How to Start a Shipping Business
With the high demand for delivery services nowadays, it's ideal to know how to start a shipping business. Everything people need is already available at the touch of a phone screen or click on a computer. Whatever type of goods a person needs is ...
With the high demand for delivery services nowadays, it’s ideal to know how to start a shipping business. Everything people need is already available at the touch of a phone screen or click on a computer.
Whatever type of goods a person needs is just a checkout button away. Clothes, shoes, food, gadgets, toys, and more products go out to thousands, if not millions, of people every day. If you think that it might be profitable to join the industry, then you’re right.
However, to succeed in the shipping business, you’ll have to consider several points thoroughly.
What type of shipping business?
Let’s break down the different shipping modes for you. Analyze and decide which type you want to pursue.
Ship or sea transportation
- Delivers international cargo from one port to another.
- Holds the most amount of cargos and packages.
- It takes the longest time to reach its destination.
- One cargo ship costs $10 million.
- A ship will cost $11,000 – $19,000 per day to rent.
Road or ground transportation
- Cargos move through trucks.
- Door to door transport.
- Can be a logistics company
- Option to choose between domestic or international shipping. If you want to provide global services, you will have to partner with air and ship freight companies.
- Truck prices are $15,000 to $174,000.
- Renting a truck per day ranges from $80 to $2,800, depending on size and model.
- You’ll need to partner up with an airline for cargo flights.
- Quickest delivery option.
- A cargo aircraft costs $24 million and above.
- Flights cost $37,000 – 450,000 per trip.
- Carries a massive amount of cargo compared to trucks.
- It is optimized to transport heavy-duty material or special cargo like cars.
- Offers faster delivery speed than road transportation.
- You’ll need to partner with a rail freight shipping company.
You’ll also need to think about the types of cargo you want to deliver, as this will help you choose which type of transportation you should select.
Now that you have an idea of equipment costs and what each service entails, you can proceed to the other factors.
What do I need to start a shipping business?
Once you’ve settled on your chosen transportation mode, you’ll have to sort out what you’ll be needing to begin your business.
Determine the organizational structure of your business. Indicate the importance of each department and their tasks, and the like. The planning and assigning of positions are vital because they will show your business’s layout and management flow.
Get all the permits and licenses that your city, state, or country will need for your business to function, like a business permit and export or import permit. Also, check if the employees you will be hiring will need be to be certified.
Starting your own shipping business is very expensive. You’ll be needing several motor vehicles, employees, and storage space, to name a few. If you don’t have the necessary funds to start on your own, you may choose to get a bank loan. The bank will need to check your financial status and other related information to decide whether they will give you a loan.
Another option is to find an investor. You will need to show your business idea and strategies so you can impress an investor enough for him or her to put money into your business. The focus will be your business’s future pay-off.
A considerable part of the expenses will be purchasing vehicles since business operations will be heavily reliant on them. You’ll need to buy cargo trucks, vans, motorcycles, and other related vehicles. Long term durability should be kept in mind when choosing equipment.
Employees are the driving force of every shipping company. From drivers, messengers to customer service representatives, all employees in shipping companies are essential. They reflect your company when handling customers, so it’s best to hire people who are fit for the job. You’ll have to find reliable employees and train them. Capable staff make fewer mistakes and make everything run smoother in the workplace.
Warehouses are a must in the shipping industry. It’s where cargos and packages are received, processed, and held before delivery. You’ll need to rent a large area to keep the items you will be accepting and distributing.
Due to the business’s nature, it’s essential to assure that your clients’ items will be safe in your custody. It’s best to provide insurance for most, if not all, packages if parcels are damaged or go missing.
After specific areas have been taken care of, you will need to ensure that your business will attract and keep clients.
Create a good brand
There are many shipping companies, but only a handful that people trust. Most are overlooked and picked when they are the only alternative available. People usually have a go-to list of shipping companies that they trust. To belong to that list of reliable shipping companies, you will need to create a good and trustworthy company image.
A company’s reputation has a huge impact, it can make or break it, so it must be built up properly and maintained. Your shipping business will need to gain people’s trust by providing consistent quality service. The workflow must be as efficient and effective as possible to avoid delays and mistakes. Should issues arise, the solution should be amiable to prevent clients from having a negative view of the company.
It’s vital to keep in mind that customer feedback has a massive effect on the shipping business. If your clients like your service, they will use it all the time. They will recommend your services to others, and their positive opinion will influence others to try your services.
Entering the shipping business is no different from going into other industries. For you to prosper in this field, and everything else, every service or product must end with your clients’ happiness and satisfaction. Strive for quality, make sure it’s in everything you do, and results will follow.