Globally, manufacturing companies especially consumer goods producers, rely on logistics firms to get their products to the end users who are scattered across the niche market. Thus, logistics remains a huge industry both locally and internationally.
This is because everything we use daily has been shipped and delivered across various destinations before being sold and put to use. This includes everyday household products, food items, luxury goods, among others.
Logistics companies plan, implement and control the movement and storage of goods, services or information within a supply chain and between the points of origin and consumption. Various logistics companies handle some or all of these supply chain functions, depending on a client’s logistical needs.
Starting The Business
Founder and managing director of Futuris Experiential Limited, Kayode Oluwo said his dive into the logistics business was because he saw a need and took it. According to him, starting a logistics company entails huge investments in assets such as: trucks, trailers, people, drivers and technology that helps in supporting a smooth running of the business.
The amount of investment in logistics business he stressed, will depend upon the services that you wish to start. “A simple brokering and freight management service will require less capital compared to a third party logistics (3PL) service. It is important to identify the niche services that you wish to target and prepare an investment plan based on it.”
While the kick-off of the business may seem easy, he said, running a successful logistics company can be challenging if the business plan, finances and recruitment strategy are not well taken care of. Despite this, he notes there are benefits. “This is because there is always one job for you per day. We mainly do FMCG business and an average sales man hasn’t concluded his job until stocks are distributed to the customers.”
“It is capital intensive and also needs a lot of technology to be able to perform optimally in the industry,” he advised.
You need funding to acquire the relevant equipment and to also pay your workers. The capital you need will depend on your level of operation. However, with as low as N300, 000, one can start a small logistics business.
The business plan will help you apply for loans from commercial banks and other forms of business grants. Also, you can get an investor or venture capitalist who is interested in your business idea with a good business plan.
LEADERSHIP findings show that a typical Lagos delivery costs N800 and sometimes more, if the distance is really far and one can get about 90 mail deliveries in a month. Hence, one can make N500, 000 monthly income or more, depending on the volume of businesses such firm is able to attract monthly.