E-commerce has been growing rapidly in Ghana in recent years. This is driven by several factors, including the growth of Ghana’s economy and the increasing availability of internet access and mobile phone ownership there.

Warehousing vs Fulfillment

The term “warehousing” is often used interchangeably with “fulfillment,” but there is a big difference between the two. Warehousing simply refers to storing inventory, while fulfillment encompasses all the steps involved in getting products to customers, from receiving and stocking inventory to packing and shipping orders. 

Most businesses need both warehousing and fulfillment services to some degree, but the mix of services that a business needs will vary depending on the type of products they sell, their sales volume, and other factors. 

In general, businesses selling lower-priced items with a high volume of orders will need more intense fulfillment services, while companies selling higher-priced items with fewer orders will need more warehousing services.

Warehousing Service for an E-commerce Business

As your e-commerce business grows, you will eventually need to consider using warehousing services to store and ship your products. There are many benefits to using a warehousing service, including:

  • You will have more control over your inventory levels. You can manage them more efficiently and have a much greater array of product types. 
  • You can save on shipping costs by using a warehousing service that offers discounts on bulk orders.
  • You will be able to ship your products faster and more efficiently.

Differences Between Normal High-Volume Warehouse and Warehousing Service for E-commerce Fulfillment

Normal high-volume warehouses are designed to store large quantities of inventory and move it quickly and efficiently. They typically have high ceilings, wide aisles, and minimal decorations or amenities. 

Warehousing service for e-commerce fulfillment is a newer type of warehouse designed specifically to store and ship smaller items ordered online. These warehouses often have mezzanines or multiple levels to use the space and are usually located near major transportation hubs.

 

Automation of the Warehousing Industry and How It Benefits E-commerce Businesses

The warehousing industry has undergone a significant transformation in recent years, with automation playing a vital role in this change. This has been driven by the growth of e-commerce, which has placed greater demands on warehouses in terms of speed and efficiency.

Automation can help warehouses to meet these challenges by reducing the need for manual labor and increasing the rate of operations. This can have many benefits for e-commerce businesses, including:

  • Reduced Costs: Greater automation can help reduce the costs associated with running a warehouse, as it reduces the need for manual labor. This can lead to savings on wages and other associated costs over the long term.
  • Increased Efficiency: Automation can also help increase warehouse operations’ efficiency by reducing the time needed to complete tasks. This can help to improve order fulfillment times and reduce shipping costs.
  • Improved Accuracy: Automating warehouse operations can also help to improve accuracy, as it reduces the likelihood of human error. This can lead to fewer customer complaints and returns. It also allows for much faster inventory turns and replenishment than in a standard warehouse. 

 

What are the Needs of E-commerce Businesses in Ghana?

There is no doubt that e-commerce has transformed the way businesses operate. In Ghana, e-commerce is still in its early stages of development but is growing rapidly. Businesses are beginning to see the potential of e-commerce and are investing in it.

However, certain needs must be met for businesses to reap the benefits of e-commerce fully. These needs include:

  • An e-commerce platform that is user-friendly and easy to navigate
  • A payment gateway that is secure and efficient
  • A warehousing and delivery system that is reliable and fast
  • A customer service team that is responsive and helpful
  • A marketing strategy that is effective and targets the right audience
  • A competitive pricing strategy

If businesses in Ghana can meet these needs, then they will be well on their way to success in the e-commerce space.

 

Warehouse Layout Adapted to Leave Dedicated Space for E-commerce Shipping Needs

The e-commerce boom has led to a surge in demand for higher warehouses that can accommodate shipping needs. This has resulted in a need for warehouses to be adapted to leave dedicated space for shipping containers.

One way to change an e-commerce warehouse layout is to create a separate entrance and exit for shipping containers. This will ensure they are not blocking traffic flow in and out of the warehouse.

Another way to adapt your fulfillment center layout is to create dedicated space for shipping containers. This can be done by segregating a section of the warehouse for them. This will ensure that they are not in the way of other activities in the warehouse.

Layout Flexibility

The e-commerce industry is booming, and with that comes a need for warehouses that can accommodate the storage and distribution of items. One of the critical factors in choosing a warehouse is its layout flexibility.

