects movement and supply of these goods to our customers. Which
is beyond our own control has time and cost in this cases are hampered”. The inefficiency among
officials of government and corruption during services impedes the logistics process.
For example, one of the participants mentioned issues of policies “The challenges with
regards to policies is the instability and lack of thoughtfulness of the legislature in laws as regard
license renewal. And other state laws which makes the fees quite high. The new levies for renewal
of license for logistics operators is outrageous”. Regulation bureaucracies in Nigeria at federal,
48
state and local government rather than helping business to run smoothly in terms of regulation
raises concerns due to overlapping of government agencies (in the case of the NIPOST Act and
CRD regulations for logistics operations in Nigeria), it also in result financial burdens for operators
due to multiple levies. The participant’s states that “the government policy those not make room
for effective logistics operations and sustenance of logistics business as it is done in modern
countries. Also the bottle necks affecting logistics also have to do with government tariffs systems,
trade restrictions and business regulation is a major constraint to logistics process management”.
This regulatory issues should strengthen logistics processes in the country to help business
grow and strengthen trust and confidence of customers in need of logistics services in Nigeria
rather than weaken these processes, overlapping or duplicity of agencies and regulations adds
constraint to the already complex logistics process management.
Theme: Economic and skills challenges
The opinion of the participant’s reveals that the logistics process management in Jumia
Nigeria alongside other logistics outfit in operation in the country are confronted with economic
and skills challenges. The participant states that “some limitation we experience is in trained
personnel’s. Due to the economic realities most often our staffs leaves for personnel’s reasons,
thus it affects smooth running of our logistics process due to retaining of staffs and cost and time
involved”. According to Madu (2015) states that “a broad base of business skills, knowledge of
the logistics process and relevant work experience open better opportunity to have a carrier with a
logistics services provides and others organizations, such as the stock controller, fork-lift truck
drives or staffs who operates ta the warehouse. This implies that an effective logistics process
management requires skills to efficient carry out the numerous activities in operations. But the
economic situation in the country according to the respondent’s opinion makes it difficult to retain
already trained staff, as they continue to seek better employment opportunity in other organization
as a result of the inadequate remuneration to get at the current employment.
According to Madu (2015), in an effort made by organizations to be competitive in the
global market, they require to move the services or products around the world to meet customer’s
needs and demands; this however cannot be achieved without efficient human resources. Giving
49
the staff a conducive working condition, fair wages to meet up with their socio-economic
obligation and investment in training and equipment can help gain commitment of staff to achieve
the goal of the logistics company and retain capable hands in the logistics company longer.
Theme: High logistics operating cost factors
The logistics process management is particular time, cost and efficiency to satisfy
customers. According to Kacmary (2014) states that “logistics process involves planning,
controlling, implementing all done efficiently, cost effectively and flow of raw materials in the
process inventory, finished goods and other related information from the point of consumption to
the point of origin for the goal of recapturing the values or effective disposal”.
Thus, the ability to reduce cost minimally is important in logistics process management.
The opinions of the participant reveals that “inadequate infrastructures affect our business, as
most of our logistics operations in done via road transportation. Other alternative such as train,
light rail etc is available in developed countries helps to meet up with time, and reduce cost of
transportation of goods”. The implies that the cost incurred due to poor and congested roads
transportation affect the overall cost of operations.
Also another participants reveals that “one of our major limitation is cost of logistics
operations which contributes to the prices paid for delivery and cost of products. The inflation
rates, cost of maintenance and running of operations is always on the rise. Without reduction is
cost the logistics process cannot be sustained”. This implies that a lot of funds goes into vehicle
operations and maintenance of vehicles due to the poor roads, poor road networks and congestion
on roads during logistics operations. This would have otherwise been the case if the road networks
are good and alternative transportation facilities are available making it less depend on vehicular
movements.
According to Madu (2015) states that “infrastructure can be seen as the basic structure that
fosters the good performances of the countries, states and cities essential services. Hence, a country
requires good investment in the different modes of transportation, constant investment from both
the private and public to have a good logistics infrastructural system. In a global market that is
competitive, infrastructures that are compatible with the demands and needs are compulsory, in
50
order to transmit to customer’s products and services through various producers and demand
centers (like Jumia Nigeria) in different parts of the country and the world at large. Thus, the need
for investment in infrastructural projects and developments cannot be overemphasized for
effective logistic operations and management.
Theme: Logistics limitations
The logistics process management in Nigeria is confronted with various limitation some of
which have been discussed in the themes above. Others limitation according to the opinions of the
participants are “The limitation of logistics is Nigeria is mostly due to the poor infrastructure
conditions in most parts of the country, especially places outside the CBD. This includes roads
and transportation, electricity, internet access, ware house facilities, control of the ports etc.”. The
erratic supply of electricity in the country make it more expensive to generate power for internal
operations as they rely on diesel generators to power equipment’s adding to the fuel consumption
cost for running fleets for their logistics operations.
According to Njoku (2016) states that “in the panel of African progress reports shows that
electricity in Africa, and in Nigeria particularly is stagnant since 2015, when it managed to get up
to 4, 810.70 MW after many years of it hovering around 1000 to 2000MW. It also reports that the
present state of electrical power supply in the country is unacceptable as the country needs at least
30,000MW to the economy of Nigeria”.
As at 2018, the Nigerian average household only have access to uninterrupted power
supply for just six hours a day out of 24hours leading to majority depending on power generators
(Invoice, 2019). The inadequacies and deficiency in Nigeria infrastructures makes it difficult to
efficient run businesses in the country especially the logistics sector that rely heavily on these
infrastructures. The cost and penetration of internet accessibility in Nigeria is also an issue to
makes the logistics process management difficult and incur higher cost.
