Working in a shipping company is an attractive career path for individuals who love traveling and want a life filled with adventure. Jobs in this industry are also attractive because they offer sizeable remuneration. This is the ideal career for you if you want to travel all over the world and still have a good income.

• How to Start a Career in Shipping
• Are Shipping Companies Profitable?
• How do Ship Owners Make Money?
• How Much Money Can You Make as a Freight Broker?
• Do Freight Brokers Make Lot of Money?
• How Much Money do Container Ships Make?
• How to Start a Cargo Ship Business
• How to Start a Container Shipping Company
• Shipping Industry Profit Margin
• Cargo Ship Profit Margin
• How to Make Money in Logistics Business
• Starting a Freight Business
• Freight Broker Success Rate
• How Much do Shipping Companies Make?
• Do Shipping Companies Make Money?
• How do Shipping Companies Make Money?
• How Profitable is Freight Forwarding Business?
• Are Logistics Companies Profitable?
• Merchant Navy Deck Officer
• Merchant Navy Officer Salary UK
• How Much Does it Cost to Start a Shipping Company?
• How do Shipping Ports Make Money?
• Can You Make 6 Figures as a Freight Broker?
• How to Start Freight Forwarding Business in India
• Freight Forwarder Salary
• Freight Forwarding Business Model
• Business Ideas in Shipping Industry
• Can I Really Make Money With Dropshipping?
• Opportunities in Shipping Industry
• Freight Brokerage Business
• How Does Shipping Business Work?
• Freight Broker Training
• Cargo Ship Profit Margin
• How Much Money Does a Cargo Ship Make Per Trip?
• Making Money in Logistics And Shipping as a Freight Broker

How to Start a Career in Shipping

The starting point

Your first step is to determine the type of job that you want. There is a lot to be done in a shipping company. Engineering jobs are usually done in oily, noisy and dirty environments. If you choose the deck department, you have to be strong and handy with tools.

People who work on the deck will also be prepared to face the weather continually. Jobs in the catering department include cooking, laundry and provisions. These are the three major areas of work on a cargo ship.

Entry level jobs

If you do not have any advanced qualification or experience in the industry, you should apply for entry level jobs that require minimal qualifications. Junior rating jobs are available in a lot of shipping companies. If you pursue this path, it will take a long time for you to rise to the top. The faster way to reach the top is to obtain a college degree in appropriate disciplines.

Working on cruise ships

The alternative to working in a shipping line is to apply for a job on a cruise ship. There are more opportunities for these types of jobs. You will not really be part of the crew of the ship. You will be involved with catering, hospitality and entertainment.

Do your research

Find out as much as you can about the openings that are available on cruise lines. You can get a lot of information on the internet. Do not send in a general application; make sure you apply for a specific job. It is vital to find out some details about the cruise line so that you can answer any questions that you are asked at the interview.

Prepare a good resume

Take time to prepare a resume that highlights your best attributes, skills, qualifications, and experience. Your resume should be submitted to a recruitment agent or sent directly to the cruise line company with a cover letter.

Read Also: Offer Community Services To Earn Money

An application form will be sent to you if your résumé passes the first assessment. Make sure that you read the form carefully and fill in the required information correctly. If the cruise line finds your qualifications suitable, you will be invited for an interview.

If you are accepted for the job, you have to go for a mandatory medical examination so that you can obtain a medical certificate that is recognized internationally. Visa arrangements will also have to be made if the cruise ship will be calling at ports in foreign countries.

You may also have to obtain work permits for certain countries. The visas and work permits may be handled by the recruitment agency. You may have to sign a renewable 6-month contract before you can start work with the cruise line.

Are Shipping Companies Profitable?

In April 2016 Maersk Line announced a Q1 2016 profit, earning US $ 32 million due to a 7 % increase in volume of TEU’s carried and 16% in cost reductions. This is a huge turn-around in their shipping industry profits from their Q4 2015 when they lost $ 165 million.

Maersk’s chief executive Nils Andersen explained their unexpectedly good performance by mentioning Maersk’s 90% capacity utilization, their reduced-costs program, as well as lower bunker costs. But bunkers are rising along with crude oil prices, and one can only reduce costs a finite degree before one cuts into the keel, and how many other lines are able to average 90% utilization?

Apparently not many: with NOL announcing a loss of $ 105 million due to their APL division last year, Hanjin and Hyundai facing tough debt, and let’s not forget Beijing’s forced merger of COSCO – CSCL so their three-straight years of enormous losses would not cause them to be delisted from the Shanghai Stock Exchange. This raises the question: can one make a profit in the shipping industry? 

Another advantage the logistics companies share is a bigger client base than the carriers. With most carriers having shed their sales forces in order to cut costs, freight forwarders such as K+N use their scale and sales heft to negotiate highly competitive rates from its carriers in these over-supplied markets.

The drop in sea freight revenue is to be expected, due to the collapse of ocean freight rates in 2016. Yet all the forwarders remained profitable when it came to their profit margins in the shipping industry, just not at Q1 2015 levels. It was CH Robinson’s strong surface transportation sector (truck & rail), however, that brought them the outstanding profits that few other forwarders and logistic companies can match.   

How do Ship Owners Make Money?

The starting point is the shipowner, who receives sufficient capital for the purchase of a ship by providing a subordinated loan. This ship is usually rented or chartered out to a charterer who has sufficient orders for the transport of goods and cargo.

The charterer has direct contact with a large number of customers (mostly from the corporate sector) who want to transport goods and therefore charters his ships on a long-term basis to handle the volume of orders. In this way, the rent for the ships is also secured, which flows from the income from transports.

In other words, the shipowner receives fixed income by chartering out his ships and can use this income to cover the running costs of the ship, repairs etc. and to pay interest and repay the loan. To ensure that this always works, there are also insurances that cover the costs in case of a defect or breakdown.

Furthermore, there is always the pure steel value as well as the sales value of the ship, which additionally secures the investment. The approach is also profitable because the charter rates are high enough to soon amortize the investment in a ship and the life of a ship is 20 years and more. The risk decreases with each year.

How Much Money Can You Make as a Freight Broker?

The average monthly pay for a Freight Broker in the United States is $3,733 a month.

While ZipRecruiter is seeing monthly salaries as high as $6,000 and as low as $1,875, the majority of Freight Broker salaries currently range between $2,958 (25th percentile) to $4,167 (75th percentile) across the United States.

The average pay range for a Freight Broker varies greatly (by as much as $1,208), which suggests there may be many opportunities for advancement and increased pay based on skill level, location, and years of experience.

Do Freight Brokers Make Lot of Money?

The job of a freight broker is to connect shippers who have goods to transport and carriers who have the capacity to move those goods. Today’s freight brokerage market is rich with opportunity, but taking advantage of the ease of getting started and straightforward licensing requirements does not guarantee future success.

With countless licensed freight brokers coming into the mix every year, it is essential to know what it takes to be successful — and profitable — from the start.

How Much Money do Container Ships Make?

One aspect of container shipping that interests all parties involved in the industry, is how a business that generally grows every year, as does the volume of containers transported, rarely turns a profit.

2019 was better than most with roughly half of the top twenty containership operators reporting returns in the black (this includes estimates on privately held companies like Hamburg Sud and MSC).

In this case, bigger was better. Maersk Line, arguably the largest carrier, posted a $2.34 billion operating profit, up from $1.82 billion in 2013. CMA-CGM, number three on the list, also had a good year with an operating profit of $973 billion.

However, most containership operators in recent years have seen very good results, even with increases in volumes. Last year, it is estimated [Alphaliner] that box volumes rose by 4.7% but the margins were only 2.7%.

How to Start a Cargo Ship Business

Operating a sea and air cargo company involves the act of transporting different kinds of consignments from a specific place of origin to an international or local destination. This business is also more commonly known as freight forwarding. The cargo forwarder also takes charge of consolidating small deliveries into one bulk shipment. The cargo operator utilizes aircraft or ocean vessels to convey these goods to the chosen destination.

Knowing the Business

Study the freight-forwarding industry. It is a complicated market that is full of various parameters and procedures. A proficient cargo forwarder should have extensive knowledge of international law, trade theories and practices and the financial aspects of trading. You must also understand foreign markets, shipping methods, insurance coverage, documentation, customs regulations and warehousing.

Your contacts should be expansive to ensure a constantly growing client base. You should also have knowledge of your competitors and their prices.

Acquire Licenses for Shipping by Air and Sea

Register your business and acquire the necessary licenses for shipping by air and sea. To obtain the adequate licensing for a sea cargo business, you must go to the Federal Maritime Commission (FMC) website and find the link to the Office of Transportation Intermediaries (OTI).

