Dump Truck Business in Nigeria: Opportunities, Challenges, and Success Strategies

Originally haulage was the process of transporting materials from one place to another either by road or rail.

However being as it may, the only efficient means of hauling presently is by road hence the need for haulage vehicles like dump trucks, tankers, trailers, and pickup vans. 

The dump truck business in Nigeria is very profitable due to the ever-increasing demand for them.

Daily you can barely count their numbers on the road. 

In this article, our main focus is the dump truck business in Nigeria popularly known as tipper trucks. In Nigeria, dump trucks are used majorly in the construction sector, for the transporting and distribution of granite from quarry sites, sand from rivers, asphalts for road construction, and as well construction equipment, machinery, and materials.

There is no limit to the amount of materials it can haul, it all depends on the size of the tipper truck being procured. 

Is the Dump Truck Business in Nigeria Profitable

Tipper haulage is a highly profitable venture in Nigeria especially now that Nigeria is capitalizing on infrastructural development: Bridges, Dams, Harbors, Estates, complexes, roads, and residential buildings.

We now have private companies taking up the baton and contributing to the infrastructural development of the country. This has spurred the need for construction materials across construction sites. And there is no efficient way to carry the materials other than haulage trucks, mainly dump trucks. 

While the need for infrastructural development has carved out the niche of the tipper business, you can still engage secondarily in hauling other products such as metal Scrap, waste, farm products, and other bulky materials. 

Mode of Operating the Dump Truck Business in Nigeria

There are modes of operating  in the dump truck business in Nigeria:

Independent haulage:  

In this mode of operation, you are responsible for all the daily activities of your business. You are responsible for employing drivers, sourcing for customers, and general maintenance.

The only downside of this operation is the stress of managing the business,  and it also needs much effort to get good contracts.

Caveat:

If you know you cannot monitor your trucks full time never send your truck to an individual, rather a third party company,  agency, or association so they can help monitor and keep track of the drivers

Contractor/subcontractor:

This is a form of alliance where you entrust your haulage vehicles to the care of a viable company (haulage agent).

This company will be in charge of your dump trucks, drivers, and the overall maintenance of the business. You don’t need to stress yourself,  you sit back and earn while the company handles your business. 

Leasing:

This is very similar to a subcontractor but with a few differences. Unlike in subcontractor where the company handles all the daily expenses, in leasing, the company handles the working aspect of the business while you are behind the scenes financing their daily expenses.

In return, you get paid an agreed percentage daily, weekly or monthly.

Factors Influencing Operating Cost of Dump Truck Business in Nigeria. 

Numerous factors contribute to the operating costs of dump trucks and these factors are linked; one influences the other.

For instance, the cost of fueling is a factor, however, this is vastly influenced by another factor which is bad road conditions.

The more dilapidated the road is, the higher the fuel consumption rate. 

#1. Driver’s habits:

Drivers are the major challenges most haulage businesses face. Driving requires skillfulness, concentration, and focus. Anything short of these could spell doom for the business.

Imagine your truck drivers running over people daily due to their reckless driving which is at times influenced by alcohol or drugs.  

A safe and economical driving style can reduce the costs of fuel and maintenance. Also, some drivers could use the allotted fuel inefficiently by using the trucks to run a side gig under your nose, in which at the end of the day, you spend more than you earn.

A bad driver with a cunning mechanic by his side can be a nightmare for your dump truck business, so take heed. 

#2. High cost of fuelling:

The cost of fuelling accounts for almost 40% of the total operating cost of dump trucks; one could only imagine the amount spent daily. The consumption rate of fuels depends solely on speed, acceleration, and distance. 

#3. Maintenance:

Regular maintenance is crucial to ensure the safety, efficiency, and longevity of the tipper trucks. Delayed maintenance can result in the breakdown of trucks which could even lead to deadly and destructive accidents. 

The essential area that needs regular maintenance includes the tire, engine, brake system, electrical system, cooling system, and any other maintenance that is very vital to the efficiency and safety of the trucks. 

#4. Road network:

Bad roads can greatly influence the cost of running a dump truck business. This single challenge can well influence other factors.

Bad roads can increase the consumption rate of fuel and also lead to the damage of vital spare parts. Another problem is the heavy traffic, which could lead to the delayed delivery of materials.

#5. Tax/Levy:  

Tax and road levies are being imposed on the dump truck business in Nigeria. In the dump truck business, you get to pay tax monthly, and also, some bodies do place a toll along the roads where they collect specific amounts per trip based on the tons of loads carried. 

Choosing The Best Dump Truck (Head)

There are many assortments of dump trucks commonly used in Nigeria, such as IVECO, SINOTRUCK, MACK, HOWO, DAF, AND MAN Diesel. Truck heads such as MACK, DAF, and MAN Diesel are only available on a secondhand basis while the rest can be bought brand new.

From the interview session, we had with one certified trailer mechanic, strongly advised that we consider MACK, DAF, and MAN diesel, due to their durability, longevity, and ability to withstand more stress than the others.