According to Vincent and Yusuf (2014) the electrical power supply in Nigeria in terms of
the voltage and billing systems are very poor. This implies that despite supplying low voltage
electrical power, the consumers still suffers over billing. Also, due to the poor infrastructure
available in the country, several challenges including low-quality distribution lines, inadequate
and weak network coverage, inaccurate system of billing, overloading of most of the transformers
51
and feeder pillars that are inferior, corruption with staffs (i.e illegal practices of employees of the
Power station), inefficient maintenance schemes and adequate logistics facilities (Otuoze et al,
2019; Amuta et al, 2018).
From the outcome of the research (i.e. primary and secondary data), the cumulative of this
infrastructural inadequacies results serves as limitation for logistics process management and the
other consumers/users of these infrastructures, all of which needs improvements.
Theme: Regulation challenges
The purpose regulation is to enable smooth running of sectors of the economy and abiding
by ethics of the business and laws government with regards to the environment, employees, safety
(i.e. staff safety to ensure they work in good working conditions and compensate in case of injury)
among others. The provision of these regulations are to make sure that businesses are kept in-check
and make sure that they abide by a common rule. But currently Nigeria just like most African
country still ranks low in business regulations to ease doing business in the country.
However, the irregularities in government agency makes regulation rather a burden than
beneficial to business entities, it this case the logistics sector of Nigerian economy. The
participants’ opinion reveals that “the government policy those not make room for effective
logistics operations and sustenance of logistics business as it is done in modern countries. Also
the bottle necks affecting logistics also have to do with government tariffs systems, trade
restrictions and business regulation is a major constraint to logistics process management”.
Others reveal that the “limitation we have is delivery of goods by the sellers and the
condition at which they are delivered. Often the logistics process from ports for imported goods,
due to regulatory issues at the ports affects movement and supply of these goods to our customers.
Which is beyond our own control has time and cost in this cases are hampered”.
The lack of professionalism and corruption with some of the government official makes
logistics business suffer delays due to time lost, pay higher fees to move processes faster thereby
incurring more cost in clearance of products before delivery to customers etc. Numerous tariffs
paid at the three tiers (Federal, states and local government levels) of government in Nigeria also
52
hampers logistics business. This means that due to the federal structure of the Nigeria’s political
system, a wide range of regulatory agencies in the country, which gives opportunity for these
public officials to demand bribes for their duty. According to the Transparency International’s
corruption perception index for 2020, Nigeria ranks 149 out of 180 countries and scored 25/100.
The logistics sector is faced with challenges due to these issues in its logistics processes
especially with clearance in ports and others logistics paper works required to operate efficiently
suffers constraint due to regulatory issues.
Theme: Improvement of logistics process management
The logistics process management in Nigeria requires improvement both internally and
externally. In the case of Jumia Nigeria, logistics process management is a crucial component of
the operations of the logistics business as its performance not only affects the internal processes
but it also affects the customer’s relations and trust for further orders received on sales and service
demands. According to the opinion of the participant “logistics process management can be
improved internally if there is provision for improved working conditions and salaries for the staffs
to enable us have experienced hands remain on the job rather than new staffs and repeating the
training circle. This is because we have huge labour force in Nigeria that are mostly unskilled”.
Thus, the staff welfare is important to encourage them in the job and give back to ensure
smooth operations of all logistics activities within and outside the company. According to Akbar
(2016) “the staffers who are habitual of management of the orders and information in the
traditional process requires training on the modern techniques; data management team could
provide weekly insight to the team on the floor and warehouses to provide smooth information
across the value chain”. Thus training of staff is important along with better wages and working
conditions.
Also, externally the availability of basic infrastructure cannot no doubt make room for
better operations. According to the participant, he reveals that “without provision of important
infrastructure, the logistics process management will still be faced with challenges. This is because
some aspects such as time and cost reduction cannot sole be controlled by managers but the
external factors need to be in check”. For instance, the street naming and house numbering in most
53
part of Nigeria is very poor, making it difficult for delivery workers to locate even with GPS, this
are some of the areas that needs attention.
The logistics process management seeks to safe time, reduce cost and ensure smooth
operations as well as customer’s satisfaction, which is difficult achieve without the necessary
infrastructural facilities. Nigeria’s logistics performance index 2012 (global ranking /155) is 121st
2.45 (score1-5) while the Global competiveness index 2012- infrastructure 130 92.28), (global
rank/144 (score 1-7). This is an indication that a lot still need to be done to improve the logistics
process management in Nigeria.
Themes: Taxation laws improvement
The issue of multiple taxation, levies and fees (Nigerian constitution on national tax
policies) takes it roots from the political system of Nigeria (i.e. the federal, state and the local
government agencies), and others are from trade unions etc. There are over 50 taxes and levies
collected by the federal, state and local government in Nigeria which creates hostile environment
for businesses and also reduces the Nigeria’s global competiveness (Ajayi, 2018).
According to the participant opinions “The government have huge part to play in logistics
process management in Nigeria. especially regarding laws of taxation, multiple taxation is a huge
burden in logistics process management”. This implies that the government role in addressing
issues of taxation is huge which begins with addressing the laws on taxation to reduce the burden
of the logistics operators and others businesses.
The heavy burden of multiple taxation also encourages malpractices between business
owners and public officials in an effort to cut down on overhead cost of running the logistics
business which needs to be addressed to improve logistics process management. This is not
beneficial to the government revenue either as some streams of income accruable to the
government ends in wrong hands. Hence, reevaluation of tax laws is beneficial to both the public
and private parties, more important the overhead cost in logistics process management can be
reduced to an extent.
