Starting a Business in the Logistics Industry

As e-commerce and a relatively low U.S. dollar fuel international trade, the logistics industry may be a good place to start a new business

I am interested in the logistics industry. Would you please talk about how to start up a freight forwarder company?—P.D., Los Angeles

Broadly speaking, the U.S. “logistics industry” consists of the private companies—freight forwarders, customs brokers, ocean transport, and air cargo intermediaries—that handle the details of importing and exporting goods in this country. At this time of burgeoning international trade, fueled by and by the relatively low U.S. dollar, the logistics industry looks to be a good place to start a new business.

Importing and exporting is a $1.5 trillion annual undertaking, said Damon Schechter, author of Delivering the Goods (Wiley, 2002) and CEO of San Francisco-based shipping and fulfillment firm Shipwire. “The logistics industry is a viable business space with a lot of money changing hands in order to facilitate economic activity,” he said.

Built on Relationships

However, the long-established industry (its industry association, the National Customs Brokers & Forwarders Association of America, was established in 1897) is built around personal relationships and trust. Entering the fray as a new face without existing customers can be a tough proposition. “This industry has been around for hundreds of years. Alexander the Great did his own version of customs clearance. It’s important to work in the industry, be a cog in the wheel, and let someone mentor you in a situation where you can develop trust with customers,” Schechter said.

“Find a market segment to work in: international trade shows, garments, the oil and gas industry, et cetera. It is best to look for clientele where you have a strong background, talent, or affinity. For instance, if you come from the construction industry, it might be best to look for your first clients there because at least you can better understand their needs. Or let’s say your parents were immigrants from Latin America, the Far East, or the Middle East, and you are bilingual. It might be smart to focus on cargo to that region,” said Gary Dale Cearley, executive director of AerOceaNetwork, a freight forwarding and international logistics network based in Bangkok.

Logistics firms typically are run by individuals who have relationships with manufacturers, transporters, storage firms, customs agents, and buyers on both sides of the border. They hire employees who do the nitty-gritty of scheduling space on air cargo or ocean containers and timing the movement of goods from factory to storage through customs checks to final customer distribution by truck or rail. If you can get a job doing that kind of ground work, it would not only give you a close-up view of what these firms do, how each differentiates itself and chooses a specialty, but it would also help introduce you to the clients who use these services.

U.S. Strong in Logistics

“If you can build a level of credibility for yourself with clients, you can make a long-term career in this industry, particularly with the level of globalization we see today and the amount of ad hoc movement across borders,” Schechter said. “One of the core competencies of Americans is logistics. China is hiring every logistics company in the U.S. to train their people to get this kind of work done.”

If you can speak foreign languages or have family or business contacts in other countries, those are additional pluses that you can leverage as you consider opening your own firm. For more information, check the Web site of the NCBFFA, which says it represents nearly 800 international trade companies serving more than 250,000 importers and exporters. The organization sponsors benchmark programs for ocean forwarders and customs specialists and its Web site includes information on how to become a customs broker or an ocean freight forwarder.

Cearley also suggests you look at the Web sites of the Federal Maritime Commission, the Homeland Security Dept., and the U.S. Customs Bureau.

Ref: BloomBerg

Logistics industry – a good place to start a new business

Convincing people that the development of the logistics industry is a scintillating topic is difficult. Bring up supply chain management, cold-chain storage, or international freight shipments and you will probably get a blank stare. But logistics don’t just go round the world—it also makes the world go round, and that’s why some of the world’s biggest tech companies, including Uber, Amazon, and Alibaba, are obsessed with it.

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From Moving People To Moving Things

Uber is spending serious money on mapping and vehicle technology because it’s not a ride-hailing app. It sees itself as a full-fledged logistics network and the company’s experiments with delivery services—including Uber Cargo and UberRUSH show that its specialty may be handling 24/7 last-mile deliveries in congested urban areas.

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Right Here, Right Now

At their core, other on-demand companies like Instacart, Postmates, and DoorDash are also logistics providers that compete to build the fastest and most frictionless connectionsbetween local businesses, delivery staff, and users.

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Drones All Over The Place

Many people thought drone delivery programs were a joke or publicity stunt. Companies still need to overcome technical, safety, and regulatory hurdles, but drones can help e-commerce sellers and logistic providers (like Amazon, Walmart, and USPS) make faster and cheaper deliveries to addresses near distribution centers.

