The level of globalization we see today and the amount of unplanned goods movements across the borders has forced the modern industrialized nations to come up with significant logistic industries. At this time of relatively low value of dollar, starting up a logistic business is a lucrative option if you know how to start, run and grab opportunities in it. An effective management and transportation network provides logistics business with an extra edge that improves efficiently and reduces monitory expenses.
Logistic industry at present is showing a good growth marked by high demand, but also with growing costs. But with proper control of business, the costs can be significantly reduced with improved profits. To start your own logistic business cost effectively and make it grow potentially follow some expert advices.
Experience is a must
Gaining experience before getting into a business is a wise option because this is the only way you can get familiar with ins and outs of the logistic industry. By working in any reputed logistic firm you will be able to make strong networking with the good companies who can be your future clients. Even otherwise experience is needed in order to create a level of credibility for yourself with clients.
Selection of services
This is one most important element in building a successful logistic solution. Choose your services in a way that they offer you highest demands and profits. The selection of services depends upon the area of, like if you think that investing on equipments like cranes, carts and other lifting equipments would give you a potential market then go for it. But if factories are the potential clients for you then you can invest on packaging equipments, racking, fork lifters etc.
The following services show best profitability and sales and revenues:
- General services related to logistics
- International Distribution
- Cost optimization
- Transportation services
- Storage services
Selecting services and then moving forward will provide you with a competitive edge against other similar firms.
Obtain funding: Starting a business by mortgaging your house is a real bad idea which involves thousands of risks. There are more efficient options available nowadays. Like you can use credit cards, not the regular cards you use for shopping but there are specifically business credit cards. Next you can go for business cash advance, these are kind of business loans but are easy to opt for.
Get licensed: Obtain license on the basis of the mode of transportation you use. Like, for example you need to license yourself with aviation services if you operate through airways or with marine services if your route is sea. I addition to this there is need to get licenses from the state and country higher authorities.
Logistics strategy: There are constant changes in the supply chain management so logistic companies need to be flexible to adapt to the supply chain changes. Strategize your business in such a way that whatever may happen in the supply chain management you will not let it affect the service levels. Due to the cut throat competition in the market it is very difficult for a new industry to own a space but it is quite possible with a little smart work.
While you develop a logistics strategy examine the following components carefully:
- Outsourcing
- Transportation
- Competitors
Lastly, always be careful with your customers in business as choosing clients are different from choosing potential clients. Choosing clients by thinking about your long term growth will be the wisest option.
Originally posted on September 13, 2012 @ 3:28 pm