business plan for logistics department

Logistics Business Plan Template

Written by Dave Lavinsky

Logistics Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their logistics companies.

If you’re unfamiliar with creating a logistics business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a logistics business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Logistics Business Plan?

A business plan provides a snapshot of your logistics business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Logistics Company

If you’re looking to start a logistics business or grow your existing logistics company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your logistics business to improve your chances of success. Your logistics business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Logistics Businesses

With regards to funding, the main sources of funding for a logistics business are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for logistics companies.

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How to write a business plan for a logistics business.

If you want to start a logistics business or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your logistics business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of logistics business you are running and the status. For example, are you a startup, do you have a logistics business that you would like to grow, or are you operating a chain of logistics businesses?

Next, provide an overview of each of the subsequent sections of your plan.

• Give a brief overview of the logistics industry.
• Discuss the type of logistics business you are operating.
• Detail your direct competitors. Give an overview of your target customers.
• Provide a snapshot of your marketing strategy. Identify the key members of your team.
• Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of logistics business you are operating.

For example, you might specialize in one of the following types of logistics businesses:

• Procurement Logistics Business: Specializes in procuring raw materials.
• Production Logistics Business: Specializes in managing the movement of procured materials once in a factory to include product management, packaging, and shipping of final products to a warehouse for distribution.
• Sales Logistics Business: Manages the shipment of products from the warehouse to retailers, wholesalers, and customers.
• Reverse Logistics Business: Specializes in recovering and recycling products and packaging.

In addition to explaining the type of logistics business you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of clients served, reaching $X amount in revenues, or the number of cities served, etc.
• Your legal business structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the logistics industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the logistics industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your logistics business plan:

• How big is the logistics industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential target market for your logistics business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your logistics business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, schools, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of logistics business you operate. Clearly, individuals would respond to different marketing promotions than corporations, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other logistics businesses.

• What types of customers do they serve?
• What type of logistics business are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you make it easier or faster for customers to obtain your services?
• Will you offer services that your competition doesn’t?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a logistics business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of logistics company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide procurement services, production logistics, sales logistics, or recovery logistics services?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the services you offer and their prices.

Place : Place refers to the site of your logistics company. Document where your company is situated and mention how the site will impact your success. For example, is your logistics business located in a busy retail district, a business district, a standalone office, or purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your logistics marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

• Advertise in local papers, radio stations and/or magazines
• Reach out to websites
• Distribute flyers
• Engage in email marketing
• Advertise on social media platforms
• Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your logistics business, including answering calls, scheduling meetings with clients, billing and collecting payments, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to convert your Xth customer, or when you hope to reach $X in revenue. It could also be when you expect to expand your logistics business to a new city.  

Management Team

To demonstrate your logistics business’ potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing logistics businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a logistics business.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your logistics business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a logistics business:

• Cost of equipment and office supplies
• Payroll or salaries paid to staff
• Business insurance
• Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your office location lease or a list of intellectual property you have.  

Writing a business plan for your logistics business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the logistics industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful logistics business.

Logistics Business Plan Template FAQs

What is the easiest way to complete my logistics business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily write your logistics business plan.

How Do You Start a Logistics Business?

Starting a logistics business is easy with these 14 steps:

• Choose the Name for Your Logistics Business
• Create Your Logistics Business Plan
• Choose the Legal Structure for Your Logistics Business
• Secure Startup Funding for Your Logistics Business (If Needed)
• Secure a Location for Your Business
• Register Your Logistics Business with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Logistics Business
• Buy or Lease the Right Logistics Business Equipment
• Develop Your Logistics Business Marketing Materials
• Purchase and Setup the Software Needed to Run Your Logistics Business
• Open for Business

Learn more about how to start your own logistics business .

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Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to learn about Growthink’s business plan writing services .

Other Helpful Business Plan Articles & Templates

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Logistics Business Plan

Both literally and symbolically, logistics businesses are the wheels of the whole global economy. As commodities go from supplier to customer, the transportation and logistics industry plays a crucial role in maintaining the American economy. So, the industry is as rewarding as important.

Need help writing a business plan for your logistics business? You’re at the right place. Our logistics business plan template will help you get started.

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• Fill in the blanks – Outline
• Financial Tables

How to Write a Logistics Business Plan?

Writing a logistics business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready and summarizes each section of your plan.

Here are a few key components to include in your executive summary:

Introduce your business:

Market opportunity:, logistics services:, management team & sales strategies:, financial highlights:, call to action:.

Ensure your executive summary is clear, concise, easy to understand, and jargon-free.

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2. Business Overview

The business overview section of your business plan offers detailed information about your company. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:

Business Description:

• Freight forwarding: These companies transport goods from one place to another for big companies.
• Heavy haulage logistics: These types of companies specialize in transporting heavy goods.
• Courier and delivery services: They deliver goods at local and regional levels for companies and individuals.
• Reverse logistics: These businesses are experts at handling the processes involved in sending products back to the manufacturer from the client.
• Describe the legal structure of your logistics company, whether it is a sole proprietorship, LLC, partnership, or others.
• Explain where your business is located and why you selected the place.

Mission statement:

Business history:.

• Additionally, If you have received any awards or recognition for excellent work, describe them.

Future goals:

This section should provide a thorough understanding of your business, its history, and its future plans. Keep this section engaging, precise, and to the point.

3. Market Analysis

The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.

Target market:

• For instance, if you own a reverse logistics type, then you need to choose the location where people buy products mostly online.

Market size and growth potential:

Competitive analysis:, market trends:, regulatory environment:.

Here are a few tips for writing the market analysis section of your logistics business plan:

• Conduct market research, industry reports, and surveys to gather data.
• Provide specific and detailed information whenever possible.
• Illustrate your points with charts and graphs.
• Write your business plan keeping your target audience in mind.

4. Products And Services

The product and services section should describe the specific services and products that will be offered to customers. To write this section should include the following:

Describe your services:

Mention the logistics services your business will offer. This list may include services like.

• Transportation
• Warehousing
• Distribution
• Freight forwarding
• Customs brokerage
• Packaging and crating
• Tracking and monitoring, and any other services you plan to offer

Describe each service:

Additional services:, quality control:.

In short, this section of your logistics plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

Unique selling proposition (USP):

• For example, excellent customer service, timely delivery, packaging, etc.

Pricing strategy:

Marketing strategies:, sales strategies:, customer retention:.

Overall, this section of your logistics business plan should focus on customer acquisition and retention.

Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your logistics business, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.

6. Operations Plan

The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:

Staffing & Training:

Operational process:, equipment & machinery:.

Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.

7. Management Team

The management team section provides an overview of your logistics business’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.

Founders/CEO:

Key managers:.

• It should include, key executives(e.g. COO, CMO.), senior management, and other department managers including their education, professional background, and any relevant experience in the industry.

Organizational structure:

Compensation plan:, advisors/consultants:.

• So, if you have any advisors or consultants, include them with their names and brief information consisting of roles and years of experience.

This section should describe the key personnel for your logistics services, highlighting how you have the perfect team to succeed.

8. Financial Plan

Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:

Profit & loss statement:

Cash flow statement:, balance sheet:, break-even point:.

• This exercise will help you understand how much revenue you need to generate to sustain or be profitable.

Financing needs:

Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.

9. Appendix

The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.

• Add a table of contents for the appendix section to help readers easily find specific information or sections.
• In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more.These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
• Provide data derived from market research, including stats about the industry, user demographics, and industry trends.
• Include any legal documents such as permits, licenses, and contracts.
• Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.

Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.

Remember, the appendix section of your logistics business plan should only include relevant and important information supporting your plan’s main content.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This logistics company business plan will provide an idea for writing a successful plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our logistics business plan pdf .

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Frequently asked questions, why do you need a logistics business plan.

A business plan is an essential tool for anyone looking to start or run a successful logistics business. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your logistics company.

How to get funding for your logistics business?

There are several ways to get funding for your logistics business, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:

Small Business Administration (SBA) loan

Crowdfunding, angel investors.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

Where to find business plan writers for your logistics business?

There are many business plan writers available, but no one knows your business and ideas better than you, so we recommend you write your logistics business plan and outline your vision as you have in your mind.

What is the easiest way to write your logistics business plan?

A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any logistics business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Logistics Company Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Transportation Industry » Logistics Company

Are you about starting a logistics company? If YES, here is a complete sample logistics company business plan template & feasibility report you can use for FREE.

Okay, so we have considered all the requirements for starting a transport and logistics business. We also took it further by analyzing and drafting a sample logistics service marketing plan template backed up by actionable guerrilla marketing ideas for logistics businesses.

So let’s proceed to the business planning section. If you are looking to start a business that has great prospects, then you should be looking at delving into the logistics business.

This is a very viable business that can make just about any focused person a millionaire. One of the things that you have got to first of all determine is the willingness for you to go into this business. Thereafter, you will begin to do other underground businesses like undertaking a thorough feasibility studies, amongst other things

A Sample Logistics Company Business Plan Template

1. industry overview.

The Freight Packaging and Logistics Services industry is an industry that is responsible for providing packing and crating services primarily for the transportation sector of the economy. The industry comprises of companies that provide consolidation of freight consignments, trade document preparation, packing, crating and otherwise preparing goods for transportation and logistics consulting services.

Some of the key factors that will contribute to growth in this industry include growth in the manufacturing sector, consumption, international trade and also increase in technology reliance will provide new opportunities for logistics consulting and advisory services, particularly for distribution chain networks and logistics. We are not ruling out the fact that technology can also cut some jobs in the industry.

The Freight Packing & Logistics Services Industry is indeed a very thriving industry in most countries of the world. It is a major sector of the economy of the united states and it generates a whooping sum of well over billion annually from more than 6,414 registered and licensed freight packing and logistics services companies scattered all around the United States of America.

The industry is responsible for the employment of well over 31,785 people. Experts project the supermarket and grocery industry to grow at a 1.6 percent annual rate. There is no establishment in this industry that has a dominant market share in the United States.

Research conducted by IBISWORLD shows that packing and crating services that are not directly related to motor vehicle operations account for an estimated 71.7 percent of the industry revenue. Packing and crating encompasses putting freight into various containers, including crates, pallets and plastic wraps.

Many companies also offer specialized services, which includes packaging unique products such as industrial equipment, artworks and weapon systems. Industry players may also offer freight consolidation. Consolidation refers to combining many frequent, small shipments destined for a similar geographical region into a single large shipment to reduce per-unit shipping costs.

This service aims to capitalize on various freight-rate discount programs. No doubt starting and operating a freight packing and logistics Services Company can be capital intensive and challenging, but the truth is that it can be rewarding at the same time.

One good thing about the industry is that it is open for both big time investors who have the capacity to start the business with over a dozen employees from a big office facility and aspiring entrepreneurs who may want to start from a shared office space and a handful of employees.

2. Executive Summary

Spencer JT® Freight Packaging & Logistics, Co is a registered and licensed Freight Packaging & Logistics Services Company that will be based in Fort Lauderdale – Florida.

We are in business to provide services such as packing goods for transportation, crating goods for transportation, and wrapping goods for transportation, freight consolidation, trade document preparation, storing goods prior to and after freight, physical distribution consulting and logistics consulting et al.

Spencer JT® Freight Packaging & Logistics, Co has been able to secure all relevant licenses and permits to operate throughout the United States and Canada. We will ensure that we abide by the rules and regulations guiding The Freight Packaging industry

Our customers and potential customers alike can be rest assured that they will get quality services at competitive rates. We will go the extra mile to ensure the safety of goods under our care and our customers get value for their money. At Spencer JT® Freight Packaging & Logistics, Co our goal is to provide excellent service to our customers and we pride ourselves on the integrity and competence of our company and our employees.

At Spencer JT® Freight Packaging & Logistics, Co we are passionate in the pursuit of excellence and financial success with uncompromising services and integrity which is why we have decided to start our own freight packaging and logistics services business; we are in the industry to make a positive mark.

We are quite optimistic that our values and quality of service offering will help us drive our business to enviable heights and also help us attract the numbers of clients that will make the business highly profitable. We are a company that will be dedicated to establishing good business relationship with our clients giving them value for their money and reasons for them to hire our services over and over again.

We are quite aware that in order to become the number one choice in our city, we must continue to deliver timely and quality services and that is exactly what we will do. We are open to the use of latest technology in The Freight Packaging and Logistics Services industry.

No doubt our excellent customer service and the quality of services we offer will position us to always welcome repeated customers and handle massive deals both from government agencies and industrial giants.

Our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.

We will cultivate a working environment that provides a human, sustainable approach to earning a living, and living in our world, for our partners, employees and for our clients. Spencer JT® Freight Packaging & Logistics, Co is a family business; it is owned by Spencer James Teddy and his immediate family members.

The company will be fully financed by the Spencer JT family. Mr. Spencer James Teddy has a diploma in Transport and Logistics Management, BSc. Business Administration and well over 10 years of hands on experience working for some of the leading in companies in the freight packaging and logistics services industry.

3. Our Products and Services

Spencer JT® Freight Packaging & Logistics, Co is established with the aim of maximizing profits in The Freight Packaging and Logistics Services industry.

We want to compete favorably with the leading freight packaging and logistics companies in the United States which is why we will ensure that every service carried out or related services rendered meet and even surpass our customers’ expectations.

We will work hard to ensure that Spencer JT® Freight Packaging & Logistics, Co is not just accepted in Fort Lauderdale – Florida but also in other cities in the United States of America and Canada. Our service offerings are listed below;

• Packing goods for transportation
• Crating goods for transportation
• Wrapping goods for transportation
• Freight consolidation
• Trade document preparation
• Storing goods prior to and after freight
• Physical distribution consulting
• Logistics consulting
• Packing services for motor carrier and storage services

4. Our Mission and Vision Statement

• Our Vision is to become one of the preferred choices of individual and organization when it comes to the demand for freight packaging and logistics services in the whole of the United States of America and Canada.
• Our mission is to ensure that we build a successful freight packaging and logistics company that will operate in the whole of the United States of America and Canada; a company that will grow to be listed amongst the top 5 freight packing and logistics services company in the whole of the United States of America.

Our Business Structure

Our business structure will be designed in such a way that it can accommodate but full – time employees and part – time / contract staff; those who just want to take some time off to generate additional incomes.

We intend starting the business with a handful of full time employees (documentation officers, professional material handlers / yard spotters and back office staff) and some of the available sales and marketing roles will be handled by freelance marketers. Adequate provision and competitive packages has been prepared for all our employees.

At Spencer JT® Freight Packaging & Logistics, Co we will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders (the owners, workforce, and customers).

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the board of trustees of the company. For now, we will contract the maintenance of our trucks to service provider, we don’t intend to maintain a very large overhead from the onset.

But as soon as the business grow and stabilize, we will assemble our own in – house maintenance team. Below are the business structure and the roles that will be available at Spencer JT® Freight Packaging & Logistics, Co;

• Chief Operating Officer (Owner)

Admin and HR Manager

• Freight Packing and Logistics Manager
• Marketing and Sales Executive (Business Developer)
• Material Handlers / Yard Spotters / Forklifts Operators
• Customer Services Executive / Front Desk Officer

5. Job Roles and Responsibilities

Chief Operating Officer (Owner):

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization

Freight Packaging and Logistics Manager

• Responsible for operating IT systems for the organization, negotiating and agreeing contracts, developing and confirming schedules, planning for and negotiating technical difficulties
• Serves as project manager of the organization; works directly with employees
• Develops strategic plan by studying technological and financial opportunities; presenting assumptions; recommending objectives.
• Accomplishes subsidiary objectives by establishing plans, budgets, and results measurements; allocating resources; reviewing progress; making mid-course corrections.
• Coordinates efforts by establishing procurement, production, marketing, field, and technical services policies and practices; coordinating actions with corporate staff.
• Builds company image by collaborating with customers, government, community organizations, and employees; enforcing ethical business practices.
• Maintains quality service by establishing and enforcing organization standards.
• Maintains professional and technical knowledge by attending educational workshops; reviewing professional publications; establishing personal networks; benchmarking state-of-the-art practices; participating in professional societies.
• Makes certain that the diamond cutting and polishing department perform efficiently, coordinate employee efforts, and facilitate communications between management and technicians
• Ensures that the organization work in line with international diamond cutting and polishing best practices.
• Allocates and records resources and movements on the transport planning system.
• Ensuring all partners in the supply chain are working effectively and efficiently to ensure smooth operations.
• Handles physical distribution consulting services
• In charge of logistics consulting services
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Designs job descriptions with KPI to drive performance management for clients
• Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Defines job positions for recruitment and managing interviewing process
• Carries out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Updates job knowledge by participating in educational opportunities; reading professional publications; maintaining personal networks; participating in professional organizations.
• Oversees the smooth running of the daily office activities.

Marketing and Sales Executives (Business Developers)

• Identifies, prioritizes, and reaches out to new clients, and business opportunities et al
• Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of projects.
• Writes winning proposal documents, negotiate fees and rates in line with organizations’ policy
• Responsible for handling business research, market surveys and feasibility studies for clients
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Develops, executes and evaluates new plans for expanding increase sales
• Documents all customer contact and information
• Represents Jolly Brothers Moving and Storage Service in strategic meetings
• Helps to increase sales and growth for Jolly Brothers Moving and Storage Service.
• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managers with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting for one or more properties.
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the company
• Serves as internal auditor for the company

Material Handlers / Yard Spotters / Forklift Operators

• Responsible for handling packing goods for transportation
• Responsible for handling crating goods for transportation
• Responsible for wrapping goods for transportation
• In charge of trade document preparation
• Responsible for storing goods prior to and after freight
• Responsible for handling packing services for motor carrier and storage services

Customer Service Officer

• Welcomes clients and visitors by greeting them in person or on the telephone; answering or directing inquiries.
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the manager in an effective and timely manner
• Consistently stays abreast of any new information on the organizations’ products and, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries

6. SWOT Analysis

Going by our vision, our mission and the kind of business we want to set – up, we don’t have any other option than to follow due process. Following due process involves hiring business consultant to help us conduct SWOT analysis for our business.

Spencer JT® Freight Packaging & Logistics, Co hired the services of a seasoned business consultant with bias in start – ups in the U.S. to help us conduct a thorough SWOT analysis and to guide us in formulating other business strategies that will help us grow our business and favorable compete in the freight packaging and logistics services industry.

As a company, we look forward to maximizing our strength and opportunities and also to work around our weaknesses and threats. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Spencer JT® Freight Packaging & Logistics, Co;

Our strength are strong management, robust network serves some of the largest population centers in the U.S., size advantages, cost advantages, customer loyalty and strong reputation amongst domestic and industry players. Basically our business is centrally located in a densely populated industrial and residential estate in Fort Lauderdale – Florida; our location is in fact one of our major strength.

Another strength that counts for us is the power of our team; our workforce and management. We have a team that is considered experts in the freight packaging and logistics services industry, a team of hardworking and dedicated individuals.

Our weakness could be lack of finance, cost structure, lack of scale compared to our peers who have already gained ground in the industry.

As a new business which is owned by an individual (family), and we may not have the financial muscle to sustain the kind of publicity we want to give our business. As a new business, we are also quite aware that it will take time for us to build trust with our clients.

• Opportunities:

The opportunities that are available to us as a freight packaging and logistics services company in the United States are online market, new services, new technology, and of course the opening of new markets.

We are centrally located in one of the busiest industrial area in South Dakota and we are open to all the available opportunities that the city has to offer. Our business concept also positioned us to be the preferred choice in Fort Lauderdale – Florida.

The truth is that there are no standard and well – equipped freight packaging and logistics company within the area where ours is going to be located; the closest freight packaging and logistics services company to our proposed location is about 15 miles away. In a nutshell, we do not have any direct competition within our target market area.

Some of the threats that we are likely going to face are mature markets, bad economy (economy downturn), stiff competition, and volatile operational costs.

Other threats that are likely going to confront Spencer JT® Freight Packaging & Logistics, Co is unfavorable government policies, seasonal fluctuations, demographic / social factors, downturn in the economy which is likely going to affect consumers spending and of course emergence of new competitors within the same location where ours  is located.

7. MARKET ANALYSIS

• Market Trends

The market trends as it involves the freight packaging and logistics services industry especially in the United States and Canada is indeed dynamic and at the same time challenging.

But one thing is certain, once a freight packaging and logistics services company can gain credibility, it will be much easier for the company to secure permanent deals / contracts with corporate organizations, big time merchants and warehouse operator et al who are involved in moving goods and materials from one location to another on a regular basis

8. Our Target Market

Our target markets are basically every one (organizations and individual as well who have cause to move documents, goods and materials from one location to another. In other words, our target market is the whole of the United States of America and below is a list of the people and organizations that we have plans to do business with;

• Merchants and Warehouse Operators
• Retailers who would want to move their goods from one locations to another
• Manufacturers (Chemical manufacturers, and Textiles manufactures et al)
• Households who would want to move from one apartment to another
• Corporate organizations who would want to move from one office to another
• Government agencies who have cause to move goods and materials from one locations to another locations
• Churches and religious organizations that would want to move instruments and equipment et al from one location to another
• Non – Profits and Charity organizations that have cause to move goods and materials from one location to another.

Our Competitive Advantage

The competitions that exist in the freight packaging and logistics services industry is stiff simply because anyone that has the finance and business expertise can decide to start this type of business howbeit on a small scale servicing a city or more.

Although, the freight packaging and logistics services industry requires some form of trainings and expertise, but that does not in any way stop any serious minded entrepreneur to start the business and still make good profit out of this business.

Spencer JT® Freight Packaging & Logistics, Co is launching a standard freight packaging and logistics services business that will indeed become the preferred choice of residence of Fort Lauderdale – Florida and in every other location around key cities in the United States where we intend marketing our services.

The business model we will be operating on, ease of payment, wide range of services and our excellent customer service culture will definitely count as a competitive advantage for Spencer JT® Freight Packaging & Logistics, Co.

So also we have a team that can go all the way to give our clients value for their money; a team that are trained and equipped to pay attention to details and deliver parcels and consignments safely, and on time both locally, nationally and international level.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category (startups freight packaging and logistics services companies) in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Spencer JT® Freight Packaging & Logistics, Co will ensure that we leverage on our strength and the opportunities available to us in the U.S. market to generate enough income that will help us drive the business to stability.

We will go all the way to explore every available sources of income in the Freight Packaging and Logistics Services industry. Below are the sources we intend exploring to generate income for Spencer JT® Freight Packaging & Logistics, Co;

10. Sales Forecast

One thing is certain; there would always be individuals and corporate organizations in Fort Lauderdale – Florida and in the United States of America who would always need the services of freight packaging and logistics services companies for the various purposes.

We are well positioned to take on the available market in Fort Lauderdale – Florida and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six month of operations and grow the business and our clientele base beyond Fort Lauderdale – Florida to other cities in the United States of America where we intend marketing our services.

We have been able to critically examine the freight packaging and logistics services industry and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projections are based on information gathered on the field and some assumptions that are peculiar to similar startups in Fort Lauderdale – Florida.