This office reviews applications and provides license applications. To obtain a license as a first-time owner of a sea cargo, fill out Form FMC-18, or the Application for a License as an Ocean Transportation Intermediary.

You can only obtain this license as a business or sole proprietor. You must present a qualifying individual who has at least three years of experience in OTI and who is an active officer of the entity, according to the OTI. You must also provide proof of financial stability: $50,000 for an ocean freight forwarder license and $75,000 for an NVOCC license.

Air Cargo Certification

You must obtain certification and licensing from the Federal Aviation Administration (FAA) to operate as an air cargo business. Complete a PASI or Preapplication Statement of Intent form and submit it to the FAA. Also, write a formal application letter, which must contain your name and the name and address of the company. This letter serves as a formal application for an Operating or Air Carrier Certificate.

Provide your pilot’s resume, certification and medical certificate. You must also submit a plan for the drug and alcohol program you plan on using to test your employees.

Business Insurance Requirements

Obtain the necessary small business insurance coverage for your employees and liability coverage in the form of marine insurance to guard against damages or loss of shipments. For the sea cargo part of your business, you must fill out Form FMC-68, which is a Guaranty in Respect of Ocean Transportation Intermediary (OTI) Liability for Damages, Reparations or Penalties Arising from Transportation-Related Activities.

You must also look for insurance that covers the amount of goods you are transporting, either by air or sea, plus liability insurance for your employees in case of accidents.

Sea Shipping Types

You may choose from two different types of sea shipping operations. The first is known as an ocean freight forwarder, which owns the ships that carries the cargo and takes responsibility for the cargo from the source port to the destination port. The second option is to choose not to operate the vessels but to provide the shipment service from one place to another. This type of business is a NVOCC.

For both types of sea cargo business, you must obtain the required licensing by filling out Form FMC-18.

Acquire Cargo Planes

Purchase your cargo airplane. The type of cargo airplanes you choose depends on how much cargo you plan to transport and the number of pilots you decide to have. If you choose to have one pilot, a small cargo airplane is enough. Types of cargo aircraft include the Airbus A300, Boeing 707, Casa 212 and Merlin 4 A.

You may also choose to lease an airplane instead of buying one. Either way, your airplane must pass the FAA’s annual Aircraft Conformity Inspection. Things that the FAA inspection checks for equipment and required items such as an FCC radio station license, current registration, an aircraft flight manual and a compass correction card.

Other information obtained during the inspection includes an airframe maker, engine information, propeller information, governors, magnetos and any additional accessories necessary for your airplane.

Formalize Your Business Plan

You should create a business plan to cover your first few years of operation. The plan will help you organize the many steps you need to start up your business. Importantly, it also serves as a document to convince potential lenders and financiers of the seriousness of your undertaking and the opportunity for profitability.

Your business plan will cover an overall description of the business, its legal organization, the principal participants along with their experience, and the anticipated finances of the business, in terms of costs for labor and operations and the amounts and types of income.

Finally, the business plan should include your marketing strategy for the company, in terms of online marketing as well as conventional print, radio and TV spots.

How to Start a Container Shipping Company

Entering the shipping container industry makes a great deal of sense for any aspiring businessman. For starters, the logistics business has a lot of profit potential since there would always be companies who require to a number of their goods transported across various parts of the world. This, in turn, allows you to establish a lasting relationship with any customer.

Add to that is the fact that the shipping container business is recovering nicely since suffering from the crash of the financial market in 2008. At the same time, shipping container companies can look forward to seeing more business on the horizon as the International Monetary Fund expects the global economy to grow by as much as 3.5 percent in 2017. This means more trade and more goods getting shipped in containers all over the world.

The key to launching it successfully is to approach the entire process strategically.

Create an Effective Business Plan

Before you do anything else, you need to come up with a business plan. A business plan basically details your new company’s road map so that you can plan for the future and avoid any problems as much as possible. It’s essentially your business’ foundation, its guidance of growth in the coming months and years.

Generally, a business plan comes with several essential parts. It begins with an executive summary that states your purpose for writing a business plan.

Here, you can state if you are on the lookout for a new business partner or investor. It’s also important to make sure that the financial section of your business plan includes accurate and timely forecasts in the industry. This is especially critical if you plan to present your business plan to lenders in order to secure more funding for your business.

Scope out the Competition

Even if you haven’t actually started your operations yet, it helps to already know a great deal about your competition in the market what makes their business successful, in particular. Look closely at them and assess their strengths and weaknesses. Study them both online and offline. Pay attention to how they promote themselves to the market. This is a good way to know what makes for effective marketing in the industry.

At the same time, figure out what can help differentiate your new business from theirs. Perhaps, there’s something they don’t offer yet that you can capitalize on.

Secure Your Certifications, Licensing and Insurance

Transporting items everywhere means there are a number of certifications and licenses that your business needs to secure. These include your new company’s sea licensing and air certification. At the same time, you also need to secure insurance coverage for your employees as well as marine insurance that would provide you with liability coverage in case of any damaged or lost shipment.

Consider Starting Small

Especially if you don’t have investors or additional funding secured yet, it’s a good idea to keep your business operations small at first and then gradually grow it as you profit. After all, you also want to get a sense of the demand first before you invest in more containers. This way, you’ll also require less space to store them when they are not being used to transport anything around the world.

At the same time, if you think you’re not just ready to purchase your own cargo plane just yet, you can consider just leasing a plane instead. This is a great way to keep your expenses relatively smaller initially.

Establish Contracts

Once you are all set up with your cargo containers, licenses, certification, and insurance, it’s time to start bringing in some money to the business. The best way to do this is get shipping contracts or letters of intent from various companies. Ideally, you want these contracts to be long-term as you can definitely use these to secure more capital.

Just follow these steps and you can set up your shipping container business easily. The moment it’s finally up and running, you can certainly look forward to getting a constant volume of business from your clients. When this happens, don’t forget to take the time to celebrate your success.

Shipping Industry Profit Margin

The industry in the first three months of the year was generally as profitable as it was during the first quarter of 2019, notching an operating profit of approximately $1.4 billion and a margin of 3.2 percent, when accounting for earnings before interest, taxes, depreciation, and amortization (EBITDA), according to Drewry. That single-digit profit margin pales in comparison to the value of global trade.

The total value of manufactured goods traded internationally is approximately $13 trillion, said Lars Jensen of SeaIntelligence Consulting. In a LinkedIn post, he brushed off suggestions of carriers profiting from the pandemic, pointing to how ocean freight accounts for a value of about 1.3 cents for each dollar of goods transported.

“The rate increase indicated by the [China Containerized Freight Index] index thus far in 2020 means that each dollar of goods have seen a freight rate increase of $0.0009 — is that tantamount to profiteering?” Jensen asked.

According to Jensen, carriers can either keep up the capacity discipline they showed in the first half and be on track to end the year with $9 billion in profit, or lose $7 billion if they can’t. There’s no guarantee that carriers won’t chase business by undercutting rates as volume rebounds. “Hence it’s far from a certainty that carriers will end the year on a positive note,” he said.

Carriers’ reluctance to add capacity, after being burned badly after failing to remove capacity following the plunge in volumes triggered by the 2008-09 financial crisis, is understandable. And, while a profitable year may be in the reach of carriers, it would be just one year. Between 1995 and 2016, the industry’s return on capital was lower than their cost of capital, wiping away $110 billion in value, according to a 2018 report by McKinsey & Co.

Cargo Ship Profit Margin

The average annual pay for a Cargo Ship in the United States is $39,678 a year. Just in case you need a simple salary calculator, that works out to be approximately $19.08 an hour. This is the equivalent of $763/week or $3,306/month.

While ZipRecruiter is seeing annual salaries as high as $74,000 and as low as $19,000, the majority of Cargo Ship salaries currently range between $27,000 (25th percentile) to $47,000 (75th percentile) with top earners (90th percentile) making $58,500 annually across the United States.

The average pay range for a Cargo Ship varies greatly (by as much as $20,000), which suggests there may be many opportunities for advancement and increased pay based on skill level, location and years of experience.

How to Make Money in Logistics Business

Logistics Business is one of the businesses that has been given different names. Some call it a delivery business while others call it a transportation business. Nevertheless, they all mean the same thing. Basically, the logistics business is all about moving goods from one destination to another, from the manufacturer to the final consumer.

Steps To Start Logistics Business

Step One – Define Your Mode Of Operation

The first step to starting a logistics company is to choose a means of delivery. Do you want to operate with bikes, buses, or trucks? Will you be involved with interstate or intrastate delivery? Are you going to focus on a particular industry or sector? Do you want to begin as an agent, transporter or contractor?

All these questions must be answered before you begin. Defining your mode of operation will help you estimate the capital you need to start and help you focus because there are many forms of logistics.