54
Theme: Roles of policies by government and legislators
The government plays a huge role in the socio-economic development of a country as their
popularity is determined by the how impactful the policies of government has been able to
transform lives and the economy of the country. The growth and potential of logistics sector in
Nigeria is enormous if the government are able to facilitate it through effective policies and
infrastructural development to help in improvement of the logistics process management in the
country. The logistics sector has the potential to add about 3.4percent to the nation’s GDP growth
(International Trade Administration, 2020).
Currently the opinions of the participants reveal that logistics management “The key players are
the government and legislators. We need policies that improves logistics process management. In
terms of infrastructures and business friendly environment”. This fact is justified by reports of
experts which states that “the health of available infrastructure and the level of integration between
them directly impacts the success of logistics process management in terms of access, reliability,
cycle of time and the cost implications in operations”.
Thus, a huge infrastructural deficit in Nigeria and the anti- business policies of government,
un-stable electricity from the national grid, poor road networks and facilities, multiple taxation
among others has led to the logistics process management not being able to achieve it potential.
The logistics business operatives are unable to fully meet their financial obligations when
compared with what is obtainable international hence the current position globally (121st in the
logistics performance index). It also leads to cost and charges transfers to the end users (customers)
which makes them uncompetitive, as well as making room for well-known international brands
with better financial capabilities to dominate and absorb higher business levels risk to penetrate
further into the market like Amazon, Alibaba, Konga etc (International Trade Administration,
2020).
Furthermore, the entrenched corruption and other issues are factors that requires urgent
government and legislatives attention to improve the logistics process management in Nigeria.
One of the goals in the logistics process management is to ensure that the customers who are the
end users are satisfied which makes the logistics businesses grow further. But, the inability to grow
also affects the economy of the country which makes it paramount to government commitment to
improvement of facilities to assist in the logistics process in Nigeria through effective policies,
55
constant strategic development plan, better performance of government institutions and political
will to drive economic and infrastructural development and more importantly, an improved
logistics process management activities facilitation in the country.
Theme: Management roles
The management role in the logistics management is critical part of it involving training
and necessary support facilities, incentives and services for improvement of the logistics process
management. According to Ajiboye (2011) states that “there is a widespread realization that
adequate training and development of employees is necessary for rapid economic growth”.
This point was also pointed by the participants as their opinions suggest that “the
management of the company (Jumia Nigeria) can help improve the condition of service, increase
wages to retain skilled and capable workforce of the company. Also constant upgrade and
retraining of staff to meet up with the changes and new trends in the logistics business to remain
competitive”. Training in this case involves a process and a series of activities that is aimed at
empowering a person to assimilate and develop skills, knowledge, understanding and values that
are not only related to a narrow field of activities, but also permits a broad range ability to define
problems, analyze them and find solutions to them. The benefits of taking these initiatives will be
impacted on the logistics process management both on the long and short term. Also, it is important
that management of the logistics business adhere to labour labor in payment of salaries and
protection and compensation of workers in advent of work hazards. This are some of the
management inputs that builds workers moral and dedication to duties.
As much as the external factors are important are important and needs improvement, the
internal coordination are also critical to improve communication during the logistics management
due to its complex nature. This so, especially in terms of interaction and relationship with each
units of the logistics business such as the warehouse, packaging, coordination at pick up centers,
IT, marketing, inventory flow of logistics design, maintenance, transportation, human resources,
administering and control of the system of movement among others who all have specific roles to
encourage smooth operations. The investment on information technology is beneficial because it
56
helps in bridging the gap between all suppliers, manufacturers and customers to reduce the amount
of lead time, paper works and other important activities in the logistics management.
This helps in maintaining a balance between the sellers and buyers of products handled,
while also achieving the goal of the logistics process management (efficiency at time management,
cost reduction, safety, customers satisfaction etc) for the business.
4.3. Analysis of improvement of logistics management
The PESTEL method is used for analysis for improvement of logistics process management is
majorly to identify the external factors affecting the logistics process management in Nigeria, such
as the political, economic, socio-cultural, technological, legal and also the environmental factors.
This factors are those that poses as threats and opportunities to improvement of logistics process
management as shown in the figure below and explained.
57
Figure 8. PESTEL method for analysis of factors affecting improvement of logistics
management (Source: Author, 2021)
Opportunities and threats
Political Factor- the roles of government in political office is very important in improvement of
logistics management as identified in the research findings. Based on the finding opportunities
abound if the government can make deliberate efforts at new policy changes. Some of the critical
steps of the political elites should include-
Implementation of tax reforms- the implementation of tax reform will help tackle the problem
of multiple taxation which results in tax burden on logistics operators and other businesses in
Nigeria. Some of these funds injected into payment of taxes could be investment in human
resources and technological advancement of the business.
Factors affecting improvement of
logistics management
Poltical Factor
Environmental Factor
Socio-cultural Factor
Technological Factor
Economic Factor
Legal Factor
58
Address political interference and instabilities in agencies- the interference by government
officials gives rise to malpractices that hinders the logistics operations especially as it regards
duties of the officials in ports (sea and air cargo ports), LASAA, CRD and other government
agencies.
Reform of corporate laws to avoid the multiplicities in regulations – the reform of laws to
correct multiplicities in regulations is important due to the system of government in Nigeria.
The federal, states and local government agency regulations can be restructured into an entity
to avoid multiplicity of their regulatory roles in the logistics sector.
Development of policies that drives infrastructure and friendly environment for business
development- the importance of infrastructural development to logistics operations cannot be
over emphasized as pointed out in the research findings. Hence, it is a very important that the
government address this problem.
It is a move to reduce the cost of incurred in the logistics management previously due to
inadequacy of electricity power supply, poor road networks and facilities, poor access to internet,
poor legislation and others which culminates to a hostile environment for logistics business in
Nigeria. The opportunities for logistics business is big given the growth in online marketing in
Nigeria and the populations (over 170million people), and as well as investment opportunities
available in the country that can boost the purchasing power of customers in the country.
