Mapping success when starting a transportation and logistics business
Everyone is talking about the growing AI or SEO industries, but it’s often overlooked how companies in more “traditional” fields are experiencing an expansion.
The global logistics market is measured in trillions of dollars, and it’s only expected to grow in regions such as the EU and the US. Overall, this competitive field requires far more success than it might seem.
A complete network of different individuals and systems is behind a single track, let alone a whole fleet. However, with access to modern technologies, businesses in this field have some important processes streamlined.
Of course, I won’t say that operating a transportation business is easy because of our technology, but it’s certain that these advancements brought us benefits. This article will help you understand the benefits of innovative technology for logistics businesses.
Basics of transportation business
Logistics businesses encapsulate a wide range of different services and operations. You’ve probably had the opportunity to collaborate with a logistics and transportation business at least multiple times in your life.
There are direct ways in which you might come in touch with them, such as taxi services or delivery. But every item that you come in contact with in a regular retail store has a complex network of logistics behind it.
To break it down, transportation businesses incorporate the processes of transporting, storing, and delivering goods or individuals from point A to point B. While we will cover different types of such businesses later, we can also divide them depending on their areas of operations or whether they transport goods or services.
Personal transport usually operates within smaller areas like cities or different municipalities. On the other hand, local transport usually moves goods within a state or a country, and it’s pretty obvious what global transport does.
The significant advantage of starting a transportation business is its low startup cost, allowing you to start the company without making an initial investment. You can start working with a vehicle you already have if it’s safe and licensed.
Other benefits include the possibility of scaling up or down depending on the situation in the market. Considering the high demand for various types of logistics businesses, you can certainly find the proper niche for yourself.
Risks and disadvantages
However, starting a transportation business isn’t always a piece of heaven. The risks are much higher than they are in digital businesses. I don’t want to sound dramatic, but people’s lives are involved in making the transportation and logistics business function.
You will need to make sure that both your vehicle and the vehicles in your fleet have passed technical examinations, as well as having your driver regular healthcare checks.
Furthermore, in extreme weather conditions, the goods that you’re transporting can get damaged, and you would have to make up for their worth. Ensure that you have multiple types of insurance.
If you’re engaging with global or interstate transportation, you will likely have to obtain certain licenses.
Another important aspect of this business is that you need to plan your scaling beforehand. Expanding your fleet will not only require you to think about the logistics of each vehicle individually but also have the right amount of supporting personnel.
Types of transportation and logistics businesses
As I’ve already mentioned, transportation and logistics businesses cover a wide variety of different services. Before starting your business, you might want to explore the various opportunities.
Trucking services are a common type of business, and they include moving goods across different regions. They are obviously more affordable than air transportation, which is why the majority of goods are transported using trucks at medium distances.
On a local level, many people opt for a taxi service. This is a convenient and easy-to-execute service, but the industry is very competitive. If you decide on a taxi service, you need to research your local market and regulations.
You can be a part of a transportation business even if you aren’t exactly transporting anything. Warehousing services are an important part of the overall process, and you can provide services such as storing and packing goods for companies that engage in other parts of this business.
At the very top of the transportation businesses, we have air transportation. You’re probably aware of the sheer amount of investment that’s required to get into this market. However, this doesn’t mean that you shouldn’t know the bits and pieces that make up this job.
You might have to collaborate directly or indirectly with an air transportation company as a part of your logistics business. For example, cab drivers that operate around airports or transporting goods that arrive from abroad.
Essential steps to success
Every business can be broken down into the essentials. No amount of planning or strategizing can ensure that you will certainly succeed in this business. However, by following some rules and being open-minded, you can certainly have an advantage over your competitors.
With some of the latest software and tools, the process of starting and maintaining a business is much easier than it was ever before.
1) Finding the proper market
Just like in every business, finding the proper market or a niche is an essential step to success. There are thousands of SaaS companies, but only a number of them are offering the proper services that people want.
The same logic can be applied to this field as well. As an entrepreneur, you must explore the market and find the proper place for your business. You might recognize some problems or needs in your local area, or you can explore international markets.
Keep in mind that starting a business that will operate in another country requires a lot of research and consideration.
2) Using innovative GPS apps
Since the transportation industry started growing, the use of GPS was quite common. Furthermore, when GPS became more accessible to individuals via applications such as Google or Apple Maps, many people started using it.
While consumer-grade GPS apps can be quite helpful, there’s still much more thinking and planning for transportation businesses. Before you choose the proper app, you should research a guide to fleet GPS tracking apps and understand the benefits and types of this innovative solution yourself.
Fleet tracking applications can give you a number of different features that will help you optimize your fleet and communicate with them more easily.
3) Optimize fuel and battery usage
An important expense for the transportation business will always be fuel usage. Both drivers and leaders of such companies have struggled to optimize fuel usage. Eventually, we’ve come to electric vehicles, which come with certain problems as well.
Compared to fuel, electric vehicles are a greener alternative, and they usually come with digital features that make the job of managers and supporting staff much easier. With battery intelligence software, you can extend battery life and improve the safety of your vehicles.
With the various ecological benefits that electric vehicles bring, a widespread switch in the transportation businesses can lead to significant benefits for the environment. Veterans in the industry might argue that they already have regular vehicles, but as a startup, you have the opportunity to go green from the ground up.
4) Expand your fleet
Just because you can start this business with a single vehicle doesn’t mean that you should stay in the same place. The transportation business offers you a lot of scaling opportunities, and you should certainly have to keep your fleet in mind.
Plan the expansion of your business in advance and have in mind all the costs that come with each new vehicle. Ensure that your vehicles are good-looking and in good and safe condition, and you won’t have any problems.
5) Hire staff beyond drivers
Drivers aren’t the only staff that a transportation and logistics company involves. Dispatchers, logistic coordinators, analysts, and even marketing specialists are all roles that can be essential in ensuring that your business is working properly or that it’s expanding properly.
Always make sure that you hire responsible individuals who will make processes go smother. Roles such as dispatcher can also be hired remotely.
Combine traditional and innovative methods for success
No amount of secondary methods, such as applications or good communication, will make up for a shipment that was late. Of course, everyone will be understanding of poor weather conditions or unfortunate circumstances, but this should happen rarely.
Innovative tracking applications and smart software are amazing additions to the traditional logistics business, but they can’t outperform poor service. Consider these steps as a recommendation, and you will certainly benefit from them.
Transportation and logistics businesses have a lot of competition, but there are still many opportunities for startups to make their place in this market. Ensure that your fleet is operating safely, get a license, and utilize adequate software, and you will have no problems.