ABC Transport And The 20-Year Revolutio/By Chigozie Chikere



For decades, countless intercity bus companies have succumbed to the tyranny of low expectations, at least when it comes to new entrants with little experience and unprofessional skills and, as such, are at the bottom of the heap. The assumption has been that new entrants in the passenger transport industry anywhere in the world face too many operational challenges regardless of the size of their fleet or the level of professionalism of their staff. Again, the oligopolistic structure of the market where operators of small fleets are frustrated by their large fleet counterparts as they compete for patronage is another factor that often relegated new entrants to the background. In time, however, many get forced out of the industry reducing it to an old timers’ affair. There was little hope that a company could make any difference to the future of new and intending bus companies without giving in to the challenges of inexperience and an unfriendly market structure.

Such attitudes consigned whole generations of entrepreneurs and transport business ideas to the scrapheap. But 20 years ago, in Owerri, a new generation company, Associated Bus Company; ABC Transport started a revolution. There are now over a hundred new generation bus companies engaged in intercity passenger and freight transport all over the country. They are enjoying good business environment, copying and remodeling innovative ideas and business strategies of frontline companies, and still maintaining a healthy symbiosis.

The emergence of ABC Transport on Nigerian highways is revolutionary, for four reasons. It represents an experiment. It is adopting and renovating time-tested practices. It is reinvigorating ailing bus companies. It is blazing the trail for new investments. ABC Transport commenced operations in 1993 as an off-shoot of Rapido Ventures Limited, led by Mr Frank Nneji; a consummate Microbiologist and an astute Businessman. The company is fashioned with a view to running a modern road transport system with international standards. ABC Transport experimented with diversification in terms of ownership and investments. It went through a successful initial public offer in 2006, and became a public limited liability company, with over 18,000 Shareholders and listing. Presently, ABC Transport is the only road transport company quoted publicly by the Nigerian Stock Exchange.

Yet the virtue of experiments is that one can draw lessons from them; and it is now becoming clear under what condition the company performs best. Audited results for the year ended 31st December 2011 shows a growth of 26.89% in turnover over the 2010 result. Turnover increased from N4.61b in 2010 to N5.85b in 2011 representing an increase of 26.89% while operating profit indicating increased operational efficiency grew from N392.94m in 2010 to N459.71 in 2011 representing an increase of 16.99%.

Cascading is one of the time-tested practices adopted and remodeled by ABC Transport. By this practice, transport operators put aging fleet to good use by scheduling them for routes and operations that are less tasking, or cannibalising them for use as spare parts for other vehicles. The common practice among older companies is to reduce these older vehicles to mass transit buses within and around the municipalities. But it is interesting to know that, at ABC Transport, older buses complement the more stable ones at the tail end of passenger journeys. Thus, while other bus companies end passenger journeys, most times, wherever the driver chooses, ABC Transport completes all journeys using these cascaded buses. For example, a bus plying the Lagos-Owerri-Mbaise-Umuahia route stops at Owerri terminal and transloads passengers and freight bound for Mbaise and Umuahia to a cascaded bus which completes the journey. The cascaded buses also play a feeder role in moving passengers from various feeder terminals to the main terminals where they continue their journeys in comfort and safety.

This revolution is now spreading round the country as formerly ailing bus companies and new ones are now shifting from traditional practices that once plagued the industry with obsolescence, touting, and general ugliness to standard practices with the aim of increasing their market share and, in the long run, their productivity. Like ABC Transport, most frontline bus companies now assert their corporate existence with ultra-modern terminals located in major cities of Nigeria and even in neighbouring West African countries where they now extend their services. Express Courier Services, Road Haulage and Hotel and Touring Services have now become ancillary to passenger transport as these companies gradually metamorphose into total logistics companies of the future.

It is pretty clear now that any aspect of the transport industry in Nigeria can be revolutionised by giving stakeholders independence – so long as it is done in the right way, with the right monitoring, regulation and safeguards from the state. Recently, Presently Goodluck Jonathan called for professionalisation of Freight Forwarding practice in Nigeria. This is a move in the right direction as Foreigners now dominate the Freight Forwarding business due to lack of professionalism of Nigerian Practitioners. The Council for Regulation of Freight Forwarding in Nigeria; CRFFN, whose mandate it is to upgrade the standard of practice, needs a strong backup as well as a strong push from the Federal Government to implement this policy. Federal Government is giving the road passenger transport industry the shove it needs, despite the delay in full implementation of the existing National Transport Policy and the final ratification of the draft National Transport Policy. Yet, more needs to be done in the area of road maintenance and rehabilitation.

By international standards, many of our bus companies are not doing well in terms of passenger comfort and safety. They do not have shelter at their terminals, their vehicles are poorly maintained, their drivers and crew are not well trained yet they compete for passengers by offering them relatively low fares and reduced journey time, which they achieve by over-speeding. The least this generation can contribute to further improve transport service standards is to continue to support and identify with notable passenger-friendly bus companies. Commending them occasionally for a job well done and patronising them can do that at no extra cost. Let the revolution continue.

Chigozie Chikere, A Member, The Chartered Institute of Logistics & Transport; CILT, Nigeria







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