Economic Factor- the improvement of logistics management plays a huge role especially with the
opportunities accruable to the economy of the country as it has in developed countries. As much
as logistics improvement benefits from infrastructure development, it also influences several areas
of the economy like the transport network, storage systems, packing services, devices used for
communication, products and industry, imports and exports services etc. The critical areas of need
that can impact (opportunities and threats) the economy and Nigeria’s logistics management are-
Cost of transportation- logistics business in Nigeria is heavily dependent on road transportation
and given the poor condition of the roads the cost and time expended during movement of
goods and delivery to the end users is much. The cost is transferred to end users, thus making
logistic management in Nigeria not competitive. Therefore, heavily investing in transportation
networks will give a reverse situation of the current challenges will not only benefit the
59
logistics operators as well as the end users both also open opportunities for return in investment
of the government in transportation development.
Fluctuation in commodity prices – the fluctuation in commodity prices and currency affects
the logistics management in the area of maintenance and overhead cost incurred in operation
and management. Mostly due to fall of the Naira to dollar (US$1 is equivalent to 450 naira in
the black market) and inflation rate in the country.
Commodity rates in different locations in the country- there are different rates in commodities
at different locations in the country (e.g. rural areas are cheaper and city centers are much
higher). The fact that majority of the logistics office are located in the city centers makes
delivery pricing defer for end users in the rural areas (i.e. shoppers at lower tiers of the
societies) due to location and accessibility of roads, which is mostly not affordable leading to
decline in such areas.
Thus, instability in the economy is a disservice to the improvement of logistics management
in reducing cost, management of time and satisfaction of end users in Nigeria. Effective policies
and collaboration with private sector can add benefits to
Socio-cultural Factor- it has to do with the areas that comprise of the belief and attitudes of people
in response to issues. They include the negotiations perceptions, general cultural beliefs, collective
cultural difference, career attitudes, negotiations perceptions, age distribution, populations etc. the
socio-cultural factor is of interest as it has a direct impact on how sellers understand buyers, and
how to satisfy these customers through change in needs to change the customers’ orders through
logistics process.
Purchasing power- the purchasing power of consumers determines what they are able to order
through the market place (such as Jumia Nigeria).
Social issues – social issues most times affects logistics management such as security concerns.
Social unrest in some parts of the country affects the safety of goods for distribution and the
personnel’s managing deliveries which in most cases restricts logistics operations into those
areas. Others are cyber security issues very prevalent which is a constraint to logistics
management in terms of ordering, delivery and mode of payment by the end users (preference
to pay in cash rather than payment online using bank cards etc).
60
For instance, Jumia technologies Nigeria is an online market place were buyers can order for
goods online and chose their medium of payments. But the socio-cultural issues hinder the
potential of logistics business in Nigeria due to cyber security concerns, preference for the
traditional marketing mediums, trust of brands (customers prefers to see what they are buying
before purchase etc) are some of the issues. Improvement of the logistics management can help
build trust of customers, increase number of orders and more importantly give room for growth of
the logistics business sector in Nigeria.
Technological Factor- improvement in technology helps with the logistics management with new
improved technologies such as the knowledge of data base, IT for tracking, internet facilities and
other facilities to improve performance. It helps in inventory tracking and filling, security, payment
system, speed etc.
Flow of information- the availability of information makes communication among the units
of the logistics business. Information flow within logistics is important as it enables the chain
to responds in real time and with accurate data.
Adaptation of advancement in technology- The new fast technologies landscape change how
the markets works which also affects the logistics management such distribution channels,
communications services, web communications, visibility such as RFID technologies, use of
tracking, transportation management and technologies, GPS etc.
Transport technologies – this involves access to more efficient vehicles for smooth operations
in the logistics operations.
Environmental factor-environmental factors over the years has become an important discuss
around the world given the emergence of various adverse changes in the environment (i.e. global
warming) due to the activities of man. This has also brought about some important ethical and
sustainable concepts in the business environment without an exception for logistics management
some of which includes-
Emission of CO2 during transportation and warehousing in the company – since logistics
operation in Nigeria is heavily based on road transportation with the sue of both heavy
vehicles and light vehicles, the logistics operations also contributes a considerable amount of
61
CO2 emission to the environment, also contributing to the traffic congestion and noise
pollution in Nigerian environment. This are some of the areas were the adoption of clean
energy alternatives becomes a better alternative to reducing emissions, this however is still
very far in policy consideration in Nigeria (e.g. carbon foot print set by government in
developed societies) for most businesses like in logistics management.
Oil waste during maintenance works- maintenance of vehicles is part of the logistics
management, and automobile oil waste is common occurrence during most maintenance
operations, especially with maintenance of vehicles and or machines used for logistics
operations. But given the awareness of the consequences of some oil spillage, it has become
important this wastage to be properly managed to reduce the negative important it has on our
environment. This are some of the areas of regulation the environmental agency in Nigeria at
the federal, state and local government levels monitors (NESREA, FEPA, LASEPA etc) to
minimize as much as possible.
Safety regulations- the Nigerian labour laws includes safety regulations for employees (e.g.
the federal and states fire service regulation compliance) in the working environment and
guidelines for compensation, should an employee be exposed to danger in the course of
carrying out his/or duties which is to be followed by the logistics company management.
Scarcity of raw materials – the aspect of packaging in the logistics management involves use
of products made from raw materials (i.e. use of cartons made of trees, plastics etc) which
also contribution to deforestation and plastics waste issues.
Therefore, the alternative measures logistics management involves a reverse logistics. This
includes focusing on recycling or reuse of materials important to reduce scarcity of raw material.
The reuse of materials helps led to increase in the importance of reverse logistics operations in
warehouses.
