By FWDR Godfrey Emeka Nwosu
Secretary General, NAGAFF
Nigeria’s freight forwarding industry must urgently embrace consolidation of operators as a strategic response to growing foreign participation in the logistics sector, while the government creates the regulatory and infrastructure framework required to protect local capacity and strengthen the nation’s economic sovereignty.
This was the thrust of a policy briefing by the National Association of Government Approved Freight Forwarders (NAGAFF), which warned that the fragmented nature of the domestic freight forwarding industry is increasingly weakening the ability of Nigerian operators to compete effectively in an evolving global logistics market.
According to the association, consolidation of smaller freight forwarding companies into stronger and more professionally structured entities would enable local operators to achieve economies of scale, improve service delivery, reduce operational risks, and compete more effectively with larger foreign companies.
The freight forwarding sector, it noted, remains a critical component of Nigeria’s trade facilitation architecture, linking importers and exporters with shipping lines, ports, customs authorities, transport operators, and other players in the supply chain.
However, the predominance of relatively small and fragmented operators has created structural weaknesses, including limited access to capital, underutilisation of cargo capacity, operational inefficiencies, and inadequate investment in modern logistics infrastructure.
NAGAFF argued that consolidation could provide a practical pathway out of these challenges by allowing operators to pool resources, share cargo space and infrastructure, coordinate transportation schedules, and deploy technology more effectively.
Economies of Scale
One of the immediate benefits of consolidation, the association said, would be lower operating costs.
By combining cargoes and optimising available transport and warehouse capacity, freight forwarders could reduce per-unit logistics costs while minimising empty runs and underutilised assets.
Such savings, it added, could ultimately translate into more competitive prices for shippers and other users of logistics services.
Beyond cost reduction, consolidation would enable local operators to expand their market reach and improve their ability to compete with foreign-owned or foreign-backed logistics companies that often have greater access to capital, technology and international networks.
The policy briefing stressed that stronger indigenous freight forwarding companies would also be better positioned to invest in staff development, digital platforms, warehousing, transportation equipment and other infrastructure necessary for modern supply-chain operations.
Benefits Across the Supply Chain
The proposed consolidation, according to NAGAFF, would not benefit freight forwarders alone.
Shippers could gain access to more affordable and reliable logistics services, while port operators could benefit from better coordinated cargo movements and reduced congestion.
Customs authorities could also benefit from a more streamlined cargo-handling structure, potentially making inspection, documentation, and clearance processes more efficient.
At the broader economic level, a stronger domestic freight forwarding industry could improve the competitiveness of Nigerian trade, increase business opportunities for indigenous operators and contribute to government revenue through a more efficient and transparent trade environment.
NAGAFF further argued that consolidation could have important national-security implications.
With cargo movements handled through stronger and more accountable structures, monitoring and tracking could become easier, potentially helping relevant authorities detect and prevent smuggling and other forms of illicit trade.
Call for Legislative Intervention
The association therefore called on the National Assembly to consider the development of an appropriate regulatory framework that would encourage voluntary and commercially viable consolidation while protecting the interests of legitimate Nigerian operators.
It urged lawmakers to examine policies that could provide incentives for mergers, strategic partnerships, shared logistics infrastructure, and other forms of cooperation among local freight forwarding companies.
NAGAFF also identified infrastructure investment as critical to the success of any consolidation programme.
It called for greater investment in warehousing facilities, transportation corridors, cargo-handling infrastructure, and digital systems capable of supporting efficient movement and tracking of goods from the ports to their final destinations.
The association further advocated capacity-development programmes for freight forwarders and customs brokers to enable them to adapt to increasingly sophisticated international trade and logistics requirements.
On security, it recommended stronger cargo-monitoring systems and closer collaboration among freight forwarders, customs authorities, port operators and security agencies to reduce vulnerabilities within the supply chain.
Public-Private Partnership
NAGAFF also urged the government to deepen public-private partnerships in the freight and logistics sector, arguing that the government alone cannot provide all the infrastructure and technical capacity required to modernise the industry.
It maintained that collaboration between policymakers and industry operators would produce more practical policies because freight forwarders possess first-hand knowledge of the operational challenges confronting the sector.
The association emphasised that consolidation should not be interpreted as an attempt to eliminate smaller businesses, but rather as a strategy for creating stronger indigenous enterprises capable of operating at scale.
It said smaller operators could participate through strategic alliances, cooperatives, partnerships, and mergers, provided such arrangements remain transparent, commercially sustainable, and compliant with competition and regulatory requirements.
A Matter of Economic Sovereignty
NAGAFF described freight forwarding consolidation as more than a commercial strategy, insisting that it should be viewed as part of Nigeria’s broader economic and trade-security agenda.
According to the association, allowing indigenous operators to remain excessively fragmented while foreign companies continue to expand their presence could weaken Nigeria’s capacity to retain value within its own logistics chain.
It therefore urged policymakers to create an enabling environment in which Nigerian freight forwarding companies can grow into competitive, professionally managed, and internationally respected logistics enterprises.
“Consolidation for freight forwarders and freight forwarding companies is a national imperative,” NAGAFF stated, stressing that the objective should be to improve service delivery, strengthen indigenous participation, and ensure that Nigerian operators remain significant contributors to the country’s trade and economic development.
The association maintained that decisive policy action by Parliament, supported by appropriate infrastructure, capacity building, digitalisation, and security measures, could transform consolidation from a business strategy into a major instrument for strengthening Nigeria’s logistics industry and economic resilience.