A warehouse for e-commerce needs to be able to store a wide variety of items, from small boxes to large pallets. They also need to be able to accommodate a variety of shipping methods, from parcel delivery to truckload, such as with more parking for vehicles. 

The distribution center design can have a significant impact on its efficiency. A well-designed layout can help reduce travel time and improve picking accuracy. It can also help minimize the need for overtime and expedited shipping costs.

Different Access Sizes

Different access sizes are essential in an e-commerce warehouse because they can help optimize space and improve efficiency. For example, if items are frequently accessed in small quantities, it may be more efficient to store them in a smaller space so they can be easily retrieved. Conversely, if items are accessed in large quantities, it may be more efficient to store them in a larger space so that more can be retrieved at once. 

Different access sizes can also help improve organization and inventory management. By keeping track of which items are accessed most frequently and in what quantities, e-commerce warehouses can optimize their storage to meet customer needs better.

Another thing to consider is the access size to foster more loading and unloading efforts, allowing more in/out movements among smaller vehicles for outbound delivery, including motorbikes. 

 

What are E-commerce Warehouse Management Systems, and How Can They Help You?

E-commerce warehouse management systems help businesses manage their inventory and orders more efficiently. By automating many of the tasks associated with managing a warehouse, these systems can help businesses save time and money.

There are a number of different features that e-commerce warehouse management systems can offer, such as:

  • Automated inventory management: E-commerce warehouse management systems can help businesses keep track of their inventory automatically. This can include tracking inventory levels, reordering stock, and generating reports.
  • Order tracking and fulfillment: E-commerce warehouse management systems can help businesses track and fulfill orders more efficiently. By keeping track of orders and inventory levels, businesses can ensure that orders are fulfilled on time and that customers receive the products they ordered.

Shipping and transportation management: E-commerce warehouse management systems can help businesses manage their shipping and transportation needs. By keeping track of shipping schedules and routes, businesses can save time and money on shipping costs.

In January 2021, Africa officially became a single free trade zone. Headquartered in the Ghanaian capital of Accra, the African Continental Free Trade Area (AfCFTA) created the largest free trade area in the world, measured by number of countries. Africa’s 1.3 billion people and combined gross domestic product of more than US$3 trillion now connect in a single market for goods and services.

In addition to AfCFTA, the explosion of e-commerce as well as infrastructure development are driving demand for high-quality warehousing throughout the continent. Agility, for example, is developing more than one million square meters of warehousing in burgeoning industrial areas. This includes new facilities in the sub-Saharan capitals of Accra, Maputo, and Abidjan. So how do you know if you are getting value for your money in Ghana, Mozambique, and Cote d’Ivoire warehousing?

Rapidly, African countries are making strides in logistics management. Warehousing used to rely on makeshift “godowns” for the storage of goods. Godowns typically lack certain basic features, such as reliable power, internet connectivity, security and sophisticated fire prevention and safety. Now, the need for modern warehouses is on the rise. With increased attention on attracting foreign investment in many African countries, here’s how to know if you are getting value for your money in Ghana, Mozambique, and Cote d’Ivoire warehousing.

What to look for in warehousing in Ghana, Mozambique, and Cote d’Ivoire

Common types of warehousing options in Ghana, Mozambique, and Cote d’Ivoire include:

  • Public warehouses: Owned and regulated by government bodies that charge rent.
  • Bonded warehouses: Owned by government or private companies with a government license.
  • Private warehouses: Owned and managed by manufacturers or by specialized developers and logistics parks operators .

Logistics parks

A logistics park is an area specifically designed to consolidate and centralize storage, distribution, processing, assembly, light manufacturing and other activities, that require warehousing. Modern logistics parks integrate easily with transportation networks so that goods move easily to and from intended markets.

Ready-built warehousing

Logistics parks feature pre-existing warehouse space, known as “ready-built warehousing,” which offers more predictable expenses. The landlord has already absorbed the cost of land, permits, and other regulatory requirements.

For example, CDCI, the largest retailer in Cote d’Ivoire, relocated to a ready-built warehouse in the  Agility Logistics Park near Abidjan. The move upgraded CDCI’s operations to international standards and helped streamline and modernize its storage facilities. Since the move, CDCI has reduced overall logistics costs and lowered the rate of theft.