Legal Factor – involves governing laws and regulations for business entities, ethical issues, labour
laws and others. They are laws binding on the establishment and operation of business in Nigeria
such as the CAMA laws (Chapter C20) LFN 2004, Company and allied Matters (Repeal and Re-
enactment) Bill 2018 etc.
62
Corporate laws- the corporate laws in Nigeria at all tiers are binding on the establishing,
operations and compliance to standards practices stipulated by the laws.
Contractual agreement and legal documentation compliance- logistics management includes
activities to deliver on binding agreements (such as the agreements between sellers and the
logistics company, agreements on online purchases etc).
The threats to ensuring improvement of the logistics management is due to the malpractices of
some of the officials of the government agencies who lobby thereby leading to complacency in
working conditions, short cuts on the part of the owners and management of logistics business in
the country, instead of full compliance to ensure ethics of logistics business, adherence to safe
practices etc.
63
CONCLUSION
The subject of this study is improvement of logistics management on the example of Jumia
Nigeria and to achieve the goal of the research and the arising research questions, three clear
objectives were achieved.
1. Concepts of logistics management, process and impact of logistic management - Logistics
process is said to comprise of all steps of that ensures planning, supervision, execution and
control of the time, cost and space transformation of goods and the related transformation in
quantity and range of assortment. It also involves the properties manipulation and the level of
logistics determination of goods. The logistics process involves lots of activities or operations
while making up for the inputs of work force /members, information and technology, finances
through actions of management and logistics activities between the consumers and the
suppliers. It is done in an effort to ensure good result with output that gives them competitive
advantage, time and movement of utility efficiently. The components of logistics management
comprise of the design of the network, order fulfilment and transportation management in
order.
2. The various logistics management in Nigeria helps to bridge the gap between the
manufacturers or producers with their customers in Nigeria. It is crucial to enable increased
offer in the market due to the intensive competition and to survive the problems faced in the
Nigerian market. It also enables these businesses meet up with the broadening marketplace and
rise in competition, globalization which has resulted in greater demand by customers putting
pressure on these manufacturers to increase their quality, flexibility and serviceability at a
competitive cost. For the regulation of logistics operations in Nigeria, NIPOST Act (2020) was
established to ensure effective and efficient courier and logistics services licensing and
procedure as well as regulation of these courier and logistics operations in the country. Using
an example of Jumia services as logistics process management business in Nigeria, Jumia
Group is the leading online market place in Africa involved in market place, logistics and
services and payment services. They ensure that items are shipped directly to the homes or
other locations at the convenience of respective customers which involves lots of logistics
processes. However, the logistics management in Nigeria is confronted by various challenges
some of which are infrastructure, ease of competitive priced shipment arrangement; logistics
64
services quality; poor investment in logistics education/training, tracking and tracing
consignment ability, frequency at which the shipment reaches the consignee with the scheduled
time frame.
3. A qualitative research was carried out to gather information from respondents who are staffs
of Jumia Nigeria to achieve the research object. Based on the knowledge derived from the
reviewed literature and data gotten from the empirical study, a discussion on the findings was
and analysis was done using PESTEL method. The following are some of the suggestions made
for improvement of logistics process management in Nigeria, it include improvement of
security, heavy investment in modern transportation infrastructures, Strict compliance to safety
regulations and standard or practice during logistics process and others.
Logistics management in Nigeria is vital for the economy especially the growing online market
place which is a shift from the traditional method shopping. The logistics management helps to
connect the customers to buyers all around the world by providing alternatives products with
consideration to time, cost during the logistics process which is beneficial to all parties. The
various identified challenges confronting logistics management in Nigeria can be addressed to
improve the sector, when the identified measures in the recommendations presented below which
are suggested to the stakeholders (i.e. government and its private counter parts) are adopted for the
logistics business sector.
65
RECOMMENDATIONS
Based on the research outcome of the research, the following recommendations are suggested
to the government and the logistics management company for improvement of logistics
management in Nigeria.
1. Improvement of security- the provision of adequate security in the country is one of the core
responsibility of the government. The social issues most times affects logistics management
such as security concerns, social unrest in some parts of the country affects the safety of goods
for distribution and the personnel’s managing deliveries which in most cases restricts logistics
operations into those areas. Also, cyber security issues very prevalent which is a constraint to
logistics process management in terms of ordering, delivery and mode of payment by the end
user’s preference to pay in cash rather than payment online using bank cards etc all is which
needs attention by the government and security outfits to improve logistics management in
Nigeria.
2. Heavy investment in transportation networks- the need for more investment in transportation
infrastructure in Nigeria cannot be overemphasized given the fact that logistics process is
heavily dependent on transportation networks, while efficient logistics management is also
crucial for the growth of Nigerians economy. This will also help move logistics process
management in Nigeria up from the 121st index it currently is. Therefore, there is need for the
government political will to develop adequate transport infrastructure to support growth and
efficiency of the logistics business in Nigeria.
3. Strict compliance to safety regulations and standards or practice during logistics process- The
Nigerian labour laws includes safety regulations (according to corporate laws) for employees
at all tiers of the government and states fire service regulation compliance in the working
environment and guidelines for compensation, should an employee be exposed to danger in
the course of carrying out which is really observed. It is importance to introduce strict measures
to be followed by the logistics company management to protect the workers as well as the work
environment.
4. Strict control of officials in government agencies- This is necessary to forestall professionalism
and compliance to regulation while discharging their duties, and it will also guide against
threats to ensuring improvement of the logistics management due to the malpractices (i.e.
66
corruption) of some of the officials of the government agencies who lobby thereby leading to
complacency in working conditions, short cuts on the part of the owners and management of
logistics business in the country, instead of full compliance to ensure ethics of logistics
business, adherence to safe practices etc.
