Prioritise operations over assets, SIFAX urges logistics investors

The Group Executive Chairman of SIFAX Group, Dr Taiwo Afolabi.

SIFAX Group has urged investors seeking opportunities in Nigeria’s logistics sector to prioritise cargo demand, efficient operations and cash flow over the acquisition of trucks, warehouses and other physical assets.

The Chairman of SIFAX Group, Dr Taiwo Afolabi, offered the advice in a speech at the 2026 Annual Strategy Retreat of Odu’a Investment Company Limited, held at the International Institute of Tropical Agriculture, Moniya, Ibadan, according to a statement.

Afolabi, who was represented at the event by Deputy Director, Strategy and Operations, Oliver Omajuwa, said the profitability and sustainability of logistics investments depended largely on customer demand, productive asset utilisation and the ability to generate returns on committed capital.

The SIFAX Group chairman identified warehousing, transportation, agricultural aggregation, cold-chain services, technology and specialised logistics as viable investment opportunities, urging investors to identify gaps across the value chain before making investment decisions.

He advised Odu’a Investment Company Limited to examine the transportation, “storage and distribution requirements of its portfolio companies, noting that their combined needs could provide a foundation for developing a shared logistics platform to support the company’s investment ecosystem.”

“Opportunities in port logistics extend beyond terminal operations to cargo handling, freight forwarding, customs clearing, equipment maintenance, storage and export consolidation,” he said.

He explained that integrating these services could improve cargo movement, “reduce operational complexities and enable customers to access multiple logistics solutions without dealing with several service providers.”

On agricultural logistics, Afolabi noted that increased production would yield limited economic benefits without adequate infrastructure for aggregation, preservation, storage and distribution.

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He identified cold rooms, temperature-controlled transportation and strategically located warehouses as critical investments capable of connecting agricultural production to processing facilities, retail markets and export channels.

The chairman further explained that investors could explore greenfield developments, acquisitions or strategic partnerships with established operators, depending on their financial capacity, technical expertise and identified market opportunities.

He added that technology-driven solutions, particularly cargo tracking, inventory management and operational monitoring systems, could improve visibility, efficiency and service delivery across the logistics value chain.

Afolabi, however, cautioned against investment decisions driven primarily by asset ownership, stressing that the acquisition of trucks, construction of warehouses or procurement of equipment did not automatically guarantee profitability.

He urged prospective investors to evaluate customer requirements, asset utilisation, cash conversion and returns on invested capital before committing resources to logistics ventures.