If you don’t have the required fund to get your own buses or bikes and start out as a standard logistics company, you can begin as an agent or contractor.

Starting as an agent means you will be the intermediary between an established logistics company and the business owner in need
of their service. You will be paid an agreed commission for every business you bring to use the services of the logistics company.

Step Two – Draft A Business Plan

A business plan is a comprehensive document stating in detail the goals and objectives of your business and how you intend to achieve them. After identifying your ‘modus operandi’, it is safe and business-wise to put down the step by step plans in writing.

Additionally, drafting a business plan also helps you access funding opportunities. The information that should be in your business plan are:

1. An overview of your logistics business
2. Executive Summary
3. General company description
4. SWOT analysis
5. Market Research
6. Your Strategy
7. The Team
8. A marketing plan
9. An operational plan
10. Financial projection
11. An appendix

Step Three – Register Your Business With CAC

Corporate Affairs Commission (CAC) is the approved body for business registration in Nigeria. The first step to structuring your business in Nigeria is to register the business with CAC. When you register your business, customers trust and see your business as credible.

To begin, you can choose to either register as a business name or as a limited liability company. The business name is cheaper than the limited liability company; the option you choose depends on the ownership structure and your funding capability.

Also, it is important to get your registration certificate because you cannot open a corporate account without it. To get started, visit CAC’s portal to run a name availability search. Once your name gets approved, you can then start the registration process.

Many aspiring entrepreneurs find it difficult to complete the registration due to the procedures involved. That is why it is advisable to hire a lawyer to help you with the registration. One of the trusted firms in Nigeria that helps with business registration is ReDahlia. ReDahlia is located at 43B, Emina Crescent Off Toyin Street, Ikeja, Lagos.

Additionally, location is not a barrier because you can send all the registration requirements via email and your certificate would be delivered to your preferred location.

Asides registering with CAC, there are other licenses and permits you need to obtain from the government. Research them and make sure you get them so that your bikes or buses are not harassed on the road.

Step Four – Acquire Funding And Capital

You need funding to acquire the relevant equipment listed earlier and to also pay your workers. The capital you need will depend on your level of operation. Actually, with as low as N300,000, you can start a small logistic 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.

Once you get your funding, acquire your equipment. If you are operating in a state with high road traffic, you may want to consider investing in bikes. However, there are new government rules debarring the free movement of bikes, especially in Lagos.

Therefore, ensure that your means of transportation will not be infringing on any law whatsoever. Also, getting fairly used cars or bikes can be a good strategy for minimizing your start-up cost.

Step Five – Set Up A Website For Your Logistics Business

It is imperative for a logistics business to have a website. Your website will serve as the intermediary between you and your customers. If anyone wants to learn about your business, they can easily visit your website, get the information they need and contact you directly from the site. WordPress or Woocommerce are easy platforms that can help you set up a cost-effective website.

Step Six – Get An Office Space

The logistics business is both an online and offline business. Some customers will prefer to visit your office to send their deliveries. So, you need to get an office space where you can also park your vehicles and bikes.

Also, brand your office and vehicles to create awareness and attract your target market. The office space must be spacious and the compound large enough to accommodate your vehicles and bikes.

Step Seven – Hire Staff For Your Logistics Business

In the logistics business, a driver or rider is very important. Hence, you need to be careful in selecting and training them. Preferably, you can start as your own driver/rider to get familiar with the routes you operate and the system of the business. That way, you will have first-hand experience with the business operation.

Depending on the scale you want to operate, it might not be feasible for you to be the only driver or even be a driver at all. But, it helps that you know and understand how the process works. You can develop winning strategies and communicate better with your drivers/riders when you know how things work.

Everyone you hire must learn the company’s culture, behave in a manner that protects your company’s image, speak politely with clients, etc. The more you grow, the more drivers/riders you can employ. This step does not apply to you if you are starting out as an agent or contractor.

Apart from drivers, you also need other employees that will attend to customers when they visit your office. You have to train, retrain, and keep training your drivers and staff because their actions and inactions affect the growth of the business especially the drivers.

Step Eight – Market Your Logistics Business

Nobody will hear about your business if you don’t market it. Advertise your logistics business both offline and online. Connect with e-commerce business owners and offline organizations. Luckily, it is easy to market your business now due to the advent of the internet.

Here are some of the marketing channels you can explore:

• Word of mouth
• Referral
• Social media advertising
• Newspaper publications
• Google advert
• Collaborations/Partnerships

Starting a Freight Business

Freight is big business. The transportation of goods across the world is the keystone of modern society, with almost everything we use and consume passing through some part of the freight network. Unless a company is big enough to own a fleet of vehicles, they will need to rely on third parties to deliver their products. Even the world’s biggest corporations rely on specialist freight services for air, rail, and sea transport.

In the U.K. alone, freight forwarding is set to contribute an estimated £21.69bn to the economy this year. This situation is mirrored across the world, and establishing a freight business has never been a more attractive prospect.

There are two major types of freight business—a freight brokerage business and a freight forwarding business. Both sectors have a range of benefits and downsides.

Starting a freight brokerage business

Freight brokerage businesses generally don’t handle any shipments themselves. They instead act as coordinators, matching suppliers with carriers. For example, a small business might want to send a shipment across the world to a customer. The freight brokerage business will research different shipping options, and then commission a carrier to pick the goods up and transport them to the destination.

The role involves a great deal of communication—soliciting clients, negotiating rates with carriers, tracking shipments, and arranging alternative transport if a problem develops in the supply chain.

Startup costs

At first glance, the required startup capital is fairly low, as brokers technically only need a phone and a computer to operate. However, bear in mind that good logistical software—an essential tool in the modern freight market—can be cripplingly expensive.

Cash flow can also prove problematic in the early days of running a freight brokerage business. Brokers usually take around 20 percent of the fee, but customers typically don’t pay until the shipment has been delivered—and carriers often demand payment upfront when dealing with a new broker.

Pros and cons

In some countries, there are few barriers to starting a freight brokerage business, making it an easy target for would-be entrepreneurs. However, many others have introduced strict regulations. For example, U.S.-based brokers must purchase an extremely expensive bond, and adhere to numerous other legal requirements.

Even if your country doesn’t monitor freight brokers, it’s advisable to seek membership of an accredited industry organization. This will lend your new company some credibility, and help persuade potential customers to enlist your services.

Finding companies to take your shipments can initially be a risky and time-consuming process. You will need to post your loads on an online board for companies to bid on, eventually negotiating a contract with the highest bidder.

Choosing a reputable carrier is essential—unscrupulous companies have been known to hold loads hostage, or simply cancel a shipment if a better offer comes in. However, once you’ve found a reliable carrier and built a working relationship with them, this stage of the process becomes much easier.

Starting a freight forwarding business

Unlike brokers, freight forwarding businesses often directly handle customer shipments. Depending on the size of the shipment and the destination, a freight forwarding business could collect goods from a customer, store them at a warehouse, group smaller shipments into one larger consignment, and even deliver them.

Like freight brokers, forwarders also commission other carrier companies to handle shipments—particularly when goods need to be transported overseas.

Startup costs

The amount of startup capital needed will vary depending on both the products you will be handling, and the services you will offer. However, it will probably be more expensive than starting a brokerage.

You will need at least one vehicle for transportation, a secure storage facility for shipments, and potentially packing materials. If you’re planning on commissioning other carrier companies, you will also need to purchase logistical software.

Pros and cons

One of the main difficulties for a freight brokerage business is handling supply chain disruptions. Transport delays and shipment issues are common, especially when working across international borders.

Although the broker is rarely at fault, late or missing deliveries can seriously harm a company’s reputation—and its income. By taking some of the transporting duties in-house, freight forwarding businesses have far greater control over their service, and are therefore more likely to both attract and satisfy customers.

However, this increased responsibility also leads to increased liability. Where freight brokers largely act as salespeople, freight forwarders actually handle shipments and are therefore subjected to many insurance and licensing regulations.

These regulations increase exponentially when operating overseas, so keeping up-to-date with international customs and transportation laws is of the utmost importance.

Freight Broker Success Rate

Keep in mind that while the initial steps of how to become a freight broker are simple enough, becoming a successful one is more complex. Because many people forget to consider the challenges before diving into the field. Freight brokerage has some of the highest turnover of any business, with many brokers failing within their first year.

1. Start with a low-cost TMS

Sure, that fancy transportation management system the salesperson pitched looks nice, but do you need all its functionality now? Whether you are digital or voice, you will need a backend system for managing loads. If you are going down the traditional route – you should be ready to go out of the box with little more than some small configuration.