Below are the sales projections for Spencer JT® Freight Packaging & Logistics, Co, it is based on the location of our business and the wide range of services that we will be offering;

• First Fiscal Year-: $240,000
• Second Fiscal Year-: $450,000
• Third Fiscal Year-: $750,000

N.B : This projection is done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and natural disasters within the period stated above. There won’t be any major competitor offering same additional services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

The marketing strategy adopted by Spencer JT® Freight Packaging & Logistics, Co is going to be driven basically by professionalism, excellent customer service, honesty and quality service delivery. We will ensure that we build a loyal customer base.

We want to drive sales via the output of our jobs and via referral from our satisfied customers. We are quite aware of how satisfied customers drive business growth especially businesses like freight packaging and logistics services.

Spencer JT® Freight Packaging & Logistics, Co is a business that is strategically located and we are going to maximize the opportunities that is available which is why we spend more to locate the business in a location that will be visible and enable us to access our target market.

Our sales and marketing team will be recruited based on their vast experience in the industry and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall goal of Spencer JT® Freight Packaging & Logistics, Co.

Our goal is to grow Spencer JT® Freight Packaging & Logistics, Co to become the leading freight packaging and logistics services company in Fort Lauderdale – Florida which is why we have mapped out strategy that will help us take advantage of the available market and grow to become a major force to reckon with in the freight packaging and logistics services industry.

Spencer JT® Freight Packaging & Logistics, Co is set to make use of the following marketing and sales strategies to attract clients;

• Introduce our freight packaging and logistics services business by sending introductory letters alongside our brochure to corporate organizations who into manufacturing, merchants and warehouse operators, households and key stake holders in Fort Lauderdale – Florida
• Print out fliers and business cards and strategically drop them in offices, libraries, public facilities and train stations et al.
• Use friends and family to spread word about our business
• Post information about our company and the services we offer on bulletin boards in places like schools, libraries, and local coffee shops et al
• Placing a small or classified advertisement in the newspaper, or local publication about our company and the services we offer
• Leverage on referral networks such as agencies that will attract clients who would need our customized services
• Advertise our business in relevant magazines, newspapers, TV stations, and radio station.
• Attend relevant expos, seminars, and business fairs et al to market our services
• Engage in direct marketing approach
• Encourage the use of Word of mouth marketing from loyal and satisfied students
• Join local chambers of commerce and industry to market our services.

11. Publicity and Advertising Strategy

Any business that wants to grow beyond the corner of the street they are operating must be ready and willing to utilize every available means (conventional and non – conventional means) to advertise and promote the business. We intend growing our business beyond Fort Lauderdale – Florida which is why we have perfected plans to build our brand via every available means.

We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.

We are set to become the number one choice for both corporate clients and households in the whole of South Dakota and beyond which is why we have made provisions for effective publicity and advertisement of our freight packaging and logistics services company.

Below is the platforms Spencer JT® Freight Packaging & Logistics, Co intended leveraging on to promote and advertise t business;

• Place adverts on both print (newspapers and magazines) and electronic media platforms
• Sponsor relevant community based events / programs
• Leverage on the internet and social media platforms like; Instagram, Facebook , twitter, YouTube, Google + et al to promote our services
• Install our Bill Boards on strategic locations all around Fort Lauderdale – Florida
• Engage in road show from time to time in targeted neighborhoods
• Distribute our fliers and handbills in target areas
• Contact corporate organizations and households and corporate organizations by calling them up and informing them of Spencer JT® Freight Packaging & Logistics, Co and the services we offer
• List our company in local directories / yellow pages
• Advertise our company in our official website and employ strategies that will help us pull traffic to the site.
• Ensure that all our staff members wear our branded shirts and all our trucks and vans are well branded with our company logo et al.

12. Our Pricing Strategy

Spencer JT® Freight Packaging & Logistics, Co has perfected our plans to charge competitive rates since we have minimal overhead compared to our competition in the industry.

We will ensure that we leverage on price to win over customers; our prices will be affordable and negotiable. The fact that our business door is open to both individuals and corporate organizations means that we will have different price range for different category of clients.

We are aware that there are some one – off jobs or government contracts which are always lucrative, we will ensure that we abide by the pricing model that is expected from contractors or organizations that bid for such contracts. As the business grows, we will continue to review our pricing system to accommodate a wide range of clientele.

• Payment Options

The payment policy adopted by Spencer JT® Freight Packaging & Logistics, Co is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Spencer JT® Freight Packaging & Logistics, Co will make available to her clients;

• Payment via bank transfer
• Payment with cash
• Payment via online bank transfer
• Payment via check
• Payment via Point of Sale Machines (POS Machine)
• Payment via bank draft
• Payment via mobile money

In view of the above, we have chosen banking platforms that will enable our client make payment for farm produces purchase without any stress on their part. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash or make online transfer for our services.

13. Startup Expenditure (Budget)

In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your employees are well taken care of, and that your facility is conducive enough for workers to be creative and productive.

This means that the start-up can either be low or high depending on your goals, vision and aspirations for your business. The tools and equipment that will be used are nearly the same cost everywhere, and any difference in prices would be minimal and can be overlooked.

As for the detailed cost analysis for starting a standard freight packaging and logistics services company; it might differ in other countries due to the value of their money. However, this is what it would cost us to start Spencer JT® Freight Packaging & Logistics, Co in the United of America;

• The Total Fee for incorporating the Business in the United States of America – $750.
• The budget for Liability insurance, permits and license – $5,500
• The Amount needed to acquire a suitable Office facility in Fort Lauderdale – Florida for 6 months (Re – Construction of the facility inclusive) – $120,000.
• The Cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al): $5,000
• Cost of accounting software, CRM software and Payroll Software – $3,000
• Other start-up expenses including stationery – $1000
• Phone and Utilities (gas, sewer, water and electric) deposits – ( $3,500 ).
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $120,000
• The Cost of Launching our official Website: $600
• Additional Expenditure (Business cards, Signage, Adverts and Promotions et al): $2,500

Going by the report from our market research and feasibility studies, we will need about $300,000 to set up a standard freight packaging and logistics services business in Fort Lauderdale – Florida.

Generating Funding / Startup Capital for Spencer JT® Freight Packaging & Logistics, Co

Spencer JT® Freight Packaging & Logistics, Co is a family business that is solely owned and financed by Spencer James Teddy and his immediate family members. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the start – up capital to 3 major sources.

Since they are the sole financier of the business, they have decided to adopt the following means to generate start – up capital for the business;

• Generate part of the start – up capital from personal savings
• Source for soft loans from family members and friends
• Apply for loan from my Bank

N.B: We have been able to generate about $100,000 (Personal savings $80,000 and soft loan from family members $20,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and document have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

The future of a business lies in the numbers of loyal customers that they have the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.

One of our major goals of starting Spencer JT® Freight Packaging & Logistics, Co is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.

We know that one of the ways of gaining approval and winning customers over is to offer our freight packaging and logistics services a little bit cheaper than what is obtainable in the market and also to ensure timely and safe deliveries. We are well prepared to survive on lower profit margin for a while.

Spencer JT® Freight Packaging & Logistics, Co will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List / Milestone

• Business Name Availability Check: Completed
• Business Incorporation: Completed
• Opening of Corporate Bank Accounts various banks in the United States: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of All form of Insurance for the Business: Completed
• Renting of office facility and renovation of the facility: Completed
• Conducting Feasibility Studies and market survey: Completed
• Start – up Capital Generation: Completed
• writing of business plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents: In Progress
• Design of The Company’s Logo: Completed
• Graphic Designs and Printing of Packaging Marketing / Promotional Materials: Completed
• Recruitment of employees and drivers: In Progress
• Purchase of the Needed furniture, office equipment, electronic appliances and facility facelift: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business (Business PR): In Progress
• Health and Safety and Fire Safety Arrangement: In Progress
• Establishing business relationship with key players in the industry (networking and membership of relevant organizations and chambers of commerce): Completed

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Logistics Business Plan Template [Updated 2024]

Logistics Business Plan Template

If you want to start a logistics business or expand your current logistics business, you need a business plan.

The following Logistics business plan template gives you the key elements to include in a winning Logistics business plan.

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Logistics Business Plan Example

I. executive summary, business overview.

[Company Name] is a new logistics company located in [location]. Our company aims to provide regional businesses with all their logistics needs. Some of the services we provide include warehousing, fulfillment, and shipping. We are open to serving any businesses within a 100-mile radius of [location], but primarily expect to work with the healthcare, agribusiness, and food and beverage industries.

[Company Name] will provide numerous logistics services to retailers and businesses located within 100 miles of [location]. Some of these services include:

• Warehousing
• Order fulfillment and packaging
• Shipping and transportation services
• 24/7 customer service support

Customer Focus

[Company Name] will primarily service businesses within 100 miles of [location]. Their potential customers are the approximately 100,000 businesses and manufacturers within this region, giving us a large customer base to work with. Though we are open to working with most businesses, some of the industries we expect to serve the most include:

• Agribusiness
• Chemical and Energy
• Food and Beverage

Management Team

[Company Name] is headed by [Founder’s Name], who graduated from [University] with a degree in Business Administration. Prior to starting [Company Name], [Founder’s Name] worked as an operations manager at a freight logistics company for [X] years, where he was able to learn all aspects of the industry, including the operations (e.g., running day-to-day operations) and management (e.g., staffing, marketing, etc.) sides. His experience will be invaluable to the business.

Success Factors

[Company Name] is uniquely qualified to succeed for the following reasons:

• [Company Name] will focus primarily on the local region (about a 100-mile radius from [location]), which is currently underserved.
• We surveyed the target market and received extremely positive feedback saying that they explicitly want to make use of our services when launched.
• The U.S. has a robust business environment with a large number of businesses needing logistics services like ours.
• The management team has a track record of success in the logistics services industry.

Financial Highlights

[Company Name] is currently seeking $1,000,000 to launch. Specifically, these funds will be used as follows:

• Warehouse design/build: $500,000
• Vehicle purchase and maintenance: $200,000
• Equipment and supplies: $150,000
• Working capital: $150,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even

Top line projections over the next five years are as follows:

II. Company Overview

Who is [company name].

[Company Name] is a new logistics company located in [location]. We provide a wide range of essential logistics services, including warehousing, inventory management, and transportation. We are open to serving any businesses within a 100-mile radius of [location], but primarily expect to work with the healthcare, agribusiness, and food and beverage industries.

[Company Name] is headed by its founder, [Founder’s Name], who worked as an operations manager at a freight logistics company for [X] years. During his career, he was able to learn the ins and outs of the logistics industry, including the operations and management sides. Throughout his career, he noticed that the local region was underserved by other logistics companies. He aims to fill this gap by creating a more regional logistics business that serves local businesses.

[Company Name]’s History

[Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].

Upon incorporation, [Company Name] was able to achieve the following milestones:

• Found a business location and signed a Letter of Intent to lease it
• Developed the company’s name, logo, and website located at [website]
• Established the company as a limited liability company (LLC)
• Determined equipment and fixture requirements
• Began recruiting key employees

[Company Name]’s Products/Services

• Supply chain management

III. Industry Analysis

The logistics industry has never been in higher demand. The pandemic has brought about a supply chain crisis, with retail establishments, grocery stores, restaurants, and many other industries still struggling to keep their inventory in stock and fulfill orders quickly. Due to market trends and the supply chain issues of the past few years, millions of people now realize the importance of having a good logistics team to help out their businesses. Therefore, it has never been a better or more crucial time to build a logistics business.

The logistics industry is enormous. According to Allied Market Research, the industry is projected to reach just under $13 billion in the next five years. Furthermore, the industry will see a compound annual growth rate of 6.5% during that time. And with the global supply chain issues, the demand for good logistics and improved supply chain services will not falter anytime soon.

IV. Customer Analysis

Demographic profile of target market.

[Company Name] will serve the local businesses and industries located within a 100-mile radius of [location]. The area is home to more than 100,000 businesses but is still relatively underserved when it comes to logistics services.

Customer Segmentation

Though we are open to working with most businesses and industries, our market analysis shows that we will primarily work with the following segments:

• Healthcare industry : [Location] is home to one of the best healthcare systems in the country. Local hospitals currently depend on other logistics companies that are not local and do not cater to their unique needs. They require special handling of their materials and quick delivery to get essential products for testing and procedures. We can easily provide the local healthcare industry with these services.
• Agribusiness : [Location] consists of a large agribusiness that is essential to the nation’s food supply. This industry needs proper storage for food and equipment and quick shipping to prevent spoilage. Since this is such an important industry, we will work closely with local agribusinesses to provide them with all their logistics needs.
• Food and beverage industry : [Company Name] will also offer storage space and refrigeration to carry perishable and non-perishable food items for local food and beverage businesses.

V. Competitive Analysis

Direct & indirect competitors.

The following logistics businesses offer extensive logistics services nationwide and therefore provide either direct or indirect competition to our business:

Mountainside Logistics Mountainside Logistics serves the logistics needs of specific industries located in or near [location]. They provide warehousing, inventory management, and local shipping services. They also provide 24/7 customer service and aim to create long-lasting relationships with their customers.

Though Mountainside Logistics serves a similar demographic, they only work with a few industries: healthcare, chemical and energy, and technology. Since the only industry we compete for significantly is healthcare, we will still get significant business from industries they don’t serve.

Logistics USA Logistics USA has been in the industry for [X] years, catering to various industries and businesses. They provide logistics services for numerous nationwide and local businesses, dominating a good chunk of the market. Some of the services they provide include warehousing, inventory management, same-day delivery, and international shipping.

Though Logistics USA is a large national competitor, many local businesses are looking for a more regional touch. They feel left behind and unvalued because they are smaller clients. We will work hard to develop long-lasting relationships with our customers so that they never feel unvalued.

Fulfill and Deliver Inc. Fulfill and Deliver Inc. is one of the leading logistics providers in the country. They offer all the logistics services a business could need, from order fulfillment and inventory management to expedited shipping and delivery. For decades, Fulfill and Deliver Inc. has been the dominating logistics company, loved for its convenience and national presence.

Though they are a giant in the logistics industry, they are often criticized for a lack of customer service. Local businesses looking for a more personal and regional touch will be eager to switch to [Company Name].

Competitive Advantage

[Company Name] enjoys several advantages over its competitors. These advantages include:

• Location : [Company Name]’s business is local and will cater to regional businesses.
• Client-oriented service : [Company Name] will have 24/7 customer service and a strong sales team to fully cater to our clients needs.
• Management : [Founder’s Name] has been extremely successful working in the industry and will be able to use his previous experience to provide the best sales and customer service experience. His unique qualifications will serve customers in a much more sophisticated manner than [Company Name]’s competitors.
• Relationships : [Founder’s Name] knows many of the local leaders, business managers, and other influencers within [location]. With his [X] years of experience and good relationships with business leaders in the area, he will be able to develop an initial client base.

VI. Marketing Plan

The [company name] brand.

The [Company Name] brand will focus on the Company’s unique value proposition:

• Client-focused logistics services that treat each client individually and get the job done right the first time
• Service built on long-term relationships
• Thorough knowledge of our clients and their varying needs

Promotions Strategy

[Company Name] expects its target customers to be businesses operating within 100 miles of [location]. [The Company’s] marketing strategy to reach these businesses includes:

Website and Search Engine Optimization [Company Name] will develop a professional website that showcases pictures of the warehouse and the services we provide. It will also invest in SEO so that the company’s website will appear at the top of search engine results.

Social Media [Founder’s Name] will create the company’s social media accounts and invest in ads on all social media platforms. The company will use a targeted marketing strategy to appeal to our target demographics.

Publications [Company Name] will announce its product launching several weeks in advance through publicity pieces in multiple newspapers and publications. Regular advertisements will run to maintain exposure to relevant markets.

Commuter Advertising We will drive attention toward [Company Name] by renting billboard ad spaces along routes or highways that hold heavy traffic. Advertising on heavily traveled commute routes is an opportunity to alert large numbers of businesses of our opening.

Client Referral Programs [Company Name] will create an aggressive client referral program that gives discounts to existing clients for every successful referral.

Direct Mail [Company Name] will blanket businesses with direct mail pieces. These pieces will provide general information on [Company Name], offer discounts and/or provide other enticements for people to use our services.

Pricing Strategy

[Company Name]’s pricing will be moderate, so customers feel they receive great value when working with us. Our customers can expect to receive quality services at a more affordable price than what they pay for larger logistics providers.

VII. Operations Plan

Functional roles.

In order to execute [Company Name]’s business model, the company needs to perform many functions, including the following:

Administrative Functions

• Bookkeeping
• Website and social media maintenance
• Provide customer service
• Hiring and training staff
• General maintenance functions

Inventory and Warehouse Functions

• Stock and organize products
• Fulfill and package incoming orders
• Count inventory often for accuracy

Transportation Functions

• Schedule deliveries and map out routes
• Load and unload trucks
• Deliver products to destinations
• Provide excellent customer service

VIII. Management Team

Management team members, hiring plan.

[Founder’s Name] will serve as the Chief Executive Officer of the company. In order to launch, it needs to hire the following personnel:

• Warehouse Manager
• Inventory Manager
• Administrative Assistants (2 to start)
• Chief Finance Officer
• Head of Marketing
• Transport Manager
• Drivers (6 to start)
• Inventory Associates (6 to start)
• Sales Representatives (3 to start)

IX. Financial Projections Plan

Revenue and cost drivers.

[Company Name]’s revenues will come primarily from the warehouse and transportation fees charged to our customers.

The major costs will consist of salaries, vehicle maintenance costs, and ongoing marketing expenditures.

Capital Requirements and Use of Funds

Key assumptions.

  5 Year Annual Income Statement

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Logistics Business Plan Template

Published Mar.20, 2017

Updated Apr.23, 2024

By: Jakub Babkins

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Table of Content

Logistics business plan for starting your own business

Starting a logistics company can be a bit tricky if you are new to the logistics domain and don’t know the industry’s trends. Logistics is a kind of business that serves as the unit that stores and delivers products to other companies. The scope of logistics is quite broad, and it is not just limited to the boundaries of a region. You may analyze various logistics business plans to gauge the domain you want to tap with your logistics company. 

If you are unsure about how to write a business plan for a logistics company, you can hire business plan experts to write you one. Alternatively, you can use this business plan for transportation service used by Secure Shipments as a reference.

Executive Summary

Starting a logistics business is undoubtedly going to be an expensive and time-consuming investment for you. Therefore, you must enter this domain after preparation.

Our business plan experts will answer your questions regarding how to make a logistics business plan. With years of experience in writing strategic business plans , they will be crafting an economically efficient and revenue-oriented idea for helping you build your own company.

2.1 The Business

Secure Shipments is a registered and licensed Freight Packaging & Logistics Services Company based in Dallas, Texas. It has a business continuity plan for logistics company that enlists services such as packing goods for transportation, crating goods for transport, wrapping goods for transportation, freight consolidation, trade document preparation, storing goods before and after freight, physical distribution consulting, and logistics consulting .

2.2 Management of logistics business

Secure Shipment’s business plan management system includes inbound and outbound transportation management, warehouse management, order processing, inventory control, supply and demand forecasting, and management of third-party logistics service providers .

In this sample, we will include the list of staff that will be hired to assist with all these processes.

2.3 Customers of logistics business

Irrespective of whether you are following a roadside assistance business plan or thinking of having a logistics business; you need to know your target audience. Secure Shipments will serve the following customer groups as its target market:

• Warehouse Operators
• Manufacturers
• Corporate Organizations

Before starting a logistics company pdf on your own, you may refer to this business plan for logistics company used by Secure Shipments.

2.4 Business Target

Our target is to become one of the preferred choices of individuals and organizations when it comes to the demand for freight packaging and logistics services in the U.S and Canada.

Company Summary

3.1 company ownership.

Trevor Scott will fully finance the company. Trevor has a diploma in Transport and Logistics Management and over ten years of hands-on experience in the logistics services industry. His educational and professional experiences helped him create this logistic business plan.

3.2 Why is Secure Shipments being started

Trevor wanted to start a business in which he could earn profit by tapping on the expertise he already possess. He found that the logistics business is an industry that is open for both big-time investors and aspiring entrepreneurs who may want to start from a shared office space. Trevor wanted to use the friendly industrial environment and came up with this business plan for logistics services to enter the venture.

3.3 How the logistics will be started

This logistics business plan sample highlights the steps taken by Secure Shipment to set up its operations:

Step1: Get the Licenses

This type of business needs the right skills and to show the people that you possess rightful knowledge, you need to have written proof. Acquire all the licenses by meeting the registration criteria of your area.

If you plan to expand your business across the boards like Secure Shipments, this logistics company business plan template can prov e very useful.

Step2: Pick a Location

Secure Shipments will be based near the potential customers and commercial area. The area for business would have enough space to park the trucks.

Step3: Research your competitors

Investigate what other service providers are doing. That will help you understand what customers expect and which of the expectations are not still being met. In this way, your business can get an edge. In this logistics business plan pdf, Secure Shipments took note of the current market trends and the existing competitors.

Step4: Write a business plan

Before entering the market, you must write a business plan as it provides you with forecasts for the next five years. A truck driving business plan will help you set objectives and set strategies to meet those goals. 

Step5: Buy or lease a truck

As is the case with vehicles, you have the option to either purchase or lease equipment. Either way, you must first decide what type of freight you plan to carry. Do you plan on only running day trips, or do you want to have a sleeper cabin? Will your first trailer be a van, a refrigerated trailer, or a flatbed trailer? All these things should be decided before you launch your startup.

Services of logistics business 

You should choose a niche in your logistics company business plan so that you can plan all aspects related to it. It can either be related to Food & Beverages, Appliances, or Industrial & Manufacturing. As per this business plan logistics company sample, Secure Shipments will be providing the following services:

• Packaging of goods for transportation

Packaging is a coordinated system of preparing goods for safe, secure, efficient, and adequate transportation. Secure Shipment provides customized packaging as per the client’s requirement to transport it securely. 

• Freight Consolidation

Freight consolidation combines multiple shipments into a single shipping container. As per this logistics proposal template, Secure Shipment will adopt this strategy to provide the service.

• Trade documentation

Trade documentation compiled by Secure Shipment includes the value of the exported/ imported goods, their quantities, detailed contents, delivery conditions, and transport costs. Since Secure Shipment will be expanding its operations in Canada, too, it is essential to complete the trade documentation per transaction. 

• Logistics consultation 

As per this transport business plan , Secure Shipment’s team of logistics consultants will usually be contacted when a customer needs to change their logistics arrangements to facilitate the delivery of their latest business plans or sales forecasts.

If you are confused about how to get into a logistics business and what services to offer, you can download this logistics business plan pdf to get a head start. This logistics business proposal can also be used to get potential investors.

Marketing Analysis of logistics business

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You must understand the market thoroughly before starting a logistics business. It will help you know the level of competition, potential untapped markets, pricing trends, and changing consumer preferences. You may go through this logistic business plan to get an overview of the current market trends and understand how to start a transport business. Understanding the market will help you answer most of the questions related to how to start a logistics business.

5.1 Market Trends

The Logistics Services Industry is very thriving in most countries worldwide. Reportedly, it generates over a billion annually from more than 6000 logistics services companies scattered all around the USA. Hence, keeping in view these trends, you must not worry about the scope if you are starting a small transport business.  

5.2 Marketing Segmentation

Identifying potential customer groups helps you plan for meeting their expectations. as per this logistics company business plan pdf, secure shipments specifies the following groups as its target customers:.

