Are you doing research to start a global logistics company? Maybe you aspire to own one of the top 100 logistics companies. Transportation and logistics is connected to the economy. Ask these four questions now...
Thinking About Owning A Transportation And Logistics Company?
Getting into any new industry is difficult if you are a newbie, right? Well, transportation and logistics is one place where it’s not too hard to affirm a spot as a recognized, legitimate business. But staying successful is absolutely the hard part.
If your business plan and recruitment aren't solid from the very first day, you’re going to find yourself in hot water. It doesn't matter if you’re starting your transportation company with just a minibus and some hope - you need to be prepared to face the competition.
It’s a busy, and even tricky, industry you’ll enter. There are some important considerations to make before you get started hauling freight. So, let’s take a look at four questions to answer before starting a transportation and logistics company.
What Are The Costs?
You don't have to be a financial genius for this one. You do, however, need to have a basic idea of the funding you’re going to need when you launch a business of this type. You need to know:
- Where you will find your capital
- The complete list of all startup expenses
- Probable operating costs
- Reasonable salaries for new and future staff
Just to start.
Transportation and logistics operating costs should be realistically known from day one while you are planning the budget. If this is not an area where are feel strong, consider hiring a knowledgable consultant.
What Should My Fleet Look Like?
As a transport and logistics company, your fleet is the key piece of the puzzle. You'll be moving freight that customers depend on your team at both ends of the customer chain.
You don't want to be the company who gets quotes with search deliveries only to have a small van for a large load - it’s embarrassing! You want to establish in advance the types and sizes of loads you will handle.
It's all relative. The smaller loads come with smaller costs, the bigger the fleet, the bigger the costs.
How Do I Secure Financing?
It doesn't matter how you pay for the vehicles, but the cost of financing your transportation and logistics business is ... huge.
You need to understand your finance options and how you plan to purchase your trucks, cabs and tractors, as well as all of the needed related equipment. Options to look at:
- Financial lease options
- Extended rental agreements
- Installment sales (you own the vehicle at the end of the lease)
Also evaluate if you will need funding for startup operating costs, insurance and fuel.
How Available Is Transportation And Logistics Training To Help Get Me Started?
There are indeed accredited training courses to help you. Search first in your local area for opportunities to gain the best qualifications and accreditations.
If you are researching and gaining familiarity in a bootstrapped mode, consider working with a trucking company to get training and secure a position in the industry for awhile to earn some experience.
If you are in a secure funding position, look at your competition and see where they started out. The way you start your business should be strong enough to ensure eventual success and surpass your competition!
These steps will help you get on the road with your business - literally - and allow you to start building a great customer base.
28 Replies
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Do you mind if I quote a few of your articles as long as I provide credit and sources back to your webpage? My website is in the exact same area of interest as yours and my visitors would certainly benefit from a lot of the information you provide here. Please let me know if this okay with you. Appreciate it!
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Hi there, Glad to know you feel the insights on my blog are worthy of sharing with others! I am happy to allow sharing and quoting as long as the actions made support Google guidelines and give ethical attribution. Thank you for visiting my blog and for your your kind question. ~Keri
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“If you are involved in transporting goods, it is essential to have sufficient insurance coverage. This precautionary measure protects you from potential risks such as loss, damage, or delay of goods, allowing you to claim compensation for any financial losses incurred by your business. Having adequate insurance provides peace of mind and ensures a smooth operation for your goods transportation activities.”
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Shahinoor, You’ve shared a quote with us here, so I’m wondering where it comes from. As the words above suggest, insurance is a very smart thing to secure BEFORE launching any type of business … especially transportation and logistics. Thank you for your comment, ~Keri
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I think before starting a new Logistics service we need to compare all the points which is given here.
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Sam, There are many things to consider before starting a logistics service, as you suggest. Glad you feel the points in this article about starting a transportation and logistics company are credible. Thank you for sharing your thoughts, ~Keri
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If you’re moving goods, it’s advisable to ensure there is adequate insurance cover. This safeguards against the risk that goods may be lost, damaged or delayed because you can claim compensation if there’s any resulting financial loss to your business.
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Hi there, You are absolutely correct. There should be appropriate insurance coverage for the freight shipped on trucks, ships and rail. Now that the transportation and Logistics landscapes are changing, it is sometimes confusing. The key is a good service agreement with a reputable carrier that can do what the customer needs. All customers should look to the transportation company or contractor for that. Shippers may also wish to carry some insurance to cover gaps. Brokers and independent truckers are seeing the most pain from regulations at present. Thanks for sharing your thoughts and insights, ~Keri
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I thought it was interesting when you talked about how it is important to evaluate your insurance costs when starting a transportation company. With that in mind, I would think that it would be a good idea for a transportation company to have great insurance for its trucks. Protecting the things that keep a trucking company running seems pretty important.
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Henry, Protecting assets is definitely important, as you suggest. There are insurance companies that specialize in transportation and trucking. They package their coverage to fit the type of operation – TL, LTL, and even logistics companies. Thank you for adding value to this post, ~Keri
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That’s really informative. thanks for sharing
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You have enlightened great insights about transportation and logistics. I think we have to do proper research before hiring any international logistics company, since logistics is one of the most important part of any business.
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In addition to regular inspections, your company’s certifications and licenses may require renewal at various intervals. To stay compliant with legal requirements, and to keep your business functioning smoothly, you need to make sure that these are always up-to-date.
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Merry, You make some very good points! 🙂 Thank you for sharing your thoughts, ~Keri
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When you own a transportation business, you need to start with the future in mind. Although your supplies, vehicles and fleet might be brand new, long-term usage can affect both safety and quality. How will you keep up with routine maintenance to ensure that your customers don’t experience any gaps in service? In addition to regular inspections, your company’s certifications and licenses may require renewal at various intervals. To stay compliant with legal requirements, and to keep your business functioning smoothly, you need to make sure that these are always up-to-date. While it’s easy for the small details to get lost in the shuffle of everyday operations, setting up recurring reminders or putting a specific employee in charge of routine checks can prevent many problems.
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Hi there, You’ve added some good insight to the article! My husband works in transportation, and you’ve made solid points that do apply. A key is developing good systems and having the right people in the right positions. Thanks for sharing your thoughts, ~Keri
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I think beforee starting a Logistics Company we need to compare all the points which is given here.
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Aman, Happy to know you feel this article gives points that should be compared and considered before starting a logistics company. Thank you for your kind words, ~Keri
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Most welcome Mam.
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Hi there, Thanks for your comment, ~Keri
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Thanks for share your knowledge with us.
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Hi there, We are happy to share tips and tactics for business leaders, marketing managers and mobile entrepreneurs. We update the blog often with similar insights, so I hope you will visit again. Thank you for your comment, ~Keri
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Thanks for sharing this informative information.
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Hi there, We are always happy to share helpful insight. Transportation and Logistics is a heavy topic considering today’s economic landscape. Thank you for sharing your thoghts, ~Keri
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Hey, Thank you for sharing this amazing informative article.
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Hi there, Thank you for visiting the blog. Glad you liked this article. I appreciate your comment, ~Keri
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I think these question are very important before starting starting a transportation and logistics company.
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Hi Ritu, Thank you for your comment. Makena at Idea Girl Media
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