In fact, you can get started for less than $50 per month, if you are not concerned about advanced functionality. Often, a low-cost cloud-based system, while more limited, is sufficient to build the business. As the money starts to roll in, you can always upgrade to that Cadillac TMS you really want. Cloud TMS providers include EKA, Emerge, Ascend TMS, and Truckstop’s ITS Dispatch. 

If you are digital, your investment should be in the user interface and experience (i.e. the app) and not necessarily the backend. Save your investment capital for making the digital product special – not building backend systems from scratch.

In fact, most off-the-shelf TMS offer a rich set of APIs from which to build products. When we spoke with market players – the most common TMS names that were brought up included McLeod, MercuryGate, and Trimble.

Exit valuations (which is what attracts the most outside investment) are driven by the distribution of the app that the customer interacts with – and not necessarily the backend pipes. If you want the most attractive business from an investment standpoint, put a lot of emphasis on the customer experience and driving distribution. Don’t spend a ton of capital on building technology that can be bought off the shelf and that isn’t customer value added. 

2. How do you count the money?

An often-overlooked system is the accounting system. Make sure you choose a system that can meet your needs, from payroll to accounts payable and receivables. Like the TMS, the accounting system doesn’t have to be top-of-the-line, but it needs to be more than Bob in accounting jotting down notes in a ledger. Quickbooks offers a cloud-based option that can get you started, and there are other options available as well. 

3. How will you sustain the company?

Sure, every transaction will bring in some revenue and if the load is priced for margin (the spread between what you sell the service to the shipper and what you pay the carrier) – you will make money on paper. Unfortunately, this won’t turn into cash overnight. Carriers will want to be paid within 20-30 days and shippers will pay in 40-90 days.

The faster you grow, the more capital you will consume. That is, unless you set up an accounts receivable financing relationship. While traditional banks offer these lines, they have little experience in freight. We recommend looking for a firm that is familiar with A/R financing in trucking and can fund your working capital. Triumph Business Capital, OTR Capital, and Truckstop.com handle thousands of freight financing transactions per day.

4. Get an MC number

Brokers who are registering for the first time must apply for broker authority with the FMCSA via the Unified Registration System and get assigned an MC number. This identifies carriers who transport regulated commodities for hire in interstate commerce. The longer you have this number, the less risky you will look to carriers, leading to more of the accepting freight from your site.

5. Get proper insurance

This should go without saying, but having proper insurance is a must. These include property and general liability; vicarious auto liability and umbrella; workers’ compensation; contingent cargo; and errors and omissions. 

6. Develop relationships with trusted carriers         

Having relationships with carriers you can count on is critical. The worst thing that can happen to any DFM is if loads are posted and never claimed. Consider using an onboarding platform for carriers and utilize tools like Carrier 411 for vetting and monitoring of carriers.

Trucker Tools has developed a trusted network for carriers, allowing the broker to rebook carriers in their network. This process keeps the carrier running with the broker, mitigating risks of onboarding..

7. Find your niche

You want to broker freight, that’s great. What kind? Are you going to accept any freight? Creating a niche can be a good way to build trust. If you handle only dry van and refrigerated freight, shippers and carriers specializing in these areas will identify easily with your site.

If you choose to accept all types of loads, make sure the various types of loads are segmented properly – either through sections or search. A flatbed hauler who has to wade through 1,000 dry van loads to find a single flatbed load won’t be a user of your service for very long. Also make sure the location is a searchable function.

8. Provide value-added management services

Simply matching loads to trucks is one thing, but if you want to stand out, develop a strategy for capacity sourcing and become a trusted advisor to carriers and shippers. This can include total cost of ownership data and understanding that freight transportation management isn’t just about price.

9. Get a rate assessment product 

The most important decision in your day to day will be to figure out what to quote shippers for loads. Most brokers pursue a margin plus based quoting strategy. In other words, you will decide what margin you want to strive for on each load. Usually it is based on a percentage of what is charged (10-20%), although some will use a flat margin per load ($100+). 

Regardless, knowing what your costs will be to buy capacity will be important. There are three products to consider from lowest cost to more advanced (and more expensive).

Truckstop.com offers RateMate, a $35 analysis tool that will get you started and going. For more advanced users, Truckstop.com offers RateAnalysis, which will assist you in developing bids and quoting. DAT has an advanced offering as well, called Rateview. Both are robust and offer tools for historical rate analysis. Truckstop.com is regarded higher in the flatbed market, so if you plan to quote on flatbed, it is worth a look. 

10. Learn how to freight forecast 

If you plan to scale your brokerage business outside of a few shippers, participating in RFPs, or quoting on new lanes, learning how to become a freight forecaster will be critical to your success. 
Freight forecasting is the skill of analyzing current and future freight market conditions.

Knowing how much capacity is available in the market now and will be available in the future is important for winning rate bids and maximizing margins. 

SONAR is the tool that freight forecasters use to track market conditions and create bids on freight. Unlike a rate assessment product (see above), SONAR uses artificial intelligence and algorithms based on Waterfall Theory of Freight to produce trucking rate and market forecasts for one day out to next year. It also provides a complete analysis of the market in near-real-time. 

11.  Join an association

To be involved in any industry requires connections. The Transportation Intermediaries Association is a trade association designed for third-party logistics providers and has plenty of networking opportunities. It also provides educational content and best practices among a multitude of benefits.

12.   Remember that freight business is about people

Organizations are only as strong as the people that make up the organization. Transportation is a close-knit community and it won’t take long for stories of mistreatment to make the rounds.

To avoid this, remember that your employees – and the carriers and shippers you deal with – are people who want to be treated with respect. Recruit strong people, retain good employees and provide incentives for jobs well done. An employee incentive program can also drive appropriate behavior and keep employees engaged.

How Much do Shipping Companies Make?

To help u answer the question properly, let’s take an example from one of the top shipping companies. Maersk publishes their financials regularly on their site: Financial Reports

Look at their latest spreadsheet and find the Maersk Line business unit. That’s the one that moves containers. You’ll see revenue, net profit and transported volumes per year (FFEs are Forty-Foot-Equivalents or two containers). From there the math is easy.

If you average the last 5 full years (2012–16), you get revenue of $1,353 and a net profit of $57 per container. Of course, it helps their bottom line that they move more than 9 million containers per year.

Do Shipping Companies Make Money?

Shipping business is a cyclical business and can be profitable. When shipping revenues are high, new ships are ordered for construction which takes ~ four years. Once these new ships with lower operating costs are in business, shipping rents come down quite a bit.

Near the low end of the cycle, older ships with high operating costs are junked. This reduces shipping capacity and shipping rents start to increase again.

How do Shipping Companies Make Money?

Ship owner either charts out their ships in the spot markets or signs a time charter with a charterer (refinery, iron ore importer, grain importer etc), under time charter a customer pays a fixed daily or monthly rate for a fixed period of time for use of the vessel.

Ship owner pays the entire vessel operating expense such as wages, repairs, insurance premiums, lubricants, dry docking charges and special survey charges.

These expenses are fixed in nature, unlike road logistics where the fleet operator (truck owner) has to pay for the fuel expense which is the biggest expense in the income statement of a truck logistic company; here the ship owner does not pay the fuel expense and the port charges which can be related to the toll charges in case of road logistics.

Fuel and port charges fall on the head of the charterer (refinery) and these are called voyage expenses.

How Profitable is Freight Forwarding Business?

Other than reducing costs, below are a few other ways in which a freight forwarder can ensure profitability..