Business plan for investors

5.2.1 retailers.

Retailers with multiple franchises require trucks to transport goods from one place to another. Secure Shipments will sign contracts with retailers across the city and help transport goods to their destination. 

5.2.2 Warehouse Operators

Companies with disintegrated supply chains are expected to sign contracts with logistic companies to transport their goods to the desired destination. Warehouse Operators will be transporting goods and services to the retailers through Secure Shipments. To facilitate them, we plan on offering customized packaging and on-time deliveries.

5.2.3 Manufacturers

Like warehouse operators, manufacturers need logistic facilities to transport their goods to retailers in the market. If you are starting a small transport business, manufacturers are the most promising target market.

5.2.4 Corporate Organizations

Given the increasing number of logistical choices available to competing companies, organizations look for the cheapest and the most reliable options to transport their goods to the market or the raw materials from the suppliers to themselves. while focusing on starting a small transport business, secure shipments promises to offer flexible rates to organizations along with secure transport services., 5.3 business target.

• Sign contracts with 35% of the retailers in the city for transportation for their goods.
• Purchase five new trucks within two years of business operations.
• Maintain a CSAT score above 90.
• Hire and train new CDL drivers as the business expands.
• Capture 33% of market share, concentrating on the wholesalers.

5.4 Product Pricing

Secure Shipments will ensure that it leverages on price to win over customers; our prices will be affordable and negotiable. You may use the same pricing strategy if your business plan for logistics company is identical to Secure Shipments.

Market analysis by Secure Shipments can help you understand how to set up a logistics company .

Marketing Strategy of logistics business

The marketing strategy adopted by Secure Shipments will be driven basically by professionalism, excellent customer service, honesty, and quality service delivery. We will ensure that we build a loyal customer base. While thinking about how to start your own logistics company, it is essential to study the existing competition in the market, come up with a unique selling point and have relevant sales strategies.

6.1 Competitive Analysis

• We use an advanced, well-integrated system to manage the route data in real time.
• Secure Shipments will use innovative ways to optimize the operations.
• We offer flexible freight rates to our long-term clients.
• Our location is one of our competitive edges.

6.2 Sales Strategy

Since sales of the service generate revenue, sales strategies should be the prime focus of logistics in the business plan.

• Introduce our business by sending introductory letters to stakeholders in the construction industry, manufacturing industry, oil and gas industry, and timber merchants.
• Create different packages for different categories of clients to work within their budgets.
• Request referrals.
• Advertise our business in magazines and newspapers.

The monthly and yearly expected sales are given below in this guide on how to start a small logistics company.

6.3 Sales Monthly

6.4 Sales Yearly

6.5 Sales Forecast

Personnel plan of logistics business

We intend to start the business with a handful of full-time employees. Adequate provision and competitive packages have been prepared for all our employees. Costs attached with salaries and appraisals are mentioned in this logistic business plan . It will give you an idea of the average costs of human resources and insights on how to open a logistic company.

7.1 Company Staff

Under this dump truck company business plan , these positions will be hired for:

• 1 Logistics Manager
• 5 Truck Drivers
• 4 Business Developers
• 6 Technical Assistants

Read this business plan thoroughly to address your questions regarding how to start a logistics company.

Financial Plan of logistics business

In setting up any business, the amount or cost will depend on the scale of your business. If you intend to go big by renting a place, you will need a good amount of capital as you would need to ensure that your employees are taken care of. The costs for making the facility conducive enough for workers to be creative and productive are also going to be high. Before figuring out how to set up a logistics company, you need to check the availability of your funds.

Secure Shipments’ logistics business plan reveals that the business is solely owned and financed by Trevor and his immediate family members. The finances required to set up this business will be similar to a business plan for taxi service that is started on a large scale. 

8.1 Important Assumptions

8.2 Break-even Analysis

8.3 Projected Profit and Loss 

8.3.1 profit monthly.

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

8.3.4 Gross Margin Yearly

8.4 Projected Cash Flow

How do you write a logistics business plan?

While writing a business plan for a logistics company, you need to take note of the following:

• Have Reliable and Good Suppliers. 
• Optimize Inventory Management.
• Integrate the Company Divisions.

Meet Deadlines and Keep your Word.

What is logistics in the business plan?

Logistics is about delivering the products from where they are being made to where they are used. A logistic business plan pdf includes sales and marketing analysis forecasts for the next five years. 

Is a logistic business profitable?

Running a transport and logistics business can be profitable, as reflected by this logistics business plan sample pdf.

What are the 7 steps of a business plan?

A business plan addresses concerns regarding how to start logistics business. The 7 steps to making a business plan include drafting:

• Step 1: Executive summary
• Step 2: Business description. 
• Step 3: Market analysis. 
• Step 4: Company organization.
• Step 5: Products or services provided.
• Step 6: Financial outlook. 
• Step 7: Operational Summary.

Download Logistics Business Plan Sample in pdf

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Business Plan Template for Logistics Professionals

• Great for beginners
• Ready-to-use, fully customizable Subcategory
• Get started in seconds

If you're a logistics professional looking to take your business to the next level, you need a solid plan in place. ClickUp's Business Plan Template for Logistics Professionals is your one-stop solution to streamline your operations and boost your success!

With this template, you can:

• Develop comprehensive strategies to optimize your logistics processes
• Set clear goals and track your progress towards them
• Allocate resources efficiently to maximize productivity and minimize costs
• Forecast financial projections to make informed decisions
• Outline operational processes to ensure a smooth flow of goods and services throughout the supply chain

Take control of your logistics business with ClickUp's Business Plan Template and achieve your goals with ease!

Business Plan Template for Logistics Professionals Benefits

A Business Plan Template for Logistics Professionals offers a range of benefits to streamline logistics operations and optimize supply chain management:

• Provides a structured framework for developing comprehensive strategies and setting clear goals
• Helps logistics professionals allocate resources effectively to maximize efficiency and minimize costs
• Allows for accurate forecasting of financial projections, aiding in budgeting and financial planning
• Outlines operational processes, ensuring smooth coordination and collaboration among different stakeholders in the supply chain
• Enables logistics professionals to identify potential risks and develop contingency plans for seamless operations
• Facilitates communication and alignment with key stakeholders, such as suppliers, vendors, and transportation partners

Main Elements of Logistics Professionals Business Plan Template

ClickUp's Business Plan Template for Logistics Professionals is designed to help you streamline your logistics operations and achieve your business goals. Here are the main elements of this template:

• Custom Statuses: Track the progress of your business plan with statuses such as Complete, In Progress, Needs Revision, and To Do, ensuring that each task is properly categorized and prioritized.
• Custom Fields: Utilize custom fields like Reference, Approved, and Section to add specific information and attributes to each task, allowing you to easily organize and filter your business plan tasks based on relevant criteria.
• Custom Views: Access multiple views tailored to your needs, including Topics view to focus on key discussion points, Status view to monitor task progress, Timeline view to visualize project milestones, Business Plan view for an overview of your entire plan, and Getting Started Guide view to help you navigate the template and get started quickly.

With ClickUp's Business Plan Template for Logistics Professionals, you can effectively manage your logistics operations, set goals, and forecast financial projections to ensure the smooth flow of goods and services throughout your supply chain.

How To Use Business Plan Template for Logistics Professionals

If you're a logistics professional looking to create a solid business plan, follow these steps using the Business Plan Template in ClickUp:

1. Define your vision and objectives

Start by clarifying your vision for your logistics business and setting specific objectives that you want to achieve. Do you want to expand your client base, improve operational efficiency, or increase revenue? Clearly defining your goals will help you stay focused and create a roadmap for success.

Use the Goals feature in ClickUp to set and track your business objectives.

2. Conduct market research

Before diving into your business plan, it's essential to gather data and insights about the logistics industry. Research market trends, analyze your competition, and identify your target market. Understanding the market landscape will help you make informed decisions and differentiate your business from competitors.

Use the Table view in ClickUp to organize and analyze your market research data.

3. Develop your business strategy

Based on your market research, outline your business strategy. Identify your unique value proposition, pricing structure, marketing and sales strategies, and operational processes. This step will provide a clear roadmap for how you will achieve your objectives and position your logistics business for success.

Use the Board view in ClickUp to visually map out your business strategy and track progress.

4. Financial planning

No business plan is complete without a comprehensive financial plan. Outline your startup costs, projected revenue, and expenses. Include details about funding sources, such as loans or investors, and create a realistic financial forecast for the first few years of your logistics business.

Use the Gantt chart in ClickUp to create a timeline for your financial projections and track your progress against your goals.

By following these steps and using the Business Plan Template in ClickUp, you'll have a comprehensive and actionable plan to guide your logistics business towards success.

Get Started with ClickUp’s Business Plan Template for Logistics Professionals

Logistics professionals can use the Business Plan Template for Logistics Professionals to streamline their strategic planning and optimize their logistics operations.

First, hit “Add Template” to sign up for ClickUp and add the template to your Workspace. Make sure you designate which Space or location in your Workspace you’d like this template applied.

Next, invite relevant members or guests to your Workspace to start collaborating.

Now you can take advantage of the full potential of this template to create a robust business plan:

• Use the Topics View to organize your business plan into different sections and topics for easy navigation
• The Status View will help you track the progress of each section and topic, with statuses like Complete, In Progress, Needs Revision, and To Do
• Utilize the Timeline View to set deadlines and visualize the timeline of your business plan
• The Business Plan View provides a comprehensive overview of your entire plan, allowing you to assess the big picture
• Create a Getting Started Guide View to provide a step-by-step guide for implementing your business plan
• Customize the template by adding custom fields like Reference, Approved, and Section to include additional relevant information
• Update statuses and custom fields as you make progress and receive approvals to keep stakeholders informed and ensure accountability.
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Ownr Blog  > Ownrship 101  > Business Stages  > Before You Start  > How to Start a Logistics Business

How to Start a Logistics Business

Logistics is a complex part of a business that many companies, especially the smaller ones, outsource. Everything from managing inventory to warehousing items can be done by third-party providers, instead of manufacturers or retailers. The reason is it cuts costs and, quite frankly, makes their business operations easier. As eCommerce continues to boom and the barrier to entry remains low, creating a transportation or logistics business could be your next great idea.

So, whether you’re considering opening up a small local package delivery business or picturing your future as an international shipping magnet, every logistics business has to start somewhere. Here’s what you need to know about how to start a logistics business today. 

• What is a logistics business?

Logistics companies help their clients move goods from one place to another. Some cover the entire journey from pick-up to delivery to the end-user, while others help with part of the process—such as transportation, warehousing, packaging , shipping, or even disposal. 

While the logistics industry might seem like a product of the internet age, the truth is companies, governments, and individuals have been moving stuff around since pretty much since the dawn of time. Before it was big shipping rigs and long-haul truckers, it was railroads, and horse and buggy.

This industry plays a real role in almost everyone’s life. Whether you’re a home decor dropshipping business or an individual ordering something from Amazon, logistics is the unsung hero that makes sure things get to where they need to be quickly and efficiently.

• Types of third-party logistics companies

Logistics is a large umbrella term for any service that helps get goods from their point of origin to the point of consumption (and beyond). These companies plan, implement, and control the movement and storage of goods and services, on behalf of their original providers. A single logistics company might handle all aspects of the supply chain function, or they might simply handle one piece. 

• Freight carriers or transportation companies

Freight companies are involved in the actual movement of goods from A to B. They will typically specialize in local, domestic or international movement, depending on what kind of transportation they provide and goods they service. 

Examples of freight companies include:

• Trucking companies : Both short and long-haul truckers (and everything in between) play a big role in getting a product to where it’s going, especially on the first and last legs of a freight’s journey.
• Rail services : Train transportation is the most efficient way to move goods across land because they can offer fast service and can often move bulk goods at lower costs.
• Ocean freight carriers : Freight movement via the ocean is a popular choice for lower budgets that can deal with flexible arrival due to the considerable amount of time it can take for a ship to move across international waters. 
• Air freight carriers : Air transportation companies can move goods internationally or domestically. Moving freight through the air is considerably faster than via the ocean, but it’s often more costly.

Carriers are often third-party logistics providers sub-contracted by freight forwarders to handle a specific part of a freight’s journey. A single shipment from Japan could make its way to Canada via ocean liner, get picked up by truck at port and dropped off at a train station. From there, the railroad can take it swiftly across the country where it will be collected by another truck to be dropped off at a retail store.

Even though each of these transportation companies work separately but together to move goods fast and efficiently, they are often separate companies. This means each logistics firm specializes in a specific form of transportation.

• Freight forwarders

Freight forwarding companies play a more consulting role in the logistics industry. They don’t get involved in moving goods or services themselves, instead they help their customers find the most efficient and affordable way to get their products where they need to be.

Forwarders can also help deal with complex pieces of moving goods like customs and import/export paperwork, coordinating efficient handling and delivery, and negotiating lower courier rates. These functions can be handled in-house but are often contracted to a forwarder because they can handle the process smoother and at a cheaper cost, even considering their fee.

• Warehousing companies

When your goods arrive somewhere but have to wait to be sent somewhere else, they need a place to stay—like a hotel, but for your goods. Warehousing companies provide a safe space for goods to wait to be shipped out for the next stage of the process.

Amazon is a good example of a warehouse provider. While they house their own goods, they also offer the option for Amazon sellers to ship their goods to Amazon and have them housed and shipped along with their Prime service. This helps smaller businesses that don’t have warehouses of their own cut costs.

• Distribution management companies

While there are many companies that handle a portion of the distribution process, distribution management companies handle the entire thing for their clients. From finding vendors and suppliers, to manufacturing, packaging and shipping goods. It’s the bigger, more comprehensive version of a freight forwarder.

Every company that makes and sells goods adopts some form of distribution management strategy to make the process easier and more efficient. But those that contract to a management company remove that process from their plates and take a more hands-off approach on the logistics experience.

• Logistics technology companies

While a logistics tech company might be a bit more technology-driven than logistics based in the minds of many, they still serve an important purpose.

Companies in the logistics technology space aim to solve a particular problem that can ultimately help make the entire process more effective, efficient, and cheaper. Examples include inventory management, reverse logistics (AKA returns), and shipping and receiving software.

• Why start a logistics business?

Logistics businesses come with a high potential for profitability but to start, you’ll need a reasonable capital investment. The potential to profit often outweighs the initial expense. Unlike a game development company where there are also upfront costs but the likelihood of profit can vary, logistics companies make money, they simply do.

There is a large prospective client market for the logistics industry, there are thousands of customers out there—anyone who needs to move goods from A to B could be on your roster. Plus, the retention rate is high—it can be really expensive to replace a provider of that magnitude, so as long as the logistics experience is good and the job is done, you should be able to develop a predictable income stream from long-term clients. 

Most logistics businesses also have a simple business model that’s flexible and ready-to-scale. You can start with driving a single truck and move your way up to transportation mogul when you’re ready. Or grow from a one-person package delivery service to a small fleet of drivers and become a local Amazon Delivery Service Partner . Because of the variety of business types, the industry has incredibly low barriers to entry—you just need to define your business model, build a plan, and be ready to work hard. 

• Disadvantages of logistics businesses

It’s not all butterflies and rainbows though, and there are a few downsides to running a logistics business. These types of industries tend to have high employee turnover, making staffing an issue, along with higher overhead expenses and lower margins.

There is also a much longer sales time when it comes to developing business. This means your sales machine really needs to continue to move, even if you have a full client roster. Finally, security issues, including data and product loss, plague all modern businesses.

• How to launch your logistics business
• 1. Decide on your logistics niche

The first step to starting a logistics company is picking your niche. There are a lot of choices out there, so it’s important that you choose the best one for you based on your skill set, interests, and budget. 

Budget is a major consideration in logistics—there is a big difference in the start-up costs of a trucking company and an ocean freight shipping firm. You could pay more than a million dollars for a second-hand ocean freight carrier, whereas a single long-haul truck can be snatched up for $200,000.

Beyond that, you need to determine where you’ll operate. Are you local? National? International? This will dictate the kinds of licenses and paperwork you’ll need. 

With the increased reliance on online shopping, logistics is a popular industry. But you still need to build yourself a solid business plan before you get started. Especially if you need to access funds. 

The possibilities are nearly endless, but there’s a logistics option for almost any budget, skills, and interest. Some ideas include:

• Owner/operator of a trucking operation: This is a great choice for the budding entrepreneur who wants to have more autonomy in their working life but isn’t ready to start a full-fledged firm yet.
• Local courier services: Ideal for those interested in labour-focused logistics and want to remain in a large urban area. You can go for something with lower overhead costs like a court-running service (delivering paperwork to and from the court) or go big with a FedEx-style operation.
• Freight-forwarding services: If administration, attention to detail, and negotiation are your strengths, then a business arranging the best deal with the most efficient service might be for you.

Whether you want to be a single-person corporation or you want to build something bigger, there’s a solution for you.

• 2. Get your finances in order

With your plan in place, you need to get your finances in order. You’ll need some serious budgeting skills or access to someone who can provide them. 

The amount of money you’ll need, along with what you can expect to make annually, will depend on the type of services you plan to provide, and your current resources. Running a one-man trucking business is very different from becoming a shipping magnet. 

• 3. Obtain the proper licences 

You want to legally operate your business. That means you’ll need licences and a legal business set-up. You’ll need to think about things like document management, taxes, and payroll. 

The exact things you’ll need to run your business will depend on what niche you’re in and the jurisdictions you’re operating in. It’s important to point out that you’ll need to be fully licenced in all the jurisdictions you’re planning to operate in. That means if you’re providing international services, you need to look into border crossings and operating in multiple countries. 

You’ll also need to figure out whether you want to operate a corporation or as a sole proprietorship . Considerations like tax benefits and liability need to be thought about.  

• 4. Create a business plan

Building a solid business plan is an incredibly important part of starting a business. While there are plenty of businesses that get started without one, going at it without a roadmap is a great way to get lost.

Don’t overthink your business plan, simple is best. Use planning as an opportunity to grow your business on paper—decide how you’ll make your money, get clients, and figure out what kind of help you’ll need.

A business plan is also key if you’re planning to get business funding . Many logistics companies need a good chunk of change to get off the ground, and your business plan will help to secure that.

• 5. Get clients

Marketing is critical to the success of all businesses, everyone needs clients in some shape or form. But developing a business in the logistics industry can be a lengthy process—it’s not as simple as throwing some money at Facebook Ads and waiting for the leads to roll in.

Contracts and partnerships in the logistics and transportation industry tend to be of high value. This means you need an in with the companies that require those services and a way to prove you’re the best choice to fulfil their requirements and meet their budget. 

Because this process can be time-consuming and might require face-to-face sales talks, start sooner rather than later. You can also consider approaching freight forwarders as potential clients as well.

• 3 common logistic company start-up mistakes to avoid

Here are three common mistakes you should avoid when starting your logistics business.

1. Forgetting about neighbouring jurisdictions

When freight gets delivered across a border—interprovincial or international—the rules and regulations of both jurisdictions must be met. For example, if a truck is headed from Calgary, Alberta to Mexico City, Mexico, a direct route will mean travelling across two international borders, and at least 10 different provincial or state borders. 

As the business owner, it’s your responsibility to ensure that everything is properly licenced and coded so you’re not violating any rules, otherwise you could find yourself in some legal hot water. 

2. Skipping the insurance

No start-up entrepreneur should breeze past the insurance section of the business. But if you are in transportation and logistics, this big no-no can turn into a catastrophic mistake if something bad happens.

When you run a transportation and logistic business, you need to think about the implications of handling someone else’s freight, having drivers on the road, and even passengers on board. Insurance is important.  

3. Not using contracts and waivers

Contracts and waivers are there to protect you and your business, and not using them is a fast way to harm your business. From unpaid work to unfulfilled promises and increased liabilities, not having waivers and contracts in place can quickly cost you a lot of money. Plus, they simply make everything look more professional. 

• Get starting planning your logistics business today

Is running a logistics business in the cards for you? If you’re ready to jump on this business opportunity, there’s never really been a better time to step into the entrepreneurial space (except maybe when they were creating lightbulbs and toasters for the first time, but that ship has long sailed).

Whether you’re ready to start your life as a supply chain consultant or are itching to plant the seeds of a local transport business, Ownr can help you take the next step.

This article offers general information only, is current as of the date of publication, and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by RBC Ventures Inc. or its affiliates.

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50 expert tips on logistics planning and strategy

Warehouse Operations Updated April 29th, 2023

A strategic plan is a framework or series of guideposts that keeps an operating plan on the right path to meeting objectives. It defines who you are, where you want to be and how you’ll get there while addressing stakeholders’ concerns and expectations.

According to Harvard Business Review , an estimated 67% of business strategies fail due to poor execution, making effective logistics planning and strategy paramount to your company’s success. A comprehensive logistics strategy should encompass strategic, operational and tactical levels of logistical planning as well as the four main pain points in the supply chain, including facility locations, customer service levels and inventory and transportation decision-making.

What are the benefits of logistics planning?

The primary objective of any logistics strategy is to deliver the right products to the right customers at the right time and at the least possible cost. An effective logistics strategy can help your company minimize investments and other costs by defining the service levels at which your organization is most cost-effective . The result is a win-win situation: your company benefits from cost efficiency, and your customers get what they need, when they need it, boosting customer satisfaction.

In a changing environment, logistics planning minimizes risk by enabling companies to anticipate change and develop strategies to adapt to those changes. Supply chains are always in a state of flux, so many companies develop logistics strategies for specific product lines, geographic regions or customer segments, enabling them to adapt to market changes impacting one region or business line while maintaining efficiency across others.

What are the three major aspects of strategic logistics planning?

The three major aspects of strategic logistics planning include long-term goals and the means and process for achieving those goals.

• Long-term goals: Long-term goals include customer satisfaction, your company’s competitive advantage and supply chain management.
• Means: The means for achieving your long-term goals include delivering value and customer service.
• Process: The process for achieving your company’s long-term goals includes how you’ll execute your logistics strategy, as well as anticipating and managing change and relating each element of your logistics strategy to the company’s overarching business objectives.

A strategic logistics plan typically covers five or more years. On a more granular level, a strategic logistics plan should include the following elements :

• An overview of the logistics strategy in general terms and how it relates to other business functions.
• Logistics objectives and how each relates to cost and service for the product and the customer.
• Descriptions of each strategy that will support the overall strategic logistics plan. These strategies should include inventory and warehousing , order processing and fulfillment , transportation and customer service.
• A breakdown of each logistic or operational plan including timing, costs for implementation and their impact on other business functions and the business as a whole.
• Forecasts of requirements for the workforce, capital and any other necessary assets.
• A financial statement that describes capital requirements, operating costs and cash flow in detail to paint a clear financial picture for executives and stakeholders.
• A business impacts analysis that details anticipated impacts on profits, customer service and other business functions.

Aligning your logistics goals to broader business objectives is a crucial component of an effective logistics strategy. According to Trissa Strategy Consulting , 63% of successful companies have every business unit aligned to their overall corporate strategy, from IT and human resources to marketing and supply chain management. Likewise, 64% of successful companies build their budget around their strategy, making elements such as financial forecasts, capital requirements and analysis of operating costs and cash flow vital to your company’s success.