5. Adoption of clean energy- Since logistics operation in Nigeria is heavily based on road
transportation with the use of both heavy vehicles and light vehicles, the logistics operations
also contributes a considerable amount of CO2 emission to the environment, also contributing
to the traffic congestion and noise pollution in Nigerian environment (such as light rails, eco-
friendly vehicles etc). Thus need for policies that promotes investment in clean energy
technologies in the country by both public and private entities in the logistics management.
6. Investment in training and new technologies – The world is constantly evolving which brings
out better measures of operations of logistics management activities. The logistics company
can meet up with market competition through investment in modern technologies for their
logistics operations and training and re-training of staffs to acquire more knowledge and skills
needed to meet up with new challenges in the logistics market. Also the logistics management
should ensure improvement of staff improved remuneration and better working environment,
to encourage a more productive workforce while achieving the overall organizational goal.
67
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APPENDICE I
The interview guide questions were developed from the arising questions from the research subject
“improvement of logistics management on the example of Jumia Nigeria”. The of the questions
arising are-
1. What are the logistics management challenges for market place in Nigeria?
2. How can logistics management be improved?
Therefore, the interview guide questions were developed within the scope of this study which is
to guide the researcher during the interview using semi structure approach. The interview guide
questions are as follows-
1. How will you describe the logistics process in Nigeria from the example of Jumia Nigeria?
2. What are the limitations to efficient logistics management in your company internally?
3. What are the limitations to efficient logistics management externally?
4. What are the challenges of logistics management in the aspects of politics, environment,
social, technology, legal and economic levels?
5. How can the logistics management be improved?
6. Who are the key players in ensuring an improved logistics management?
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APPENDICE II
The qualitative research involved carrying out a semi structured interview and the
information derived from the participants are presented in the table below. The theme for the
research analysis are developed from the opinions of the participants.
Table 5. Theme development from the original interview information (Source: Author, 2021)
Question Interview idea Original part of
interview
Subtheme Initial theme Final theme
How will you
describe the
logistics
management
in Nigeria
from the
example of
Jumia Nigeria
Our logistics process
management revolves
around activities between
the sellers and the buyers
of the products. So it is
about ensuring the process
are followed with
consideration to safety,
time and cost.
Revolves around
activities between
the sellers and the
buyers of the
products. Ensuring
the process are
followed with
consideration to
safety, time and
cost.
Logistics
process links
sellers and
buyers
Logistics
Process links
sellers and
buyers
Logistics
process
management
The logistics process
involves more of how we
manage the activities
within our company and
outside with clients
connecting sellers and
buyers, which involves
transportation. Taking
inventories, taking orders,
delivery and others
Manage the
activities within our
company and
outside with clients
connecting sellers
and buyers
Logistics
process
connects buyers
to sellers
Logistics
process
connects buyers
to sellers
Logistics
process
management
Our logistics process
management is broad. It
depends on which area of
operation the personnel
belong. It entails, ensuring
the warehouses are run
effectively, fleets
Logistics process
management is
broad. Management
of the warehouse,
fleets, IT,
Marketing.
Logistics
process
management
activities
Logistics
process
management
activities
Logistics
process
management
77
managed, IT and
marketing units,
personnel’s take
inventories etc.
Our logistics process
management is
interdependent on one
another. Given the large
area we cover in the
marketplace in Nigeria.
but the bulk of it lies with
the personnel’s
management. Ensuring
that each part of our
logistics activities are
done at the right time as at
when due. Also, the care
of both our facilities and
products
Logistics process
management is
interdependent.
Ensuring that each
part of our logistics
activities are done
at the right time as
at when due.
Logistics
process
management,
interdependent
activities
Interdependent
activities of
logistics process
management,
Logistics
process
management
The logistics process
management is huge and
requires studying the
staffs we work with and
ensuring effective
communication to make
sure that the necessary
activities are carried out as
at when due. It usually
involves aspects of
inventory, maintenance,
stock taking, stock taking,
inventory, cost
management, fleets
operations etc. given the
various aspects, team
work is essential for every
aspects of our logistics
logistics process
management is
huge and requires
studying the staffs
we work with and
ensuring effective
communication.
Involves aspects of
inventory,
maintenance, stock
taking, cost
management, fleets
operations etc
logistics process
management,
effective
communication.
Effective
communication
in logistic
process
management
Logistic process
management
78
process to run smoothly
within and outside with
the other parties.
What are the
limitations to
efficient
logistics
management
in your
company
Some of the limitation we
have is delivery of goods
by the sellers and the
condition at which they
are delivered. Often the
logistics process from
ports for imported goods,
due to regulatory issues at
the ports affects
movement and supply of
these goods to our
customers. Which is
beyond our own control
has time and cost in this
cases is hampered.
Limitation we have
is delivery of goods
by the sellers and
the condition at
which they are
delivered.
Regulatory issues at
the ports affects
movement and
supply of these
goods.
Control has time
and cost in this
cases is hampered
Limitation,
regulatory issue,
control of time
and cost.
Constraint of
regulation, time
and control.
Regulation
challenges
Some limitation we
experience is in trained
personnel’s. Due to the
economic realities most
often our staffs leaves for
personnel’s reasons, thus
it affects smooth running
of our logistics process
due to retaining of staffs
and cost and time
involved.
Limitation we
experience is in
trained personnel’s.
The economic
realities most often
our staffs leaves for
personnel’s reasons.
Economic
challenge of
retaining skilled
workforce.
Economic
challenge, skills
Economic and
skills challenges
The cost of effectively
running the management
of the company’s logistics
operations is a major
challenge. Such as cost of
power generation, parts
for equipment’s, taxes,
cost of effectively
running the
management of the
company’s logistics
operations is a
major challenge.
