Bicycle Empowerment Centre Course Section 3


 Costs of  shipping bikes to Africa, Economic models

As we discussed earlier, there are many groups
now  collecting bikes and  we believe this  base can be easily expanded.  Key is understanding the  economics of the process.  First off, the bikes can be shipped in a customer owned  40 foot high cube container, these cost about $2500US. If   a shipping line container is used, these are ones provided by the  ocean shipping company, it is free. 
Next there are the local charges to truck the container to the port, to  lift it onto a truck etc and this on average is about $1000.  Basically from any port in North  America to any port in Africathe   ocean cost is about $5,000.  Tax’s to get bikes into  African countries keeps going up,  with Kenya being the highest and Namibia the lowest, ranging from  a high of $11,000  to a low of $1,000. On top of these charges, there is the cost of inland trucking to the final destination, once it reaches the closest port and this can  be  as expensive as  the ocean shipping.


For  discussion  purposes, it might cost about $10,000 US to get a container of bikes to an African port and clear them through customs.  With 400 bikes in a container, this  works out to about $25 per bike that the African team has to cover.  T be successful and to create an opportunity, the key is to be able to cover cost and make a profit , or have a supply of bikes to give away to your community, if that is your objective.


Models to fund the shipment of bikes

Bicycles for Humanity started out
providing  bicycles to Community health workers and students having to travel long distances to school.  When bikes were given away free of charge, it was easier for B4H chapters to   raise the funds to cover the shipping.  As the B4H partners in Africa moved more towards a Bicycle Centre model and started selling bikes, it became  increasingly harder to raise funds from donors, since the model was now a pure business model.

B4H Chapters were the only ones that helped cover the cost of shipping, all other group collecting bikes, put
the  responsibility  to fund shipping squarely on the  back of the  group receiving the bikes.  I believe this is the way it should be, or if the  group in the  developing  world can build a great relationship with a donor group, they may get  partial funding.

Since the game has changed and with literally millions of new bikes coming on stream,
those  requiring bikes will need to look at new models to fund shipping.  Over the past 15 years, we have seen many  financial models implemented. Some of the models  begin used are as follows.

1.  Sort the bikes,   clean and fix them up and sell them based on
their  value in the local marketplace,  holding back   a portion of the funds to cover  additional  container shipments.

2.  When the container of bikes arrives sort them at a
facility  near the port
into     size and quality levels.  Exampls, kids, mountain, road or  city cruiser and by quality  fair, good, excellent.   You can then sell them in lots to cover the shipping costs and then the remaining bikes are yours o give away or sell.