Logistics planning and strategy tips

As the biggest players in fulfillment, distribution and omnichannel retail continue to push boundaries, logistics and planning strategists are forced to innovate. Luckily, the current movers and shakers of the logistics and supply chain world are all too happy to dole out sage advice in the form of blog posts, interviews, podcasts — you name it. Seeing this, we decided that it would be helpful to compile a curated list of 50 of the best tips on logistics planning and strategy that we could find.

The logistics tips below cover everything from unified supply chains to automated collaboration integration and beyond. Click on a category below to jump to the section that fits your interests best:

Planning tips to unify supply chains

Logistics strategies for streamlined fulfillment.

• Integrating automated collaboration

Logistics personnel and supplier management pointers

Tips for improving customer experience.

1. Create an adaptive unified buying process.  “If you look at the typical buying process, it is bifurcated based on geography. If I am going to buy goods from this geography, then I use this process. If I am going to deal with these partners, then I use this process. Another geography may call for another process and a different technology. Our point of view is to ask our clients what it is that you want to buy and we will unify those processes across the geography, those partners and those technologies so that it becomes transparent to the user.” —  Sue Welch, CEO of TradeStone Software, as quoted in  A Unified Supply Chain ,  Forbes; Twitter:  @Forbes

2. Make room for collaboration. “With better communication tools present, businesses can also build their collaborative rapport across the supply chain to eliminate confusion. Traditionally, most supply chain members are solely concerned with their own performance and output. While it’s certainly important for each stakeholder to ensure they’re meeting deadlines and turning in quality performance, silos along the supply chain make it difficult to address inefficiencies in any meaningful way.

“Many supply chain members simply pass the buck. Many times, not fully understanding how their own activity connects to other teams can breed a flippant attitude. Companies can boost holistic supply chain management by working with all stakeholders to develop a roadmap for consistent, continuous and collaborative improvement.” —  4 Ways to Make Supply Chain Management More Efficient ,  Lightwell; Twitter:  @lightwellinc

3. Take a generous approach to your supply chain collaboration.  “As more organisations recognise the need to collaborate, a whole new culture is evolving. This is why collaboration has become such a familiar buzzword in the supply chain world. But true collaboration is not an easy state to arrive at. Boundaries of mistrust must be broken down and conflicting objectives must somehow be transformed into aligned goals.

“Steady progress is being made though, aided by web technology that helps companies share information, systems integration for seamless supply chain handoffs, and perhaps most importantly, by the fearlessness of pioneering organisations. These brave leaders in supply chain collaboration are neither afraid to share supply chain risks or too self-serving to share the rewards. They show us how collaborative supply chains thrive and prosper, ensuring that the concept continues to gain acceptance and popularity.” —  Rob O’Byrne,  An Introduction to Supply Chain Collaboration ,  Supply Chain Secrets; Twitter:  @scs14official

4. Make your supply chain center of excellence (CoE).  “Although it is entirely possible to create a virtual center of excellence by having experts across the company collaborate electronically, they often can be more effective if they work together in the same location. One reason is that doing so can improve communication and collaboration. For example, supply chain design is extremely complex, and the analyses lend themselves to sitting side-by-side and graphically depicting and explaining ideas.

“A centralized group can also help to resolve another common concern: it’s hard for an expert to have credibility across the company when he or she is remote and attached to a particular business unit. And finally, a centrally located department promotes the most efficient use of a limited talent pool, allowing experts to focus on the CoE’s mission rather than having to juggle responsibilities on both a business-unit and a corporate level.” —  Jonathan Whitaker,  How to Create a Supply Chain Center of Excellence that Works , Supply Chain Quarterly; Twitter:  @TheQuarterly

5. Devise a model that supports environmental sustainability.  “BSR recommends that companies address climate risks in their supply chains by focusing where they have the greatest impact and greatest influence and taking several steps:

• Consider a broad range of climate risks and prioritize parts of the supply chain that are most at risk.
• Implement supply chain actions, including with internal procurement teams, with suppliers and through broader collaboration, and develop measurable targets for these efforts.
• Evaluate the impact of supply chain actions and adjust programs and goals over time.

“By integrating climate risks and building the climate resilience of the communities on which supply chains depend, companies increase the likelihood of fulfilling their supply chain objectives.” —  BSR, as quoted in  How to Integrate Climate Change Risks and Opportunities into Supply Chain Management , SupplyChain247; Twitter:  @supplychain247

6. Understand the effect that supply chains have on their companies.  “As companies have looked to spread their production around the globe to cut costs and build their customer base, effective supply chains have been found to often raise efficiency and assure products reach their end user as quickly as possible.

“Businesses don’t compete; supply chains compete. Now, supply chain officers are getting in on the strategic decisions that are being made.” —  William Verdini, associate professor and chairman of the Supply Chain Management Department at Arizona State University’s Carey School of Business, as quoted in  The Importance of Education in Supply Chain Management ,  Reliable Plant; Twitter: @NoriaCorp

7. Know when you are inviting risk into your supply chain.  “Get to grips with the risk each supplier brings to your business — how credible is each of the organisations on which you depend? By getting to grips with issues such as suppliers’ creditworthiness, payments history, data security and their own supply chain resilience, you can build a much more in-depth picture of any threat they may propose — and manage the danger accordingly. Try to avoid a tick-box approach to evaluating risk – you need a more sophisticated analysis of the different levels of maturity your suppliers may have.” —  Seven Ways to Boost Supply Chain Resilience , Finextra; Twitter: @finextra

8. Acquaint yourself with the dreaded ‘worst case scenario’.  “Building on a well designed product and supply chain, it’s time to plan for the inevitable — disaster! Whether natural or otherwise, Murphy’s Law states it’s going to happen, so you must be ready for it when it does. One of the keys to effective supply chain management is a control tower, essentially a single place where you can go to see everything that’s happening, evaluate your response and execute upon it. NetSuite has launched a supply chain snapshot feature that’s a central part of any control tower that shows all of your inventory and related transactions with the ability to filter by subsidiary, location, etc.

“Users can easily now look at your global or regional supply situation and quickly source alternates when required, but the key here is to practice your response. Using a sandbox account to plan out some simple and worst-case scenarios and discussing the best ways to resolve them and how those should be communicated internally and externally will make it easier to execute an alternate plan when it’s required.” —  Gavin Davidson, Design, Plan Execute, and Support–A Supply Chain Evaluation Guide , NetSuite Blog; Twitter:  @NetSuite

9. Study the needs of your supply chain in order to make informed predictions.  “Many manufacturers practice demand-driven logistics, meaning they are focused on their customers’ buying signals. The idea is to have aligned their enterprise to seamlessly respond to those signals. That’s an extremely efficient way of reducing total logistics costs while providing optimal customer service.

“However, during certain times of the year, demand spikes can be volatile and can happen very fast. In those situations, true scalability is more readily achievable if manufacturers are also focused on their customers’ demand signals.” —  Keith Biondo, Publisher of Inbound Logistics, Three Logistics Lessons Black Friday Can Teach Manufacturers and the Supply Chain , Thomas; Twitter: @Thomasnet

10. Reassess your demand forecasting model.  “Demand forecasts should predict two outcomes: the expected demand and how much uncertainty there is in that prediction. The need to  predict demand  is fairly obvious. It drives most supply chain planning activities. And you probably measure the efficacy of your tools and processes with well-known forecast accuracy KPIs.

“But the need to  predict forecast uncertainty  is not nearly as clear, and you probably make some gross assumptions about demand uncertainty and just assume they are accurate. By the way, if you don’t know whether or not you are making these assumptions, then we can pretty much guarantee that you are.” —  Jeff Bodenstab & Stefan de Kok, What’s Wrong with Demand Forecasting? , Supply Chain 247; Twitter: @supplychain247

11. Maintain and expand your inventory management strategies.  “Maintaining inventory accuracy is important for both your customer-facing systems and your internal ones. As we just mentioned, updating your inventory count in real time ensures that your customers can’t order products unless they’re in stock. At the very least, they should see a message indicating that the products are out of stock before they make the purchase. This is just good customer service.

“As for your internal systems, real-time inventory management helps you manage your fulfillment warehouses. This allows you to keep tabs on the inventory levels of your various products, helping you decide if you need to ramp up your production of those products or decrease it. After all, one of the more difficult aspects of managing warehouses is what to do with excess inventory, so you need to reduce it as much as possible.” —  5 Strategies for Streamlining Order Fulfillment , SelectHub; Twitter: @SelectHub

12. Reassess the value of your 3PL provider.  “Third party logistics (3PL) providers offer solutions in warehousing, packaging, assembly and distribution under one roof, so you can leave some or all of the order fulfillment to supply chain experts.

“A 3PL can provide a range of fulfillment services, from setup, to shipping, to customer service. Most can integrate with existing e-commerce systems, manage inventory, optimize transit time, process returns and claims and provide the data you need on your unique KPIs. You don’t need to invest in warehouse space or expanded technology, and you don’t need to hire and sustain more internal employees.” —  How to Create a Fulfillment Strategy that Delights Customers , Saddle Creek Logistics Providers; Twitter: @saddlecreeklog

13. Promote your visibility.  “Because demands in the e-commerce sector are ever-changing, it’s important that you increase your supply chain visibility at every corner. This means that you utilize tools to track production, orders and product shipments in order to get a better idea of what might be hurting — or helping — your unique processes.

“Even if you feel that you’ve done your due diligence, chances are there is a kink somewhere in your order fulfillment process that can be easily fixed once identified. Set aside the time, funds and book your most thorough employees to do a review, then reap the rewards once you’ve made plans to remedy your trouble spots.” —  Fergal Glynn, 5 Ways to Streamline the Order Fulfillment Process , 6 River Systems; Twitter: @6riversystems

14. Evaluate your warehouse manager’s pick and pack processes.  “Operations management offers a large field of contenders, but this final element has the greatest potential to impact efficiency, productivity and costs. For many companies, the picking process represents as much as half of the operating cost of the warehouse. Moreover, pick-n-pack is one aspect that is entirely under your control when it comes to having a positive impact on your customers. You can’t control the weather or the traffic or any number of factors that happen outside your warehouse doors, but you can track the efficiency of the picking process that takes place under your roof.

“By keeping an eye on these warehousing metrics, you can map out an error-resistant fulfillment process that moves from order to delivery as efficiently as possible. That, in turn, will help to drive customer satisfaction and loyalty to fuel growth. Sure, you may need to expand your warehousing space, but that’s a good problem to have, given the alternatives.” —   7 Metrics You Need to Streamline Your Warehousing Processes , Aero Fulfillment; Twitter: @AeroFulfillment

15. Incorporate scalable processes into your logistics strategy.  “Holiday seasons and flash sales are big reasons for sudden spikes in order volume. The increase in sales is great but only if you are able to meet customer demand. If your logistics processes can scale to meet periods of peak order volume, you will not only increase cash flow during sales frenzies, but you’ll also generate loyalty with highly satisfied customers.” —   A Simple Guide to Better eCommerce Fulfillment and Logistics , dotcom Distribution; Twitter: @DotcomDist

16. Take a fresh look at your omnichannel fulfillment .  “Innovation is crucial for expanding the current footprint of omni-channel fulfillment. While ARC has outlined the five key applications for executing seamless fulfillment, companies need to continue to look at new technologies and innovations. This is especially true for the last mile. Crowdsourced options for delivery are a cost-effective manner for home delivery, yet these solutions are still in the infancy stage.

“Many companies are waiting to see how these companies pan out, but more emphasis needs to be placed on making bold moves with high reward potential.  This indicates there are a lot of white spaces out there that can be filled by suppliers. This can be accomplished by new solutions or acquisitions.” —  Chirs Cunnane, Omnichannel Fulfillment: Strategies for Success , Logistics Viewpoints; Twitter: @logisticsviewpt

17. Consider implementing cross docking procedures.  “Within cross docking lies many tactics in how to make it all work to your benefit. If you are a retailer that sells various types of goods, cross docking can use ‘consolidation’ which would take small shipments and compile them into one large transport. Another tactic is when a major retailer that needs to distribute a large amount of product to various stores, but orders the supply in one large bulk. You can ‘deconsolidate,’ which would allow this large bulk of supply to be fed into many trucks at one time, thus lowering the amount of stops that would have to be made by the supplier.

“In the end, cross docking is a logistical method that calls for perfect timing and procedure but reaps the benefits of lowering overhead costs and streamlining turn around time. What does this mean for you? Well, it could boost your bottom line and shorten lead-time. For your customers it could mean lower retail prices, always-stocked shelves and shipments being on time. Overall, if your company’s warehousing, transport or distribution costs are too high or being placed completely on your plate, consider investing in a 3PL service that can help you implement a cross-dock strategy.” —  Streamline and Build Efficiency Through Cross Docking , Draco; Twitter: @dracoindustries

18. Weigh your costs against your customer experience.  “The order fulfillment process needs to be designed around the customer, but within the limits of the firm’s business and marketing Although many managers consider order fulfillment to fall within the role of the logistics function, it is the integration with other functions in the firm and other firms the supply chain that becomes key in defining order fulfillment as a supply chain process.

“The team also needs to understand the firm’s order fulfillment budget. That is, determining how much is acceptable to spend on fulfilling the order. A firm might be able to most quickly deliver a product to the customer with an express air shipment, but the costs associated with that policy erodes profits and could be unacceptable. Likewise, financial issues might dictate a minimum order size or something about the selling terms. Throughout the design of the fulfillment process, the team needs to tradeoff the costs of the solution with the benefits to the customer and the impact on the financial performance of the firm, and its customers and suppliers.” —  Keely L. Croxton, The Order Fulfillment Process , The Ohio State University; Twitter: @OhioState

19. Be upfront about your returns policy.  “According to a  comScore survey of 3,100 U.S. online shoppers conducted in February , 63 percent of those surveyed said they look for a website’s returns policy prior to making a purchase, and nearly two-thirds (62 percent) said they’ve returned a product they purchased online. Half of customers who plan to return a product visit that retailer’s website to find its returns policy. As a result, having an easy-to-find returns policy will enhance the customer experience and reduce the number of inbound customer service calls.

“What’s more, a clear returns policy increases the probability of recommendations and repeat business from online shoppers, as almost half of the respondents said they’d be likely to shop more often with a retailer or recommend a retailer to a friend if the retailer has a lenient and easy-to-understand returns policy.” —  The Retail Online, 7 Operations and Fulfillment Tips to Boost Efficiency , TotalRetail; Twitter: @MyTotalRetail

20. Revisit your item details and product pages.  “Do you have all the available product details, photos and inventory? Customers want to know as much about a product as they can find, since when they go in the store they have the opportunity to see and feel the things they buy. They’re placing an awful lot of trust in you by buying something they can’t see. So give them  more item details and product information than they ask for . It’s better to have too many than not enough — it helps consumers have confidence in making a purchase from you.

“Also, it’s a good idea to make sure your  inventory information  is indicated on the e-commerce website and is correct, perhaps down to the local store level. When people see you have a certain item on your website, they’re trusting you to have it in stock and will send it to them. They don’t want to get to the store to pick up their  BOPUS order  just to find out their order isn’t complete. They don’t want to receive an email days after they place their order informing them that the item is on backorder. That’s a quick way to lose a sale and a long-term customer.”  —Brandon Pierre, Eight Ways to Improve E-Commerce Order Fulfillment , SPS Commerce; Twitter: @SPS_Commerce

Integrating Automated Collaboration

21. Upgrade your manual systems to automated ones.  “In the digital age, there are a number of ways you can automate the logistics process, including tracking and monitoring each delivery. These systems take the guesswork out of planning your supply chain by reporting the raw data without bias. Ensuring your business is better informed by using fleet and inventory management software will allow you to refine your processes around the factors that impact your bottom line the most.” —  Peter Hunt, Five Tips for Managing Your Logistics More Effectively , Supply Chain Digital; Twitter: @SupplyChainD

22. Educate your company on the benefits of logistics management software platforms.  “A growing number of systems and apps on the market help distributors, warehouses, retailers and other companies optimize the daily comings and goings of products and inventory. Through the use of cloud-based technologies, teams can now access real-time insights and vital information to collaborate with other team members, partners and customers around the world.

“Amazingly, this can often be done from a single logistics management software platform that serves to handle your most pressing shipping, financial and HR figures. Depending on the nature of your business, there are several options that can bring order to your chaos.” —  Fergal Glynn, 50 Best Logistics Management Software Platforms, 6 River Systems ; Twitter: @6riversystems

23. Think about how your warehouse might look in 2030. “The urban warehouse must be equipped to produce products as well as store and ship them. With greater customization on the horizon and the continuing maturation of 3D printing technology, the urban distribution center will be well positioned to ‘print’ products on demand and then package and deliver them just as they do products from inventory.” —  Michiel Veenman, Envisioning and Planning the Future Warehouse of 2030 , Supply Chain 247; Twitter: @SupplyChain247

24. Bolster your WMS with other helpful pairings.  “In automated environments, WMS often work alongside warehouse control systems (WCS) that manage the routing of containers as they traverse the material handling equipment, and warehouse execution systems (WES) which often have basic task management capabilities but not the level of control or optimization of a WMS.” —  Matt Butler, Warehouse of the Future: Adopting Automation in Your Supply Chain , BlueYonder

25. Cut down on sluggish production times by identifying your operation’s repetitive tasks.  “The four primary benefits of warehouse automation are: Reduced labor costs, increased operational efficiency, increased workplace safety and the ability to address labor availability concerns.

“The secret behind these results? Identifying repetitive tasks or unnecessary movements of resources or inventory that can be eliminated or conducted more efficiently, at a lower cost, with less labor, more accurately and in less time.” —  Warehouse Automation Guide , Conveyco; Twitter: @Conveyco

26. Create an end-to-end warehouse testing plan with the help of strategic automation.  “Overall, the primary focus of testing should be on the end-to-end ETL process. This includes validating the loading of all required rows, correct execution of all transformations and successful completion of the cleansing operation. The team also needs to thoroughly test SQL queries, stored procedures or queries that produce aggregate or summary tables. Finally, with digital transformation initiatives focusing on delivering exceptional customer engagement, it is becoming increasingly critical for the test team to design and execute tests that accurately mirror the customer perspective.” —  Wayne Yaddow, Building an End-to-End Data Warehouse Testing Strategy and Test Plan , DZone; Twitter:  @Dzone

27. Only purchase automation that complements your needs and/or goals. “ Speed of sortation , throughput and various others factors should all come into play when selecting an automated warehouse system . If, for example, your company needs to be able to process 250,000 units per day, then that benchmark should be factored into your purchase decision.” —  Bridget McCrea, 7 Steps to Take Before You Install an Automated Warehouse System , Modern Materials Handling; Twitter:  @modernmhmag

28. Begin making use of shipping integrations.  “Integrated shipping carriers allow your warehouse team to instantly print shipping labels and manifests, whilst automatically alerting carriers that a shipment needs to be charged for and picked up. To cover all areas, you should ensure that the shipping integration you use also has the ability to circle back around to your central management system to reflect the current status of the order, and automatically send out tracking references to customers.” —  Justine Cross, Five Warehouse Automation Technologies and Tips , ERP Focus; Twitter:  @erpfocus

29. Consider Automation-as-a-Service. “Balancing supply and demand is as important as ever, but doing so requires flexibility. The  adoption of Automation-as-a-Service technologies  is on the rise, allowing warehouses to readily scale resources up or down to accommodate shifts in demand. These systems can provide more flexibility when it comes to managing costs, priority deliveries and distribution channels. For instance, companies like 6 River Systems allow warehouse operators to  rent collaborative robots  during a peak period and return them when demand returns to baseline levels, avoiding major investments in equipment that would sit idle during non-peak periods.” — Will Allen,  6 ways logistics technology is impacting warehousing , 6 River Systems; Twitter: @6riversystems

30. Swap out your heavy-duty scanners, for inexpensive, lightweight devices.  “In the past, only large expensive rugged devices seemed fit for purpose. However, it has become all-too-natural to ask how smartphones, Android devices, wearables, etc. could be used as a cheaper, more familiar alternative to bulky and expensive RFID guns that were a fixture in most warehouses.” — Tim Payne, The Evolving Warehouse and Future Trends , Explore WMS; Twitter: @ExploreWMS

31. Communication with the entire staff is one of the building blocks of productivity.  “Communications is very important to this phase of your business. Schedules must be current, and warehouse staff and transportation personnel need to be aware of scheduling changes at all times. Your customers also require attention. This is not only for his own facility’s scheduling, but it’s necessary for your company to maintain a strong customer service presence and preserve the reliability on which your customers count.” —  Tips for Improving Your Outbound Logistics , Liquidation.com; Twitter: @liquidation_com

32. Develop a social awareness that your supply chain can respect.  “‘To be a good supply chain leader, you have to be able to span boundaries. To be successful in supply chain management, you have to have social awareness, and be accommodating and flexible to lead change that transcends boundaries.” —  Chuck Taylor, CEO and executive vice president of ServiceCraft Logistics, as told to Leslie Hansen Harps, What Makes a Logistics Leader? , Inbound Logistics; Twitter: @ILMagazine

33. Be a sounding board.  “A strong operations leader understands that employees are a valuable resource and can effectively communicate with operations staff. That not only means delivering the hard facts and providing thoughtful and constructive feedback, but listening to empowered employees who are part of the same team.” —  5 Management Traits of an Operations Manager , The University of Scranton; Twitter:  @univofscranton

34. Take a partnership approach to supplier management.  “The following three principles, if followed, will help your company graduate toward best-in-class supplier performance management.

“1) When selecting suppliers, ask not only what they can do for you, but also how realistic it will be to work with them for mutual benefits.

“2) After relationships have begun, look for mutually beneficial ways to reduce total supply chain cost or maximise profitability.

“3) By all means, agree penalties to discourage lackluster supplier performance, but reserve their application for when collaborative efforts fail. Even then, you should be sure your own organisation is not at fault, before leaning on suppliers with charge-backs or other penalties.” —  Rob O’Byrne, 4 Tips for Effective Supplier Performance Management , Logistics Bureau; Twitter: @LogisticsBureau

35. Make talent development a priority.  “Succession planning and team training are the foundation of any procurement or logistics operation. Getting in someone that knows how to identify talent, internally and externally, will help the operational business in many areas. The right person will know how to attract the right calibre of employee, whether that be graduates or experienced hires, by structuring development plans implementing innovative initiatives to keep them engaged, while developing their careers.” —  10 Skills Your Logistics Team Needs to Know,  Michael Page Logistics; Twitter:  @MichaelPageUK

36. Add value to all facets of your team.  “The team is an essential aspect of an organization that is responsible for the growth. Whether it’s the delivery guy or the warehouse manager, everyone should be perfect in their respective field of work. For this, you need to invest in proper training of the employees. Regular training workshops keep the employees updated with the latest trends in the logistics industry. This helps in increased efficiency and satisfaction of the clients.

