Amidst rising competition in the mobility hailing market in Nigeria, bike–hailing app company, Gokada, is shutting down its operations temporarily in Nigeria today, August 14, 2019. The shutdown was announced by the Chief Executive Officer, Fahim Saleh.
Saleh revealed this in a note he wrote and published on a news website yesterday, August 13, 2019. The decision to exit the market immediately was compelled by his personal experience on one of the company’s bikes in Victoria Island, Lagos.
The motorbike hailing market is still relatively new but it’s an emerging market that promises so much revenue potential to investors. Its entry barrier is, however, high and costly to operate.
The reason for the shutdown: While most businesses shut down their operations in Nigeria due to the country’s business environment, Saleh’s reasons have nothing to do with Nigeria’s hostile territory but self-development to enable the company to compete better in the emerging market.
According to Saleh, he hailed a Gokada bike from Victoria Island to Mainland bridge, and his experience was unpleasant because of two major reasons.
- Rider’s failure to get to his pickup point within allotted time.
- Rider’s struggle to navigate the road due to a fault developed by Gokada’s app.
In his explanation, Saleh said, “I opened the Gokada app, requested, got a pilot, and waited patiently for him to arrive. I called to confirm my location which the pilot said he knew. 5 minutes passed by and the pilot had not moved.
“Another 5 minutes passed and the pilot was going in the wrong direction. After 15 minutes and three phone calls, the pilot finally arrived. Upon questioning the pilot, I learned that he didn’t use GPS on his phone because the earplugs he had were broken.”
Saleh added that, “It should be pretty obvious how to get to the mainland bridge from VI, so I didn’t concern myself with providing him directions but I knew from Google Maps using the best route, it should only take 10 –15 minutes. After about 15 minutes, we were still on the road.
“I hastily took out my phone and did a quick input of the directions to the bridge and realized we were still 15 minutes away. This pilot had taken a long route to get to the bridge, one that would have been completely avoided had he used the map…
“How could I be the CEO of Gokada, the company that pioneered motorcycle ride-hailing in Nigeria and be saying this? I was disappointed in Gokada but most of all, I was disappointed in myself. I told the pilot to pull over to the side of the road, I would hop over the median and wait for an Uber. This is what it has come to.”
Temporary exit: The closure, however, will be temporary as the company would be taking a short break to correct the problems that could result to poor customer experience. The shutdown which begins today will end on August 26, 2019.
Why the closure matters: For Saleh, Gokada has succeeded and failed at the same time but despite being the first bike-hailing app company in Nigeria with deep penetration, the company needs to look deep into its operations.
He said the temporary exit from the market would enable the company to do the following:
- provide new bikes;
- retrain Gokada riders;
- provide improved safety measures; and
- ensure all riders are happy by maintaining their bikes for free, opening a drivers’ club, and expanding our health benefits.