Why Start a Logistics or Supply Chain Business?

With the help of today’s technology, it is very easy to create a supply chain business or logistics business, without even leaving the comfort of your home. SCM business may provide additional income to your monthly budget, but, with a bit of care and dedication, it can turn into a full-scale business that enjoys a great deal of success. If you are interested in starting a supply chain or logistics business, then do take the time to read the following aspects, as they are crucial details you need to know if you plan on venturing into this particular business sector.

How to Start Supply Chain Business?

1. Upcoming Trends in Supply Chain Business Industry:

A. The omnichannel method will take over revenue management:

There is an obvious battle between online stores and traditional brick-and-mortar shops, as the latter lost a lot of terrain in the favor of online shopping. Thus, most of them adopted the omnichannel method, with the main purpose of attracting more clients and generating better revenue.

B. Automation and shortage of drivers:

Many companies hope that autonomous cars will soon be safe enough to be released on public roads, vehicles that will solve their driver shortage issue and reduce costs. But, since that is not going to happen anytime soon, one of the biggest challenges of logistics companies is to do their best in attracting sufficient drivers. Without them, it is impossible to record the desired level of performance in the field.

C. The tariffs may change significantly:

Companies around the world take into consideration the modification of current tariffs, something that will significantly change the existing supply chains. It is not known when it will happen and how, although some companies already started re-designing their supply chain so that they will be ready in case of tariffs change and prices go up.

D. Digital technologies still have a lot of say in this industry:

The players in this industry are still very fascinated by the existence and emergence of various technologies, like IoT, autonomous cars, machine learning, and so on, which they regard as the solutions that will make their businesses more effective and successful. Whether this will happen, we will have to see. Although the fascination for technology continues, many companies trying to see how they can use them to improve their performances.

AIMS’ best online MBA in logistics & supply chain management and Training on Supply Chain Management as a Career Path are well-known qualifications to develop the necessary skills that you may need to start a supply chain or logistics business.

logistics business

2. Fundamental Requirements for Starting a Supply Chain Business:

  • You need financial resources for funding your SCM business and perform the required investments;
  • Begin by obtaining all the permits and licenses you need to have such a business;
  • Check out the tax permits in your state, as you will have to cover these as well;
  • Do a thorough research of the market first, which includes studying your competition, to see how they are doing and what they may be missing, so you can come up with something fresh;
  • Come up with a solid business plan, based on your research. You can start out by self-funding your business, but things may evolve slower this way. Consider including necessary factors.
  • You can apply for a loan as well, a supply chain business requiring $250,000 to $300,000 to get started until managing to generate the first funds;
  • Set up an official office for your company;
  • Get insurance that will have the business covered;
  • Hire your first employees in order to start doing business.

3. Personal & Professional Skills That You Must Develop:

  1. Solid analytical and numerical skills;
  2. A good amount of knowledge in business supply chain management;
  3. Attention to detail;
  4. The ability to make good decisions, even in high-stress situations;
  5. Knowing how to be a team player;
  6. The ability to adapt fast;
  7. Excellent interpersonal and communication skills.

You may refer to the detailed guide to logistics management and international logistics and supply chain management for a detailed understanding of logistics and supply chain management.

4. How to Sustain & Grow Your Supply Chain Business?

A. Create a clear map of your business’s supply chain:

You need to have a clear view of the supply chain, this includes seeing the challenges your business and supplies are facing. Each supplier may face a set of risks and to understand these risks will help you make adequate adjustments to the chain so that problems are avoided.

B. Make sure your vision is well communicated:

If you have several shareholders in your supply chain business, make sure that each of them knows and understands your vision. You should do the same with your employees and any other person that is part of your business so that everybody will work in the same direction.

C. Establish good connections with other business leaders in this industry:

It is very difficult to make it on your own, so creating and maintaining good connections with other, more experienced leaders will give you the chance to find the solutions you need to the problems that may arise.

supply chain business

How to Start a Logistics Company?

‍The logistics industry is growing at a rapid pace, and with that growth comes new challenges as well as the opportunity to become an industry leader. Being in such an ever-changing environment requires strategic thinking and adaptability. To stay ahead of the competition, you need to think outside of the box and consider non-traditional business models.


Below is a guide to starting a logistics business from scratch. Follow these steps to create your own logistics company.

