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BizReport : Internet Marketing 101 : July 06, 2021

4 Steps to Launching Your Transport Company

Are you about to embark on an exciting venture of starting your own logistics company?

by BizReport

Are you prepared to cope with the challenges that lay ahead as you try to get your startup off the ground? If not, we're about to give you a helping hand with some essential steps that you need to follow before launching a transport company.

Focus On Efficiency
Clients aside, efficiency will be the number one determining factor in how successful your business becomes. Start with the basics of getting a fleet management system in place. Utilize the software to the maximum and you'll enjoy GPS tracking, automated fleet reports, improved safety, better fuel efficiency and improved customer service and satisfaction.

Next, think about how efficient operations are in your back office and what steps you can take to make improvements. Is bookkeeping taking up too much of your time? Are your employees spending time on menial tasks that could be automated? Do you have all the software you need to get insights into every facet of your business operations? These are all things to think about.

Analyze Your Operational Spending Costs
It costs plenty of money to run a logistics company and there's no escaping the big bills that you'll have to pay. Understanding these costs is essential so take some time to make a list of your fixed (rent, insurance, tax etc.) and variable costs (fuel, shipping expenses, cost of raw materials etc.). If you don't know these numbers, you'll never to able to determine whether your business is running at a profit or loss.

Don't Undercut Your Prices
Attracting clients is difficult when starting out in business and it can be tempted to charge the lowest prices to stand out. This is a huge mistake that you'll live to regret. Instead of undercutting your competitors, determine what your operating costs are and what rate you'd have to charge on top to make a healthy profit. Market research will be your best friend here so don't overlook the benefits of getting familiar with your target market and what they would be willing to pay for a premium service. Some of the factors you need to consider in your research include:

- Form of transportation
- Shipping routes
- The quantity and weight of the cargo
- Category of shipping method
- Insurance
- Category of goods
- Time
- Distance
- Your added value

Choose The Right Shipping Method
It's essential to know the differences between the two most popular shipping methods. It can be confusing if you're just starting out so let us explain the difference in simple terms. Less than truckload is a method that combines lots of shipments from different clients. With this option, the clients pay a fee that's based on the weight of the goods or the space that they take up.

For example, if a client's goods take up half of the available space in the truck, they pay for that amount of space. LTL is an ideal option for businesses that have a lot of clients from small-scale businesses. In contrast, Full Truckload Shipping (FTL) is a form of ground freight transportation that enables a company to utilize an entire truck to ship their goods, regardless of the number of items that need to be transported. This option is perfect for large logistic businesses with big clients who need to ship products in large quantities.


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