“A logistics manager with impeccable interpersonal skills is crucial for the organization. There are times when the things don’t work according to the plan. In this situation, instead of panicking, you need a reliable person who can sort out the issues with utmost efficiency. Moreover, the manager should have authoritative contacts in the industry. This can be beneficial in tapping the business opportunities.” — Adam Robinson, 6 Important Tips for Effective Logistics Management , Cerasis; Twitter: @Cerasis

37. Set mutually-beneficial goals with your suppliers.  “Common challenges and shared successes will drive reciprocal support.  A win-win orientation is the key to promoting risk reduction, technology innovation, system integration and cost effectiveness. When suppliers and companies focus on communal benefits, this increases both organization’s market agility and competitiveness. Creating a network of suppliers who support each other and leverage their unique abilities will drive operational innovation and process improvement activities. Shared information resources will promote continuous growth and minimize risks. Regular benefits measurement, executive oversight and strategic coherence will ensure organizational success.” —  Tim Brittingham, Director of Continuous Improvement at RBW Logistics, The Secrets to Successful Supplier Relationship Management , RBW Logistics; Twitter:  @rbwlogistics

38. Protect yourself by evaluating your supplier’s liability and insurance needs. “Use of any external supplier of products or services, either upstream or downstream, requires an evaluation of potential liability exposure. Every contract must address the three-legged stool of protections: limitation of liability, indemnification and supplier insurance. The last requires special administrative attention, but is frequently under-managed.

“Suppliers should carry insurance for two reasons. First, it protects them from legal and financial exposure that could limit their ability to support contractual commitments. Second, it provides a buffer of protection to the procurement organization against direct or indirect claims from suppliers or other third parties that may be affected by contracted suppliers’ actions or inactions. If a contracted supplier is allowed to utilize key subcontractors in the performance of services, those firms must also be required to provide insurance coverage compliance.” —  Mark Trowbridge, Five Techniques to Manage Supply Chain Risk , Supply Chain Management Review; Twitter: @SCMR

39. Provide your team with accessible benchmarks.  “Getting everyone on your team involved is crucial to improving overall supply chain management. Each person has a unique part to play in the health and success of your company, and setting goals can help everyone get on the same page.

“Go beyond the traditional metrics of capital, service and cost and determine some aggressive key performance indicators (KPIs) that are necessary for helping your supply chain improve. Sit down with your executive team and really brainstorm what metrics matter to your business. Don’t just include something because you think it ‘should be’ measured; forcing KPIs that don’t matter to your business goals are just going to frustrate everyone and take away from the opportunity to work toward effective goals.

“No matter what you choose to do, improving your business’s supply chain management is an important factor in your overall success. Getting serious about measuring the right things and analyzing data that matters to your business is going to help your business grow and thrive for years to come.” —  3 Tips for Improving Supply Chain Management , Cannon Hill Logistics; Twitter: @cannonhilllogis

40. Create a “middle ground” for your suppliers.  “Spend equal time aligning incentives and penalties. It is natural to worry about the worst case, such as if a shipment is not received and a plant grinds to a halt. Conversely, the extra value created when production and asset utilization is optimized should be the basis of improving the value proposition for both parties.” —  Dave Blanchard, 10 Strategies for Managing Suppliers , Industry Week; Twitter: @IndustryWeek

41. Remain open to change.  “When a customer’s desire for effective and trusted product fulfillment is becoming as important as the product itself, retailers clearly need a better fulfillment model. Retailers need to be able to present service and costed delivery options immediately — and that has to be based on real–time information throughout the supply chain, from last-mile services through to the wider distribution network and end suppliers.  Critically, that information has to be available to the retailer in such a way that costs can be automatically assessed and a price dynamically created and presented to the consumer to ensure the service option is financially viable.” —  Pól Sweeney, Vice President Sales at Descartes Systems UK, Delivering an End-to-End Customer Experience , Supply Chain Digital; Twitter:  @SupplyChainD

42. Award transparency to your customers.  “Instead of simply getting goods from point A to point B, logistics providers need to think of themselves as a strategic asset. Making this shift means thinking through the big picture value for customers.

“It’s not about claim rates and transit times. It’s about giving customers insights into their businesses which can drive improved performance, savings and value for their own clients. These insights, in turn, shape the kinds of services that shippers will demand moving forward, which provides an opportunity to control the customer experience far beyond today’s transactional environment.” —  Zen Newman, A Technology-Driven Customer Experience is the Future for the Logistics Industry , Capterra; Twitter: @capterra

43. Follow the CX (customer experience) trends.  “In terms of the impact of CX on the supply chain, most logistics professionals in retail are seeing CX improvement as part of their operational marching orders. Eighty-three percent of respondents said CX is now a company-wide goal, and they’re feeling the pressure to improve it.

“According to the survey, conducted by eft Supply Chain & Logistics Business Intelligence, over 83% of respondents said customer experience is a company-wide goal, with nearly 56% reporting CX measurement is key to their operational decisions. Two-thirds of respondents said gaining greater control of CX is crucial or very important to their approach to delivery.” — Customer Experience a Key Aspect of Retail Supply Chain Operations , Multichannel Merchant; Twitter: @mcmerchant

44. Keep customers up-to-date with shipping and product replenishment alerts.  “In addition to tracking capabilities, up-to-date alerts keep customers’ expectations realistic when unforeseen events take place in the supply chain. Customers appreciate alerts to weather delays and other interruptions so that they can react proactively to late deliveries.

“As e-commerce now makes up a total of 17% of all retail sales in the USA, retailers need to put their focus on improving their supply chains in order to win and retain business.” —  Improving the Customer Experience in the Age of E-commerce , Supply Chain 247; Twitter: @SupplyChain247

45. For a better customer experience, tighten up your demand planning tactics.  “One way to alleviate the pressures of modal selection is through demand planning. A good demand planning process incorporates many different departments across the organization — from sales, marketing and manufacturing to supply chain management and in-store operations. To make informed decisions regarding demand, organizations should also have a warehouse management system (WMS) in place for aggregating data and providing predictive analytics. Adding qualitative data from across the company can then help put your predictive analytics in context – supporting your plan for demand at a very granular level.” —  Ryan Kelly, How Inbound Logistics Impacts the Customer Experience , FedEx Supply Chain; Twitter: @fedex

46. Be generous to your customers, and make sure you can deliver on your promises.  “If you are an e-commerce merchant, your supply chain might stretch thousands of miles. But these days, all eyes seem to be trained on the final stretch of that journey from the point of manufacture to the customer’s hands. Retailers and their service providers are applying a range of strategies to deploy the last mile of e-commerce fulfillment to win consumers’ hearts and minds.

“The theory is that if you make the experience pleasant, provide lots of information, offer special services and maybe turn the product’s arrival into a mini-celebration, customers will keep coming back for more.” —  The Customer Experience: The Last Mile Gets the Royal Treatment , Inbound Logistics; Twitter: @ILMagazine

47. Don’t be afraid to ask for feedback.  “We all dislike emails that have no business in our inboxes. Moreover, we do not really enjoy email surveys — they are long and time-consuming. One way to receive timely feedback is to get customers to participate in quick, SMS-based surveys that they can finish in a heartbeat.

“We all have our mobile phones on hand every second of the day, and SMSes have high open rates. Studies have also shown that by sending SMS surveys, the response rate is significantly higher than email surveys — 51% to 43% respectively. Imagine gaining valuable customer feedback right after their packages are delivered — it’s a win-win situation!” —  Wavecell, 5 Things Logistics Companies Should Do to Boost Customer Experience , Medium; Twitter: @Wavecell

48. Invest in technology that triggers automated communication with the customer.  “Another recent innovation being adopted by retailers is to use despatch scans in the warehouse to trigger messaging to the consumer. As a product leaves, the consumer is connected with the start of its journey, and then has visibility of its progress through the tracking mechanism on the retailer’s website so that they know exactly where it is and when it will arrive at its destination. Underpinning these advances, is technology that has been designed not only to enhance operational efficiency but to extend that to improve the experience of the customer.” —  Kees de Vos, Chief Product & Marketing Officer at MetaPack, Bridging Logistics Efficiency with Customer Experience , ITProPortal; Twitter: @ITProPortal

49. Invest in a tailored mobility solution.  “To reduce the delivery time and in order to enhance the customer experience, enterprises must focus on adopting the right mobility solution that aids in running their field operations seamlessly. For example, Last -mile deliveries in the region are time-consuming with the delivery cycle easily lasting for 6 to 7 days or more. The longer delivery window poses a challenge for the delivery personnel to carry the details of each and every parcel delivery.

“With the help of mobility solution, that functions in 2G networks or even offline mode, the delivery personnel can save the information and update his manager ‘real-time.’ Adopting a flexible and future-oriented solution helps in generating automated reports on cash reconciliation, updating the task lists and the progress of the jobs allotted after the run-sheet is generated.” —  Kushal Nahata, Logistics Must Adapt to New Age Digital Technologies to Transform the ‘Digitally-Empowered’ Customer Experience , Forbes Middle East; Twitter:  @ForbesME

50. Consider investing in augmented reality technologies.  “Augmented reality is another innovation that our retail and e-commerce customers can offer to consumers, providing more control over the shopping experience. The technology creates a virtual image of how an item will look in a given room, dramatically decreasing the likelihood of returns. Augmented reality enhances the efficiency of the entire last mile process, reducing time inside the home and the risk of product damage.” —  Troy Cooper, President of GXO Logistics as told to Brian Straight, GXO Logistics Turns to Augmented Reality to Boost Last-Mile Customer Experience , Freight Waves; Twitter:  @FreightWaves

Interested in more? Let’s discuss the solution that’s right for you. Contact us today.

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How to Build a Logistics Department

The global logistics industry is worth hundreds of billions of dollars. As more people relegate their purchases to online shopping, we expect that number to continue expanding.

Whether you’re running a manufacturing operation or any other type of business that owns and operates a warehouse-like structure, chances are, you need a dedicated logistics department. To craft one that works for your business needs, you need to understand your logistics workflow, organize various pieces to support that workflow, and start maximizing your efficiency.

If you’re curious to know how to do that, you’re in the right place. Below, our team breaks down key considerations to keep in mind as you begin to establish your logistics operations.

Document Your Workflow

Before you can start building your logistics team, you need to understand what that team will need to do. The way to come to that determination is to document the workflow that needs to occur to get your products to your customers.

This task sometimes strikes people as overwhelming as documenting processes can be multi-faceted. Our advice is to work backward and write out each step that occurs the moment just before your customer takes delivery.

For example, before your customer takes delivery, your inventory needs to be shipped in a truck. That truck needs to pick up your shipment from your warehouse. That shipment needs to be packed on a pallet, etc.

By documenting your workflow, you can quickly identify all of your logistical needs.

Consider Location

A big piece of the logistical efficiency puzzle is location. Unfortunately, many manufacturers/businesses can’t finesse this issue because they are already invested in real estate. Therefore, optimally, you would consider location before purchasing a warehouse.

The reason why location matters is because there is a tremendous expense involved in getting items out of your warehouse and to their final destination. If you need to move your inventory to your nearest dock so a boat can ship products overseas, you will save a tremendous amount of money being close to that dock versus being fifty miles away.

Introduce Automation

Your location is fixed. Your workflow is documented. Before you proceed any further in developing your logistics department, consider where automation makes sense.

Automation is an effective vehicle when it comes to generating cost savings for organizations, so getting out in front of areas where it can be implemented gives you a great chance of padding your company coffers.

Here’s an example… If part of your logistics process includes identifying and logging parts that flow into your warehouse from a vendor, you could invest in a scanning system that will log arrivals on your behalf.

Connect With Vendors Where Necessary

Another key component of your logistics team will likely be third party vendors. These vendors will do everything from service machines in your warehouse to take care of reefer fuel delivery .

Look over your workflow documentation. See which steps are better managed by specialists. Once identified, start getting quotes/hiring those specialists onto your logistics team.

Hire an Experienced Logistics/Floor Manager

Every great logistics department has an experienced logistics/floor manager at its helm. You should move to hire this person early in your department development cycle. That way, they can lend advice on where investments need to be made to ensure operational efficiency.

Finding a good logistics manager can be accomplished by writing up a detailed job description. After, post what you write on popular job boards like LinkedIn or Monster.

Tailor Your Warehouse Floor

When you look over your logistics workflow with your floor manager, does the way your warehouse floor is laid out, support seamless transitions between steps? Are your pallets next to your truck ports? Would workers have to walk across the building to move through their tasks?

Ask yourself how you can efficiently structure your logistics department. The goal should be to reduce the time it takes to get products to their final destination. If you can do that, you’ll enjoy a massive boost in operational efficiency.

Hire Your Ground Crew

This is a step that is going to be mostly managed by your logistics/floor manager. Once you have your warehouse floor laid out and the steps leading up that moment in place, it’s time to start bringing on headcount, where necessary, to execute your logistical processes.

Have your floor manager start small when it comes to hiring, so you lower the likelihood of laying people off shortly after bringing them on.

Implement Ways to Measure Effectiveness

By this point, you have a functional logistics department. Your work isn’t over, though!

Make it a point to have triggers in place that allow you to measure the efficiency of the department you’ve set up. Always look for opportunities to make tweaks against those measures. That way, you can continue saving your organization time and money.

A Great Logistics Department Makes for Happier Customers

At the end of the day, your company’s job is to make great products and get those products to your customers as seamlessly as possible. Great logistics departments enable both of those ends since refined workflows include quality checks and enable shippers to move items quickly.

All of that to say that paying mind to the efficiency of your logistics is worth doing!

Are you still scratching your head when it comes to establishing logistics solutions? Do you want more guidance on how best to proceed? If so, check out more of the content we have regarding the topic on our blog.

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Strategic Logistics Plan Examples

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Factors Affecting Inventory Control Policies

Definition of order processing costs, warehouse inventory issues.

• What Are Logistical Processes?
• How Does Logistics Differ From Distribution?

Strategic logistics plans define how a business plans to deliver products or services to customers. Some businesses don't require as many steps in product delivery while others have many stages and steps. Address logistics in a methodical way that allows your business to scale operations or increase profitability. While every company has different needs, looking at logistics plan examples help business owners develop the right strategy for business development.

Warehouse Strategies

Warehouse strategies are highly dependent on the type of business in question. Companies with perishable goods like flowers need refrigerated warehouses that contain only enough inventory to cycle through short-term needs thus limiting waste. This strategy requires not just the warehouse infrastructure but a clear understanding at any given time of what fulfillment needs exist. A strategy like this might be highly contingent on seasonal demands change needs.

Other strategies such as building materials don't need to worry about carrying excess stock levels because there is less concern with waste. An important strategy for a large warehouse physically positions frequently accessed items at the front of the warehouse closer to loading docks. This reduces time and energy spent loading and unloading items and gathering orders making the warehouse more efficient.

Transportation Strategies

Not every company has large transportation needs, wheras others rely on transportation as the cornerstone for accomplishing business goals and product delivery. Transportation includes short- and long-distance trucking options, air transportation, shipping through ports and trains. There may be times where transportation strategies include several different transportation options.

For example, a lumber mill needs to get products from the mill to buyers. The lumber might start on a truck taking a load from the mill to a train. It may later get put back on a truck for delivery or port shipment. Business owners need to consider the costs and efficiency of each transportation method. Cargo ships must deal with port costs. There might be restrictions or permit requirements for truck shipments such as fireworks. As with warehouse issues, perishable items require refrigerated transportation, increasing costs and reducing delivery timetables.

Parcel Shipping Strategies

Smaller packages have options on how to deliver products. Smaller packages and envelopes have the option of mailing items via the US Postal Service, United Parcel Service (UPS) or FedEx. There are also international parcel shipping services such as DHL. Businesses often give consumers options based on price and timeliness for delivery when choosing these options. Insurance and delivery confirmation help business owners and consumers protect and track items in transit.

Drop-Ship Strategies

Drop shipping is becoming more popular among small business owners. Drop shipping refers to inventory being held in a central warehouse, with orders compiled and shipped on demand. There are two drop-ship strategies. The first is when a business compiles inventory from different suppliers to get packaged on demand and shipped under the business' label. This method usually involves some level of proprietary products and is considered inventory held by the business.

The second strategy uses a drop-ship, third-party inventory supplier such as Shopify. Suppliers list goods with these sites. Business owners establish an account with Shopify instead of the suppliers, and choose which products out of the thousands to include in the business model. Online orders then get processed in an automated system, with products delivered directly from suppliers on behalf of the business. Business owners have less control of consumer pricing in this model, but they don't need to purchase and hold inventory.

• Shopify: Understanding Dropshipping
• CamCode: Logistics Strategies for Business: 23 Experts Share Tips on How to Develop a Winning Logistics Strategy (or Improve Your Existing One)
• Ingenics: Logistics process planning

With more than 15 years of small business ownership including owning a State Farm agency in Southern California, Kimberlee understands the needs of business owners first hand. When not writing, Kimberlee enjoys chasing waterfalls with her son in Hawaii.

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Logistics Planning: Definition, Types, Importance, and Strategies

Have you ever been to a business that looked neat and orderly at first glance, but behind the scenes it was a different story? It’s easy to present as a well-oiled machine in the front office, but if you neglect business processes at other levels, you’re in trouble.

Logistics planning can help you fire on all cylinders by supporting every department individually while improving overall supply chain operations. It ensures proper flow to reduce service delays, lower supply chain costs, and increase fleet capacity utilization, which can also have a substantial impact on your bottom line.

What Is Logistics Planning?

Logistics covers how you manage your product from creation to distribution. Logistics planning involves refining those processes to account for the ideal use of your systems, equipment, and storage facilities to create a seamless system. 

Logistics planning is most effective for companies that produce physical products and move them through a multi-step supply chain. For example, factories, warehouses, and retail stores can improve operations across the board to create a more stable and efficient organization geared for future growth.  

It’s easy to see how these changes could impact a massive company, but logistics planning is not just for large corporations anymore. When smaller companies develop logistics strategies, they have a better chance of competing in the changing marketplace.

Digging deeper, logistics planning relies on a three-part approach that addresses your entire system. 

• Long-term goals set up your organization for success by satisfying consumers and meeting customer demand through a stable, adaptable supply chain. Goals must have quantifiable factors and rely on data to assess successes.
• Means refers to the ability to deliver a positive customer experience, provide value, and work toward your long-term goals. 
• The process addresses the strategies for achieving all business objectives.

Logistics planning is not an immediate solution, it’s a long-term approach that entails mapping out strategies and setting objective, obtainable goals. 

Types of Logistics Management

There are four primary types of logistics management to address the various supply chain areas. Efficient logistics planning addresses all of them to improve the entire supply chain.

Inventory Management

Creating products means several moving parts at all stages of the process. Consider procuring the raw materials used to create a line of products. You need to store the raw materials and then the completed products. Plus, you need to transport them to a retail location or directly to the customer. 

Inventory management can impact a business in many different ways, but it’s mostly about waste reduction and a chance to reduce supply chain costs. Knowing what you have at all times, and where to find everything, supports a cost-effective logistics operation. 

Accurate inventory management helps you plan for ordering materials, accommodate high-volume sales times, and keep accurate records of the status of finished products.

Say, for example, you get an exceptional deal on two key materials that don’t expire. There’s not enough room in the usual space to store them, so you tuck the overstock away somewhere else. Unaware that you purchased extra and where it’s at, your manager orders replacement stock as usual.

This situation costs you in several ways. First, you pay full price for more of something when you don’t need it. Further, the raw materials could go unnoticed or forgotten for some time, meaning more full-priced orders.

Logistics management can help your team avoid these unnecessary costs. It involves accommodating the excess without anything getting lost or forgotten. The approach requires exceptional organization and processes to address overstock and knowing when to purchase more of a specific material. 

The production process is the backbone of any product-based company. Coordinating every aspect of the manufacturing process can eradicate wasted time, like waiting for other departments to finish their jobs.  

Restructuring steps can reduce overall production time, alleviate stress on your team, and improve your bottom line. Even if you have smooth business operations, there might be ways to refine them further for a more efficient system and lower supply chain costs. 

For example, you might find that one step in the production process takes twice as long as the following step. These issues cause backups and leave workers standing around waiting to do their jobs. It’s not efficient or effective for anyone and often causes undue stress and tension between team members.

Stepping back to consider each step objectively could help you identify wasted time and steps or a different process that reduces wait time. That’s just one example of how logistics planning can support your production teams.

Distribution

Getting materials and products from one place to another can impact every other aspect of your business. Damaged and lost products, delayed shipments, and other issues aren’t entirely avoidable, but logistics planning can ease the strain. 

Addressing distribution channels at every stage of the process can ensure you have contingencies in place and reduce the chances of lost and damaged items. It’s one more step in supporting the overall processes to reduce waste, improve efficiency, and support your bottom line to achieve long-term business goals.

Reclaiming materials and products is an often overlooked area. From customers returning products to recycling older or damaged items, it’s important to consider reverse logistics in your planning and strategy.

Addressing these issues can reduce the negative impact returns and waste have on your bottom line. There might be ways to reuse excess raw materials or repurpose returns.

For example, depending on your product, you could revamp returns by doing a complete overhaul. The items become refurbished products that you can resell at a lower price while still making a profit.

Logistics Planning Challenges

Challenges seem endless when you have so many moving parts, but we can typically break them into two groups. Expected challenges, like a holiday rush, are easier to plan for but can still stress your logistics. Unexpected challenges, like a global pandemic, can throw a major wrench into your system, and they aren’t as easy to attack. 

You can probably list a dozen challenges you expect to face over the next six months, from the holidays to a manager taking a planned leave of absence to launching a new product line. Your team likely has some strategies in place to address these hurdles with limited disruption to your customers, but that’s not to say you won’t face some tension and loss.

Unexpected challenges pose a greater hurdle for most companies. Most companies have experienced more than their fair share of unexpected challenges over the past few years, including erratic gas prices and significant supply chain disruptions. 

It’s safe to say that few people had contingencies in place for dealing with a global pandemic or the subsequent fallout. However, some organizations adapted and bounced back faster than others. Some plans and strategies created more adaptable and resilient systems that can withstand supply chain disruptions.

Why Logistics Planning Matters 

Logistics planning benefits can vary from organization to organization, depending on the existing system’s efficiency and complexity. Still, every company stands to benefit in some key ways because logistics-based strategies represent the future of business.

Build a Stronger Business Foundation

A business is like a building in that it’s only as strong as its foundation. When the foundation cracks, it weakens the building’s structure and those cracks often spread to other areas. The same is true for a business – cracks appear in various processes leading to lost products, customers, and revenue.

Establishing a solid base allows the business to sustain itself and flourish, making it possible to remain competitive and scale effectively. Addressing the base processes to create the most efficient system possible helps you identify and fill in cracks to reduce losses. 

Solid logistics operations keep everything running smoothly, within budget, and satisfying customer requests promptly. It’s the best chance for an organization to sustain itself and withstand unexpected roadblocks, like a global pandemic.

Shoring up your logistics operations means considering short and long-term goals while preparing you to set future goals. You must step back and look at your business objectively. What can you do to reduce costs without compromising customer service? 

Increased Oversight

Since logistics planning involves exceptional organization at every level, you gain insight into what everyone is doing and where every component moves at any given time. Having this level of oversight creates a more adaptable system while maximizing asset utilization. 

You can easily adjust various points and movements to accommodate unexpected disruptions or fluctuations to limit the impact on the overall supply chain. Additionally, tracking the information creates historical data to support more accurate forecasting and find new areas to optimize for increased efficiency.