Step 1: Determine the type of logistics company you want to build:

Before you begin building your logistics business, you need to determine what type of logistics company you are looking to build. This will help you make the right business decisions throughout the process. There are five main types of logistics companies:

A. Transportation and Freight:

This type of logistics company focuses on moving products from one place to another by truck or rail.

B. Warehousing and Inventory Management:

This company specializes in storing, picking, and packaging goods in a warehouse.

C. Freight Brokerage or Logistics Consulting:

A freight brokerage company matches shippers with the right carriers and deals with customs documentation and other paperwork. A logistics consulting company only advises on logistics.

D. Distribution Centers:

These companies focus on moving products from the manufacturer to the retail store.

E. IT and Software for Logistics:

This type of logistics business focuses on building the logistics technology platform behind the scenes.

Step 2: Choose your company name and determine your branding strategy:

Logistics companies are heavily dependent on brand recognition. Customers will be choosing your company every single time they need to ship a product. Branding is crucial to getting your business off the ground.

  • You will want to spend plenty of time choosing the name of your company as well as its branding strategy.
  • Your company name should be able to resonate with your customers and stand out amongst the competition. When it comes to branding, there are many ways to go about it.
  • You can create a catchy tagline, use a celebrity spokesperson, or focus on the message behind your business. You should also have a look and feel for your logo and website that correlate with your brand.

Step 3: Hire the right team:

A logistics company is only as good as its employees. You will want to put a strong emphasis on hiring the right team members from the get-go. You will want to make sure you hire a balanced team of logistics experts, operations managers, software engineers, and sales representatives.

  • Logistics experts will be responsible for researching the latest shipping and freight trends, creating new routes, and ensuring the company is compliant with all rules and regulations.
  • Operations managers will be responsible for building out the supply chain, hiring and managing employees, and creating the routing and scheduling for the company.

Logistics technology engineers and sales representatives will help create the software and sales strategy behind the logistics technology platform.

  • You will want to make sure you hire the right people from the beginning.
  • You can do this by creating a job description that outlines what skills are required for each position.
  • You can then use a hiring platform to source candidates.

Step 4: Find the perfect warehouse:

If you are starting a warehousing and inventory management logistics company, you will want to find the perfect warehouse as soon as possible.

  • You will want to make sure the warehouse is in a strategic location and has the necessary equipment for storing and picking inventory.
  • You will also want to make sure the warehouse is clean, and well-organized, and features state-of-the-art technology and safety features.

To find the perfect warehouse, you can either work with a third-party logistics company or use an online warehouse marketplace to find a location. Warehouse marketplaces like Flexport and Prologis help connect you with warehouse owners to find the perfect location for your business. You can also use these marketplaces to find suppliers and transport companies to help build out your supply chain.

Step 5: Build out your supply chain and logistics technology platform:

Once you have found the perfect warehouse, you will want to start building out your supply chain and logistics technology platform. You can start by partnering with a third-party logistics provider to help get you off the ground. You will then want to begin researching and building your own technology platform. This platform will be the backbone of your logistics company and is essential for growing your business. Here are a few things you will want to consider when building out your platform:

  • What are the pain points in your industry?
  • What are customers facing?
  • What are their needs?
  • What trends can you see in the industry?
  • How can you get ahead of them?
  • What are the latest trends in logistics technology?
  • What are the benefits?
  • Where can you save money and invest in the future at the same time?

Step 6: Start marketing to build up your network:

Once you have your logistics company up and running, it is time to start marketing to build up your network. You will want to start with a marketing strategy that focuses on building relationships with potential clients and partners. Here are a few ways you can do this:

A. Join a trade association:

Joining a trade association can help you make connections in your industry and get your name out there.

B. Start a blog:

Having a blog that features industry news and updates can help you establish yourself as an expert in the field.

C. Attend conferences and networking events:

Networking is crucial to growing your business. You want to make sure you attend conferences and networking events.

Step 7: Adopt Latest Trends:

It is important to remember that the logistics industry is ever-changing. This means that your company must also be flexible and ready to adapt to the latest trends. When the time comes to scale your logistics company, you will have to make strategic decisions regarding your supply chain, technology platform, and partnerships. This can be challenging, but with the right strategic approach, it can be done successfully. When starting a logistics company, you need to make sure you know what type of company you want to build and hire the right team members. You will also want to find the perfect warehouse and start building out your supply chain and technology platform as soon as possible. Finally, you will want to start marketing to build up your network as soon as your logistics company is up and running.

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