Flexible leasing

Another advantage to ready-built warehousing is support for flexible leases and space allowing businesses to scale. A flexible lease allows you to use or let warehouse space according to need. Agility Africa, for example, offers flexible leases from six months to five years with sizes from 500 square meters to more than 10,000 square meters.

Infrastructure reliability

International standards include 24-7 security, plus consistent electrical power, all included in the lease. Security includes controlled access as well as constant monitoring of the facility. Plus, the warehouse features sprinkler systems and other fire-prevention measures.

Increasingly, world-class warehousing involves internet connectivity and dependable backup service. Reliable internet service provides access to inventory, data analytics and insights that your company can use to build a resilient supply chain.

Prime location

The UN Centre for Trade and Development estimates that there are currently more than 180 special economic zones (SEZs) in Africa, with 51 more under development. SEZs are areas that provide tax incentives in exchange for a company’s investment. Many African governments are facilitating development of logistics parks within SEZs to attract foreign investors.

Ghana, for example, established the Ghana Free Zones Authority (GFZA) in 1995. The GFZA lets companies operate in certain zones without paying customs duties. The Agility Logistics Park in the Tema Free Trade Zone offers not only bonded warehousing in Ghana but also laydown yard. A laydown yard is an outdoor space within a warehouse area to store material and equipment, often convenient for mining companies as well as oil and gas businesses.

For instance, many international energy companies have set up shop in the Agility Logistics Park near Accra. Its warehousing meets international standards, important for oil and gas, mining, automotive, fast-moving consumer goods, and electronics companies.

Why invest in warehousing in Ghana, Mozambique, and Cote d’Ivoire

The World Bank’s Logistics Performance Index is a survey of operators who provide feedback on a country’s logistics “friendliness.” Its most recent scores revealed that countries in sub-Saharan Africa averaged a score of 2.20 out of 5 for logistics infrastructure. However, African countries are emphasizing infrastructure upgrades. In fact, the British property consultancy Knight Frank estimates US$400 billion worth of rail and road development is taking place across Africa.

Africa’s industrial corridors

African governments with the support of the World Bank are creating seven industrial corridors that connect African regions by rail, by road, and by sea. For example, the West Africa Growth Ring links Ghana, Togo, Burkina Faso, and Cote d’Ivoire. The West Africa Growth Ring has seven main ports, including Takoradi and Tema in Ghana as well as San Pedro and Abidjan in Cote d’Ivoire.

Elsewhere, the Nacala Corridor connects Mozambique, Malawi, Zambia, and Zimbabwe. It features the Nacala Railway, valued at US$4.4 billion. Also, its main port of Nacala, in Mozambique, is the deepest port in southern Africa.

The objective of Africa’s industrial corridors is to promote investment and development, laying the groundwork for more than a million square meters of purpose-built warehousing, Knight Frank predicts. Companies such as Agility have built logistics parks along these prime industrial corridors, offering ready access to major ports and roadways.

Growth of e-commerce

Even before the COVID-19 pandemic, the Economist Intelligence Unit had predicted e-commerce in Africa to drive a 3.2 percent increase in retail sales. The pandemic drove even greater economic growth in online goods, which in turn created a promising outlook for warehousing, according to a study by the Mace Group.

Specifically, online sales revenues across Africa increased by more than 28 percent from 2019 to 2020, according to Knight Frank. Furthermore, e-commerce revenue could nearly double to $46 million by 2025 from the 2020 value of $27 billion, creating further private sector demand for warehousing.

Return on investment

Africa’s increasing attraction to foreign investors is driving demand for logistics facilities such as warehouses. As a result, industrial assets such as warehouses offer an average 12 percent yield. That’s double the yield of residential and more than the 9 percent yield of retail or office space, according to Knight Frank.

How to identify potential hidden costs in warehousing

Despite the emphasis on attracting foreign investment, each African country differs in its regulations. That’s why relying on local know-how helps your company figure out how to know if you are getting value for your money in Ghana, Mozambique, and Cote d’Ivoire warehousing.

