As the logistics and freight industry continues at a steady rise, some wanting to take part in the market may question how to grow a freight forwarding business or how difficult is to grow a company? Starting a freight forwarding company or trying to efficiently grow the business can have difficulties in such a competitive market.
As the market continues to expand daily, freight forwarders must make the proper changes to keep up. According to MarketWatch, “The global Digital Freight Forwarder market size is projected to reach USD 3756.5 million by 2027, from USD 1370 million in 2020, at a CAGR of 15.5% during 2021-2027.” At such a rapid pace, forwarders must quickly have a strategy from a business standpoint on how to gain a competitive edge. Just understanding the market is not enough to keep up with the never-ending market growth, freight forwarders must take the proper steps for efficient growth.
Freight forwarders must take proper action and steps in gaining a competitive edge to grow a company or start one. Approaches such as finding and training the proper staff, digital advancements with software, and utilizing social media to reach more customers can help grow a forwarding business, but alone, these steps can be confusing and lead new enterprises down rabbit holes that never build the business. However, the key to success is a unified, comprehensive strategy and series of steps that can help grow the business from the ground up and avoid problems. Let’s take a deeper look at the top steps to growing a freight forwarding business starting with a single shipper contact and how technology can help your business along the way.
Study Your Competition
As competitive as the freight forwarding market continues to be, businesses must understand the need to study and understand their competition as a valuable tactic. Understanding how other competitors acquire customers so quickly and the systems they use can help you know what to include in business. Many companies use customer relationship management (CRM) services to see how long a salesman takes to make a deal. Additionally, using an updated and tech advanced platform can provide the upper hand to speed up processes and gain more customers.
In regards to freight forwarder business growth, shippers seek forwarders that can provide efficient customer service, fast response times, and proper cargo handling. Studying competitors can provide some tricks to use and add to your business strategy, and some to do differently and use as a lesson of what to avoid. Forwarding companies can then take the information gained from observing the competition and see where to implement changes.
Find and Train the Right Staff
For anyone wondering how to grow a freight forwarding business, or what it takes to have a successful business, remember the importance of the proper staff. A company is only as good as its staff, which is why freight forwarding businesses must take the time to hire and train the right staff. An expert team can make the work experience easier to manage and make the transportation process smoother. Most importantly, properly training staff is vital for safety purposes to ensure proper cargo handling without injuries. Understanding the market and what shippers hope to gain from forwarders can promote proper communication and training to staff.
The staff must also comprehend the importance of the target audience and the most beneficial way to acquire new customers. For a business starting out, hiring and training the staff properly allows for them to easily grow with the business and adapt to more customers. Enforce the staff to focus on offering new solutions to customers, generate additional revenue, and build a stronger customer relationship. Acquiring new customers is always important, but make sure the staff understands the importance of maintaining a good relationship with current customers. Striving to have a more personal relationship with customers can gain a competitive edge over bigger companies in the logistics market.
Stay Financially Stable With Freight Finance Solutions
Freight forwarders have the task of finding solutions for difficult shipping and warehousing needs for clients. The startup costs for a freight forwarding business are low, however as the business loads grow, so will the cost to keep up. Companies roughly request on average a month to three months to pay for invoices. Such a long period of time without payment especially from multiple clients can result in financial problems quickly occurring. One financing solution is freight factoring all invoices or only the slow-paying ones. Freight factoring allows you to receive liquidity and immediate advance while the invoice company waits for the payment. As soon as the client is happy with the services, the factoring company will review the documentation and send the funds. Freight factoring allows for improved cash flow and diminishes issues with slow-paying invoices, which can allow businesses to grow at a steady pace.
Digitize Your Workflows by Choosing the Right Forwarding Software
Especially when starting a freight forwarding business or hoping for freight forwarder business growth, using the most efficient forwarding software is essential. The right forwarding software should provide a variety of services and implications to make the process easier and improve business. When starting a business, the core technology and software can make or break how the company will work or grow. The most beneficial system software can provide integrated services and capabilities for the business and customers.
Real-Time Data Access
Modern freight forwarding services should be able to provide real-time data as the topic continues to grow in demand. Instant access to data can provide forwarders with the proper information to make data-driven decisions. Technology has the ability to streamline operations and provide an easier process throughout the supply chain with the proper data. The correct data can provide insight into improving profit margins, reducing costs, and what areas to focus on for improvement. Shippers need the ability to access instant shipment status and data and they rely on the freight forwarder to make that happen. Using outdated data or not having an easily accessible platform can cause shippers to have the wrong information, or not have it at the right time.