1. Having a clearly defined organisational structure is key to the successes of many companies and everyone from the management to the driver must clearly understand the company values, culture, strengths, mission, vision and identify with these so everyone can move in the same direction.. For a freight forwarder, the entire staff complement must be aware of the “essence of freight forwarding” discussed above..
2. Providing value-added services which is customized to your customers’ needs and not just offering the same service basket to all customers, allows forwarders to improve their profitability substantially.. The business of global trade and logistics can be complex at the best of times and therefore, catering to complex demands from customers provides several opportunities to a freight forwarder to improve their business prospects and create a positive reputation..
3. Having an innate understanding of the customer’s business by asking the right questions, practical learning like visiting the customer’s business or factory to know how things are done at the customer, understanding their organisational abilities etc, is a huge plus for any forwarder.. Companies who develop a profound understanding of their customer’s business are able to adapt to their customer’s logistics needs which could end up saving costs for both them and the customer..
4. Having the right relationship works wonders in any business and by assigning specialised and experienced staff within your organisation to handle customers with special requirements, you can handle any complex requirements of the customer which will make them stick with your company providing you with a sustainable volume and profitable revenue stream..
5. Efficient data management is a key area which can assist a freight forwarder in increasing their profitability.. In any shipping transaction, a lot of data flows through a freight forwarder.. Data to Customs, Port, Carrier, Trade associations, Chambers of Commerce, Banks, Truckers, Police and many many more..
6. By aggregating these data flows, shaping it and using it effectively, a freight forwarder can collect and analyse a mountain of realistic and tangible data which will help them in not just understanding their customer’s requirements, but also commodity movements and cost implications..
7. For any freight forwarder, it is imperative to have a good customer mix across various trade lanes/cargo types and not just operate with the same customer mix..
8. Apply sound, tried and tested freight forwarding principles like many of the successful legacy freight forwarders have been doing over the decades..
9. Transport costs and efficiencies have a major impact on the business of a freight forwarder and this is one the areas where a freight forwarder may lose profitability if not managed properly..
10. But not everything is about rates/prices.. Client retention, new business development and growth are some of the organic ways in which a freight forwarder can maintain/increase profitability.. Below are some tips to achieve client retention and growth..
    • Be Reliable – reliability and market presence is one of the most important factors a client looks to in a freight forwarder.. Be reliable, punctual, transparent and honest in your approach to the customers ;
    • Be part of a Network – being part of a global freight network can provide some benefits for the freight forwarder such as
      1. reliable partners that can assist with the requirements of the customer in a new country ;
      2. reduce costs for the forwarder by way of volume-based rebates on rates both at origin and destination ;
    • Be proactive – problems happen in all areas of the business and as the agent responsible to handle the client’s requirements, it is up to the forwarder to be pro-active, consider eventualities that may come up and be prepared for the same when it does happen ;
    • Develop a Reputation – if you take genuine care of the customer, their business and their interests, it will give you a solid competitive advantage as a trusted freight forwarder and this will go a long way in generating repeat business and also referrals ;
    • Digitalise – digital technology gives a forwarder the competitive edge and ability to speed up the process of various processes including rates, bookings, documentation etc thereby saving them time and money.

While the global outlook for shipping seems to be dim right now, freight forwarding still seems to hold its place as a growth industry and contrary to popular belief, this is not the beginning of the end for the freight forwarder as we know them..

While cost control and cost reduction are one of the key areas where a freight forwarder can increase profitability, after a certain level, this cannot be done without compromising on the service offered to the client..

Freight forwarders need to position themselves strategically in the market to share in this growth.. This can be achieved by providing reliable and value-added service to the customers while being flexible in the approach to customer requirements..

Leveraging the capabilities of technology, digitalization, AI, Big Data and IoT, a freight forwarder can exercise strict cost control which in turn can translate into innovative and cost-effective solutions to their customers and help them achieve, maintain and increase their profitability.

Are Logistics Companies Profitable?

Logistics is the commercial activity of transporting goods from the point of origin to the point of consumption. This is a complex operation involving the coordinating, moving, and housing of supplies. Logistics is an integral part of every material industry and will always be a necessity as long as goods are produced.

According to Research and Markets, “the global logistics market was worth 10.32 Billion USD in 2017 and it is estimated to grow to 12.68 Billion USD by 2023 with a CAGR (compound annual growth rate) of 3.49% between 2017 and 2023.” 

Reasons cited for this predicted growth are an increase in global trade activities in developing economies, a rise in trade-related agreements, and advancements in information technology and transportation.

The Asia Pacific region is predicted to be the leader of the global logistics market in the future, but the United States is not far behind. Currently, the U.S. is among the top ten leading global logistics markets and is the third-highest market in the world for third-party logistics (3PL) companies.

Merchant Navy Deck Officer

The Merchant Navy is a lucrative and an enjoyable line of work that demands a great deal of hard work right from the day you step into a maritime academy, whether it is nautical science or marine engineering.

As is with choosing any stream of education, selecting a career in Merchant Navy also requires a considerable amount of time devoted towards research so that a prospective individual is able to choose a course that best suits his needs. Some might aspire to become deck officers whereas others might be interested in engineering knowledge.

With a plethora of maritime institutes offering a variety of courses, it is natural for a candidate to get confused, and in the process, make a wrong decision.

There are myriad of maritime institutes all over the world and it is natural to be spoiled for choice. However, it is necessary to understand that not all of them offer the path to becoming a Deck Officer on ship in the way that it is imagined.

The role of a Deck Officer in merchant navy is indispensable on board and it is important for a prospective Cadet to know what a deck officer does on board ships.

A Deck Officer works in the execution of a variety of tasks- namely navigation and maneuvering of the vessel, handling of all safety equipment on board, and handing cargo, communications, and safety.

All of this seemingly daunting work is designated, divided, and handled among the Trainee Cadet, 3rd Officer, 2nd Officer, Chief Officer, under the supreme supervision of the Captain of the vessel.

The prerequisites to join a maritime course pertaining to the Merchant Navy are generally kept low, except the physical fitness and medical requirements. However, it is advised that an interested individual inquire with the respective institute offering the course in order to get the exact criterion.

Merchant Navy Officer Salary UK

The figures below are only a guide. Actual salaries may vary, depending on:

• where you work
• the size of the company or organisation you work for
• the demand for the job.

During training the sponsoring company may pay the cadet an allowance of between £5,500 and £15,000 a year as well as accommodation while attending college.

Average starting salaries, when qualified, are £22,000 to £30,000 a year for a third officer, rising to £34,000 to £42,000 for a second officer. Chief officers can earn up to around £55,000 a year and masters (captains) can earn up to £80,000 or more a year.

While at sea, you would have free food and accommodation as well as some travel costs. On foreign-going ships, your earnings may be tax free.

How Much Does it Cost to Start a Shipping Company?

More than 50% of the businesses in the US fail because of money problems. Therefore, it is essential to consider the start-up cost first.

• $10 million to buy a cargo ship
• $750 is the fee for incorporating a business in the US.
• $5000 or more will cost to buy insurance, permits and license.
• $50,000 for renting out an office or warehouse in the US.
• $15,000 for office equipment.
• $15,000 shipping equipment.

Looking at the numbers, you must have figured out that running a shipping business is not cheap and requires a ridiculous amount of money. So, if you do not have this much amount of money then it is better to consider some other business.

How do Shipping Ports Make Money?

The Port of San Diego’s budget is $151 million. About $86 million of its operating revenue comes from real estate waterfront leases each year. The real estate division’s purpose is to promote development.

It is in charge of negotiating and managing leases as well as conducting rent reviews. Most of the port’s remaining revenue – about $40 million – comes from Marine Operations. This division manages the Tenth Avenue, National City and Cruise Ship terminals.

Can You Make 6 Figures as a Freight Broker?

Freight brokering is a hot entrepreneurial subject, particularly when it comes to the earning potential. We could spell out all the projections and forecasts for the industry, but for the sake of brevity, we won’t.

Currently, the average reported salaries for brokering freight (taken from the top salary websites) comes to around $56,000/year. However, someone who hustles can easily break six figures.

Find A Niche

The logistic industry is vast, so the best approach to launching a successful freight brokerage is to find a specific niche in the industry. A freight brokerage might ship specifically for farm co-ops, construction companies, chemical plants, or equipment manufacturers.

Find a particular niche and engross yourself in it; there is always room to expand into different industry expertise later. The more expertise you have in an area, the better you can secure customer’s trust and scout the right carriers.

Build A Business Plan

Get a business plan down on paper. This is the tangible first step to launch your business. This is the anchor for the freight brokerage. It defines its purpose for existing and will guide the direction you want it to grow.

There are many ways to develop a business plan. To get started, find templates and suggestions through an online search engine or business book.

A completed business plan will prove the market viability of your business. Freight brokering can be very capital intense when going out on your own. More than likely, a business line of credit and/or a business loan will be necessary to get started, so organization is going to be key. Presenting a business plan to the bank will help secure those funds.    

Credit Check

Lines of credit or business loans are often necessary, so good credit is essential. Since you’ll take on financial risks, do a credit check. If there are any personal debts, pay them off. Get 6 months of savings in the bank account. Launching your own business takes time and resources to ramp up, so a healthy credit score is a key to success.

Secure Initial Operating Capital

Have enough initial operation capital to launch. There will be several expenses associated with starting a freight brokerage: registration fees, surety bond payments, office expenses, and load board subscription fees, just to name a few.

From the beginning, have cash in the bank to pay your carriers on time, as shippers might be late paying you. Not having enough operational capital on hand at launch is one of the main reasons brokerages fail in their first year of running under their own authority. Make sure you are comfortably padded.

If you have a year of logistic experience and a book of business, it’s possible to avoid these initial expenses through the previously mentioned Freight Broker Agent Program.

The authorized agent works under the operating authority (MC number) of the 3PL, so there’s no need to pay the fee for the agent’s own MC number. The agent is also backed by the 3PL’s surety bond, insurance, software, and back office staff, saving on long term operating expenses.