Careful land management

For instance, leasing warehouse space in an Agility Logistics Park avoids the potential pitfalls of identifying and purchasing the land yourself. The navigation of each individual local market throughout sub-Saharan Africa requires informed decision-making and in-depth knowledge of local regulations. Otherwise, taxes or other fees particular to the chosen location can cause unpredicted cost overruns.

Stability in pricing

Furthermore, land prices are rising due to declining availability of suitable, properly zoned and approved land combined with increasing demand for industrial space. A further advantage of leasing space in a logistics park involves stability in operating expenses, such as electricity or waste management.

Emphasis on operational efficiency

Warehouses that meet international standards also decrease capital costs and boost quality control. Proximity to roads, railways, and ports also helps speed distribution.

How to incorporate best practices for investing in warehousing in Ghana, Mozambique, and Cote d’Ivoire

Best practices in warehousing go beyond physical infrastructure as well as considerations regarding power supply, internet access, and security.

Training local workers

Logistics in Africa have increased employment opportunities in Ghana, Mozambique, and Cote d’Ivoire. In Tema, for example, Agility hires 100 percent of its employees locally. The company offers vocational and technical training to local students to create its own skilled labor force.

Paying attention to the environment

In keeping with the global movement toward sustainability, Agility warehouses meet international environmental standards. For example, Agility uses energy-efficient roof materials. Skylights provide natural lighting and accompany LED and energy-saving bulbs. Solar-powered streetlights and wind-driven roof fans also contribute to energy savings.

Using data-driven solutions

Reliable internet means companies can use technology to improve best practices in warehousing. Artificial intelligence (AI) can save companies time and reduce operating costs. For example, AI can free employees from routine tasks, such as modifying fulfillment orders that come through the warehouse.

How to find the future in warehousing

The prime warehousing and logistics market has seen increased activity in certain pockets of sub-Saharan Africa, notably Abidjan and Maputo, Knight Frank reports. There’s rapidly improving infrastructure and favorable government regulations. It’s important to determine if you are getting value for your money in Ghana, Mozambique, and Cote d’Ivoire warehousing. Contact Agility today for expert guidance on how to capitalize on these emerging markets.

As a logistics hub for the World Food Program, the West African nation of Ghana has attracted attention in areas that support the movement of goods. Warehousing in Ghana has benefited from associated investments from private business as well as public-private partnerships.

With a population of more than 31 million, Ghana ranks as one of the fastest-growing economies in Africa, according to the World Bank’s Logistics Performance Index. Located just north of the equator in West Africa, Ghana’s coast runs 328 miles along the Atlantic Ocean, providing easy access to global shipping lanes.

Ghana channels its exports through two principal seaports on the Gulf of Guinea, which is an embayment of the Atlantic. Tema is located fifteen miles east of the capital city of Accra. Takoradi is in the other direction, about 113 miles west of Accra. In addition, Ghana has four international airports, including Accra’s Kotoka International Airport.

While the COVID-19 pandemic has disrupted economic activity in Ghana and worldwide, it also has forced African nations to find innovative solutions for trade. The continent is undergoing rapid change. After a six-month delay due to the pandemic, the African Continental Free Trade Area (AfCFTA), headquartered in Accra, launched in January 2021.

AfCFTA created the largest free-trade area since the formation of the World Trade Organization. Africa’s 1.2 billion people and combined gross domestic product of $3 trillion now create a single market for goods and services. Aspects of AfCFTA include reductions in tariffs, the free movement of people, and the emergence of new trade routes.

The signatory countries expect AfCFTA to boost trade within Africa and promote industrialization. Like other African governments, the Ghanaian government is determined to drive investment into its logistics infrastructure to support the emerging continental market. This includes improvements to ports, road systems, and warehousing in Ghana.

Benefits to renting warehouse space in Ghana

Several government initiatives have spurred the development of logistics in Ghana since the 1990s.