However, he further recommends IVECO as the best next option if one insists on getting brand-new ones.

Things to Consider Before Buying a Dump Truck (trailer) Head. 

#1. Availability of spare parts:

You need to buy trucks whose spare parts are easy to get when replacement is needed. Some of these trucks are not commonly used in Nigeria hence spare parts need to be ordered from China.

So popularly used products save you the stress of spare part replacements. 

#2. Engine: 

In Nigeria,  trucks are typed with grade A and fairly used. Grade A is the best because they are from foreign countries where they undergo less work and are still intact compared to fairly used ones already used by Nigerians which portholes might have dealt with. 

#3. Tonnage:

It’s important to consider the truck’s tonnage. The higher the tonnage, the more materials the truck can carry in one trip.

Also, purchasing the right tonnage is very important for avoiding damages(due to heavy loads) to the truck, such as the brakes and suspension. For tonnage, you can check the truck specifications before making a purchase

#4. Cost of maintenance:

You need to factor in the cost of maintenance, and choose a truck with a low cost of maintenance that can still deliver as expected. 

#5. Number of tires:

Trucks with more tires improve the efficiency of the truck, it can increase the truck’s load capacity and improve the maneuverability of the truck. However, more tires signify more costs and heightened maintenance as there will be more parts to be serviced and replaced. 

#6. Ease of repair and maintenance:

You need to check how easy it is for mechanics To repair and maintain the truck.  

#7. First-hand review:

Look for anyone who has experience with trucks or preferably use online platforms where people who bought trucks drop reviews,  so you can learn all there is to know about the kind of truck you ought and ought not purchase. 

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Step-by-Step Guide on How to Start a Dump Truck Business in Nigeria

Before starting a dump truck business in Nigeria there are certain procedures to follow to avoid unnecessary mistakes and hassle. Let’s begin.

#1. Research: 

Every business starts with an idea, so to build upon this idea you are advised to make notes of what you want your business to look like, the working system, and the profit structure.

You have to stand on a platform where you can see the fate of your dump truck business in the next 10 years and that platform is research, which we believe is your purpose on this page. 

#2. Business plan:

This plan contains everything that involves the business like vision, mission, goal, financial analysis, market and product research, and generally any details that validate the operation of the tipper business.

While you can draft out this business plan yourself; it’s however advisable to send words to professionals regarding how you want the plan to be sketched.

#3. Competitor analysis:

Before starting a tipper truck business you should conduct a brief research about your competitors, majorly those offering the same service as yours and also doing great at it.

You should look out for who your competitors are, their customers, their channel of distribution, expenses, down to how much they make.  You can even take it further by looking for their weak points, the part which they slack then take advantage of that by learning from their mistakes.

#4. Market analysis:

This entails checking which type of hauling is in high demand. For example, Abuja is the capital of Nigeria with a heavy concentration of construction companies.

You can decide to venture into hauling construction materials such as sand, gravel, granite, scrap materials, machinery,  and the like. 

#5. Capital:

The tipper truck business is a capital-intensive venture that requires no small capital to begin.

As part of the research process we earlier discussed, you are expected to factor in the cost of starting the business, the cost of maintenance, the cost of obtaining a license, the cost of employing skilled workers, and other miscellaneous.

However, you should also know that your start-up capital depends on the area of specialization you have decided upon.

Let’s say you decided to specialize in the hauling of construction machinery.  The best thing to do is to conduct a bit of research regarding the type of tipper truck needed, the cost of maintenance, the cost of fuel or diesel, etc.

The endpoint of the research will determine the capital needed to start the business. 

#6. Registration/paperwork:

Virtually every business in Nigeria is registered in one association or another. You can’t be an island, it’s either you register with these organizations or cease working within their reach because they will hunt you down wherever you are, and this could negatively impact your business.

Besides, joining these organizations is at its best very advantageous when it comes to putting your business at the forefront of productivity.  

The most common of these unions is the Nigerian Union of Road Transport Workers (NURTW). It’s a big umbrella body that regulates the activities of all transport and logistics activities within Nigeria.

This comes first, other unions are major subsidiaries compared to NURTW. To be on the safer side, you will want to do research by asking those in the business about the best and most effective association to register with. 

#7. Operation license

This includes all necessary licenses needed to operate the tipper truck business.

It’s also recommended to register your business with the Corporate Affairs Commission (CAC), all you need is a unique and catchy business name for your haulage business and a few other details.

You even need to be registered with the quarry site where you intend to source the materials from. 

Conclusion

To wrap it up, the Dump truck business is a capital-intensive trade due to the high cost of haulage vehicles including the cost of maintenance and other miscellaneous.

As with all businesses, you need to keep your eyes peeled for trends and be sure to tread wisely by making informed research. Importantly, never put all your eggs in a basket, test the waters before going all out.

Even if you can purchase 100 trucks at a go, you can be wise to purchase only 3 to test the water; we call this the mouse trap method.