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Enabling E-Commerce In Asia

India and Southeast Asia boost two of the fastest growing e-commerce markets in the world. Unfortunately, they also suffer from woefully underdeveloped logistics networks. Companies using tech to solve that problem include Delhivery and Bangkok-basedaCommerce.

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Chilling Out In China

Cold-chain logistics is the complex process of shipping items that need constant refrigeration, like fresh produce and seafood, over long distances. Chinese e-commerce leaders Alibaba and JD.com are both trying to grow their grocery delivery business, which has notoriously tight margins, and have invested millions of dollars into new temperature-controlled trucks and warehouses.

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Making Freight Less Frightful

International freight shipments are managed with outdated technology, including faxes and emailed spreadsheets. Several startups, including Fleet and Flexport, want to make overseas cargo less hellish for small businesses with tech platforms that make the process as easy as, well, calling an Uber.

Ref: TechCrunch

Business tips – 10 steps to building a successful business

Building a successful business is no easy feat. As a two-time entrepreneur, I’ve experienced the ups and downs of building a company and culture. Aside from my children, however, there is nothing I’m prouder of than the two great companies we’ve built: Likeable Media and Likeable Local. As we celebrate Small Business Saturday, here are 10 simple steps I took to build our first company, and a blueprint you can use to build a business of your own:

1. Find a Trustworthy Partner
In my early 20s, I was working in sales at Radio Disney. I was the No. 1 sales person in the country until this woman came into my office and dropped me to No. 2 in just four months. I was shocked and stunned by her talent and I realized two things: a) I needed to marry her and b) I needed to go into business with her.

In 2007, as we planned our wedding, we realized we couldn’t afford the large NYC wedding we both wanted, so we devised a marketing plan. In July 2007, Carrie and I had an entirely sponsored wedding at a baseball stadium in front of 200 friends and family and 5,000 strangers. We raised $20,000 for charity and $20M in earned media. Everyone was thrilled with the outcome and when our wedding vendors asked us what was next, we thought: “We can’t get married again, so let’s start a company instead.”

While not everyone can start a business with their husband or wife, it really helps to have a truster partner to be #inittogether with. For my second business, for instance, I partnered with my friend of three decades to build our product. Who can you partner with?

2. Create a Strategy and Singular Focus
If you asked me what we did early on in our first business, I’d have told you, ‘What do you need done?” And if you’d asked me how much we charged, I’d have said, “What’s your budget?” While this may have worked early on to help generate revenue, it wasn’t sustainable. Ultimately, too many businesses fail because they don’t have a sound strategy and focus.

I’ve been using Verne Harnish’s one-page strategic plan for both of our businesses. Our management teams meet quarterly to plan the strategy, and believe it or not, thanks to Verne’s tool, we summarize the entire business plan and strategy on just one sheet of paper.

3. Say No to What’s Off Focus

It’s easier to create and plan a strategy and focus than it is to stick to it. But if you’re going to be successful, it’s not just important to say “Yes” to the right things, it’s important to say “No” to the wrong things.

A major turning point in our first business was when we fired Charlie. Charlie was a Greek restaurant owner in Astoria, Queens. A super nice guy, Charlie had us helping promote his restaurant and their special events. But he could only afford to pay us $500 a month — and I knew we couldn’t scale our business if we kept working with people like Charlie. So we fired our own client — and then focused on landing bigger clients who could better help us grow. It’s really hard to say no — but essential, if you’re going to really grow your small business.

4. Find Peer Support

It’s lonely at the top. Seriously, running a business is one the loneliest jobs out there, even if you have a great partner. Nobody really understands what you’re going though. A huge part of our going from $1 million in revenue to $5 million in revenue in three years was my joining Entrepreneurs Organization (EO) in 2010. EO is the world’s largest peer-to-peer network of CEOs, and it’s most important element is monthly meetings with a small group of fellow entrepreneurs called Forum. My Forum of six people has become one of the most important resources in my business and life, my closest friends, and a great support system.

EO isn’t the only game in town though. Here are five great small business peer-to-peer organizations for entrepreneurs to consider, including BNI, Vistage, YPO and YEC.

