DHL Express is a global logistics company that offers an unrivalled portfolio of logistics products and solutions ranging from domestic and international parcel delivery to international express, road, air and ocean freight to end-to-end supply chain management. Hennie Heymans, CEO DHL Express, sub-Saharan Africa recently visited Nigeria after the Covid-19 pandemic disruption of business activities globally. During the visit, Heymans shared his thoughts with selected journalists on the company’s sustainability plans for the Nigerian SMEs market. He also talked about how the investments will help boost capacity among the SMEs to contribute to Nigeria’s GDP. Businessandeducation.ng was there and brought this report.
What is your view on the SME market and its significance in Nigeria and in SSA?
Nigeria is an entrepreneurial country, which means SMEs are the lifeblood of the country. In Nigeria, SMEs contribute 48 percent of the national GDP, account for 96 percent of businesses and create 84 percent of employment; clearly indicating how crucial this sector is crucial for the growth and survival of the economy in Nigeria.
Across Africa, SMEs provide an estimated 80 percent of jobs across the continent, representing an important driver of economic growth. Sub-Saharan Africa alone has 44 million micro, small, and medium enterprises, almost all of which are micro
What does the future hold for SMEs in Nigeria and SSA as a whole?
SMEs and Small and medium-sized enterprises are going to take central stage as the population continues to grow in Nigeria, as there will be greater reliance on SMEs as the main source of employment and economic growth.
Technology and favourable regulations will also make it easier for SMEs to trade both regionally and globally, further improving their success in the country.
What are some of the challenges that SMEs are battling with?
Similar to SMEs across the region, SMEs in Nigeria are also facing the following challenges:
• Access to finance – Financing gaps and credit constraints are faced by the majority of MSMEs, making them less able to cope with costs of doing business. For these businesses to grow, create more jobs, and generate economic growth, they need access to capital.
• Access to physical and digital infrastructure – SMEs often do not have or cannot access basic infrastructure, including roads, ports, clean water and electricity. They are often excluded from business and employer networks and do not have resources for digital technologies.
• Skill shortages and talent attraction – Due to their small size, SMEs have limited access to skills training, in addition to lower ability to attract talents.
• Regulatory environment – SMEs face complex regulations at any stage of development, ranging from bureaucratic and administrative burdens, tax regimes, logistics, safety guidelines, etc. When going beyond national borders, the situation becomes even more difficult
How is DHL supporting SMEs in Nigeria?
• DHL has specialised solutions designed for SMEs
• DHL uses its network to support SMEs in Nigeria to trade locally and regionally. Whether the customer is a small business just starting out, DHL has tailored solutions for SMEs in Nigeria who are looking to grow their reach to international and cross-border markets. (SME360 programme spotlight).
• DHL is supporting SMEs in Nigeria through our GoTrade programme. DHL is working with governments and international organizations to remove red tape at the border and support small and medium-sized businesses to increase cross-border trade.
• Speed and access to global markets are critical to the growth and expansion of SMEs in Nigeria. DHL has a footprint and global network spanning 220 territories and well-positioned to support the country’s trade and GDP growth.
• Regulatory Affairs are changing. Governments are becoming more demanding regarding the data they receive from businesses. This means businesses need to know what is required from them, for this they need to have a partner that can walk with them on their journey through all these changes. DHL has partnered with GIZ to provide seminars and training sessions for SMEs to understand customs processes.
What does the future hold for DHL in Nigeria?
Nigeria is an important market for DHL. We have been operating in the country since 1978, and we continue to work hard to support our customers on their growth journey in the country and beyond.
What are the most significant trends impacting the courier services industry currently?
Research shows that 50 percent of buyers are interested in environmentally-friendly delivery methods. And 88 percent of customers are more likely to be loyal to a company which supports environmental issues; customers will seek to find a balance between convenience and sustainability in their delivery options.
We are extremely passionate about sustainability at DHL. Not only are we fervent about driving sustainability within the logistics industry, but we’re also working hard to help our customers improve their credentials too.
DHL Express has recently launched Go-Green Plus, a new service that will allow customers to reduce (‘inset’) the carbon emissions associated with their shipments through the use of Sustainable Aviation Fuel (SAF). The GoGreen Plus service is part of Deutsche Post DHL Group’s sustainability goal of achieving net-zero emissions by 2050.
Cyber Security, Compliance, Safety:
Visibility and transparency are paramount.
Customers need providers who are compliant with local and international laws and regulations, to ensure they are working with ethical and credible providers.
The rising importance of health and safety is also a key focus to ensure the safety of our staff, customers and network.
As we transact more digitally, cyber security is another concern that requires ongoing focus and investment
Digitalization & innovation
Use of RPA, big data and AI to help improve processes and provide seamless delivery for customers and improve strategic decision making.
E-commerce (Both B2B & B2C)
Constant evolution in this space, fuelled by improved technologies – customers want convenience and seamless delivery – with full visibility. Logistics providers need to adapt and fully integrate with customer value chains.
By working closely with stakeholders from the public and private sector, we remain humbled by the level of sincere commitment to supporting the advancement of MSME – including youth and especially ones led by Women.
We use the vehicle of Power Up Your Potential to facilitate workshops that bring these stakeholders together and begin a dialogue that outlines the opportunity presented by cross-border e-Commerce.
At Deutsche Post DHL, the ultimate goal of our sustainability programs is impact. Our approach is to match the Group’s strengths with priority global needs, and to work with leading international organizations so that our resources are channelled for maximum effectiveness.
GoTrade draws on the Group’s expertise in trade and logistics to enable developing countries and their SME’s access the global market. We leverage our core logistics competencies and tap into the wealth of knowledge and experience within the DPDHL Group to enable countries implement best-in-class policies and procedures at the border and help local businesses to access the global market. We consider the GoTrade projects successful if we achieve:
Increased numbers of SMEs trading cross border; Increased volumes being traded cross-border; Reduced costs in border related processes and sustainable long term economic growth through trade
DHL advocates for SMEs through our various engagements with Governments & Regulators to reduce barriers to entry and create an environment where women-led businesses may thrive. Some of these collaborations include:
Pan African e-Commerce Initiative (PeCI) in collaboration with the GiZ in KE – GH – RW + Nigeria and CI; Global Business Schools Network> SMEs paired with MBA students from Uganda, Namibia, Kenya and Nigeria; SheTrades collaboration initiatives in GM – GH – ZM + Kenya; Mauritius; Rwanda and South Africa.
Collaboration with the Cherie Blair Foundation in KE – ZA; and Corporate Partner collaborations including Ecobank
Efforts focussed particularly in the Agri Sector; Smallholder farmers will benefit from opportunities to integrate their activities into regional agricultural value chains and high-value agricultural commodities and agri-food products for export markets (specifically an opportunity for and in Nigeria) 2nd City Development to diversify economic base away from concentrated cities to peri-urban areas.