Find More Customers

Get a book of business together. This will take time and patience. If you have existing connections to suppliers, this will be easier. For example, if you’re a beer aficionado, you might be friendly with a few brewery owners. You know some of them are expanding their own books of business, so they could be your first shipping customers.

Shippers regularly work with a few brokers, so even if they already work with one, they might want another broker for back up. When you provide outstanding service for the first few loads, then you become their broker of choice.  

Don’t Give Up

Being a freight broker is hard work, but the risk of launching your own brokerage can be worth the reward. These skills, habits, and hard work will pay off! Take the time to plan out your path, speak with mentors, present your business plan to your financial advisor (find a financial advisor if you don’t have one), and pursue your dreams of entrepreneurship.

How to Start Freight Forwarding Business in India

The Indian economy has grown tremendously in the past few years resulting in a huge market for logistics services. Over 50 million people in India are being employed by the logistics industry.

Operations of any business can be improved significantly by cutting cost and delivery time due to having an efficient logistics network . This would eventually results in profits and market share for the business. The different types of logistics business that an entrepreneur can start are as follows.

1. Courier and freight cargo services
2. Air cargo services
3. Warehousing services
4. Third party logistics (3PL)

The following aspects need to be considered for any logistics company to be successful.

Registration and Compliance

It is essential to obtain the necessary registration and compliance certifications. As with any business, logistics services require registrations to be obtained and also government compliance. In India, the following registrations are mandatory.

Freight forwarders need to get registered with International air Transport Association (IATA) and Air Cargo Agent Association of India (ACCAI). It is also necessary to be a part of industry forums such as the Institute of Logistics so that issues raised to logistics industry may be raised.

Other important registrations in India include Income Tax Department registration, DGFT registration, Registrar of Companies and other departments.

IndiaFilings suggests the following registrations for a logistics business:

• Private limited company registration
• Import export code
• VAT Registration
• ESI or PF Registration
• Trademark registration, in case of unique brand name.

Investment

A logistics company would seek investment as the first step. The amount of investment in the business would depend on the services that the company intends to do. For instance, setting up a freight forwarding service in the country would require a capital investment of about Rs. 12 Crore.

A brokering and freight management service would require less capital compared to a third party logistics company. A 3PL service company would require investments to the tune of Rs. 65 Crores to Rs. 100 Crores. Starting a Container Freight Station (CFS) or an Inland Container Depot (ICD) requires investments running into several hundred Crores.

Hence it is essential to identify the services that one needs to target and prepare an investment plan based on the same. Due to liberal FDI norms, it is relatively simpler to find investment in logistics in India. Interest in the sector shown by large private equity players would also help get funding.

Risk

Business risk is another aspect that needs to be looked into. Risk management plays a huge role in a developing economy like India, especially for the logistics business. Since the business is very dynamic with many vendors and partners involved in the entire operations, the risk of a claim is extraordinarily high.

It is essential to cover liability by taking adequate amount of insurance for the business incase things don’t go according to plan. Insurance plans which are suitable to such businesses are offered by many such insurance companies in India.

Cargo damage, theft, environment damage, injury etc. can cause serious liability issues and although such business insurances enable the business to address some liability issues, they are not always very effective. It is important to understand the risks involved before executing any contract.

For example, many cargo and property insurance companies in India would not cover inventory shortages as this is considered to be normal risk while running a third party logistics business.

Clientele

Engaging clients well is the key to any successful business. A thorough study of various industries/ products and understanding logistic needs in such studies is essential if the entrepreneur wishes to start a third party logistics company. There are many sectors booming currently such as infrastructure, auto, services and manufacturing as India is primarily an export economy.

All these sectors would need logistics services. Providing operationally efficient solutions and identifying weak areas is key to winning new customer in third party logistics services. Once a regular clientele is established, infrastructure investment can be focused upon as well as creation of solutions to cater to the outside market.

Competition

As liberalisation of FDI (Foreign Direct Investment) norms have made it easier for multinationals to enter the India logistics sector, it is imperative to understand the competition that the business faces as such these capital heavy players can invest heavily in marketing and infrastructure.

Hence it is important to do a complete research on the competition and to focus on the company’s positioning in the market.

Freight Forwarder Salary

As of Jul 8, 2021, the average annual pay for a Freight Forwarder in the United States is $45,462 a year. Just in case you need a simple salary calculator, that works out to be approximately $21.86 an hour. This is the equivalent of $874/week or $3,788/month.

While ZipRecruiter is seeing annual salaries as high as $63,000 and as low as $30,000, the majority of Freight Forwarder salaries currently range between $37,500 (25th percentile) to $51,000 (75th percentile) with top earners (90th percentile) making $60,000 annually across the United States.

The average pay range for a Freight Forwarder varies greatly (by as much as $13,500), which suggests there may be many opportunities for advancement and increased pay based on skill level, location and years of experience.

Freight Forwarding Business Model

The business plan is a document used to describe your enterprise and the business model that supports it. This plan is the base of all freight forwarding companies, as it consists of the strategy upon which they should be shaped in order to have a successful performance.

But what are the best practices to create a winning business plan for freight forwarding companies? You can see all the steps necessary to create a complete plan for your logistics business.

1. Market analysis

Analyzing the market is one of the most fundamental steps to prepare a good business plan. At this stage, you will define who your customers, competitors, and suppliers will be, in addition to detailing the products and services you plan on offering.

Identifying the target audience of your company is critical. It seems obvious, but it is important to remember: without customers, there is no way a company exists. Therefore, look for detailed information on who your ideal customer is, how they behave and what they seek in the marketplace.

The collection of this information can be done by means of the elaboration of surveys, interviews, and conversations with potential clients, or by competitive analysis. The information collected will indicate which direction of what future customers want.

The results will dictate the actions of promotion and marketing for the company to win the public right at the beginning of the action. The entrepreneur can look for specialized companies to accomplish this task.

2. Quality and cost-effectiveness

After tracing the profile of your business’ target audience, it is important to think about the positioning of the services you’ll provide. Think about how you want your services to be seen by the international market in order to be chosen over your competitors. What does quality and cost-effectiveness mean for them?

The more specific market data you gathered in the first stage, the more knowledge you’ll have over the skills you need to develop in order to establish your business in the market.

3. Operational plan

Once the stages of gathering data and brainstorming are over, it is time to know the best way to execute your business plan. This is when the elaboration of an operational plan comes into play.

The operational plan describes how your freight forwarding company will be structured: location, physical facilities and equipment. You should also make estimates about your company’s productive capacity and how many operations you can develop per month. In addition, you should outline the amount of employees needed and the tasks that each one will have in your business.

4. Financial projections

It is also extremely important to find out if your business is financially viable. When it comes to financial terms, you should have a sense of how much should be invested to get your business started, considering aspects like rent, worforce, equipment and registration fees.

You should also stipulate the capital necessary for your company to operate in the long term, making a balance between variable/invariable expenses and the expected revenue.

At this point, the immediate need for each professional/equipment/facility must be observed, and you can even consider if some of them can be outsourced.

Business Ideas in Shipping Industry

Brilliant logistics business ideas can lead to massive profit. There are many startups creating new and innovative solutions to support business operations. From shipping to transportation, the logistics industry has several profitable opportunities available.

In fact, third party logistics providers generated over $185 Billion in revenues last year. As an entrepreneur, you want to choose the best idea in the best industry that would appeal to your market and skill set. In order to do so, we have put together some of the best logistics business ideas that are in demand around the globe.

1. Packing And Moving Services

A packaging and moving service is a successful logistics business idea. All types of businesses look to packing and moving services for assistance. Whether it is a single owner business or multi-national corporation, moving services are needed every time a business expands or consolidates.

For example, business owners who are changing locations due to growthwill a pay for these services so that they do not lose any business in the process. It saves them time and resources while moving a business.

As long as you can ensure the safety and arrival of belongings, you can profit. To startup such a company, you do not need to spend a lot of money. Begin with one van or truck. As your business grows, you can increase both the size and number of vehicles.

2. Shipment Information Provider

Secondly, consider starting up a shipment information company. If you are tech savvy entrepreneur, you can create a platform to lower shipping prices for customers. This would allow customers to analyze their shipping data and compare it against other pricing in the market. While developing the platform, you can even work from home if you choose.

When you offer comparisons between different shipping companies, include price differences and time estimates. You can earn a commission off the booking or charge carriers for getting listed in the platform.This is one of the trending logistical ideas that can satisfy the need for business owners to lower their freight shipping costs.

3. Package Consolidation Services

Similar to shipment information, package consolidation services reduce shipping costs to companies. Services like BluePostal provide less expensive shipping rates by consolidating multiple packages into one shipment. For international businesses that need to import items from abroad, package consolidation lowers the cost per shipment.