Investment incentives

 To promote real estate investing in Ghana, the government passed the Ghana Investment Promotion Centre Act in 1994. The act established a government agency (the Ghana Investment Promotion Centre) specifically for encouraging and promoting investments in Ghana. In particular, the agency seeks to provide a transparent and attractive investment environment by facilitating the following:

  • An investor registration process
  • Work and residence permits for employees
  • Import duty exemptions for machinery
  • The acquisition of permits and approvals

Free zones

In 1995 the Ghanaian parliament passed the Free Zone Act, which established the Ghana Free Zones Authority (GFZA). The GFZA regulates certain special areas within which companies can produce, receive, and store goods without paying customs duties. In addition, real estate developers receive an exemption from property tax for their first eight years of operations.

The World Bank has recognized Ghana’s efforts. Its report Doing Business 2019: Training for Reform noted the following improvements:

  • Easing trade across borders: Ghana has improved electronic document processing and submission for imports. Also, it has enhanced customs administration and inspections for imports and exports.
  • Strengthening construction quality control: Ghana has imposed stricter qualification requirements for professionals in charge of inspections.

Location

By virtue of its location, cargo and travelers in Accra can reach Europe or the Americas by air in around eight hours. In addition, Ghana has an underdeveloped inland water transport system with great potential. Lake Volta winds 250 miles past important Ghanaian towns and connects to the Atlantic Ocean. Despite numerous constraints that affect industrial development, cargo ferries and barges carry an estimated 255,000 tons of products every year.

Furthermore, the Ghana Shippers’ Authority (GSA) has completed feasibility studies for warehousing projects at Buipe, a town in northern Ghana. Buipe sits on an inlet of Lake Volta. The GSA hopes to make use of its location to provide warehousing facilities to shippers, especially those from landlocked countries.

New terminals

Ghana has undertaken additional projects to attract logistics providers. For example, in 2016 the Ghana Airport Cargo Center (GACC) opened at Kotoka International Airport in Accra. A public-private partnership funded the 10,000 square meter (108,000 square foot) warehouse. The GACC features high-speed internet as well as solar water heaters and an in-house water filtration plant. The warehouse also has LED lighting and panoramic lifts for handling air freight and other cargo.

In addition, the Ghana Ports and Harbour Authority, a container terminal operating company, and a French logistics firm partnered on a new container terminal in Tema. The $1.5 billion investment increases the access of Ghana to the global trade market.

Infrastructure investment

An additional project focuses on expanding the road between Accra and Tema to a six-lane modern highway. The project is a collaboration between an international container terminal operating company, the government of Ghana, and a nonprofit road safety organization. The project also will improve connecting roads and access points between Tema and inland destinations.

e-Commerce

A report by the McKinsey Global Institute indicates e-commerce activity in Africa could reach $75 billion by 2025. The report designates Ghana as an “emerging” nation in terms of its internet economy and foundations for future performance.

The expansion of e-commerce depends on the availability of warehouses that meet international standards. According to the World Economic Forum, e-commerce logistics requires four times the warehouse capacity of a traditional fulfillment model.

Improvements to warehousing space in Ghana

For years, African countries relied on “godowns” for the storage of goods. A godown functions as a sort of makeshift warehouse that a retailer may use to store its own goods. Godowns lack certain basic features that meet international standards, such as reliable power, internet connectivity, security and protection from weather and the elements.

But as the Ghanaian government recognizes the importance of upgrading infrastructure, it has emphasized simplifying the development of commercial property.

Procedure simplification

The Ghana National Single Window program allows importers and exporters to file all necessary documentation in one place. Previously, a tangled web of paperwork contributed to inefficiencies in logistics management. Centralizing these requirements into one online repository simplifies the process for a logistics company seeking to operate in Ghana.

Warehouse certification

In 2019, the Ghana Commodity Exchange (GCX) launched a program to promote the use of warehouse receipts for trading and financing. After a farmer stores goods in a warehouse, the GCX produces an electronic receipt. The farmer may then use the receipt as collateral to secure a loan or as a commodity for trade.

Warehouse receipt finance has underpinned development of several countries in Africa, most notably Ethiopia, South Africa, and Tanzania. The GCX hopes to see similar growth in Ghana, where agriculture is a key sector of the Ghanaian economy. Agriculture accounts for up to 20 percent of the gross domestic product and 60 percent of employment, according to Ghana Talks Business.

