Nigeria Third-Party Logistics (3PL) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Nigeria Third-Party Logistics (3PL) market is segmented by Type (Domestic Transportation Management, International Transportation Management, and Value-added Warehousing and Distribution), and by End-Users.

Market Snapshot

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Study Period: 2016 - 2026
Base Year: 2020
CAGR: >8 %

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Market Overview

The Nigerian Third-Party Logistics (3PL) market is expected to register a growth rate of over 8% during the forecast period of 2020-2025. 

The growth in the market is driven by the growth in the intra-continental trade via the African Continental Free Trade Agreement (AfCFTA). Moreover, the growth in the manufacturing sector and the change in the consumption patterns contribute to the market growth, with a higher generation of demand for logistics services.

The major pullbacks of the economy are the infrastructure deficits and the fragmented of supply chains in the countries. The African countries require to massively and strategically invest in connectivity and infrastructure. Along with the infra development, the synchronization of regulations related to different sectors (such as pharmaceutical products) and sub-regional blocks is necessary to support trade and an advantageous business climate.

The developing transport infrastructure also support the growth of the market. The African government is under talks to develop the roads, railway and maritime connectivity of the countries. Nigeria and South Africa - the biggest economies on the continent of Africa are under talks of collaborative work to build road network on the continent.

Scope of the Report

A comprehensive background analysis of the Nigeria Third-Party Logistics (3PL) Market, covering the current market trends, restraints, technological updates and detailed information on various segments and competitive landscape of the industry. The impact of COVID-19 has also been incorporated and considered during the study.

By Services
Domestic Transportation Management
International Transportation Management
Value-added Warehousing and Distribution
By End-User
Manufacturing & Automobile
Oil, Gas & Chemicals
Distributive Trade (Wholesale and Retail trade including e-commerce)
Pharma & Healthcare
Construction
Other End Users

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Key Market Trends

AfCFTA to Increase Intra Regional Trade

The intra-Africa trade currently is limited to 15% of Africa’s total trade, indicating a very weak intra-regional value chain as compared to Asia, where it is at 80%. With the introduction of the African Continental Free Trade Agreement (AfCFTA), which is the world's largest free trade zone signed by 54 countries and is expected to revolutionize trade across the continent, the trade volume and hence the economy of the continent is expected to grow significantly. The act will focus on increasing the production capabilities in an exceedingly competitive global landscape.

With the agreement implemented, the manufacturing and production of essentials and value-added products will increase improving the economic diversification and accelerating structural transformation, increasing the investments and decreasing the dependence on labour forces; shaping the competitiveness of African economy by productivity gains. With the increase in in-house production in South Africa, global exports are also expected to increase.

Although Nigeria signed the agreement in July 2019, in October, it slapped a ban on the movement of all goods from countries like Benin, Niger and Cameroon, banning all trade—import and export—with its neighbouring countries to curb the smuggling of goods like rice, tomatoes and poultry and strengthen Nigeria’s agricultural sector. The ban was removed in December with the strong determination of not allowing any smuggling and other destructive trade practices to continue unchecked in the country, undermining the nation’s development efforts.

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Boost in manufacturing output and exports to increase the demand for 3PL services

The project Make in Nigeria for Export (MINE) is a presidential initiative, to develop the “world-class” Special Economic Zones (SEZs) across Nigeria and boost the manufacturing of “Made in Nigeria” goods for export, regionally and globally. The project aims to increase the manufacturing sector’s contribution to GDP to about 20%, create 1.5 million new direct jobs and generate over USD 30 billion yearly by the year 2025. The Federal Executive Council (FEC), Economic Management Team (EMT) and Project MINE’s Steering Committee of the country will be working under the sustainable Public-Private Partnership (PPP) model to develop SEZs across Nigeria.

The first round of funding will quintessence on developing Funtua Cotton Cluster, Enyimba Economic City and Lekki-Epe Model Industrial Park in Katsina, Abia and Lagos State respectively increasing the domestic demand as well as exports in the market giving a boost to the logistics and warehousing sector.