Cost of power
Operation cost
challenge,
infrastructure
issues
Cost of
operation issue
High logistics
Operating cost
factors
79
other corporate and
imports issues to name a
few.
generation, parts for
equipment’s, taxes,
other corporate
Our logistics process has
more of staff’s
management and fleets
management which is not
easy nor cheap. The
conditions of the roads
result in damages on fleets
that requires for budget on
maintenance which does
not help in reduction of
cost of operations. The
cost incurred during our
logistics
activities/operations also
affects the cost of delivery
of the goods ordered by
customers which they
often complain it too high.
Which results in drop of
demands for products
through Jumia market
place.
The conditions of
the roads result in
damages on fleets
that requires for
budget on
maintenance which
does not help in
reduction of cost of
operations.
The cost incurred
during our logistics
activities/operations
also affects the cost
of delivery of the
goods ordered by
customers which
they often complain
it too high
Cost of
operations,
impact of poor
infrastructure
increase cost of
operation.
High cost of
operation, poor
infrastructures.
High operating
cost factors.
One of our major
limitation is cost of
logistics operations which
contributes to the prices
paid for delivery and cost
of products. The inflation
rates, cost of maintenance
and running of operations
is always on the rise.
Without reduction is cost
the logistics process
cannot be sustained.
Our major
limitation is cost of
logistics operations
which contributes to
the prices paid for
delivery and cost of
products. Inflation
rates, cost of
maintenance and
running of
operations is always
on the rise
Limitation is
high cost of
operation. High
cost of
maintenance
due to inflation.
High operating,
maintenance
cost.
High logistics
operating cost
factors.
80
What are the
limitations to
efficient
logistics
management
in Nigeria?
The limitation of logistics
is Nigeria is mostly due to
the poor infrastructure
conditions in most parts of
the country, especially
places outside the CBD.
This includes roads and
transportation, electricity,
internet access, ware
house facilities, control of
the ports etc.
Limitation of
logistics due to the
poor infrastructure,
includes roads and
transportation,
electricity, internet
access, ware house
facilities, control of
ports etc.
Logistics
process
limitation, poor
infrastructures
Logistics
limitation
Logistics
limitation
The government policy
those not make room for
effective logistics
operations and sustenance
of logistics business as it is
done in modern countries.
Also the bottle necks
affecting logistics also
have to do with
government tariffs
systems, trade restrictions
and business regulation is
a major constraint to
logistics process
management.
Government policy
those not make
room for effective
logistics operations
and sustenance of
logistics business as
it is done in modern
countries.
Bottle necks
affecting logistics
also have to do with
government tariffs
systems, trade
restrictions and
business regulation
Government
policy,
regulation
Government
policy and
regulation
Regulation
challenges
Inadequate infrastructures
affect our business, as
most of our logistics
operations in done via
road transportation. Other
alternative such as train,
light rail etc is available in
developed countries helps
to meet up with time, and
reduce cost of
transportation of goods.
Inadequate
infrastructures
affect our business,
as most of our
logistics operations
in done via road
transportation.
alternative such as
train, light rail etc is
available in
developed countries
Inadequate
infrastructures,
cost, time in
logistics process
Inadequate
infrastructures
affects cost,
time
High logistics
operating cost
factors.
81
helps to meet up
with time, and
reduce cost of
transportation of
goods.
The state of the
infrastructure in Nigeria
affects our business badly.
Especially the
transportation facilities
given the fact that the our
business of logistics
covers large part of
Nigeria where the
customers others their
goods from, meeting up
with their demands at the
right time and within the
appropriate cost is
difficult due to the state of
infrastructure and its
management in Nigeria.
The state of the
infrastructure in
Nigeria affects our
business badly.
Meeting up with
their demands at the
right time and
within the
appropriate cost is
difficult due to the
state of
infrastructure and
its management in
Nigeria
Poor
infrastructure
affects our
business of
logistics badly,
demands of
time, cost.
Limitation of
logistics process
Logistics
limitation
The state of disrepair of
most road curses damages
to out fleets making
maintenance cost high and
also the inflation affects
cost of parts for
maintaining our fleets and
other facilities.
state of disrepair of
most road curses
damages to out
fleets making
maintenance cost
high
disrepair road
curses damages
on fleets
Challenges in
operation
Logistics
process
limitation
What are the
challenges of
logistics
management
in the aspects
of politics,
environment,
The challenges with
regards to policies is the
instability and lack of
thoughtfulness of the
legislature in laws as
regard license renewal.
And other state laws
Challenges with
regards to policies
is the instability and
lack of
thoughtfulness of
the legislature in
policies
instability and
lack of
thoughtfulness
Policies issues Regulation
challenge
82
social,
technology,
legal and
economic
levels?
which makes the fees
quite high. For instance
the new levies for renewal
of license for logistics
operators is outrageous.
laws as regard
license renewal.
The environmental
concern in with regards to
pollution from vehicular
movement and congestion
in cities. The government
is far have not done
anything laudable to
decongest the roads by
better modes of
transportation that we can
also adopt.
Environmental
concern in with
regards to pollution
from vehicular
movement and
congestion in cities.
Decongest the roads
by better modes of
transportation
Decongest
roads, better
transportation
modes.
Better road
infrastructure
Improvement of
logistics process
The economic angle to the
challenges is the continual
inflations leads to high
cost of our operation
despite the existing
burden of multiple taxes.
economic angle to
the challenges is the
continual inflations
leads to high cost of
our operation.
Existing burden of
multiple taxes
Inflation, high
cost of
operation,
multiple taxes
Cost of
operation, taxes
High logistics
operating cost
factors
The world is constantly
involving, hence there are
constant development of
new technologies which
no doubt puts pressure on
out logistics process
management in the area of
need to train and retrain
staff and purchase of new
equipment’s to meet up
with the trend.
