Growth in the Indian economy over the past few years has led to a huge market for logistics services. More than 50 million people work in the logistics industry in India. An effective logistics partner can help improve the efficiency of any business by reducing costs and delivery time. This ultimately leads to a market share and profit for the business.
Some Classified websites also help us to grow our business, for example, Justdial, Sulekha, Hudku, Quikr, and Olx, etc. There are different types of logistics business that you can start. These include third-party logistics (3PL), courier and freight services, air transportation and warehousing services etc. Any logistics company should consider the following aspects in order to be successful.
The first step to be taken by any logistics company is to look for investments. The amount of investment in the logistics business will depend on the services that you want to start. A simple brokerage and charter service will require less capital than the 3PL (Third-party logistics) service.
For example, to set up a freight forwarding service in India, you will need a capital investment of $ 1 million to $ 2 million. Net service 3PL will require investments in the amount of 10 to 18 million US dollars. The launch of an internal container warehouse (ICD) or a container freight station (CFS) requires investments of several hundred million US dollars.
The second step is to get the mandatory registration and certificates of conformity. As in any business, provision services need sure registrations and agreement by the government. In India, registration with the International Air Transportation Association (IATA), and the Air Freight Association of India (ACAAI) is incredibly helpful for freight forwarders.
It's going to even be necessary to participate in business forums, like the CII(Confederation of Indian Industry) Institute of provision, to handle problems associated with the provision. Other important registrations in India is the registration of DGFT(Directorate General of Foreign Trade).
The beginning of a brand new business is connected with some uncertainty and several risks. In a developing economy like India, risk management plays a vital role in the provision business. Because the logistics business is incredibly dynamic with many partners/suppliers involved in the entire operation. The chance of filing an application is incredibly high. It's necessary to cover the liability of business insurance. several giant insurance firms in India provide such insurance plans.
Serious liability problems arise due to cargo damage, theft, injury, environmental damage, etc. whereas business insurance helps solve some liability issues, they're not always terribly effective. Here we have some person, who involves himself in many businesses.
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Acquiring clients is the key to successful business. If you want to run the 3PL service, it would be useful to study the various industries/products and understand the logistics needs in such industries. Since India is mainly an export economy, there are many fast-growing sectors such as Auto, Infrastructure, Production, and Services. All these sectors require logistic services. It is also important to understand your competition. The liberal rules of FDI (foreign direct investment) facilitated the transition of MNCs to the Indian logistics sector. Such large players can invest heavily in infrastructure and marketing.