How to Start a Logistics Company

Logistics companies specialize in the organization, storage, transportation and delivery of their clients’ products. Lean manufacturing companies will outsource the logistics function to decrease costs and increase efficiency in their supply chains. As more companies realize the benefit of operating lean and outsourcing non-core competencies, the demand for logistics service providers will no doubt continue to increase. Knowing how to start a logistics company is the first step to entering this exciting industry.

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Determine the specific logistics services that you will offer your clients. Logistics companies can provide a range of specialized services, including storage, trucking, shipping by sea, air transportation, shipping through the mail and integrated supply chain technology management. Choose services that you are experienced with personally, and those that will give you a competitive advantage over competitors in the marketplace.

Register your business in your state. The process for registering your business varies by state, and according to how you plan to organize your business.

Obtain start-up funds. Logistics companies with a transportation focus generally cannot bootstrap their start-up; significant amounts of money or credit are needed upfront for vehicles, facilities, technology and other equipment. Create a business plan, and present your business model to lenders and investors to obtain the money you need to buy your initial equipment. Consider bringing a partner or two into the business to increase the debt-free resources brought to the table, as well.

Purchase the equipment your suite of services calls for. Purchase enough vehicles and storage space to handle the volume that you expect for the first few years; do not try to start out too small or you may have trouble gaining momentum in the logistics industry. Purchase enough equipment to be able to simultaneously serve several customers at once in the beginning.


Implement supply-chain-management technology. Logistics-management software can help you to track exactly which items from which clients are on which vehicles, as well as show you exactly where each shipment is via satellite tracking. Install long-range communication technology for your drivers, such as CB radios or cellphones, to stay in contact at all times. Implement Radio Frequency Identification tracking technology to gain further control over your shipments, storage and products in the pipeline.






Source: bizfluent

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