Constant
development of new
technologies which
no doubt puts
pressure on out
logistics process
management. To
train and retrain
staff and purchase
of new
equipment’s.
New
technologies,
pressure on
logistics
process,
training,
purchasing cost
Cost of logistics
operation
High logistics
operating cost
factors
83
The legal system is the
country is a major issue
considering the time it
takes to file a suit of cases
that sometime props up in
the course of carry out our
logistics operations and
well as the corruption
eating up the system.
Legal system, issue
of Time it takes to
file a suit of cases.
Corruption eating
up the system.
Time issue,
corruption
issues
Issues affecting
logistics
process.
Improvement of
logistics process
How can the
logistics
management
be improved
Logistics process
management can be
improved internally if
there is provision for
improved working
conditions and salaries for
the staffs to enable us have
experienced hands remain
on the job rather than new
staffs and repeating the
training circle. This is
because we have huge
labour force in Nigeria
that are mostly unskilled.
Logistics process
management can be
improved internally
if there is provision
for improved
working conditions
and salaries, staffs
to enable us have
experienced hands
remain on the job
Huge labour force
in Nigeria that are
mostly unskilled.
Improved
working
condition, retain
skilled staff
Improved
working
condition, retain
skilled staff
Improvement of
logistics process
Without provision of
important infrastructure,
the logistics process
management will still be
faced with challenges.
This is because some
aspects such as time and
cost reduction cannot sole
be controlled by managers
but the external factors
need to be in check.
Provision of
important
infrastructure.
Aspects such as
time and cost
reduction cannot
sole be controlled
by managers but the
external factors
need to be in check.
Infrastructure
provision,
external factors
control
Improvement of
logistics process
Improvement of
logistics process
The government have
huge part to play in
logistics process
Government have
huge part to play in
logistics process
Government
laws, multiple
taxation.
Improvement of
laws on taxation
Taxation laws
Improvement
84
management in Nigeria.
especially regarding laws
of taxation, multiple
taxation is a huge burden
in logistics process
management.
management in
Nigeria. Laws of
taxation, multiple
taxation is a huge
burden in logistics
process
management.
Logistics is very
important for trade
facilitation so it is
important for the
government to provide
infrastructure to meet with
the deficit in overall
transportation networks,
internet penetration,
electrical supply etc which
logistics process thrives
on.
The government to
provide
infrastructure to
meet with the
deficit in overall
transportation
networks, internet
penetration,
electrical supply etc
which logistics
process thrives
Infrastructure
Provision,
improved
internet
penetration,
electric al power
supply
Suggestion for
Improvement of
infrastructure
Improvement of
logistics process
Logistics process
management both
internally and externally
thrives on basic facilities
and services which are not
easily accessible. For
instance, the corruption of
government agency
officials also adds to the
challenges encountered in
our operations. There is
need for overhaul of the
agencies of government
for improved services.
And policies that drives
infrastructural
development.
Thrives on basic
facilities and
services which are
not easily
accessible.
corruption of
government agency
officials also adds
to the challenges
encountered in our
operations.
There is need for
overhaul of the
agencies of
government for
improved services.
Corruption,
improved
services,
infrastructure
development.
Suggestion for
Improvement of
logistics process
management
Improvement of
logistics process
85
Who are the
key players in
ensuring an
improved
logistics
management
The key players are the
government and
legislators. We need
policies that improves
logistics process
management. In terms of
infrastructures and
business friendly
environment.
Key players are the
government and
legislators. Policies
that improves
logistics process
management.
Policies by
government and
legislators
Development of
key policies for
improved
logistics
Role of policies
by government
and legislators.
The government have a
huge role to play to ensure
improvement of existing
infrastructures and
provision of better
transportation networks.
Government huge
role to play to
ensure
improvement of
existing
infrastructures and
provision of better
transportation
networks.
Improvement of
existing
infrastructures
and provision of
better
transportation
networks.
Government
Improvement
and provision of
better
infrastructures
Government
role
Agencies of government
(eg. LASMA officials,
Customs officers at ports
etc) needs overhauling in
their services and duties to
help the logistics process
dealings at ports,
corporate regulations
offices et run smoothly.
To save time and cost of
our operations.
Agencies needs
overhauling in their
services and duties
to help the logistics
process.
Agency
Overhaul for
improved
logistics process
Agency
Overhaul for
improved
logistics process
Government
agency role
Government provision of
improved infrastructures
and access to basic
facilities can help ease the
logistics process
management.
Government
provision of
improved
infrastructures.
Improved
infrastructures
provision
Improved
infrastructures
provision
Government
role
86
The management of the
company can help
improve the condition of
service, increase wages to
retain skilled and capable
workforce of the
company. Also constant
upgrade and retraining of
staff to meet up with the
changes and new trends in
the logistics business to
remain competitive.
Management of the
company can help
improve the
condition of
services to retain
skilled
Improved
working
condition
Improved
working
condition
Management
role
87
APPENDICE III
Array of pictures showing Jumia Nigeria Logistic company Resources
Picture 1: Showing a delivery employee of Jumia Nigeria (Source: Rhodes, 2019)
Picture 2. Showing Jumia Nigeria pick up center (Source: Jumia Nigeria, 2017)
88
Picture 3. Showing some of Jumia Nigeria vehicles for delivery (Source: Jumia, 2019)
Picture 4. Showing an employee pushing pallet of stock inside Jumia Technologies
distribution warehouse in Lagos Nigeria (Source: Bloomberg, 2019)
89
Picture 5. Showing packaging by an employee at Jumia Nigeria warehouse (Source: Jumia,
2019)
Picture 6. Showing packages set for delivery (Source: Alamy, 2021)