Create Flexibility and Resilience for Sustained Business Growth

Logistics planning calls for transparency and data-driven decision-making that helps you build a better framework for business. 

Your teams can communicate better across departments to arrive at enhanced solutions that contribute to and support overall business goals. Further, the entire organization becomes more flexible and able to adapt to disruptions at any point in the supply chain. 

For example, suppose a hurricane disrupts part of your supply chain in one region. Since you have a flexible framework with strong interdepartmental communication, another region steps up to fill the gaps and keep the business running as usual. 

Reduce Costs and Increase Revenue

Selling more products or services isn’t always the only opportunity to increase revenue. Reducing costs, like overhead expenses and losses due to wasted materials, can help you improve the bottom line.

Logistics planning lets you use physical resources more efficiently instead of investing in more, which also reduces overhead costs. For example, you might have three warehouses to hold your products. Before acquiring a fourth to accommodate your growing business, you might be able to rework the existing three to create a more functional supply chain. 

Further, you can reduce wasted expenses and losses that eat into your profits by creating more cost-effective solutions. Logistics planning helps you identify areas of improvement to make your organization more adaptable to hidden factors and unexpected problems.  

By refining your processes and addressing areas of significant waste, time sucks, and lost profits it’s possible to build a more sustainable, adaptable system. Keeping on budget and on time creates greater gains and improves customer satisfaction with your service. 

Increase Customer Satisfaction

Satisfied customers become loyal, repeat buyers who spend more with your organization and spread the word to others. Build your company reputation by consistently meeting customer expectations and maintaining consistent customer service levels. 

Strategic logistics planning helps you meet customer demand, which these days are almost immediate. Refining your processes helps you meet faster shipping requests and deliver more service options. You can adapt to meet customer requests and needs.

Top Logistics Planning Strategies

Establishing effective logistics planning isn’t always easy, and it takes time to make the changes. Embracing some key strategies can help ease transitions and ensure ultimate success with any logistics plan. 

Build a Solid Plan

Like most things in life, logistics planning can succeed or fail depending on the roadmap. Developing a strong logistics process as your foundation reduces the risk of delays, breakdowns, and snap decisions. 

Crafting a solid plan requires a data-driven approach with transparency throughout the process. Every person participating in the planning process has a stake in its success, and they can only succeed if they communicate openly and have all of the necessary information.

Remember that there is no flawless path in logistics planning. However, a detailed approach that addresses how to respond to various problems can help the process.  

Make Data-Driven Decisions

Data-driven decisions tend to be more accurate and reliable. Using objective information to build strategies creates consistency across the board and provides a clearer picture of what’s really happening at every stage of the supply chain.

It’s easy to go along with a decision because it makes sense at the moment or sounds like a legitimate plan. However, if it’s based on incomplete or insufficient data, you might create more problems than you solve. 

Collecting and analyzing data requires time, but the methodical approach can limit disruptions and missteps.

Create Backups and Contingencies

Even with a solid plan, you can face unexpected problems, such as natural disasters, that threaten to derail things. Establishing backups and contingencies can mitigate the issues and help you stay on track. 

It’s important to create contingency plans for every aspect of your logistics plan. Think, if not A, then B for each step in the supply chain. In some cases, it helps to have a backup for your contingency. 

Though you don’t want to get too convoluted with contingencies, knowing where to go in the event of certain circumstances can keep your entire supply chain on track or close to it without stressing your team.

Build On Missteps

Historical data is one of the most relevant and reliable places to start planning. You will certainly make mistakes somewhere along the way, but every misstep is an opportunity to learn something new. 

Turning a mistake into a lesson requires analyzing historical data to discover where things went wrong. It helps you identify weaknesses and plug holes that you might have missed during the initial planning stages. Be sure to get feedback from your teams and collect as much data as possible before making adjustments.

Automate When Possible

Automation provides an opportunity to Improve workflow and reduce strain on your employees. It’s one of the most effective solutions for teams seeking to streamline workflow, making it a key component in logistics planning.

New technologies allow you to automate mundane tasks so that your human team members can focus on more complex and important tasks. With fewer distractions, they can focus on more crucial business practices. 

Automation can reduce mistakes and increase overall efficiency in several departments. For example, you can automate delivery processes by allowing software to handle all delivery tracking and monitoring delivery. Improving your existing tracking abilities makes it easy to see where your materials and products are at any time, which ultimately improves operational efficiency. 

Additionally, artificial intelligence (AI) can support teams with several tasks and take the load off your human employees. Further, you can run automated reports and use software to analyze large volumes of information quickly and efficiently to provide better forecasting.

Hire an Experienced Leader

Digging deeper, it helps to have an experienced leader involved to guide the process. It might benefit your team to hire a logistics manager to help guide you through the finer points, especially to point out weak spots and provide valuable insight.

People who specialize in logistics planning and have experience within your industry can bring valuable insights to the table. They can highlight known failures and successes at each stage in the supply chain to help you build a viable plan faster and with less trial and error.

Conduct Regular Strategy Reviews

As you proceed through the logistics planning process, take time to review the plans and current data. Checking in at various stages of the implementation process can help you identify shortcomings and adapt strategies to meet unexpected challenges or avoid major pitfalls before they occur. 

Make sure you ask the same questions at every strategy review to maintain integrity and consistency. Ensure that your logistics strategies meet customer demand, satisfy the company’s objectives, and push toward achieving short and long-term goals.

Final Thoughts: How Logistics Planning Paves a Path to the Future

Good logistics planning is key for all organizations. It addresses every aspect of supply chain management to create more efficient processes that support the organization’s goals.

If you want to commit to effective scalability and improving your bottom line, a proper logistics strategy could be your best opportunity. Logistics services help organizations build a stronger foundation and framework that’s more flexible and resilient to support long-term growth. 

Additionally, effective logistics planning helps teams gain more oversight and transparency to become more adaptable while reducing costs, and increasing revenue.

Further, strategic logistics planning sets you up to deliver better service leading to a more loyal customer base with repeat business. When you have effective supply chain management, you can better meet consumer expectations and demands by delivering quality products and services promptly.

A proper logistics plan takes time to achieve your ultimate goals. However, with proper teamwork, data, and organization-wide commitment, logistics planning can refine your supply chain to meet customer demand and achieve real results. 

It will likely involve some growing pains and workflow changes, but learning from mistakes, automating tasks, and relying on data can reduce major disruptions.

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Warehouse Business Plan Template

Written by Dave Lavinsky

Warehouse Business Plan

You’ve come to the right place to create your Warehouse business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Warehouse businesses.

Below is a template to help you create each section of your Warehouse business plan.

Executive Summary

Business overview.

FlexiStore Warehousing is a startup warehousing business located in Tulsa, Oklahoma. The company is founded by Martin Snow, a warehouse manager who has an extensive number of customers who have appreciated his service in the past ten years of his employment with a national chain warehouse company. Martin consistently went out of his way to accommodate the particular and sometimes, unique, needs of his customers in moving goods of all types into and out of the appropriate warehousing; the perfect sized facility, warehousing that was renovated to meet customer needs, and other specific solutions for customers. Whether large inventory or small, Martin Snow was known in the chain as the “Go To” solution-provider.

FlexiStore Warehousing will provide an advanced technology infrastructure, including barcode scanning, RFID tracking, and automated inventory management systems. These systems will ensure goods are brought in as properly tracked, sorted, managed and, finally, sent out without errors or issues involved.

Product Offering

The following are the services that FlexiStore Warehousing will provide:

• Logistics management
• State-of-the-art facility
• Advanced technology infrastructure
• Highly-skilled team
• Clear access to major transportation hubs
• Timely entry/exit management
• Fulfillment options
• Value-added options
• Technology-driven security system

Customer Focus

FlexiStore Warehousing will target e-commerce companies. They will also target medium-to-large manufacturers. They will target regional wholesale companies. They will also target medium-to-large retail outlets, chains and other stores needing warehousing for overstocks or ancillary goods.

Management Team

FlexiStore Warehousing will be owned and operated by Martin, “aka Marty,” Snow. He recruited his former warehouse associates, Roger Hartwell and Kenny Jones, to assist in the management of the startup business.

Marty Snow is a veteran of over fifteen years of warehousing experience, five of those years in management. His former employer was a national chain, which meant that Marty was limited in some areas where he could see that improvements to inventory, storage and processing could have been a factor in gaining or retaining customers. For these reasons, and with a large following of customers who’ve already agreed to move their warehousing to his startup, Marty has made the decision to form FlexiStore Warehousing.

Roger Hartwell, formerly a warehouse team member with Marty, will take on the role of Inventory Control Manager. In this role, he will exercise his depth of knowledge using the advanced technology tools installed to perfect the process of inventory control. Roger has a background in the U.S. Marines as a Staff Sergeant in the logistics department of a nearby station.

Kenny Jones, a former team warehouse member with Marty, will take on the role of Operations Manager, overseeing the movement of goods in, through, and out of the warehousing process. His keen eye for detail and depth of warehousing knowledge has earned him this role.

Success Factors

FlexiStore Warehousing will be able to achieve success by offering the following competitive advantages:

• Friendly, knowledgeable, and highly-qualified team of FlexiStore Warehousing

Financial Highlights

FlexiStore Warehousing is seeking $200,000 in debt financing to launch its FlexiStore Warehousing. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and marketing costs. The breakout of the funding is below:

• Office space build-out: $20,000
• Office equipment, supplies, and materials: $10,000
• Three months of overhead expenses (payroll, rent, utilities): $150,000
• Marketing costs: $10,000
• Working capital: $10,000

The following graph outlines the financial projections for FlexiStore Warehousing.

Company Overview

Who is flexistore warehousing.

FlexiStore Warehousing is a newly established, full-service warehouse business in Tulsa, Oklahoma. FlexiStore Warehousing will be the most reliable, cost-effective, and efficient choice for commercial enterprises throughout Tulsa and the surrounding communities. FlexiStore Warehousing will provide a comprehensive menu of warehousing and inventory control services for any client to utilize. Their full-service approach includes a comprehensive array of technology-driven processes that guarantee inventory control, logistics movements, and security.

  FlexiStore Warehousing will be able to warehouse goods for any medium-to-large manufacturer or other entity. The team of professionals are highly qualified and experienced in logistics, inventory control and warehousing solutions. FlexiStore Warehousing removes all headaches and issues of common warehousing issues and ensures service and reliability are included in the best customer service.

FlexiStore Warehousing History

Since incorporation, FlexiStore Warehousing has achieved the following milestones:

• Registered FlexiStore Warehousing, LLC to transact business in the state of Oklahoma.
• Has a contract in place at one of the nearby buildings to set up its 10,000 square foot office space.
• Reached out to numerous contacts and former clients to refer FlexiStore Warehousing to associates in their industry.
• Began recruiting a staff of ten warehousing team members and office personnel to work at FlexiStore Warehousing.

FlexiStore Warehousing Services

The following will be the services FlexiStore Warehousing will provide:

Industry Analysis

The warehousing industry is expected to grow over the next five years to over $1,007 billion. The growth will be driven by the increased number of goods imported into the U.S. which require either distribution or warehousing until clients schedule shipments. The growth will also be driven by increasing demand for efficient logistics and supply chain management The growth will also be driven by an increasing need for advanced security systems as warehouse thefts continue to be problematic The growth will also be driven by e-commerce, which will call for more fulfillment capabilities, upsell options and other consumer offers that will necessitate warehousing special services. Costs will likely be reduced as shipments increase and supply chain issues are resolved from years past. Costs will likely be reduced as improved shipping times increase the regulation of delivery of goods, implementing a smoother process for inventory and logistics control.

Customer Analysis

Demographic profile of target market.

Customer Segmentation

FlexiStore Warehousing will primarily target the following customer profiles:

• Medium-to-large manufacturers
• Regional wholesale companies
• Medium-to-large retail outlets and chains
• Stores needing overstock facilities

Competitive Analysis

Direct and indirect competitors.

FlexiStore Warehousing will face competition from other companies with similar business profiles. A description of each competitor company is below.

Swift Logistics

Swift Logistics is a warehouse business located in Claremore, thirty miles from Tulsa, Oklahoma. The business is owned by Jack Parsons, an entrepreneur who has determined the warehousing market is a viable and profitable venture. Jack Parsons has instituted previously-unknown technology systems into the warehouse company, where the results have been mixed success throughout. The company owns five warehouses, soliciting small to medium-sized businesses as clients.

Jack Parsons has an extensive list of clients that has grown from the past ventures he has initiated. He has a mixed amount of success in these ventures, but has a dedicated following of supporters willing to continue investing in each venture. Former startups include Rent-a-Place LLC, a traveler’s rental business; HowsAboutThat, Inc., a company that sells unusual toys and novelties; and TeddyBear Wonders, Inc., a company that imports teddy bears of all kinds.

Exceptional Service Wearhouse Co.

Exceptional Service Warehouse Company has five warehouse units of 120,000 square feet each. It is located in Fort Worth, Texas, about 180 miles from Tulsa, Oklahoma. As a direct competitor, Exceptional Service Warehouse is a large-scale service with multiple options for customers who need a vast array of services. The organization has over 300 team members with multiple offices and functions within the general administration of the company.

Exceptional Service Warehouse has a strategic initiative to include the very largest inventory supplies in the nation within their warehousing facilities. Toward this end, the company does not solicit any business from medium or small-sized companies, nor does the company allow any exceptions to their stated policies. This somewhat limits the participation of smaller companies and does not offer solutions when potential clients present unusual circumstances or emergency requests.

Thomas & Harris Warehouse

The Thomas & Harris Warehouse company is located in Tulsa, Oklahoma in the southeastern portion of the city. The company targets small businesses specializing in grocery items, including refrigerated and frozen goods. This specialty ensures a steady stream of grocery store clients and other large chains who need emergency supplies for overstocks or other grocery items. Overall, the team of six people run the warehousing and operate the administrative side of the business. There is no technology for inventory control or distribution and there are no options for added value packaging or fulfillment of orders. The targeted customers are grocery stores or wholesalers to grocery stores or chains.

Competitive Advantage

FlexiStore Warehousing will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

FlexiStore Warehousing will offer the unique value proposition to its clientele:

• Highly-qualified team of skilled employees who are able to provide a comprehensive array of services
• Technology-driven systems that manage inventory, logistics and cost controls throughout the warehousing system
• High-tech security systems that guarantee the safety of warehouse goods
• Fulfillment and upsell options; logistics RFID controls and other options
• Unbeatable pricing to its clients; they will offer the lowest pricing in Tulsa.

Promotions Strategy

The promotions strategy for FlexiStore Warehousing is as follows:

Word of Mouth/Referrals

FlexiStore Warehousing has built up an extensive list of contacts over the years by providing exceptional service and expertise to their former clients. Marty Snow has multiple former clients who have announced to him they are following him to the new company and will also help spread the word of FlexiStore Warehousing.

Professional Associations and Networking

Marty Snow will be involved in networking during industry associations and trade shows related to warehousing, technology solutions, and related subjects. He will also offer to speak or exhibit the successful processes of his new startup to others to help spread the word of efficiencies that can be offered to all new customers.

Website/SEO Marketing

FlexiStore Warehousing will extensively utilize their website. The website will be well organized, informative, and list all their services that FlexiStore Warehousing provides. The website will also list their contact information and list their available square footage for rent on any given day and date. The up-to-the-minute information will help clients immediately identify the capabilities they need for warehousing. The website presence will contain SEO marketing tactics so that anytime someone types in the Google or Bing search engine “warehouse company” or “warehouse near me”, FlexiStore Warehousing will be listed at the top of the search results.

The pricing of FlexiStore Warehousing will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.

Operations Plan

The following will be the operations plan for FlexiStore Warehousing. Operation Functions:

• Martin Snow will be the Owner and President of the company. He will oversee all staff and manage client relations. Martin has spent the past year recruiting the following staff:
• Roger Hartwell, formerly a warehouse team member with Marty, will take on the role of Inventory Control Manager. In this role, he will exercise his depth of knowledge using the advanced technology tools installed to perfect the process of inventory control.
• Kenny Jones, a former team warehouse member with Marty, will take on the role of Operations Manager, overseeing the movement of goods in, through, and out of the warehousing process.

Milestones:

FlexiStore Warehousing will have the following milestones completed in the next six months.

• 5/1/202X – Finalize contract to lease office space
• 5/15/202X – Finalize personnel and staff employment contracts for the FlexiStore Warehousing
• 6/1/202X – Finalize contracts for FlexiStore Warehousing clients
• 6/15/202X – Begin networking at industry events
• 6/22/202X – Begin moving into FlexiStore Warehousing office
• 7/1/202X – FlexiStore Warehousing opens its office for business

Marty Snow will be the owner and operator of the FlexiStore Warehousing company. He has recruited his former warehouse associates, Roger Hartwell and Kenny Jones, to assist in the management of the startup business.

Financial Plan

Key revenue & costs.

The revenue drivers for FlexiStore Warehousing are the fees they will charge to clients for their services.

The cost drivers will be the overhead costs required in order to staff FlexiStore Warehousing. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.

Funding Requirements and Use of Funds

FlexiStore Warehousing is seeking $200,000 in debt financing to launch its warehousing business. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Number of Clients Per Month: 26
• Average Revenue per Month: $78,000
• Office Lease per Year: $100,000

Financial Projections

Income statement.

Balance Sheet

Cash Flow Statement

Warehouse Business Plan FAQs

What is a warehouse business plan.

A warehouse business plan is a plan to start and/or grow your warehouse business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Warehouse business plan using our Warehouse Business Plan Template here .

What are the Main Types of Warehouse Businesses? 

There are a number of different kinds of warehouse businesses , some examples include: Distribution centers, Climate-controlled warehouses, Smart warehouses, Bonded warehouses, and Consolidated warehouses.

How Do You Get Funding for Your Warehouse Business Plan?

Warehouse businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Warehouse Business?

Starting a warehouse business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Warehouse Business Plan - The first step in starting a business is to create a detailed warehouse business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your warehouse business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your warehouse business is in compliance with local laws.

3. Register Your Warehouse Business - Once you have chosen a legal structure, the next step is to register your warehouse business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your warehouse business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Warehouse Equipment & Supplies - In order to start your warehouse business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your warehouse business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful warehouse business:

• How to Start a Warehouse Business

Logistics planning: how to implement it with flying colors

Properly structured logistics planning is fundamental for optimising all operations involved in the warehouse. And the incorporation of strategies specially devised for each particular case actually reduces inefficiencies and multiplies productivity.

But how is this successfully implemented in an organisation? In this article, we analyse which aspects to take into account when designing logistics planning and what the deployment process should look like.

What’s logistics planning? Definition and purpose

Logistics planning consists of an action plan agreed upon by all stakeholders that establishes a company’s logistics objectives . It ranges from the procurement of the raw materials necessary for manufacturing the product to the management of shipments to customers. For example, the players involved arrange the terms of delivery to the end customer, the loading docks to be assigned to a shipment, etc.

This plan also sets out the key performance indicators (KPIs) to be measured, as well as their parameters, in order to assess the company’s logistics performance . These data also serve to identify inefficiencies and errors to be remedied throughout the product’s supply chain .

Lastly, logistics planning determines the methods and regularity with which operations are evaluated. The aim is to prepare a continuous improvement plan that multiplies productivity in the installation.

When developing the planning, it’s important not to lose sight of your main objectives, namely:

• Reduction in errors and inefficiencies : planning facilitates control over information in all logistics phases, drastically minimising mistakes in the warehouse.
• Optimisation of resources and investment : monitoring the company’s logistics systems in real time allows managers to make decisions related to movement flows in the warehouse. As a result, it’s easier to leverage the resources available to the logistics manager.
• Increased productivity and efficiency : the end goal of all logistics planning is to ramp up throughput in the installation, boosting the productivity and efficiency of each operation.

Planning all the stages of logistics activities

It’s essential for planning to include the four key stages of any logistics operation:

• Procurement of raw materials
• Inventory control
• Goods distribution

Nevertheless, planning also includes aspects taking place prior to the logistics process, such as warehouse design and management of warehouse slotting, taking into account operator workflows and goods inflows and outflows.

Likewise, planning covers elements subsequent to the delivery to the end customer. An example of this is reverse logistics : the business needs to have a strategy for minimising the impact of this consumer trend, which already accounts for over $50 billion a year in the US, according to a study from the Reverse Logistics Association .

Good logistics planning: how to do it

The secret to good logistics planning is to analyse your supply chain down to the last detail to identify all obstacles in each logistics phase and devise the best way to overcome them.

Consequently, the strategy should take into account, for example, your end customers (and their delivery demands), your suppliers and their lead time , and even the intrinsic characteristics of the product.

Additionally, all logistics planning should:

• Be designed for growth : the company’s strategy should consider the possible expansion of the storage installations and production lines and the potential increase in demand. One criterion that can facilitate this next step is flexibility in warehouse design.
• Employ appropriate metrics : the supply chain generates an endless stream of information that, when properly analysed, is extremely useful. However, it can also lead to inefficiencies in the installation. Thus, understanding the product and defining the right KPIs is vital for logistics planning to be successful.
• Innovate constantly : although the business should have clear targets in place, it must continuously seek out new methods that enhance the efficiency of its logistics operations. From this perspective, the incorporation of new technologies in storage facilities has become an invaluable asset for responding to the challenges of omnichannel retail and same-day deliveries.

Staff and goods flows and warehouse organisation are other elements that should be integrated in a good logistics planning strategy. But the list of aspects to be included doesn’t end here. Handling equipment such as stacker cranes , storage systems such as the Pallet Shuttle , and automatic elements that ensure efficiency in picking such as pick-to-light systems will make the difference between good planning and no planning.

On the other hand, in recent years, the incorporation of warehouse management systems (WMSs) has become especially relevant , as they collect the information generated in the installation and automate such complex phases as stock control , warehouse shipping and receiving , and order picking .

Logistics planning for warehouse efficiency

All businesses, regardless of their sector, perform a role in the supply chain . Underestimating the importance of this stage in the business can lead to cost overruns, mistakes, and inefficiencies in service provided to the end customer.

An excellent example of logistics planning is seen in Belgian textbook rental company Rent a Book : Due to inefficient order prep ― reverse logistics accounted for up to 3% of its final shipments ― this firm designed a plan based on digitising its processes and automating picking with RFID technology. Another case illustrating logistics planning is KH Lloreda. Faced with increased demand, it came up with a logistics strategy that consisted of automating its warehouse to improve its customer service .

In the end, in any organisation, all departments have to work in sync and focus on the overall goal of logistics: to ensure that the goods arrive at right time, in the agreed-upon conditions, and at the lowest possible cost .

Recent entries

Chief supply chain officer: roles and responsibilities

Warehouse organisational chart: purpose and elements

SaaS: What is it and how does it work in logistics?

AI in warehouse management: impact and applications

3PL automation and how it’s transforming logistics warehouses

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7 Steps To Starting A Transport And Logistics Business Logistics is a big game both locally and internationally, because everything we use daily has been shipped and delivered across various destinations before it's sold and put to use. This is where you can cash in.

By Diana Albertyn Jul 22, 2019

You're reading Entrepreneur South Africa, an international franchise of Entrepreneur Media.

Thinking of starting your own transport and logistics company? While getting into the industry is not difficult, staying successful as a trucking company can be challenging if your business plan, finances and recruitment strategy aren't solid from day one.