5. Form a Board of Advisors

You can’t possibly know it all, and even with a great partner and great peers, you can use help in growing your business. While it’s great to have friends and mentors who can help you, I recommend you codify your mentors through the creation of a Board of Advisors.

In 2012, we asked longtime friends and mentors with a wide variety of experience and talent across various focus areas: finance, law, marketing, brand management, and sales. We formed the Likeable Advisory Board and instantly had a group of 11 advisers who we could call on anytime and who met with us formally four times a year to help us grow our business.

We all have friends and mentors with more experience than we have — by forming a Board you can better tap into that experience.

6. Hire Slow. Fire Fast.

“Dave,” said my erstwhile employee of a sales manager I once had, “I don’t care if the guy is putting up big numbers. The guy is doing cocaine in the bathroom with his team.”

When I think back to the biggest mistakes I’ve made as an entrepreneur, they all revolve around hiring the wrong people, or worse yet, keeping the wrong people for longer than they should be around. The employee in the example above, I let go just after that conversation — but it was probably two months after the point at which I should have let him go.

What happens often is, we move too quickly to hire someone and end up hiring the wrong person for the wrong position. Then, even though our intuition tells us we’ve hired the wrong person, we don’t want to accept that fact, so we keep trying to justify the decision, coach that person to success, and/or move him to a new position. This is often more damaging than hiring the wrong person in the first place! The solution? Hire slow, fire fast.

7. Build Great Values and Culture

You and your employees spend more awake time at work than you spend anywhere else, including at home and with your family. So the core values you have and the culture you cultivate at work is absolutely essential to your success and happiness.

We took great care with both of our companies to create core values that would resonate: Amongst them, for Likeable Media: transparency, accountability, and passion; for Likeable Local: obsession for customer success, drive, and continuous improvement. We’ve also worked tirelessly to build culture: retreats out of the office, social events, unique benefits like on-site manicures and massages. The results: Likeable Media has been named to the Crain’s Best Place to Work in NYC for three straight years — and continues to attract the best and brightest people in New York.

8. Build Your Brand

The world of the mobile internet and social media has made it easier than ever before for a small business is “act and look big.” One of our first decisions in business seven years ago was to publish a daily blog. A couple of years later, we had one the most well-read blogs in social media marketing — and that blog didn’t just build our brand — it kept generating lots of leads!

Today, whether it’s on your blog, on Facebook, Twitter or LinkedIn, through online video or pictures, or articles or whitepapers, you have an ability to constantly build your brand — to make your business more credible, more trusted, and more accessible to your customers and prospects. Social media is the great equalizer when it comes to building your brand, and you have a greater opportunity than ever before to make your small business brand BIG!

9. Ask for Referrals

It was late 2011, and we’d hit a wall. New customers weren’t banging down our doorstep, and for the first time ever in business, my wife and I were questioning whether we could continue rapid growth.Then, one of our advisors said, “Have you asked all of your current customers for referrals?”

It seemed so obvious, like so many good ideas after the fact. So we went ahead and asked, and the next thing we knew, we had filled up our pipeline again with strong prospects, that would lead to new closed business and continued rapid growth. The best form of marketing has been and will always be referrals from your current customers, because if you’re doing a good job, they’ll want to help. You won’t have a chance unless you ask.

10. It’s the People, Stupid

Likeable Media and Likeable Local would be absolutely nowhere without our employees, partners, and advisors. Five of the nine steps above involve people. The reality is, your job as an entrepreneur and leader is just three-fold: set the vision and strategy, make sure there’s enough money in the bank to make payroll, and get the right people in the right seats on the bus. The people you hire and fire, partner with or don’t partner with, take advice from or choose not to take advice from — these people will make the difference between success and failure. These people will help you go from 0 to $500K, or 0 to $5 million, or even from 0 to $500 million.

Your people ARE your business. Your people are your future success. Your people are your everything. Now go out there, get some great people together and build that #smallbusiness of your dreams.

Published in collaboration with LinkedIn

Author: Dave Kerpen is the founder and CEO of Likeable Local, a social media software company serving thousands of small businesses, as well as the chairman and co-founder of Likeable Media, an award-winning social media and word-of-mouth marketing agency.

Ref: Weforum