The global pandemic has caused the logistics business to slow down due to border closures around the world. A few companies showed resiliency as they focused on strengthening their core business and enhancing operational efficiencies. This shows that it’s still possible to go into the logistics business in the middle of a pandemic.
But before an entrepreneur should invest in this low-margin type of business, it’s essential to consider a couple of things.
Cost of Opening the Business
The first thing to consider is the cost of opening a logistics business. Entrepreneurs are aware of this since they know the importance of finances in a business. If they don’t have ready capital for the company, they should find a source of funds. It can be a bank loan, business partners, or even through crowdsourcing.
Aside from the fund sources, entrepreneurs should consider the cost of starting the business. The price includes the acquisition of the trucks needed for the company. It also should consider office equipment and supplies.
Additionally, entrepreneurs should also include the cost of acquiring protective equipment for the employees. Since the pandemic is still ongoing, masks, face shields, and other protective gear are necessary. They can also get footwear similar to the safety boots of construction workers to help protect the feet of your employees when they’re moving items in and out of the truck.
Entrepreneurs should also consider the cost of leasing a warehouse. When looking for a suitable warehouse, they should also check the location and security of the area. It wouldn’t be good if the warehouse is located in an area with a high crime rate. In this case, it will require a bigger expense in securing the warehouse.
Entrepreneurs should also look into the expenses associated with operating the business. These expenses include employee salaries, training costs, maintenance expenses, and even toll expenses. Taking these expenses into consideration allows the entrepreneur to set aside the budget to allow the business to run even if it has a few customers at the start. At this time, the company is still marketing itself and finding more customers who will use its services.
Right Trucks for the Business
Choosing the right trucks is important since it’s among the most significant investments in the business. It also enhances efficiency and makes the work of the employees easier. Additionally, the trucks also reflect the image of the company. Using a small van to deliver a huge load does not speak well of the business. It can even be risky for the employees if the load is too heavy for the van.
So. the entrepreneur needs to decide on the type of truck to buy for the business. This allows the entrepreneur to find suitable financing for the vehicle. Getting an average-sized truck can be suitable for businesses that aim to cover shorter distances. But if the entrepreneur wants to go for long-distance trips, a long-haul truck is advisable.
The entrepreneur should also consider the type and volume of load the truck will carry. It is also important to consider the terrain where the truck will pass through. These factors can determine the model of the truck to purchase.
Moreover, courier companies have specific requirements for logistic companies before they work with them. In this case, the entrepreneur should consider these requirements before deciding on the truck to purchase for the business. It’s also advisable to purchase brand-new vehicles since they come with a service plan and full warranty.
Technology for the Business
Using technology in the business is also important to make it easier for entrepreneurs to run the business. Aside from connecting with the customers, logistics apps also allow entrepreneurs to manage their fleet and track the trucks’ location.
Additionally, these apps also allow the business to record, store, and access data about the transport items. They also enhance customer service since some apps offer automatic updates to customers about their shipments’ location.
Major logistics companies are currently using these apps. So it’s also a good idea for the entrepreneur to use similar apps when they start their own logistics business.
Marketing the Business
Entrepreneurs should also consider how to promote and market the business. They can use their assets in their marketing plan to show potential customers what they can offer. These assets include their trucks, warehouse location, and the apps available for the customers to use.
Additionally, the business should also focus on providing a positive customer experience so their customers will put in a good word for the business if their friends are looking for a logistics company.
Starting a logistics company during a pandemic can be challenging. But once entrepreneurs know the things to consider, they can look forward to seeing their business thrive despite the current situation in the world today.