The verdict in three sentences
The last mile is the real cost center of e-commerce in Lagos: 25 to 40 % of an order's cost, and one failed delivery wipes out the margin of two successful orders. No option is perfect: an in-house fleet pays off above a certain volume, aggregators (GIG, Kwik) are flexible but costly per trip, dedicated riders (okada) offer the best ratio at medium volume. The key is not the carrier, it is the tracking tool that cuts failures and the poorly controlled pay-on-delivery.
Comparing the three delivery models
In Lagos an intra-city trip costs between 1,000 and 3,500 FCFA depending on distance, time and mode. The real trap is cash on delivery: uncollected money, riders fronting funds, disputes.
| Model (2026 ballpark) | Cost / trip | Average time | Failure rate | Cash on delivery |
|---|---|---|---|---|
| In-house fleet (2 okada) | 800 to 1,500 FCFA | 45 to 90 min | 5 to 8 % | controlled |
| Dedicated riders | 1,200 to 2,500 FCFA | 60 to 120 min | 8 to 12 % | contractual |
| GIG / Kwik | 1,500 to 3,500 FCFA | 30 to 75 min | 10 to 20 % | risky |
| Post / pickup point | 500 to 1,200 FCFA | 1 to 3 days | 12 to 25 % | avoid |
An in-house fleet becomes profitable above roughly 300 to 400 deliveries a month. Below that, aggregators and dedicated riders avoid the fixed costs of bikes, fuel and salaries.
The tracking tool that saves your margin
The real extra cost is not the trip price but the failures: customer absent, wrong address, refusal to pay. A tracking dashboard with real-time status, proof of delivery, and mobile money confirmation before the parcel leaves changes the game.
| Lever (2026) | Impact on failures | How |
|---|---|---|
| SMS confirmation + time slot | -30 to -40 % | customer warned, present |
| Paystack / MTN MoMo prepayment | -50 % cash disputes | no money to collect |
| Geolocated address (pin) | -20 to -30 % | no more false addresses |
| Photo proof of delivery | near-zero disputes | traceability |
| Auto rider reassignment | -15 % time | optimized dispatch |
A tracking tool built into the store costs 500,000 to 1,500,000 FCFA to develop, and pays for itself as soon as it prevents 30 to 50 failed deliveries a month.
Mini case study
Chidi, who runs a fashion e-commerce in Lagos, handles 500 orders/month with an 18 % failure rate via Kwik trips averaging 2,200 FCFA. Each failure costs him the round trip plus the tied-up product, about 4,000 FCFA. At 90 failures/month that is 360,000 FCFA lost. After switching to a 2-okada fleet (fixed cost ~450,000 FCFA/month) plus a tracking tool with Paystack prepayment, his failure rate drops to 7 %, i.e. 35 failures and 140,000 FCFA of losses. Net saving: 220,000 FCFA/month, tool repaid in 3 months.
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FAQ
What share of an order cost is delivery in Lagos?
Between 25 and 40 % of the total cost of an urban e-commerce order in 2026, depending on distance and mode. It is often the first line after the product itself.
In-house fleet or aggregator: which to choose?
Below 300 deliveries/month, aggregators (GIG, Kwik) or dedicated okada riders avoid fixed costs. Above that, an in-house fleet at 800-1,500 FCFA per trip becomes more profitable.
How do I reduce failed deliveries?
Prepayment via Paystack or MTN MoMo removes about 50 % of cash disputes, and SMS confirmation with a time slot cuts absences by 30 to 40 %. Geolocated addresses handle the rest.
How much does a delivery tracking tool cost?
From 500,000 to 1,500,000 FCFA to develop, integrated with your store. It pays for itself as soon as it prevents 30 to 50 failures a month.
Is pay-on-delivery still viable?
Yes but risky: favor mobile money prepayment. If you keep cash, require SMS confirmation and photo proof of delivery to limit disputes.
Let's talk about your project. We connect your store to a tracking tool that drops your delivery failures below 8 %. 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.