The government of Ghana owns the GCX and provided the setup capital for the warehouse program. The GCX trades contracts for immediate delivery of white maize, yellow maize, sesame, sorghum, and soya bean through several warehouses.

The Ghana Grains Council, an industry association supporting the grains industry in West Africa, lists twelve GCX certified warehouses throughout the country. It also lists twenty-two community warehouses still operating under manual warehouse receipt.

Waste reduction through warehousing in Ghana

The government of Ghana has been working to establish itself as an important gateway to the West African market. Ghana Vision 2020 was the government’s economic plan to promote the flow of foreign capital into Ghana and provide international-quality infrastructure services.

Perishable goods

Globally, about one-third of food gets lost or wasted, according to the Food and Agriculture Organization of the United Nations. In Africa, poorly managed storage contributes to much of this loss.

To reduce waste, modern warehouse facilities in Ghana utilize temperature regulation as well as pest control and security measures. In addition, consolidating warehousing for commodities and agriculture allows local processing to take place in facilities used for storage.

For example, an aviation company developed the Air Ghana Perishable Centre (AGPC). The AGPC has features designed for the handling of perishable cargo designated for export out of Ghana. The facility has a refrigerator measuring 165 square meters (about 1,800 square feet) that can adjust to various temperatures.

In addition, the aviation company manages a 6,000 square meter (64,500 square foot) cargo facility in Accra. The warehouse has an automated storage retrieval system that can store up to 2,800 tons of goods. The facility also has three refrigerators offering various temperature ranges, all of which have sensors and alert systems to protect perishable goods.

Support for small and medium enterprises

A Ghanaian food producer consolidated its operations into a single production location. The company used a support program for small and medium enterprises (SMEs) to move into a ready-built warehouse that meets international standards. Thanks to the SME program from Agility, the company did not have to provide financial guarantees or raise capital. It moved into its new facility with just three months’ rent as a deposit.

Best practices for warehouse space in Ghana

In response to the COVID-19 pandemic, Agility offered free warehouse space to the World Health Organization (WHO). The WHO used Agility warehouses to stockpile medical supplies and the COVID-19 vaccine in Ghana and its other centers.

Setting the standard with Agility Ghana

Agility Ghana operates a forty-five-acre state-of-the-art industrial park in the Tema Free Trade Zone. The Ghana Agility Distribution Park is the first of a planned network of logistics parks Agility plans to build across Africa. The network has already expanded to include logistics parks in Mozambique, Ivory Coast and Nigeria.

Agility has a lease agreement with various types of tenants. Agility rents to multinational companies seeking to enter the market of West Africa. Also, small- and medium-sized Ghanaian companies looking to expand light manufacturing and their import-export businesses have a lease agreement. Agility is building seven more warehouses at the Ghana park, and it offers build-to-suit options for companies with specific requirements for rental property.

Sustaining environmental awareness

All Agility distribution parks meet international environmental standards. For example, the Ghana facility uses an energy-efficient roof and side-insulated panels as well as wind-driven roof fans. For lighting, it has skylights, LED and energy-saving bulbs, and solar-powered streetlights. Agility offers ecofriendly waste management services: the site recycles paper, plastic, metal, and carton waste.

Agility logistics parks also feature laydown yards. These are open spaces within the site to store a wide range of products, from vehicles and engineering components to oil and gas industry equipment. An online stock management system controls the movement of goods in and out of the laydown yards.

Agility’s laydown yards sit inside a separate fence within the Agility outer compound wall and feature constant security monitoring. In fact, all of Agility’s rental property, including the Ghana Agility Logistics Park, feature twenty-four-hour security and reliable power and connectivity. Thus Agility sets an example for quality logistics infrastructure with its warehousing in Ghana.

Investing in the labor force

Beyond the development of physical infrastructure, Agility has invested in human resources. It has developed leadership programs throughout Africa for local employees and university graduates. These programs provide training in management and skills related to logistics. Participants in the program have the opportunity to gain experience by working with Agility in Ghana and around the world.

Contact Agility to find out more about the Ghana Agility Logistics Park. Find out how the logistics hubs that Agility is building across the continent can help your company with a logistics infrastructure that meets or bests international standards.