Big companies are acquiring and partnering with the companies in Nigeria looking at the growth scope in the country. For instance, Coca-Cola acquired a 40% stake in the Nigeria based beverage company, Chi Limited intending to evolve as a total beverage company with the help of Chi’s diverse range of portfolio.

With the trade agreement in place, the scope of the development of the manufacturing space in Nigeria is huge.

Nigerian freight logistics startup Kobo360 raised USD 20 million Series A round led by Goldman Sachs and USD 10 million in working capital financing from Nigerian commercial banks. The company connects truckers and companies to delivery services will use the funds to upgrade its platform and expand to 10 new countries beyond current operating markets of Nigeria, Togo, Ghana and Kenya.

Maersk Shipping Line has concluded plans to provide logistics and supply chain management support for FMCG companies in Nigeria. The Sealink is envisioned to bridge the regional maritime logistics infrastructure gap and to also moderate the transport logistics in intra-African trade.

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Competitive Landscape

The market is highly fragmented with a large number of local and international players such as DHL, FedEx, UPS, GMT Logistics and Maersk as its key players. Given the vast population and regulatory changes in the economy, the country expects a speedy growth in the coming years. Companies globally are investing in the development of their business in the country in order to grasp the opportunity.

Among recent developments, UAE-based retailer Lulu Group annoucned plans to set up a sourcing and logistics facility in Nigeria to export local agricultural produce across the GCC, India and the Far East.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

    1. 2.1 Analysis Methodology

    2. 2.2 Research Phases

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS AND INSIGHTS

    1. 4.1 Current Market Scenario

    2. 4.2 Market Dynamics

      1. 4.2.1 Drivers

      2. 4.2.2 Restraints

      3. 4.2.3 Opportunities

    3. 4.3 Value Chain / Supply Chain Analysis

    4. 4.4 Government Regulations and Initiatives

    5. 4.5 General Trends in Warehousing Market

    6. 4.6 Demand From Other Segments, such as CEP, Last Mile Delivery, Cold Chain Logistics Etc.

    7. 4.7 Insights on Ecommerce Business

    8. 4.8 Technological Developments in the Logistics Sector

    9. 4.9 Industry Attractiveness - Porter's Five Forces Analysis

    10. 4.10 Impact of Covid-19 on the Market

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Services

      1. 5.1.1 Domestic Transportation Management

      2. 5.1.2 International Transportation Management

      3. 5.1.3 Value-added Warehousing and Distribution

    2. 5.2 By End-User

      1. 5.2.1 Manufacturing & Automobile

      2. 5.2.2 Oil, Gas & Chemicals

      3. 5.2.3 Distributive Trade (Wholesale and Retail trade including e-commerce)

      4. 5.2.4 Pharma & Healthcare

      5. 5.2.5 Construction

      6. 5.2.6 Other End Users

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Overview (market concentration and major players)

    2. 6.2 Company Profiles

      1. 6.2.1 Maersk Line

      2. 6.2.2 DHL International GmbH.

      3. 6.2.3 Creseada International Limited

      4. 6.2.4 Bollore Transport and Logistics

      5. 6.2.5 MSC (Mediterranean Shipping Company)

      6. 6.2.6 ABC Transport

      7. 6.2.7 LOGISTIQ XPEDITORS LIMITED

      8. 6.2.8 REDOXCORP SHIPPING & LOGISTICS LIMITED

      9. 6.2.9 GWX

      10. 6.2.10 Redline Logistics

      11. 6.2.11 AGS Movers Lagos

      12. 6.2.12 UPS (United Postal Services)*

    3. *List Not Exhaustive
  7. 7. FUTURE OF NIGERIA 3PL MARKET

  8. 8. APPENDIX

**Subject to Availability

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Frequently Asked Questions

The Nigeria Third-Party Logistics (3PL) Market market is studied from 2016 - 2026.

The Nigeria Third-Party Logistics (3PL) Market is growing at a CAGR of >8% over the next 5 years.

Maersk, DHL International GmbH., Creseada International Limited, Bollore Transport and Logistics, MSC (Mediterranean Shipping Company) are the major companies operating in Nigeria Third-Party Logistics (3PL) Market.

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