Whether you're starting off with a bakkie or a minibus, you need to ensure you're prepared for high competition because of the transport and logistics industry's low barrier to entry.

Why should I start a transport and logistics company?

Aside from the ease of access into the industry, you don't need much capital to start off with – but you will need to do your homework. This is the only way you'll build a sustainable business.

"In many instances the entrepreneur starts these businesses with little to no capital, relying instead on revenue derived from the business to cover all overheads from day one," according to BizConnect . "Seek out customers and contracts before you start the business because transport contracts don't magically appear later on."

Related: Driving Profits In Transport

Now that you've established the kind of market you'll be entering into, how do you go about starting your own logistics company? These are some of the top questions you should be asking before starting a freight company:

1. What costs do I need to consider when starting a transport company?

You don't need to be a numbers genius, but a basic understanding of finances is helpful when launching any kind of start-up.

• First, you'll need to establish where you're going to source capital to get your transport business started. There are multiple options including the bank, investors and bootstrapping.
• Next, you need to consider the specific expenses associated with the logistics industry, for example the licence and toll expenses, aside from maintenance, fuel and driver skills development training costs.
• Although you haven't started running your transport and logistics company yet, you need to consider operating costs and maintenance expenses when drawing up your budget. The latter is crucial for providing reliable service to customers as you must deliver the excellence you will market to them. While marketing may not seem important at this stage, it's important to budget for this expense as your company grows.
• Remember that besides all the above costs, you'll require money to keep your vehicles safe when they aren't in use and when they are on the road. Invest in a secure location and other security features, such as trackers.
• Lastly, you're going to need to pay your drivers and other staff salaries on a monthly basis, so factor in that expense when budgeting for your transport and logistics business.

2. What should I look out for when buying my first fleet of trucks?

Choosing the right vehicles for your transport and logistics company means your drivers will have the right vehicle for the job. This leads to efficiency and speed of service.

Related: Benji Coetzee Never Worked In Logistics, Find Out How She Launched Empty Trips A Successful Logistics Marketplace

"Seeing someone driving a small van to deliver a huge load will make your company look unprofessional, as will using large bus trailers to carry minimal cargo," say experts in the truck and trailer industry.

Establishing what vehicles you need now will help you have a clearer idea of how much truck finance to apply for when you approach banks for transport financing options . This information helps structure your repayment plan and set your interest rate more accurately. You will be able to budget your finance accordingly.

Experts recommend investing in a long-haul truck for larger cargo and longer trips. Babcock International , for example, has vehicles that will meet this need, although the cost is slightly higher than an average-sized truck.

If you're already considering new vehicles instead of preowned trucks for your business, you'll benefit from a full warranty and service plans.

Related: 10 South African Entrepreneurs Who Landed Funding – And How They Did It

Once you've established how much you're able to spend on your fleet, start considering the available models for your business's specific needs.

"An important aspect to consider is what the vehicle will be used for. Now, this might sound simple, but it is an aspect that is often overlooked by many fleet owners. You need to have an idea in mind about what the vehicle will be used for before you can go to a dealership." – Truck & Freight

There vital aspects to consider when choosing your logistics vehicles are:

• What types of supplies you will be carrying
• The volume of supplies you will be carrying
• The types of terrains you will be driving over.

Courier companies will require different vehicles from moving companies, for example. Your idea of the ideal vehicle for your type of transport and logistics company may have to be adjusted based on the amount of finance you qualify for or how much capital you have managed to allocate to purchasing of vehicles for your fleet.

Related: How To Keep The Wheels Turning For Your Transport Business

You may need consider viable alternatives to find the right vehicle. So, list features like safety, comfort and condition instead of looking for brand names and the latest models. "Being open to different vehicles is the key to a successful fleet vehicle purchase," experts advise.

3. How can I get truck finance for my transport and logistics company?

Regardless of how vehicles are paid for, the cost of financing a transport and logistics business is the biggest expense you will have to manage.

Make sure you do your homework and understand the different options available when it comes to paying for vehicles. You can consider the following options:

• Financial lease and extended rental agreements, where the use of vehicles is funded from revenue, no upfront payment is required, but the ownership remains with the lessor;
• Instalment sale where a small amount relative to the total purchase price is paid as a deposit, your instalments are fixed, and you own the vehicle at the end of the term.

Related: How To Service Customers Through Reverse Logistics

Remember to factor in the running costs of operating a logistics company, such as maintenance and wear-and-tear. These expenses should be included when considering the amount of finance needed to launch and sustain your transport and logistics company.

Before approaching a financial institution for financing, devise a budget and calculate your affordability.

4. Where can I find training to help me start a transport and logistics business?

The Road Traffic Management Corporation provides regulated, professional training courses such as a National Certificate in Freight Handling. Contact TETA for a list of accredited training institutions.

The Department of Public Transport , Roads and Works is responsible for the issuing of operating licenses.

Related: A Free Business Plan Example to Launch Your South African Business

A National Certificate in Professional Driving is a valuable qualification that equips owners and managers with a variety of capabilities. It's advisable to look for a qualification that has been accredited by the Transportation and Training Authority.

Remember that according to South African law, any vehicle on public roads needs to be deemed roadworthy by an official testing station. The roadworthiness test checks the following aspects of the vehicle:

• Identification and documentation
• Electrical systems
• Fittings and equipment (including mirrors, safety belts etc)
• Braking system
• Wheels (including tyre condition)
• Suspension and undercarriage
• The steering mechanism is in order
• Exhaust system
• Transmission
• Instruments
• Vehicle dimensions.

5. How do I employ drivers to work for my transport business?

The key components of your business, besides your vehicles, are your drivers. Your drivers need to obtain the relevant licenses before they can be considered legal to operate vehicles in your transport and logistics business.

Related: 5 Different Types Of South African Business Structures

Avoid issues later on, with the law and your customers, by ensuring you're recruiting qualified and experienced drivers at launch and as your business needs grow. Not only do quality drivers boost productivity, but your reputation is elevated when your clients know they can rely on your staff.

Invest in excellent employees and avoid setting the bar as low as the ability to drive and follow directions. Your drivers will need the relevant driver's licences for different trucks and require training to handle driving in hazardous situations, like storms and heatwaves.

"Know how to deal with staff, and understand all of the shortcuts in the areas they'll be delivering to," advises Business South Africa . "They will also require excellent communication skills to relay messages about their whereabouts."

6. Where do I find customers for my logistics company?

As mentioned earlier, everything around us needs to be delivered from point A, to point B. So, while it may seem that jobs are scarce and getting business is difficult in the beginning, avoid grabbing the first opportunity to get your first client.

Related: Seed Capital Funding For South African Start-Up Businesses

It may sound counterintuitive to let chances at getting the wheels turning pass by, but, it's important to assess whether it's worth your while or not. Proper planning is essential so it's advisable to avoid ad-hoc business.

Remember that all you need to get customers' attention is a computer, a smartphone and an Internet connection.

"Technology centred around cargo has advanced dramatically over the years, and as have the expectations of customers. Most large companies allow clients to book and track all of their parcels or deliveries online." – Business South Africa

The best part is that, not only is getting word about your transport and logistics coming out there inexpensive, it's also relatively easy and quick.

Related: Your Free Business Idea Evaluation SWOT Analysis Template

Embracing technology doesn't mean setting up an elaborate website, but you do need to ensure that your customers can track their deliveries and reach you quickly if they need to. Perhaps you should implement an SMS notification system so clients can track their orders at the touch of a button.

Ensure your system is accurate when it comes to ETA for deliveries and any delays on delivery, giving clients peace of mind about using your service and the confidence to recommend you to others.

Your service needs to be as simple and convenient to use as possible.

7. How do I get suppliers to add my logistics company to their books?

The best way to get noticed and acquire regular business is by being reliable from day one. People like that. They notice and appreciate good service and when you start your transport business, it's a good reputation to have.

Related: 2 Simple Ways to Keep Your Startup Growing

When a business decides to make use of your transport services, they need to be sure that you won't let them down . Satisfied customers value trustworthy service and it's easier to retain existing clients when you offer quality service. It also helps that good customers can encourage new business through recommendations.

Despite the many challenges that come with running a successful transport and logistics business, customers like to know that you're giving of your best and consistency is key to build loyalty from these companies.

It's advisable to start out with logistics you're best qualified to handle and work your way from there.

If you have experience with smaller items, start there, but if you intend to eventually expand your portfolio to include other specialised services, acquire as much comprehensive knowledge as you can, while building a strong set of connections in relevant regions across the industry, and possibly the country as well.

Related: Treat Yourself as a Client for Startup Success

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Logistics Management 101: A Beginner’s Guide

What Is Logistics Management?

Logistics management is the process of managing the activities that are required to transport goods from its source to the final customer. That process involves a series of logistics activities such as order processing, material handling, packaging, warehousing, transportation and customer service management.

The logistics management process is used for tangible goods such as raw materials, finished products, equipment and machinery to food or other consumable items. A person who works in this field is called a logistician or logistics manager.

Logistics Management vs. Supply Chain Management

Logistics management is a subset of the larger supply chain management. Supply chain management plans, implements and controls the efficient flow of storage, goods, services and related information from the point of origin to the point of consumption. This is done for the purpose of meeting the requirements of customers.

Logistics management in business works across industries. It aims to manage the fruition of project life cycles , supply chains and resultant efficiencies. As businesses grow more complex and expand into a global marketplace, business logisticians have evolved into something called supply chain logisticians.

With logistics management in manufacturing , the focus is twofold: inbound logistics for internal functions and outbound logistics for the external flow from the point of origin to the point of consumption. Logisticians focus on inventory management, purchasing, transportation, warehousing, consultation and the organization and mapping of these processes.

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Different Types of Logistics Management

Here’s a quick overview of the main types of logistics management, each emphasizing a different aspect of the supply chain management process.

Inbound Logistics Management

Inbound logistics management refers to the logistics activities that are necessary to transport materials, equipment and machinery from a supplier to a production facility.

Production Logistics and Management

Production logistics management manages the transportation of goods during the production process. This involves the staging of materials from production warehouses to the production line at the right time to streamline the production process .

Outbound Logistics Management

Outbound logistics management is the opposite of inbound logistics. It involves the transportation of goods from the production or distribution center to the final customer.

Third-Party Logistics Management

Third-party logistics management refers to the outsourcing of logistics management activities. Third-party logistics management can involve outsourcing inbound or outbound logistic activities.

Supply Management Logistics Management

This involves the planning, procuring and coordinating materials that are needed at a certain time at a particular place for the production of a task. This includes transportation of the materials as well as a place to store them. Additionally, evaluating the level of supply at the different stages of the process is required to ensure the needs of the customer are met, for example delivering materials to a construction site or parts for a manufacturing plant.

Distribution Logistics Management

This takes stored materials and transports them to where they need to go. The issues in this involve moving materials; including loading, unloading and transportation, as well as keeping track of the stock and how it’s used. This type of logistics management controls the movement of supplies from a central warehouse to the stores that sell the product to the public.

Customer Service Logistics Management

Customer service logistics management consists of ensuring products are delivered on time and damage-free to ensure customer satisfaction. To do this, organizations use logistics management tools and techniques to track customer interactions along the logistics management process of order processing, handling, transportation and delivery of goods.

Reverse Logistics Management

This is about the management of reclaiming materials and supplies from the customer back to production. For example, reverse logistics management is concerned with the return of unwanted or unused products from the end customer seeking a refund.

To model, analyze, visualize and optimize this complex logistical puzzle, the use of logistics management software is often used. ProjectManager has planning tools such as Gantt charts, kanban boards, timesheets and real-time dashboards to help you manage the tasks in your logistics management process. Get started for free today.

The Logistics Management Process: Logistics Activities

Logistics management is a process that consists of logistic activities, also referred to as functions that allow organizations to implement the types of logistics management explained above.

1. Warehousing or Warehouse Management

A warehouse is a physical place where goods are stored when they come out of production. But warehouse management can be strategically used by companies to excel in the market. For example, the location of a warehouse can play a significant role by allowing companies to deliver their products faster than their competitors. Warehousing automation can also help companies cut labor costs.

2. Order Processing & Fulfillment

Order processing and fulfillment is the process of receiving an order, ensuring payment terms have been met, checking the production capacity and availability of stock and preparing the order for transportation. Another important aspect of order processing & fulfillment is to document transactions and make sure the warehouse inventory is updated whenever an order is fulfilled.

3. Material Handling

Materials handling refers to the movement of goods in a warehouse. Companies need to plan their warehouse layouts carefully to help their employees clearly understand where to find the products that are ordered by customers. Some warehouses for big companies can be very large, so it’s important to plan carefully to avoid any logistic inefficiencies.

4. Packaging

In logistics management, the packaging doesn’t focus on the aesthetics of the product packaging for the final customers, but instead on how well the product is packaged for transportation in terms of storage space efficiency, breakage prevention, packing cost and ease of handling. If packaging meets these requirements, it can help companies save money and facilitate its logistics management process.

5. Transportation Management

Transportation is the process of delivering products or materials from their warehouse to the final customer. This is the most expensive logistics activity and therefore, is a step that should be planned carefully to minimize manufacturing costs . Logistic managers need to find the most efficient transportation schedule and method of transportation such as rail, truck water and air.

6. Inventory Management

Keeping an inventory of products at the warehouse is costly for businesses and may affect their profitability. For this reason, the goal of inventory control is to gauge customer demand to maintain an inventory level that satisfies it, but without causing overcosts. Some manufacturing methods such as lean manufacturing or just-in-time manufacturing allow businesses to manage their inventory costs.

Related: Inventory Template

The Distribution Network of Logistics Management

The various links and points of distribution in a logistics management network include the following:

• Factories that manufacture products
• Warehouses that store products
• Distribution centers to receive and return items for clients
• Transport to deliver the product
• Retail locations, from small to larger stores sell a product

These are the major hubs for the logistics of a product, though there can be vendors and intermediaries operating between these points.

Tips for Smart Logistics Management

Logistics management involves a lot of planning and the more steps, the better. By considering every stage of the product, its distribution and the return of materials and supplies, you’re more likely to increase efficiencies and increase revenues.

The larger the operation, the more complex and difficult the logistics management. Therefore, the more you need a strong logistics management plan. To be prepared and have the best plan possible, follow the below tips.

• Have a strong plan: Like any management, it succeeds or fails on the plan’s strength. The more thorough your plan, the less you’ll have to think on your feet. There will always be issues and only so many potential risks you can anticipate, but planning early and in detail can help mitigate delays and other obstructions to the clear flow of materials and supply.
• Make a plan B: No matter how good your initial plan is, there can always be something that comes along that it cannot manage. That’s why you need a contingency plan for every element of your logistics plans to respond to unforeseen problems that might arise. But it’s important to also know when to give up the original plan and move on to the secondary one.
• Hire a manager: It’s critical that this process has an experienced leader who can work with a variety of different parties, all of whom are involved in the logistics of the materials and supplies. That means interpersonal skills are a must. They should also have strong industry contacts to deal with any last-minute logistics changes in suppliers, etc.
• Automate: It goes without saying that automation is a built-in way to make workflow more efficient. They are so many processes that can be helped through task automation , from tracking to monitoring delivery to fleet and inventory management software.
• Learn from mistakes: This goes for almost everything. You’ll take missteps on your journey of managing logistics. That’s a given. What’s not assured is that you’ll learn from those mistakes, so they don’t happen again. Take time to look back on what you’ve done, where it worked and where it didn’t, and get feedback from your team.

Why Is Logistics Management Important?

The purpose of logistics management is about finding more efficient and effective ways to move resources and products from conception to completion and, finally, to the customer. But the driving force of these actions is to meet customer demand and provide the best service possible to retain customers and maintain their satisfaction by meeting their product requirements .

As customers demand better service, there’s a need to ship faster, more accurately and with a high level of quality. It’s through logistics management that customer satisfaction is achieved.

But that’s not the only benefit. It also helps to create visibility in the business’ supply chain . By analyzing historical data and tracking the real-time movement of goods, logistics managers can better the flow of materials and avoid potential disruptions.

Therefore, logistics management helps drive up revenue. It improves customer service and adds to the company’s good reputation and brand, which in turn creates new and more business. With more visibility into the supply chain, there’s the opportunity to save costs in operations , by controlling inbound funds, keeping inventory at the right level and organizing the reverse flow of goods.

How ProjectManager Helps Your Logistics Management

Logistics is just planning with literal deliverables. Therefore, successful logistics managers understand the importance of a project management software tool to help them collect, organize and move items from one place to the next efficiently. ProjectManager is award-winning software that’s designed to improve the organization of projects and teams to maximum effect.

Track Progress With Kanban Boards

When you’re dealing with an overwhelming amount of shipping, priorities and deadlines, you need a way to see where those pieces are at any given time. Our kanban tool visualizes the movement of your shipments with cards representing each item and columns that show where it is in your shipping cycle.

Dashboards and Reporting Keep Things Moving Smoothly

Since our software is online, every time there’s a status update, it reflects across the tool. We have dashboard and reporting tools that provide more data and make managing logistics simple. For example, you can get a high-level view of your costs, variance, tasks and more. The data is crunched automatically and displayed in easy-to-read graphs and charts.

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Logistics Organizational Structure & How to Develop an Efficient Team

The organizational structure of a logistics company is vital to the business’s success. The right personnel in the correct positions can mean the difference between a smoothly running operation and one constantly struggling. 

This article will discuss the different components of a logistics company and how to develop an efficient team for your business.

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What is a Logistics Company, and What Are its Key Components?

A logistics company is a business that specializes in the transportation and storage of goods. The critical components of a logistics company are the transportation, warehousing, and distribution divisions. Each of these divisions has responsibilities, and each plays a vital role in the company’s operation.

Transportation Division

The transportation division is responsible for moving goods from one location to another. This may include local, national, and international shipments. The transportation division must have a good understanding of the different modes of transportation and the regulations that govern them. They must also be able to plan and schedule shipments in a way that is efficient and cost-effective.

Warehousing Division

The warehousing division is responsible for the storage of goods. This may include raw materials, finished products, or even hazardous materials. The warehousing division must have a good understanding of the different storage facilities and the regulations governing them. They must also be able to plan and organize the storage of goods in a way that is efficient and cost-effective.

Distribution Division

The distribution division is responsible for the distribution of goods. This may include local, national, and international shipments. The distribution division must have a good understanding of the different modes of transportation and the regulations that govern them. They must also be able to plan and schedule shipments in a way that is efficient and cost-effective.

Key Personnel in a Logistics Company

Several key positions must be filled to run a successful logistics company. These positions include:

Transportation Manager

The transportation manager is responsible for moving goods from one location to another. This may include local, national, and international shipments. The transportation manager must have a good understanding of the different modes of transportation and the regulations that govern them. They must also be able to plan and schedule shipments in a way that is efficient and cost-effective.

Warehousing Manager

The warehousing manager is responsible for the storage of goods. This may include raw materials, finished products, or even hazardous materials. The warehousing manager must have a good understanding of the different storage facilities and the regulations governing them. They must also be able to plan and organize the storage of goods in a way that is efficient and cost-effective.

Distribution Manager

The distribution manager is responsible for the distribution of goods. This may include local, national, and international shipments. The distribution manager must understand the different modes of transportation and the regulations that govern them. They must also be able to plan and schedule shipments in a way that is efficient and cost-effective.

Customer Service Manager

The customer service manager is responsible for providing excellent customer service. This may include answering customer questions, resolving customer complaints, and providing information about the company’s products and services. The customer service manager must have excellent communication skills and be able to deal with difficult people.

Sales Manager

The sales manager is responsible for generating sales. This may include developing marketing plans, setting sales goals, and managing a sales team. The sales manager must be able to motivate and lead a team of salespeople. They must also be knowledgeable about the company’s products and services.

Marketing Manager

The marketing manager is responsible for promoting the company’s products and services. This may include developing marketing plans, conducting market research, and creating advertising campaigns. The marketing manager must be creative and have excellent communication skills.

Financial Manager

The financial manager is responsible for the financial health of the company. This may include developing budgets, preparing financial reports, and managing investments. The financial manager must be able to understand and interpret financial data. They must also be able to make sound financial decisions.

Human Resources Manager

The human resources manager is responsible for the management of the company’s human resources. This may include recruiting and hiring employees, managing employee benefits, and handling employee relations issues. The human resources manager must be able to effectively communicate with people. They must also have a good understanding of labor laws.

Each of these managers has a specific set of responsibilities that they must fulfill in order to keep the operation running smoothly.

How to Develop an Efficient Team for Your Logistics Company

Now that you understand the different roles and responsibilities of a logistics company, you can start to develop an efficient team. Here are a few tips:

• Hire people with the right skills and experience.
• Train your employees on the specific tasks they will be responsible for.
• Delegate tasks to employees based on their skills and experience.
• Set clear expectations for each employee.
• Hold employees accountable for their performance.
• Provide feedback to employees on a regular basis.
• Reward employees for their good work.

By following these tips, you can develop an efficient team that will help your logistics company run smoothly.

The organizational structure of a logistics company is vital for ensuring that goods are stored and transported efficiently and cost-effectively. By hiring the right people and training them on the tasks they will be responsible for, you can develop an efficient team that will help your logistics company run smoothly.

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Free Business Plan Template for Small Businesses (2024)

Use this free business plan template to write your business plan quickly and efficiently.

A good business plan is essential to successfully starting your business —  and the easiest way to simplify the work of writing a business plan is to start with a business plan template.

You’re already investing time and energy in refining your business model and planning your launch—there’s no need to reinvent the wheel when it comes to writing a business plan. Instead, to help build a complete and effective plan, lean on time-tested structures created by other  entrepreneurs and startups. 

Ahead, learn what it takes to create a solid business plan and download Shopify's free business plan template to get started on your dream today. 

What this free business plan template includes

• Executive summary
• Company overview
• Products or services offered
• Market analysis
• Marketing plan
• Logistics and operations plan
• Financial plan

This business plan outline is designed to ensure you’re thinking through all of the important facets of starting a new business. It’s intended to help new business owners and entrepreneurs consider the full scope of running a business and identify functional areas they may not have considered or where they may need to level up their skills as they grow.

That said, it may not include the specific details or structure preferred by a potential investor or lender. If your goal with a business plan is to secure funding , check with your target organizations—typically banks or investors—to see if they have business plan templates you can follow to maximize your chances of success.

Our free business plan template includes seven key elements typically found in the traditional business plan format:

1. Executive summary

This is a one-page summary of your whole plan, typically written after the rest of the plan is completed. The description section of your executive summary will also cover your management team, business objectives and strategy, and other background information about the brand. 

2. Company overview

This section of your business plan will answer two fundamental questions: “Who are you?” and “What do you plan to do?” Answering these questions clarifies why your company exists, what sets it apart from others, and why it’s a good investment opportunity. This section will detail the reasons for your business’s existence, its goals, and its guiding principles.

3. Products or services offered

What you sell and the most important features of your products or services. It also includes any plans for intellectual property, like patent filings or copyright. If you do market research for new product lines, it will show up in this section of your business plan.

4. Market analysis

This section includes everything from estimated market size to your target markets and competitive advantage. It’ll include a competitive analysis of your industry to address competitors’ strengths and weaknesses. Market research is an important part of ensuring you have a viable idea.

