Shipping Business: How to Start and Where to Get Financial Support

We live in a global society that is supported by the global economy – and this economy simply cannot function if it were not for ships and shipping. Shipping is indeed the basis of the world economy: without shipping, intercontinental trade, the transport of bulk materials, and the import/export of affordable food and manufactured goods would simply not be possible.

Moreover, business is done every day, and there is always a need to deliver goods and products to wholesale customers and end-users.

A transport company is a commercial enterprise that transports goods to buyers who can be wholesalers/intermediaries from manufacturers from any part of the world.

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Interesting! It is generally accepted that more than 90% of world trade is done by sea.

Due to the growing demand for transport services that offer reasonable prices and promise convenience, speed, and reliability, now is the best time to start a shipping business. In addition, the industry is growing and changing rapidly due largely to growing demand and dependence on online shopping.

Demand, Competition, Economic Profitability

The field of shipping business extends to the public sector, the organized private sector, households, communities, and people of various classes and all segments of society.

List of people and organizations that need the services of shipping companies:

the public sector (public institutions, etc.);
organized private sector (corporate organizations);
small business;
businessmen and entrepreneurs;
contractors;
sports organizations, etc.

The shipping company needs more than your experience, knowledge of how to deliver secure contracts, as well as the ability to communicate with the right set of people who matter; communication with decision-makers that can decide who can transport a particular set of goods is also important.

Statistics: The projected size of the global market for sea containers in 2027 will be 12 billion US dollars. (Source: Statista)

If you plan to start a shipping business in the United States, your main task should not be limited to purchasing office space and equipping it or hiring the best workers in the industry. On average, establishing and running a shipping business in the United States, as elsewhere in the world, can be costly simply because of the logistics and means that are involved in the business.

If your budget is not so large, you must first find funding sources or partners.

Create a Business Plan

If you want to create your own transport company, you need to write a detailed business plan that will correspond to reality. Consider the facts, figures, and other indicators in the shipping industry, be sure to take into account the indicators and the economic situation in the country in which you are going to start a business. It shall include:

business overview;
your competitors, their skills and prices;
target market;
a unique trade offer and core competencies;
prices, financial and marketing plans;
sources of your funding;
threats and opportunities in the shipping industry of the country;
exit strategy.

This document will not only help you through the processes of successfully launching and managing your business; it will present your idea to third-party sponsors such as investors and banks.

Costs for the Establishment of a Shipping Company

Here are some of the major costs you should consider when setting up a shipping company in the United States:

The business registration fee is $750.
The budget for insurance, permits, and licenses is $5,000.
Rent a suitable office space – $50,000.
Office equipment – $15,000.
Purchase shipping equipment – $50,000.
The launch of the official website is $700.
Additional expenses (business cards, signs, advertisements, promotions, etc.) – $2500.
Other – $1000.

You will need about $130,000 to set up a small shipping company in the US.

“Admire a small ship, but put your freight in a large one; for the larger, the load, the greater will be the profit upon profit.” — Hesiod.

Transport Company Financing

If you have a good and workable business plan, you don’t have to fight much before convincing your bank, investors, and your friends to invest in your business.

Here are some of the options you can use when looking for seed capital for your transport company:

raising money from personal savings and selling personal shares and property;
investors and business partners;
applying for a loan from your bank/MFI;
receiving business grants and seed funding from donor organizations.

The most affordable and cost-effective ratio of your future earnings and investments will be taking emergency cash at Fit My Money. How do you get a loan if you are self-employed? When you are self-employed, proving that you have a stable income stream and can make timely payments can be challenging.

Here are a few ways to prove that you are a reliable loan candidate:

tax returns and statements;
bank statements;
bail;
a co-signer.

Photo by Kindel Media

How to Make the Company Popular?

Here are some of the ways you can use to promote your shipping company:

Advertise your business in relevant business magazines, television, and radio stations.
Write your company in local catalogs/editions (both online and offline).
Join local chambers of commerce to network and market your shipping company.
Show your business by sending welcome letters along with your custom brochure to all corporate organizations, communities, hospitals, hotels, and government agencies in your target region.
Create different packages for different customer categories to work with their budgets.
Engage in direct, referral, and other types of marketing by e-mail.

Training your employees and regular evaluations will help you manage your organization effectively. You should also encourage your employees to be certified in various areas of your specialization; this will help your organization profile.

One of the best ways to attract new ones and keep old customers is to be satisfied with your work. If you are open and fulfilling your duties qualitatively, they are unlikely to look for other companies.

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