Your Goods Cost KSh 30,000. Shipping Them to Rwanda Costs KSh 14,000.

A new study from the Kenya Association of Manufacturers shows that shipping costs are swallowing the margins of small exporters. For many SMEs, moving goods across an African border costs almost as much as the goods themselves. And that is before you add border delays and unpredictable transit times.

What the Study Found

The Kenya Association of Manufacturers (KAM) released its Logistics Study Report on March 30, 2026. The study was supported by TradeMark Africa and funded by the UK government through the Foreign, Commonwealth and Development Office (FCDO).

The central finding: logistics costs on intra-African trade routes are so high that they cancel out the gains from the African Continental Free Trade Area (AfCFTA). AfCFTA reduced tariffs across 54 countries. But if it costs more to ship goods than the tariff savings are worth, the agreement does not help small traders.

For Kenyan manufacturers, particularly SMEs, the study found that the ability to access African markets is severely limited by high freight costs, infrastructure gaps, border inefficiencies, and limited options to consolidate cargo.

How the Numbers Stack Up

The study gives concrete figures. For a small exporter shipping goods worth KSh 30,000:

• Rwanda: KSh 14,000 in freight costs
• Nigeria: KSh 17,000
• Qatar: KSh 10,000
• Australia: KSh 38,000

Shipping to Rwanda costs nearly half the value of the goods. To Nigeria it costs more than half. These are not outliers. They are the standard rates SMEs face when moving small consignments.

For a small exporter, shipping goods worth KSh 30,000 to Rwanda costs KSh 14,000. That is 47 cents in freight for every shilling of product value.

For bigger shipments the numbers are similarly stark. Moving a standard 20-foot container from Nairobi to Lusaka costs between USD 3,500 and USD 7,000. Transit time ranges from 8 to 30 days depending on border conditions and disruptions along the route.

Why Small Businesses Pay More

The logistics system was not designed for small businesses. Freight pricing rewards volume. Large companies shipping full containers get better rates. SMEs moving partial loads pay higher per-unit costs and have almost no bargaining power with freight providers.

Border inefficiencies compound the problem. Delays at crossings add unpredictable days to transit times. When a shipment that should take 8 days takes 30, the cost of working capital tied up in those goods rises too.

The study identified three main barriers: high freight costs, infrastructure gaps, and the absence of cargo consolidation mechanisms. Without a way to pool shipments with other small exporters, each SME bears the full cost alone.

What the Report Recommends

KAM and TradeMark Africa propose several fixes:

• Better coordination between border agencies to cut processing times
• Investment in transport infrastructure along key trade corridors
• Cargo aggregation mechanisms so small exporters can consolidate shipments and share costs

One specific proposal is a centralized SME distribution warehouse in Lusaka, Zambia. Small Kenyan exporters could send goods there, pool with others, and share last-mile distribution costs into Zambia and neighboring markets. This kind of hub would give SMEs the same cost efficiencies that large companies get through their own logistics networks.

The full report is available at the KAM website.

Why This Matters

This is not just a Kenyan problem. The same dynamics affect small traders across the continent. If you buy goods from another country, you pay these costs on the import side. If you sell across borders, you pay them as an exporter. Either way, logistics costs eat into what you earn.

AfCFTA was meant to make cross-border trade cheaper. The tariff reductions are working. But tariffs are only one part of the cost. Freight, border delays, and documentation fees are often larger. Small businesses cannot benefit from a free trade area if the logistics system prices them out before they get started.

The study also highlights the unpredictability risk. When freight costs and transit times swing wildly, small traders cannot price their goods confidently. They either price high and lose sales, or price low and lose margin. There is no good option when a shipment can take anywhere from 8 to 30 days.

Conclusion

The KAM study puts hard numbers on a problem that African SMEs have felt for years. Shipping goods across the continent often costs as much as the goods are worth. Until logistics infrastructure catches up with trade agreements, small businesses will keep paying more per unit than large competitors. Cargo aggregation hubs and streamlined border processes are practical starting points. But the fix requires action from governments and logistics providers, not just individual traders.

Sources

• Kenya Association of Manufacturers (KAM) — Logistics Study Report 2026
• Capital FM Business — High logistics costs lock Kenyan SMEs out of African market
• The Africa Logistics — High Logistics Costs Lock SMEs Out of African Markets, New KAM Study Warns
• Xinhua — High logistics costs lock Kenyan SMEs out of African market