5. Marketing plan

How you intend to get the word out about your business, and what strategic decisions you’ve made about things like your pricing strategy. It also covers potential customers’ demographics, your sales plan, and your metrics and milestones for success.

6. Logistics and operations plan

Everything that needs to happen to turn your raw materials into products and get them into the hands of your customers.

7. Financial plan

It’s important to include a look at your financial projections, including both revenue and expense projections. This section includes templates for three key financial statements: an income statement, a balance sheet, and a cash-flow statement . You can also include whether or not you need a business loan and how much you’ll need.

Business plan examples

What do financial projections look like on paper? How do you write an executive summary? What should your company description include?  Business plan examples  can help answer some of these questions and transform your business idea into an actionable plan.

Professional business plan example

Inside our template, we’ve filled out a sample business plan featuring a fictional ecommerce business . 

The sample is set up to help you get a sense of each section and understand how they apply to the planning and evaluation stages of a business plan. If you’re looking for funding, this example won’t be a complete or formal look at business plans, but it will give you a great place to start and notes about where to expand.

Lean business plan example

A lean business plan format is a shortened version of your more detailed business plan. It’s helpful when modifying your plan for a specific audience, like investors or new hires. 

Also known as a one-page business plan, it includes only the most important, need-to-know information, such as:

• Company description
• Key members of your team
• Customer segments

💡 Tip: For a step-by-step guide to creating a lean business plan (including a sample business plan), read our guide on how to create a lean business plan .

Benefits of writing a solid business plan

It’s tempting to dive right into execution when you’re excited about a new business or side project, but taking the time to write a thorough business plan and get your thoughts on paper allows you to do a number of beneficial things:

• Test the viability of your business idea. Whether you’ve got one business idea or many, business plans can make an idea more tangible, helping you see if it’s truly viable and ensure you’ve found a target market. 
• Plan for your next phase. Whether your goal is to start a new business or scale an existing business to the next level, a business plan can help you understand what needs to happen and identify gaps to address.
• Clarify marketing strategy, goals, and tactics. Writing a business plan can show you the actionable next steps to take on a big, abstract idea. It can also help you narrow your strategy and identify clear-cut tactics that will support it.
• Scope the necessary work. Without a concrete plan, cost overruns and delays are all but certain. A business plan can help you see the full scope of work to be done and adjust your investment of time and money accordingly.
• Hire and build partnerships. When you need buy-in from potential employees and business partners, especially in the early stages of your business, a clearly written business plan is one of the best tools at your disposal. A business plan provides a refined look at your goals for the business, letting partners judge for themselves whether or not they agree with your vision.
• Secure funds. Seeking financing for your business—whether from venture capital, financial institutions, or Shopify Capital —is one of the most common reasons to create a business plan.

Why you should you use a template for a business plan

A business plan can be as informal or formal as your situation calls for, but even if you’re a fan of the back-of-the-napkin approach to planning, there are some key benefits to starting your plan from an existing outline or simple business plan template.

No blank-page paralysis

A blank page can be intimidating to even the most seasoned writers. Using an established business planning process and template can help you get past the inertia of starting your business plan, and it allows you to skip the work of building an outline from scratch. You can always adjust a template to suit your needs.

Guidance on what to include in each section

If you’ve never sat through a business class, you might never have created a SWOT analysis or financial projections. Templates that offer guidance—in plain language—about how to fill in each section can help you navigate sometimes-daunting business jargon and create a complete and effective plan.

Knowing you’ve considered every section

In some cases, you may not need to complete every section of a startup business plan template, but its initial structure shows you you’re choosing to omit a section as opposed to forgetting to include it in the first place.

Tips for creating a successful business plan

There are some high-level strategic guidelines beyond the advice included in this free business plan template that can help you write an effective, complete plan while minimizing busywork.

Understand the audience for your plan

If you’re writing a business plan for yourself in order to get clarity on your ideas and your industry as a whole, you may not need to include the same level of detail or polish you would with a business plan you want to send to potential investors. Knowing who will read your plan will help you decide how much time to spend on it.

Know your goals

Understanding the goals of your plan can help you set the right scope. If your goal is to use the plan as a roadmap for growth, you may invest more time in it than if your goal is to understand the competitive landscape of a new industry.

Take it step by step

Writing a 10- to 15-page document can feel daunting, so try to tackle one section at a time. Select a couple of sections you feel most confident writing and start there—you can start on the next few sections once those are complete. Jot down bullet-point notes in each section before you start writing to organize your thoughts and streamline the writing process.

Maximize your business planning efforts

Planning is key to the financial success of any type of business , whether you’re a startup, non-profit, or corporation.

To make sure your efforts are focused on the highest-value parts of your own business planning, like clarifying your goals, setting a strategy, and understanding the target market and competitive landscape, lean on a business plan outline to handle the structure and format for you. Even if you eventually omit sections, you’ll save yourself time and energy by starting with a framework already in place.

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Business plan template FAQ

What is the purpose of a business plan.

The purpose of your business plan is to describe a new business opportunity or an existing one. It clarifies the business strategy, marketing plan, financial forecasts, potential providers, and more information about the company.

How do I write a simple business plan?

• Choose a business plan format, such as a traditional or a one-page business plan. 
• Find a business plan template.
• Read through a business plan sample.
• Fill in the sections of your business plan.

What is the best business plan template?

If you need help writing a business plan, Shopify’s template is one of the most beginner-friendly options you’ll find. It’s comprehensive, well-written, and helps you fill out every section.

What are the 5 essential parts of a business plan?

The five essential parts of a traditional business plan include:

• Executive summary: This is a brief overview of the business plan, summarizing the key points and highlighting the main points of the plan.
• Business description: This section outlines the business concept and how it will be executed.
• Market analysis: This section provides an in-depth look at the target market and how the business will compete in the marketplace.
• Financial plan: This section details the financial projections for the business, including sales forecasts, capital requirements, and a break-even analysis.
• Management and organization: This section describes the management team and the organizational structure of the business.

Are there any free business plan templates?

There are several free templates for business plans for small business owners available online, including Shopify’s own version. Download a copy for your business.

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Distribution Logistics 101

A manufacturer produces a commodity that is bought by an end customer – and that sounds simple enough. However, many decisions and processes are necessary so that a product not only reaches its destination, but also everyone involved is satisfied with the result: manufacturer, intermediary, service provider, and customer. The tasks required for this constitute distribution logistics. This essential aspect of logistics is presented here.

What Is Distribution Logistics?

Distribution logistics is also referred to as sales logistics. It represents the link between a company’s production and sales activities. The aim is to bring commodities from a company to its customers and to control this physical flow of goods in a targeted manner and make it as efficient as possible.

Distribution Logistics: Definition

Distribution logistics is the sum of all processes between production and the customer. These processes result from planning, managing, and controlling the storage, handling, and transport of goods.

Simply put, distribution logistics encompasses all the activities required to get a company’s products to the end customers as quickly, precisely, and economically as possible. An example of a work step in distribution logistics is outbound goods . Conversely, inbound goods is an essential part of procurement logistics, which is the counterpart of distribution logistics.

Objectives of Distribution Logistics

Distribution logistics has a direct influence on the customer experience and the business success because it is all about how the goods reach the customer. Two overarching goals may be derived from this:

• customer satisfaction
• minimization of logistics costs (packaging, transport, warehousing, order processing) without compromising delivery quality and customer satisfaction

In addition, distribution logistics should ensure for a company:

• high availability , so that customers acquire a product as quickly and conveniently as possible (which in turn contributes to customer satisfaction)
• potential influence on the distribution and marketing of their products

Tasks and Realization of Distribution Logistics

To achieve these goals, decisions must be made at three levels in distribution logistics:

• overarching strategy
• tactical design of distribution processes
• operational execution.

These levels result in corresponding tasks for distribution logistics:

• strategic tasks : These include, for example, determining a distribution channel, planning of warehousing with the selection of distribution centers, deciding on IT management systems, marketing strategy, and establishing cost-efficient distribution networks.
• tactical tasks : decision on the use of own means of transport or the assignment of transport logistics to experienced service providers such as DHL Freight; definition of the level of service; selection and dimensioning of the necessary means of transport
• operational tasks : order processing, order picking, packaging and shipment, load and route planning, customer service or returns management

Different Distribution Channels

The distribution or sales channel has already been mentioned as one of the strategic tasks. It refers to the way in which the product is delivered from the manufacturer to the customer. A basic distinction is made between a direct and an indirect distribution channel.

Direct Distribution

The manufacturing company needs its own sales team for direct distribution. The most common types of direct distribution are factory outlet, online sale, telemarketing, and still also doorstep selling. The main advantage of direct sales is complete control over the entire process – a maximum of influence. The disadvantage is the costly and time-consuming set-up and upkeep of a corporate sales department.

That is why direct distribution is only suitable for a few types of products such as:

• goods sensitive to transport
• complex products requiring explanation
• products uneconomical for retailers to store, or
• special products with a very limited customer base.

The direct distribution channel only makes economic sense if the distribution costs incurred on the company side are lower than the profit margin achieved with direct distribution.

Indirect Distribution

In indirect distribution, the company outsources the distribution of its products to one or more marketing agents. Wholesalers and retailers, for example, are such marketing agents. A wholesaler is an intermediary who buys products from manufacturers to resell them to retailers. Depending on how many marketing agents are involved, there are three different variants of indirect distribution:

• one-level with only one marketing agent. Most often, this is a retailer or, nowadays, an online marketplace.
• two-level : Initially, the company sells its goods to a wholesaler, who resells them to retailers.
• multilevel : In this case, more than two marketing agents are involved. This model is most common in the import-export business or, for instance, in the distribution of agricultural products, where farmer’s cooperatives are engaged.

Indirect distribution inevitably limits the company’s influence over product presentation and other aspects of sales that it can control in direct distribution. In addition, the trade margin is reduced by that amount by which the retailers participate in the turnover. On the other hand, through indirect distribution, a greater market breadth can usually be achieved and the company does not have to carry out labor-intensive tasks in distribution logistics itself.

The target group is decisive for the choice of a distribution channel – direct or indirect, one-, two-, or multilevel. Can the intended consumer be reached by this means of distribution? Furthermore, how can high delivery quality best be implemented? The distribution channel should support the corporate goals.

The Most Important Key Figures in Distribution Logistics

Whether the selected sales channel is a success can be determined based on the relevant KPIs (key performance indicators). KPIs objectively capture the quality and efficiency of individual operational processes or business units.

These KPIs are decisive in distribution logistics:

• delivery accuracy: How many delivery orders are executed without incident?
• delivery time
• transport costs
• warehousing costs
• supplier-compliance: How efficient and reliable is the logistics service provider's performance?

Distribution logistics is about that part of the supply chain that is critical to customer satisfaction and loyalty. For supporting the corporate success via distribution logistics, smooth processes that ensure delivery quality, delivery accuracy, and delivery reliability are crucial.

In this critical scope of duties, it is essential that you can rely on a dependable distribution partner. At DHL Freight, we put our experience and passion to work to help you achieve your distribution goals. With us, your goods will reach their destination quickly, safely and sustainably.

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How to ‘ACE’ hospitality recruitment

Thanks to the lifting of travel restrictions in many regions, hotels are filling up again. However, instead of heaving a sigh of relief that the worst of the pandemic is over, hotel executives find themselves with a new problem on their hands: a lack of personnel.

Up to 70 percent of all hospitality workers in the United States 1 “AHLA data shows 70 percent of hotel employees laid off or furloughed,” TSNN, May 4, 2020. and the United Kingdom 2 “Coronavirus and its impact on UK hospitality: January 2020 to June 2021,” Office for National Statistics, July 19, 2021. were furloughed or laid off during the pandemic, and many employers are struggling to get them to return to work. Like their counterparts in other industries, hospitality employees have used the time off to reassess their priorities, and many have found new jobs that offer more flexibility.

Accustomed to this new way of working, many are reluctant to go back to their old positions, especially if they held roles waiting tables, cleaning rooms, and checking in guests. Such roles make up a significant portion of the hospitality and travel workforce in many markets, such as in the United Kingdom, where they account for 45 percent 3 Hospitality and tourism workforce landscape , Economic Insight, June 2019. of all jobs in the industry. While automation may reduce the workforce requirements for many of these functions in the future, the current labor crunch is worsening as demand for hospitality services in the immediate term spikes.

Even those who kept their jobs are likely to seek better career prospects elsewhere as more employment opportunities open up: around 40 percent of respondents in a McKinsey survey said that they are thinking about leaving their positions in the next three to six months —and many are even willing to quit without having another job lined up.

What’s changed and what can employers do to recruit—and retain—talented employees?

In this article, we delve into the five key talent acquisition trends that employers should be aware of. We also offer a simple approach for how they might “ACE” talent attraction: analyze talent suitability with digital tools; clearly define and communicate job requirements and career paths; and empower the HR department with the skills and tools they need to find and keep talented candidates.

Five hiring trends all hospitality employers should know

The pandemic has altered the hiring landscape in nearly every industry, including hospitality. Employers who equip themselves with a deep understanding of these five shifts in talent acquisition will be better able to adapt their hiring processes to staff their workforce with the talent their companies need to thrive into the future, as well as to recoup the losses incurred during the pandemic.

1. Digitization is radically changing hospitality roles

Like many other industries, hospitality is being transformed by digital and automation technologies. As such, many companies are rethinking their business models and workforce composition with an eye at simultaneously lowering costs and improving customer experience. In hotels, more guests are checking themselves in at self-help kiosks, and autonomous drones are delivering amenities directly to rooms, alleviating the labor shortage for some of the more labor-intensive functions.

As automation takes over more tasks currently performed by humans, new job roles will be created, especially to design and manage emerging technologies and digital solutions. It is estimated that 65 percent of primary-school students in 2030 will perform jobs that don’t yet exist. 4 The future of jobs report, Chapter 1: The future of jobs and skills , World Economic Forum, 2022. As hotels increasingly base decision making on customers’ booking and behavioral patterns, AI skills will grow in importance, and more data analyst positions will be created.

Hotel brands and other hospitality-focused companies have been rolling out customer-facing mobile apps, as they have found online digital channels to be especially effective at direct customer engagement. As such, more user experience (UX) designers will be needed to create attractive and intuitive customer journeys on these digital platforms and to continually optimize their design and functionality based on data analyses of customer engagement. Online marketing managers will also be needed to conceptualize and launch compelling campaigns and brand stories across mobile and other emerging platforms to entice potential customers.

To support all these shifts, software engineers will be needed to design and implement new AI solutions on the back end, as well as to optimize booking platforms on the front end and embed software for Internet of Things (IoT) applications.

2. Employees are expecting more flexibility

The pandemic has debunked, to a large extent, the idea that work needs to be done exclusively in an office. Videoconferencing and cloud-based digital tools have enabled remote work without much loss in productivity, if any. And while many people around the world have begun returning to their workplaces, they have grown accustomed to the increased flexibility to manage work and personal commitments—a level of autonomy they are reluctant to relinquish. This has led many companies to implement numerous hybrid work models.

Job searches for remote work have nearly quintupled from June 2019 to June 2021. And while five years ago about a fifth of job postings offered the option to work remotely, nearly 80 percent of postings do today (exhibit). As jobs have become increasingly location agnostic, former hospitality workers have shown an unwillingness to return to jobs that require them to be tethered to reception desks, for example. Furthermore, candidates applying for digital roles in the hospitality sector expect the same flexibility offered in other industries.

Based in Germany, Koncept Hotel is an example of a company that has radically embraced the idea of remote work. Some of the hotel chain’s properties are almost entirely without staff, as everyone apart from the housekeeping team works remotely. A cloud-based automation system takes care of everything, from reservations and check-ins to payments and night audits.

Many roles in hospitality could be offered with remote-working options, including social-media managers, event planning consultants, accountants, marketing and PR executives, and customer support associates. Even a concierge can go virtual with the right technology support system in place.

But what about roles that have to be performed in person, such as housekeeping or waitstaff? To address this issue, employers may need to consider redesigning what a career in hospitality looks like. For example, if employees have a diverse portfolio of roles, they may be able to enjoy more flexibility in terms of work hours and location, along with a number of other benefits.

3. Hospitality careers are becoming more multifaceted

People who currently work in the hospitality industry often wear multiple hats out of necessity. Staffing shortages are straining the smooth running of daily operations, and guest-facing employees frequently have to perform different functions to keep service standards high. For example, many hotels equip receptionists with mobile tablets so they can double as concierges. And as more burned-out employees leave the hospitality workforce, the labor crunch will likely become more severe, especially for tasks that require a physical presence.

However, some hotels are taking this seemingly intractable challenge as an opportunity to reimagine what a career trajectory in hospitality looks like. While important, a paycheck has become only one among a number of factors candidates consider when accepting an offer. Employees seek a sense of fulfilment and meaning, and one way employers can foster personal and professional growth in hotel staff is to provide opportunities for them to expand their skill set.

In-person roles can become more rewarding for current employees and more attractive to talented candidates. Digitization can provide employees in service jobs with more flexibility in responsibilities and career growth. Some functions, such as housekeeping and reception, may require a physical presence, but an employee with a portfolio of in-person and location-agnostic duties may not have to spend all their workdays on-site. As career paths become more multifaceted, employees may also be able to command higher wages and greater satisfaction.

Companies could identify and offer top performers training opportunities for higher-skilled functions in other departments. For example, a member of the front-desk team may enroll in a social-media training program to learn how to conceptualize, run, and track the effectiveness of online campaigns. After completing the course, such employees could work with the hotel’s marketing department, contributing to digital campaigns, and, as such, work from home two days a week. Since front-desk employees have firsthand interactions with many guests, they could offer invaluable qualitative insights to the campaigns they work on, while at the same time deriving professional fulfillment from being involved in an interesting project, greater flexibility to balance their personal and professional commitments, as well as a higher salary.

Naturally, empowering staff to take on multiple roles requires an investment from hotel managers and executives. And as more employees work across functions, collaboration among different departments needs to be effective, and executives would have to build the right suite of digital and on-site training programs. A robust technology and communications stack could be key to reducing complexity and to opening up the instant communication channels needed for effective problem solving. Hyatt, for instance, has created a centralized digital workspace called Konverse, which includes communication channels and a task tracking system that enables daily collaboration for employees from front desk to housekeeping to engineering.

4. ESG cannot be ignored, even in hiring

Many employees take into consideration the social and environmental responsibility of a company when choosing a place to work. As customers, investors, and employees grow in their awareness of environmental, social, and corporate governance (ESG) issues, hotels are reviewing every aspect of their corporate strategy and operations, including hiring practices and roles.

Many companies are finding it helpful to have a leadership position that provides oversight and coordinates best practices on issues pertaining to their climate impact. As examples, Carnival Cruise Line has a strategic sourcing manager in charge of sustainable procurement, and TUI Cruises has an environmental manager who is in charge of ensuring that all of the company’s functions are aligned with ESG standards. On a more granular level, more hotel chefs are being tasked with sourcing more locally, organically, and sustainably, and chains such as the Shaner Hotel Group hire eco guides to educate guests about the environment and plan eco-focused activities.

As customers, investors, and employees grow in their awareness of environmental, social, and governance issues, hotels are reviewing every aspect of their corporate strategy and operations.

When hiring, employers could also be paying more attention to diversity, equity, and inclusion (DEI). A diverse and inclusive workforce contributes to greater employee satisfaction and is correlated with better economic performance . Companies could partner with external organizations and reassess their perks and benefits to foster greater inclusion. For instance, Kimpton Hotels and Restaurants works with organizations such as Trans Can Work, The Mom Project, and DirectEmployers Association in their recruitment efforts, enabling the company to benefit from a diverse talent pool of candidates. Meanwhile, Hilton, which ranks second in Fortune’s 100 Best Companies to Work For list for 2022, uses a quarterly diversity dashboard to track a company’s diversity performance based on clear metrics and targets, including the makeup of its corporate leadership. To ensure a pipeline of diverse leaders for senior management, Hilton partners with universities such as Harvard and Cornell on external development programs.

5. The bar for hygiene will remain elevated

Even though restrictions implemented during the COVID-19 pandemic are gradually being lifted, many hygiene protocols will likely endure beyond the pandemic. New roles and skills are needed to improve the coordination of hygiene-related initiatives across companies to protect the safety of both guests and employees.

For instance, some hotels have hired hygiene managers to revise sanitation protocols and oversee their implementation across the property. This requires coordinating with different subdepartments such as food and beverage, spa and wellness, and entertainment. The hygiene manager trains hotel staff on how to maintain hygiene standards and also works closely with the legal department and medical team to ensure that initiatives adhere to local laws and are grounded in science.

ACE talent acquisition

Hospitality employers may need to adapt their hiring practices in response to these five shifts. To start, we’ve come up with a broad approach that may help them ACE talent attraction and improve employee retention.

• Analyze talent suitability with digital tools: Whittling down a pool of applicants is often done based on gut feeling and the personal experience of the recruiter, which is not only expensive but often ineffective—up to 80 percent of employee turnover is due to poor hiring decisions. Advanced data analytics can be a powerful tool to help identify appropriate candidates while reducing the subjective aspects of the screening process. An employer can define the specific talent they are looking for (analytic tools may help identify potential gaps) and work with a data analytics team to build a predictive model to identify likely characteristics of success, using it to sift through the stack of digital résumés. By implementing this approach, a fast-growing organization that struggled to retain high-performing sales talent managed to reduce first-year attrition by 23 percent and improve quality of new hires by 40 percent.
• Clearly define and communicate job requirements and career paths: No one likes nasty surprises, so it’s best to avoid them by defining roles and their requirements early in the game. Each candidate and new employee should know how performance will be evaluated and the perks, support, and benefits they will enjoy when they join the company. While an employee’s career trajectory may change after joining a company, the candidate should be aware of the options available and the path they can expect when they receive an offer. In our experience, employers who use employee-centric design to optimize and customize a candidate’s career path within the organization, taking into account their unique attributes, skill sets, and interests, tend to be companies with the greatest impact and satisfaction rates among their staff.
• Empower your HR department: A skilled HR team  makes all the difference, but building one requires investment and training. They should be trained to wield the digital tools they have at their disposal competently to screen the most suitable candidates quickly, identify reasons why candidates fall out of the recruitment funnel, and streamline the overall hiring process so that it doesn’t drag on for more than two weeks. Beyond these technical skills, the HR team should also know how to conduct smooth interviews. According to Workplace Trends, nearly 60 percent of job seekers have experienced poor interview processes, and 72 percent of them shared those experiences with others. Even when a candidate is not the perfect fit for a specific role, they may be suitable for another role, so it’s important for those who don’t get an offer to also feel valued.

Hotels and other hospitality players have a rare opportunity to rebuild their workforces by transforming their hiring practices. Those who keep these five trends in mind and adopt the ACE approach may find the industry’s brightest talents clamoring to join and grow in their ranks, delivering superlative guest experiences for a long time to come.

Margaux Constantin is a partner in McKinsey’s Dubai office; Steffen Köpke is a capabilities and insights expert in the Düsseldorf office, where Joost Krämer is a consultant.

This article was edited by Jason Li, a senior editor in the Shanghai office.

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