If you are located in a country that charges high taxes, tariffs and customs fees, you should consider fulfilling this demand. You would need a warehouse in the country of import and working relationship with the local government to streamline the shipping process for other businesses.

4. Pick And Pack Warehouse Services

One of the best logistics business ideas is a warehouse service. You can choose to specialize in various types of warehouse services. However, pick and pack services are among the top in demand internationally. With pick and pack, your company would process large volumes of product shipments, picking out specific products and packaging them for an order.

Usually this type of warehouse service is needed by major retailers or product-based companies. However, you can also choose from several warehouse service offerings that are in high demand. If you fill this need for enterprise companies, your startup could experience sustained growth as your customers grow too.

5. Ferry Transportation Services

A transportation service that move goods by ferry is a great logistics business idea. Roads are already filled with trucks and passenger vehicles. Sometimes, it can be very challenging for companies to find an affordable and trusted courier to transport goods. Offer businesses an alternative to freight shipping with ferry transportation services.

Moreover, water transportation might be the only option to haul large commercial or construction items. Since there are very few competitors in the ferry transportation market, you could stand out as an alternative shipping option to save money for business owners.

BMSB (Brown Marmorated Stink Bait) can be a major problem for businesses in the shipping container industry. BMSB is an invasive species that feeds off of many types of food and materials, including wood and paper products like cardboard boxes. BMSB is also known to use the insides of shipping containers as nesting sites, which can lead to significant structural damage and costly repairs. BMSB Fumigation services are necessary if you want to avoid this problem, but they’re not cheap. If you’re running a shipping container business it’s important to be aware of BMSB!

Can I Really Make Money With Dropshipping?

Yes, dropshipping can be profitable to merchants. Dropshipping is a low-risk business model that allows you to sell products to your customers without incurring huge running costs like a wholesaler would have. Because of these lower costs, it is easier to become profitable with dropshipping a lot faster than other business models.

Opportunities in Shipping Industry

The shipping industry is a driving force of the global economy, despite the need for strategic changes. Old fashioned container shipping, remains the world’s first global industry, connecting markets, people and businesses. There is an abundance of products in the global market that get in their majority, from producers to distributors via ocean freight.

Amazon, launched the “Shipping with Amazon” service in the US recently, looking to expand into the logistics and delivery industry.

Transport & Logistics

A recent PWC report on Transportation and Logistics identifies some key trends in the immense industry changes. New technology, new market entrants, new customer expectations, and new business models, create an environment of Risk and Opportunity.

The sector seems to be under acute and growing pressure to deliver a better service at a lower cost. And it can only hope to do this by making maximum and intelligent use of Technology.

According to Sri Laxmana at Maritime Executive, despite the rapid employment of technology, the Shipping Industry has not yet seen meaningful transformation. There are basic and fundamental areas of the business in need for drastic improvement.

Maritime Industry Trends

According to the “Global Trends Driving Maritime Innovation” report,  key societal trends such as: population and trade growth,  climate change or higher energy production & consumption, will drastically influence the future of Waterborne Industries.

The expected social changes create a thriving business opportunity environment for entrepreneurs. Ideas related to disrupting technologies can address, rising needs in the Maritime Industries, such as:

• Increase in production and transport of clean fuels
• Increased transport of goods, energy, raw materials, food and water
• Port infrastructure and significant investment in new port facilities and extensions
• Bunkering of alternative fuels
• Need for robustness of ships, ports and offshore structures for severe weather conditions
• Higher degree of automation of systems and autonomous operation
• Sea-based and shore-based operations: integration and transformation
• Need for secure connectivity against cyber-attacks
• Stricter safety and security standards
• Electronic data instead of legal paper documentation
• Digitization leading to data access issues, IPR, etc.
• Increased use of ferries, cruise ship and leisure craft etc.

Investments of more than 3.3 million dollars, went into maritime and logistics startups in the last 5 years, according to Camille Egloff. (The Future of Shipping, Mastering the Digital Wave, organized by BCG at Stavros Niarchos Foundation, Athens, Greece.)

Freight Brokerage Business

A freight broker is an individual or a company that brings together a shipper who has goods to transport with an authorized motor carrier that wants to provide that service.A freight broker falls into the category of transportation intermediary, which is a company that is neither a shipper nor an asset-owning carrier, but plays an integral role in the movement of cargo.

Brokers provide an important and valuable service to both motor carriers and shippers. They help carriers fill their trucks and earn a commission for their efforts. They help shippers find reliable motor carriers that they might not have otherwise known about.

In fact, some companies use brokers as their traffic department, allowing the broker to coordinate all of their shipping and transportation management needs.

Brokers aren’t new to the trucking industry; they’ve been around since the industry itself began in the early part of the 20th century. Prior to the 1970’s, however, regulations governing brokers were so restrictive that few firms were willing to even try to gain entry into the industry.

But with dramatic changes in federal transportation policy during the 1970’s, regulatory restrictions have eased, creating new entrepreneurial opportunities in the third party logistics provider arena.

An industry so huge and diverse requires a wide range of participants to thrive. Some of these participants’ titles may be a bit confusing, and some of their responsibilities may overlap. So who are the key players in brokerage and what do they specifically do?

Key Players in Brokerage:

• Freight Broker. A freight broker connects shippers with motor carriers to move their goods.
• Shipper. A shipper is an individual or business that has products or goods to transport.
• Motor Carrier. A motor carrier is a company that provides truck transportation.
  • There are two types of motor carriers: “Private” (A company that provides truck transportation of its own cargo) and “For Hire” (A company that is paid to provide truck transportation of cargo belonging to others).
• Freight Forwarder. Often confused with freight brokers, freight forwarders are significantly different. Forwarders typically take possession of the goods, consolidate numerous smaller shipments into one large shipment, then arrange for transport of that larger shipment using various shipping methods, including land, air and water carriers.
• Import-Export Broker. They are facilitators for importers and exporters. Import-Export Brokers interface with U.S. Customs, other government agencies, international carriers, and other companies and organizations that are involved in international freight transportation.
• Agricultural Truck Broker. Generally small and operating in one area of the country, unregulated agricultural truck brokers arrange motor carrier service for exempt agricultural products.
• Shipper’s Associations. Shipper’s associations are exempt, nonprofit, cooperative organizations formed by shippers to reduce transportation costs by pooling shipments. Shipper’s Associations operate in a manner very similar to that of freight forwarders, but their service is limited to their members and is not available to the general public.

In a perfect world, of course, each entity in the industry would handle its traditional role and that’s all. However, the transportation industry is changing so rapidly that once-distinctive lines are always blurring. Also, it’s quite common for a successful freight broker to expand his or her business by creating subsidiaries or additional companies that offer other freight services. 

Some brokers also may opt to use agents to develop a wider scope of operations. In this context, agents are independent contractors who represent a freight broker in a given area. This gives the broker a local presence while giving the agent access to the broker’s services for their own customers. 

An agent’s work is very similar to what a broker does, but the agent functions under the auspices of the broker and the broker is the one responsible for such issues as paying carriers and maintaining the required surety bond.

As you can tell, there are many different types of freight brokers out there. Hopefully this clears up what their roles are and what services they provide. A good freight broker or 3PL is a crucial asset in your supply chain.

How Does Shipping Business Work?

The container shipping industry works because of, well, containers. Boxes.

You put your goods in a container, make sure they are secure in there, and all going well, the next time that it is opened, at any point on Earth where you want it to be opened you can have access to the goods within.

Containerization has enabled world trade to grow in leaps and bounds. All you need is a standard shipping container, and the material needed to handle it and transport it, and that kind of stuff is uniformly available worldwide.

There is barely any place on Earth that cannot handle a standard container, even in the remotest places.

In other words, if you want to get your goods from any place to any place, stick them in a shipping container. They will get there. People will know what to do.

Vessel Operators like Maersk own their own vessel & they provide regular service of loading/offloading of containers/cargo to different ports in different country just like a Train which goes from one state to another.

To book a ticket in train is easy but to book a container in a vessel you need to contact shipping lines/NVOCC/ Freight Forwarder, they will provide containers to stuff cargo & a custom house agent will give clearance for shipping.

Once shipping bill is generated your container got the license to export/import your cargo from one country to another. Your container will go to a shipping port where a vessel will pick up your container to the destination.

Freight Broker Training

It may be tough for aspiring freight brokers to start operating in this rather complex field. You need a solid set of diverse skills and knowledge, ranging from communication, marketing and sales along with encompassing legal and industry know how.

To help aspiring freight brokers, we compiled a list of the top freight broker training schools. We’ve ranked these schools based on things like programs, teachers, location, reviews and pricing. Here are the top 8 freight broker training schools.

