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

Reasons You Should Consider a Career in Logistics

Logistics is one of the most important career fields in the world. Without the planning and execution of the distribution of resources, society as we know it would cease to function and food shortages would cause chaos around the world.

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Every company uses logistics even though full-time logistics managers may not be employed. The work of a logistician begins with bringing in the supplies and raw materials necessary for a business or organization to operate. Inbound logistics are then used in conjunction with outbound logistics to distribute products or services where they are in demand.

If you are thinking about a career change, the field of logistics has much to offer.

Following are the top 10 reasons to consider a career in logistics:

1. New opportunities are opening in logistics.

As the global economy has expanded, logistics has become increasingly important. Outsourcing has provided new challenges and new opportunities in logistics. Estimates provided by the U.S. Department of Labor show that logistics jobs will increase in number by 25.5 percent from 2010 to 2020. This estimate means that an additional 27,800 jobs will have been created in this timespan.

2. Careers in logistics are paying more than ever.

In 2002, the average salary of logisticians was $53,000. Today, the median annual earnings of logisticians is nearly $74,000. Although the salary distribution for the lowest 10 percent was $43,500 in 2010, the top 10 percent were earning over $108,000 per year. The top market for logisticians in the U.S. is Bellingham, WA, where the average annual salary is $96,740.

3. Jobs are available in logistics for people of all education levels.

Logistics may seem like a complicated job that requires an advanced degree, but this depends on which facet of logistics you enter. Truck drivers, warehouse workers and forklift operators are all part of the logistics team, but they are organized and directed by mid-level managers and experienced logistics executives.

4. Advancement opportunities in logistics are plentiful.

Because logistics has so many facets and levels, opportunities for advancement are always available. In addition, the logistics industry tends to promote and train low-level employees to high-level positions rather than hire from the outside. Promotions are commonplace, and the hardest working and most innovative individuals can advance quickly.

5. Logistics training can be provided by the U.S. government.

Many people who enter the field of logistics do so after serving in the U.S. military. Logistics operations are extremely important in the armed forces, and getting positions in supply chain management is rarely a problem. The practical experience provided by four years of military service is often enough for a mid-level logistics position in a civilian organization.

6. Logistics careers can be started anywhere.

Unlike some careers that require you to relocate to a specific area or region, careers in logistics can begin anywhere. Nearly every company and organization has a need for logistics workers and managers. However, a few locations are known as hotspots of logistics activity, including Los Angeles and Chicago.

7. Logistics careers are rarely boring.

The word boredom is not in the vocabularies of most people with careers in logistics. The sheer variety of work always keeps the job interesting, and crossover may occur when one facet is slow but another is bustling. In addition, many companies specializing in logistics deal with a wide variety of materials and goods.

8. Opportunities for women are expanding in logistics.

Logistics careers have traditionally been held by men, but women are becoming increasingly involved at all levels. Many women hold top positions in logistics companies and logistics departments.

9. Logistics is a stepping stone into the field of international business.

Many people who begin a career in logistics find that they quickly gain enough experience with international business to develop new skills or open new opportunities. Learning a second language is much easier when you are working with people who speak that language. In addition, it may be possible to relocate to other countries temporarily or permanently.

10. People working in logistics develop fraternal relationships.

People who have a career in logistics cite their coworkers as one of its great advantages. Logistics can be a demanding field, and those working in it develop a high level of pride in their jobs.

Ref: Supply Chain Digital

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