DETERMINING THE IMPACT OF HINTERLAND DISTANCE ON SHIPPERS' BUSINESS PERFORMANCE IN LAGOS AND OGUN STATES, NIGERIA

Abstract

The more we understand the sphere of influence port, the better the decision on business location; especially in the hinterland. This study therefore examines the impact of hinterland distance relative to seaport on shippers’ business performance in Lagos and Ogun States, Nigeria. Data were collected through questionnaire survey of 23 publicly quoted manufacturing companies were purposively selected from import-dependent manufacturing sub-sectors namely; Consumer Goods, Industrial Goods and Healthcare Business. Panel Vector Error Correction Model estimation were conducted on a panel data that span for 10 years duration. Study results show that there is an overall significant relationship between hinterland distance relative to Lagos seaports has positive and significant impact on turnover and cost of sales. On the long run relationship, hinterland distance relative to Lagos seaports are likely to negatively and significant impact on business performance of the sampled firms. The study demonstrates that hinterland distance works as an indicator to determine the sphere of influence of a seaport on its hinterland.