1. Freight Broker Planet

Freight Broker Planet was founded in April of 2011, and has been improving their courses ever since. They have streamlined the delivery of crucial information within their courses, including the necessary interaction between facilitators and class participants, and the evaluation standards which encourage trainees throughout the learning process.

• Price: Freight Broker Training Plus costs $1,099, and Freight Agent Training is currently costs $950.
• Location: Online
• Website: https://freightbrokerplanet.com/

2. Loadtraining Freight Broker School

A great option for your freight broker training needs is the Loadtraining Freight Broker School. You should start by reading the inspirational personal story of the founder David Dwindle on how he came to love his profession. It will certainly motivate your own efforts in the industry.

• Price: The online course costs $599. The Home School option is $799. The 5-day course costs $1,999. The D.O.B. 5-day option is $5,500 and includes a personalized business plan.
• Location: Phoenix, AZ – Houston, TX – Dallas, TX – New York, NY – Chicago, IL – San Luis Obispo, CA – Los Angeles, CA – Kansas City, KS – Raleigh, NC – Nashville, TN – Louisville, KY – Atlanta, GA
• Website: http://loadtraining.com/

3. The Brooke Transportation Training Solutions

The Brooke Transportation Training Solutions is a well-known and established freight broker training school. In fact, it is the first result you will get if you search for “freight broker schools” on Google. Its website is modern, information-rich and user-friendly.

• Price: The five-day Freight Broker Basic Course costs $2,495. The five-day intensive Freight Broker Advanced course Course costs $3,995. The online course via Ed2Go is $1,895.
• Location: Dallas / Fort Worth, TX – Charlotte, NC – Jacksonville, FL – Indianapolis, IN – Chicago, IL – Memphis, TN – Phoenix, AZ – Louisville, KY – Ontario, CA – Salt Lake City, UT – Atlanta, GA
• Website: http://www.brooketraining.com/

4. Freight Movers School

The Freight Movers School is certainly one of the top names in training freight brokers and agents. It used to operate as the Transport Training of America, Inc.

• Price: The In-Depth Freight Broker Training Course costs $2,250. If you opt in for the In- Classroom Combination Course (In-Depth Freight Broker Training Plus Focus On Sales), the price is $2,500. The online options are $900 and $1,050, respectively.
• Location: Courses are offered in Atlanta, GA and Dallas, TX. The school also offers online programs for remote students.
• Website: https://freightmoversschool.com/

5. Logistics Academy

The Logistics Academy was founded in 2015, but it has managed to establish a name for itself. The school offers affordable and diverse courses for brokers.

• Price: The basic Freight Broker Training course costs $299, while the Freight Agent Training one is $249. The Sales Techniques and Strategies program costs $149. For the Basic Logistics Training, you’ll need to pay $199. There is also a Premium Freight Broker Training Package, which costs $699 and covers all of the abovementioned courses.
• Location: Online
• Website: https://logisticsacademy.org/

6. Freight Brokers Course

The Freight Brokers Course offers high-quality online logistics training which is accessible for budding brokers from across the U.S. The school also has freight broker training quiz apps (both iOS and Android), which may be quite handy for transportation professionals.

• Price: The Freight Brokers Course presents four pricing options for its online course and materials. The Basic Course + Forms cost $99. For $449, you get access to the Basic Plus option, which consists of the Basic Course, Forms, and a rich Transportation Directory. With the advanced option for $549, you also get a one-year membership to the website’s load board. The Deluxe option, which costs $749, offers you also website templates, license filing service, and social marketing leads.
• Location: Online
• Website: http://freightbrokerscourse.com/

7. Taltoa Freight Broker Training

Taltoa has trained and consulted freight professionals for more than 20 years. The school offers training, placement, and consulting for freight brokers and agents.

• Price: The Freight Broker Essential course costs $4,950. The online Freight Broker Essential course is $2,650. The customized option is priced according to your specific study program. The self-study options costs $99.95 for the online course and $69.95 for the Freight Broker Training Manual.
• Location: You can take the course online. The school’s location if you choose in-class training is in Fort Smith, Arkansas.
• Website: http://www.taltoa.com/

8. Freight Broker Trainer

The Freight Broker Trainer school is led by the Transportation Training Group. The school offers training options for brokers, freight dispatchers, and oversize load pilot car operators.

• Price: The online class for freight brokers costs $699.95. The TTG’s Freight Broker Training Guide is $199.95.
• Location: Online
• Website: http://www.freightbrokertrainer.com/

Cargo Ship Profit Margin

Ocean carriers enjoyed their best quarter in container shipping history in the final three months of 2020, but are expected to have significantly topped that record in the first quarter of this year.

According to New York-based Blue Alpha Capital, fourth-quarter net earnings for the 11 carriers that report their financials came in at $5.8bn, but assuming that the non-reporting operators, such as MSC, achieved similar results, based on the average for the 11 lines the consultancy estimated the cumulative net profit for the period was a staggering $9bn.

For the full-year, Blue Alpha Capital calculated a combined net profit of $10.2bn for reporting carriers and an estimated $15.8bn net for all the top-ranked lines.

To put the 2020 earnings into context, they are more than double the total circa-$7bn of profit ocean carriers produced in the previous five years – with several carriers having racked up year-on-year losses during that period.

Moreover, the 2020 result is a complete reversal of the outlook for the industry before the pandemic.

“The final result for 2020 is a far cry from some of the doomsday predictions made mid-year, with fears the industry might post a collective net loss of up to $10bn,” said Alphaliner.

Analysing the performance of the three main Taiwanese carriers, Evergreen, Yang Ming and Wan Hai, as an example of the turnaround, Alphaliner noted that the lines had “profited from soaring transpacific rates and the added rate impact of box shortages”.

Evergreen posted a net profit of $853m for 2020, while Yang Ming and Wan Hai recorded profits of $420m and $396m, respectively.

Alphaliner also noted that the trio had reversed a breakeven at Evergreen and loss at Yang Ming, while Wan Hai tripled its net result last year.

Meanwhile, Blue Alpha Capital founder John McCown traced the liner industry’s turnaround to an unforeseen over-correction of capacity by carriers on many tradelanes at the start of the pandemic.

“Carriers took immediate and aggressive action to reduce capacity by blanking sailings,” he said, adding that the industry consolidation in the form of the alliances had “made this logistically easier to accomplish”.

He said: “As it turned out, that was an over-correction in many lanes that resulted in demand exceeding capacity.

“The $64m question remains whether the industry has embarked on a new trajectory for its results, based on new capacity management skills, or whether it will revert to its historical mean performance,” he added.

Nevertheless, with massive spot rate hikes now complemented by much higher contract rates, carriers look set fair for even greater profits for the first two quarters of the year, at least, if not for the whole of 2021.

Indeed, China’s Cosco Shipping has advised its first-quarter profit will exceed $2bn, and The Loadstar understands that two European-based carriers will shortly alert shareholders to a much-improved outlook for the half-year.

How Much Money Does a Cargo Ship Make Per Trip?

Renting or buying a shipping container can be a very smart choice. When it comes to shipping container costs, they are convenient and affordable. There are a variety of ways you can finance one, and you have the option of choosing a way that makes the most sense for your business. 

There is a wide range when it comes to shipping container costs. You are able to rent or buy, select a used, refurbished, or brand new container, choose a size, pick and choose your add-on features, among other choices.

Read Also: Pay Less Brokers Fee Day Trading

They can be priced anywhere from around $1,400 to $6,000, and if you’re renting, you can it up into monthly payments over a decided-on period of time. So essentially, whether your budget for a container is high or low, you can find one that best fits your business’s needs.

Making Money in Logistics And Shipping as a Freight Broker

With more businesses in need of intermediaries, new brokers have a chance to gain valuable market share quickly after entering the business. However, the business potential for brokers is not an easy grab — individuals in the industry need to know what it takes to create a successful, competitive business from the start.

The first step is getting licensed and trained in the business of freight brokering while creating valuable business relationships and partnership that allow for easy connection to potential customers.

Once these processes are in the works, freight brokers must also ensure they are working in line with federal and state guidelines. One of the requirements to become a freight broker is securing a freight brokerage bond or a trust fund, both which offer protection against bad business practices and future claims against the business.

No freight broker can operate legally without the appropriate bond or trust fund in place, so it is crucial to understand these requirements before starting a brokerage business. Those who recognize the need to follow these guidelines and have strong relationships in the industry are positioned well to enjoy the growth in the industry over the next several years.

Freight brokers must focus on maintaining strong relationships with their customers to do so, as well as staying up to date with training, licensing and bonding requirements, and new digital practices.