The verdict in three sentences
In Lagos, last-mile delivery costs between NGN 1,500 and 4,000 per parcel depending on zone and mode. Cash-on-delivery still rules but fails 10 to 20 % of the time — customer absent, refusal, fake number — which heavily erodes margin. The right choice between independent bikes, platforms (GIG, Kwik) and an in-house fleet depends on your daily volume.
Comparing delivery modes
Each option has a distinct cost and reliability profile.
| Mode | Cost/parcel (NGN) | Reliability | Best for |
|---|---|---|---|
| Independent bike | 1,500 to 2,500 | medium | low volume |
| Platform (GIG/Kwik) | 2,000 to 4,000 | good | demand peaks |
| In-house fleet (bike) | 1,200 to 2,000 | high | steady volume |
| Pickup point | 800 to 1,500 | high | self-serve customers |
| Inter-area transporter | 1,000 to 2,500 | variable | far zones |
An in-house fleet becomes profitable beyond ~25 to 30 deliveries/day: below that, platforms avoid fixed bike and rider costs.
The true cost of cash-on-delivery
COD appeals to customers but hides failure costs. 2026 order of magnitude for 100 orders.
| Indicator | Prepaid (mobile money) | Cash-on-delivery |
|---|---|---|
| Delivery failure rate | 3 to 6 % | 10 to 20 % |
| Return cost/100 orders | ~NGN 15,000 | ~NGN 60,000 |
| Cash tied up | no | yes (T+2 to T+5) |
| Fraud risk | low | medium |
| Average order | equivalent | often lower |
Each failed COD delivery costs twice: the trip out AND the parcel return, plus the tied-up product. Encouraging mobile-money prepayment (via a small discount) sharply cuts these losses.
Mini case study
Ngozi, who runs a fashion store in Lagos, ships 60 parcels/day, 70 % on cash-on-delivery. Her COD failure rate is 16 %, i.e. ~7 parcels/day returned at NGN 2,200 round-trip lost: ~NGN 15,400/day, or ~NGN 400,000/month evaporating. By offering NGN 500 off for prepayment, she lifts prepaid from 30 % to 60 %: her overall failure rate drops to 8 %, saving ~NGN 180,000/month net.
Need a professional website?
Kolonell builds websites that attract clients, optimized for the Sénégalese market. Free quote in 2 minutes.
FAQ
How much does a Lagos delivery really cost?
Between NGN 1,500 and 4,000 per parcel depending on zone, mode and urgency. Far zones and express push toward the top of the range.
Is cash-on-delivery worth it?
It boosts trust and volume, but with 10 to 20 % failure it doubles logistics cost on failed orders. Frame it with caps and phone confirmation.
When should I build an in-house fleet?
From 25 to 30 steady deliveries/day, an in-house bike fleet becomes cheaper than platforms and improves reliability.
How do I reduce delivery failures?
Confirm each order by phone, incentivise mobile-money prepayment (small discount) and offer pickup points. This can halve the failure rate.
Are pickup points relevant in Lagos?
Yes for self-serve customers: at NGN 800 to 1,500/parcel, they cut cost and absence failures, at a slight effort for the customer.
Let's talk about your project. We design your last-mile logistics and integrate mobile-money prepayment to protect your margin. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
