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Nigeria's NIPOST Commercialization

Nipost – Tekedia

Prof, could you share the best way NIPOST Nigeria can be commercialised to support e-commerce in Nigeria. Also is there any chance we can make NIPOST work in Nigeria. How can we fix NIPOST?

This is a very hard one (I do think privatization could also work here). Largely, I do not know what will work since it is not even clear on the level of commercialization that has happened in NIPOST. I know that govt has their staff in NIPOST and I am not sure anyone can buy NIPOST with pension burdens.  And that brings  ...what can someone buy in NIPOST? Do they have cars of planes to help logistics? I do not see any value in NIPOST on pure logistics. But acquiring NIPOST will be a good business. It has great real estate which can be monetized, depending on the discounts government is willing to give. It may be better to build your logistics service from the scratch and leave govt.

NIPOST could play a useful role in financial inclusion. Correct me if I'm wrong, but I think Nipost has a pretty extensive 'branch' network across Nigeria, even in rural areas where commercial banks wont find it viable to operate branches. There, they could serve as petty cash centres or e-money agents (e-wallet.. etc).  As for the profitability of this, I am not sure. But it works pretty well here, where I live (Europe)

The NIPOST can actually work, if they want it to work. Its network of branches cut across every local government area and several communities in the country, yet they failed to see value and opportunities in such a vast network. And people are still collecting salaries from there. To revive it, the first thing would be to audit its assets and liabilities, separating the two components. Maybe a consectioning or outright outsourcing should be agreed on subsequently. No further solution can be proposed at this point, without determining its state.

Good point but besides having branches, the value proposition must include logistics assets. I am not sure hundreds of branches create deep value if they are not connected through logistics. Do they have planes, trucks, etc to move items at fast rate from one region to another? Making it a cash center, while useful, limits the value of the Service. Our electronic commerce will continue to struggle until we have a solid logistics system. NIPOST can be that.

So, I just looked up on their website and EMS, their subsidiary says "standard delivery time is 24-48hrs nationwide" this, to me indicates a sizeable logistic capability. If these figures here (https://www.premiumtimesng.com/business/business-news/225744-nigerian-postal-service-generated-n8-84-billion-revenue-2016.html) are anything to go by, then its probably not as rotten as one might think. NIPOST probably needs an efficient management and they should be 100% financially independent from govt handouts. and surprisingly, they already have an e-payment service called "online money order". I wonder how many people know about this..
Anyways my 10cents observation is that if they actually do 24 - 48hrs nationwide, then at the very least, they deserve a second look. No?

"standard delivery time is 24-48hrs nationwide" That will even beat anything I have seen in U.S. Of course what is written may be different from reality. If NIPOST has such level of quality, I can say that most e-commerce companies will collapse their logistics operations into NIPOST.  Those numbers are not real: we spend money in my office in Owerri sending packages via luxury buses. My team, I have confidence in them, would have figured out NIPOST alternative. Nonetheless, I will check more and ask them to investigate. Thanks for sharing.

On a more serious note, there is no way NIPOST will roll out all the needed services to support e-commerce without:

1. Capacity building: People comes before profit, if NIPOST believes in that, then building capacity which is a colossal problem in public institutions in Nigeria need to be fixed. There is no way you can work in today's world, without a periodic update on your level of knowledge, capacity, and skill.

2. Management Style: Visit any nearby NIPOST Office and you will see dirts, most are bushy environment. Tell me, do NIPOST Managers do visit all the branches under their care? They dont, so that is why everywhere is very dirty. They need to fix the management style

3. Technology Deployment: NIPOST Staff are grossly incompetent to use todays technology, even ordinary POS you NEVER see at NIPOST Office, everything must be done in cash. Competency and Skill development is required.