Mike Ebonugwo
11 January 2009
opinion
ARE you interested in bulk or wholesale purchase of motorcycles and looking for the right place to make this happen? Chances are that on enquiry you are likely to be directed to Herbert Macaulay Street, Lagos and other surrounding streets in Oyingbo, Yaba also in Lagos which arguably have become the headquarters of dealers in commercial motorcycles popularly known in local parlance as okada.
Indeed, a first time visitor will have no difficulty coming to the conclusion that the entire neighbourhood has been taken over by wholesale motorcycle dealers as almost all buildings in the area have shops and offices displaying one brand of motorcycles or the other for sale. The very big dealers are not just content with having such shops and offices: They operate from whole buildings complete with warehouses which are stocked full of motorcycles in their completely knocked down(CKD) and fully-assembled states. For instance, on the day Sunday Vanguard visited, it was a beehive of activities at one of these big dealers,Degab Enterprises, as customers streamed in and out of the large building that serves as its operational headquarters. Most of the customers are no small time dealers themselves as they were there to make wholesale purchases of motorcycle brands of their choice.
As the workers in the company were busy attending to this steady stream of customers, some others were busy offloading a container load of motorcycles from a trailer parked across the road. A visit to other dealers'offices will find their workers similarly engaged.
And this readily gives the impression that these dealers are certainly doing well for themselves. And why not, considering the fact that the motorcycle or okada has become the most popular means of commercial transportation in Nigeria, especially in Lagos and other urban centres in the country where okada operators virtually take over all available roads on a daily basis.
And they come in different shapes and sizes ranging from such reputable brand names as Honda, Suzuki, Yamaha and Kawasaki to the now more common and popular Jincheng, Bajaj, AVS, Nifan, Loncin, among several others now competing for space and attention on Nigerian roads. So, if the high patronage of motorcycle for commercial transportation is anything to go by, it can be said tha
t the dealers as far as the importation and distribution of the product is concerned are certainly enjoying a boom with lucrative returns to the bargain.
Remarkably, most of the dealers do not agree with this conclusion. One of them, Mr Victor Nwaonumah, the chairman of Porvic Associates, said the motorcycle business is not particularly lucrative for most Nigerian dealers since they are not in a position to import the product. He told Sunday Vanguard in an interview that the importation of motorcycles is dominated by Asians, especially the Chinese and Indians. And he has an explanation for this.
Capital intensive
According to him, importation of motorcycles and similar products is capital intensive and most Nigerian dealers lack the financial muscle to compete favourably with the Asians. Apart from that, the Asians, he said, try to retain a monopolistic control of the business by taking steps to frustrate attempts by Nigerians to get involved in the importation side of the business so that they can enjoy maximum profit at the expense of the Nigerian dealers who are left picking the crumbs as distributors and retailers.
"Attempts by some of our people to import did not work out well because imagine a situation where you succeed in importing five containers, the same people who sold this to you as manufacturers will follow behind with say 20 containers. And on getting here, they will want to sell at a cheaper price considering the quantity and amount involved. And because of this our people cannot cope," he informed. He said the only way to reverse this unfavourable trend was for government to come out with a legislation that will curtail this deliberate dominance of foreigners in the importation of motorcycles.
Mr. Patrick Uzoka, owner of Albright International Limited, a motorcycle retail outlet, shares Mr. Nwaonumah's position on the matter. According to him: "It's wrong for these Asians to be involved in importation and distribution considering the fact that they are the ones manufacturing the product. What they have succeeded in doing is to control the business from manufacturing to distribution down to retailing, which is wrong. And when you really look at the situation, it's as if the Nigerian dealers are only working for them on a commission basis"
, a spokesman for Degab was of the view that the Asian dominance of the import side of the business does not constitute a major problem or handicap to the company since it has continued to operate successfully in spite of this prevailing situation. Such a seemingly restrictive operating environment was not peculiar to the motorcycle business but obtains in other areas of business in the country. He added that it was left to the individual dealers to confront the challenge by adopting a method of operation favourable to them both as importers and distributors.
Okechukwu Eze, a staff of an outfit that deals only in Honda products, mainly motorcycles and generators, has a slightly different view. He blames the influx of what he considers sub-standard motorcycles on some Nigerian dealers who import such from Asia based solely on the profit motive. According to him: "They import anything in the name of motorcycles without caring about the safety and durability of the these products.
But that is not the case with brand name motorcycles like Honda, Suzuki and Yamaha which are imported by multinational Asian companies which have established their own assembly plants in Nigeria. Although Mr. Uzoka agrees that many of the motorcycles being imported into the country are sub-standard with short life span, he said the same applies also to such supposedly trusted brand names as Honda, Suzuki, Yamaha, Kawasaki and others in the same class and quality. According to him: "Although Honda and Suzuki(motorcycles) are originally from Japan, most of the ones you see in Nigeria today are imported from China.
Even though the standard is supposed to be the same since it's the same companies that established their branches in China, but what happens is that some unscrupulous Nigerian dealers go there to tell them to reduce the quality so that Nigerian users can afford to buy them. The fact is that if the standard ones are imported many Nigerians will not afford them.
The same thing applies to other brands of motorcycles from China and other Asian countries: The manufacturers will sell the original ones to you if you want. But since they will be too expensive to most Nigerian buyers, some importers prefer that the quality be reduced to accommodate these buyers. That is why most of these motorcycles don't last up to two years before they start giving problems".
But this is a fact that the end users, especially commercial motorcycle operators or okada riders may or may not be aware of. What is important to the average Okada operator is the amount of money he makes everyday, regardless of the brand or make of motorcycle he has. While a number of them own the motorcycles they operate with, others hire out their services to owners of motorcycles and make financial returns everyday based on agreed terms. James Okon who operates own bike says he has been in the okada business for over four years. It started for him after he was retrenched from his place of salaried employment.
"After they paid us off I used the money plus the little I have saved to buy this okada. That's what I have been managing since then to take care of my family since I could not get another job," he said. But he lamented the fact that contrary to the belief in many quarters that commercial motorcycle operators make a lot of money from the business, "the money we realise is not actually much, especially during the raining season when rain will not allow us to operate".
Chinedu another okada operator who plies the Ikotun to lyana Isolo and Cele Express routes concurred. But he prefers to blame council and transport union officials for what he perceives as excessive levies which eat deep into what the average okada operator takes home everyday. "It's these council and transport union people that don't allow us to make enough money from the business.
Imagine making between N2,500 and N3000 and you have to pay these people between N350 and N500 for tickets. When you remove money for fuel and maintenance what is left will not be much. So, it's not true that we're making a lot of money. One is only doing this because there's nothing better to do to earn money if you don't want to become a criminal," he stated rather resignedly.
Going by this revelation, the situation is understandably worse for Rasaki Oniru and others like him who operate and make daily returns to owners of the motorcycles they are using. "This okada is not my own; it belongs to one woman like that and I usually return N 5 00 to her everyday I use the okada. I pay N500 because the okada I'm using is Jincheng; the people using Bajaj(motorcycles) usually return N700 everyday to the owners," he informed.
Asked to explain the disparity based on differences in bikes he said: "It's because Bajaj no dey chop fuel like Jincheng and other motorcycles. So, you as an okada man will spend less fueling it". This may explain why in spite of the fact that the Bajaj motorcycle is presently the most expensive bike in the market, it seems to have upstaged the Jincheng motorcycle as the preferred choice of most Okada operators currently.
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