Digital Document Management
No shipper wants the hassle of searching through an endless paper trail to find the documentation and shipment status needed. Without proper documentation management, important paperwork such as invoices, bills of lading, and customs clearance paperwork can be lost or impossible to track down. A proper forwarding software can provide a resource for storing, retrieving, and searching for documents. Having access to such a platform can increase communication throughout the team and allow them to implement the information across the documents. Proper document management can provide important documents to be easily recorded, filed, managed, and accessed digitally whenever needed.
A beneficial freight forwarding software will enable less time to be spent searching for documents and data. Forwarders have the opportunity to visualize cargo flow more efficiently while alleviating issues throughout. Shippers will have the ability to gain transparency through the platform provided by the forwarding software. Transparency allows for everyone to know the shipping status and other details to keep operations functional and on the same page. As volumes continue to grow daily forwarders can help provide access to timelines across different modes through a single platform to provide shippers and carriers transparency with shipment information.
Software should provide accessibility for inventory flow, freight relocation in the warehouse, and forecasting of the product demand from data and analytics. Going back to proper real-time data, without this the inventory count and logistics will be incorrect and can affect profit. To positively affect profit, inventory management can decrease waste reduction due to tracking inventory levels and trends of products, sales, and deliveries. A freight forwarder that provides a platform should benefit shippers with timely inventory planning and to achieve increased visibility.
Companies curious about how to get clients as a forwarder must understand the need for actionable data and analytics in such a competitive market. For a forwarding business starting out or hoping to grow, they must gain a competitive advantage and get ahead of the rest. Proper analytics through software can improve cost management, visibility, and efficiency through the operations of the supply chain. Real-time data and analytics can provide shippers with the visibility and resources needed for data-driven decision-making. Unifying data and analytics allows forwarders to keep landing costs in check while providing shippers with the data needed to understand what forwarders have done for the business. Data and analytics improve managing e-commerce to gain knowledge of what should be focused on and improved from a business standpoint.
Forwarding software should be able to provide visibility from real-time data and analytics. Having the proper data, analytics, and visibility can reduce the risk of lost shipments and improve tracking. Using freight forwarding platforms, client data, documentation, predictive analytics, and real-time data can provide clear visibility while also deriving actionable insights for freight forwarders. Becoming data-centralized and focusing on visibility with shipment status, documentation, and scheduling deliveries or pickups can increase efficiency, avoid delays, and improve operations overall. Freight forwarding software can increase visibility and actionable insights for shippers through platforms, client data, documents, analytics, and real-time data.
Stay Informed with Platforms
Collaborative platforms allow shippers, freight forwarders, and others to maintain communication and more helpful resources. Especially in today’s world as change happens rapidly, having a system that allows for constant messaging and data access is vital. Such a platform allows for document management, communication with shippers and others, and statuses on shipments to be easily accessed. Shippers should expect document management, easy access to booking cargo space, and tracking of shipments, providing a website that signifies the shipper’s needs will entice them to become returning customers. Especially for freight forwarders starting out, having a platform or dashboard allows for sales performance and data-driven strategy to be utilized.
Create Robust Social Media and Digital Marketing Campaigns
Social media can provide an easy platform to use for marketing and public relations (PR) for small or large companies. Such platforms help freight forwarder business growth due to easy access, entry to anyone, and the ability to target consumers. Rather than only reaching out to those who already understand and work with logistics, social media provides a way to include others. Logistics continues to be a topic that users either understand or don’t, social media platforms can increase recognition to the public. Marketing through platforms commonly used such as Facebook, Twitter, LinkedIn, and more, can provide market segmentation to reach the proper audience. Putting ads on such platforms and taking the proper steps to ensure the most beneficial audience sees the ad can increase customer potential.
Companies cannot just continue to plaster stickers on the side of trucks and hope the right people drive by and just so happen to need a forwarder if the question at hand is how to get clients as a forwarder. Logistics companies have the opportunity to use technology and globalization to improve communication and advertisement. Having a business page on social media and using ad campaigns can lead customers to the website and entice them to pay for the service. Social media is everywhere today, providing businesses with a platform to reach customers anywhere and everywhere on the web. Providing a functional website that clearly delivers the company’s message and is easy to use can attract more customers. Ensure the customers can find everything and anything they may need to plan a load or meet basic necessities.
Stay Engaged With News-Driven Content Too
New forwarding companies can benefit from understanding the freight forwarder book of business and engaging with logistics and freight news content. Staying up-to-date on news-driven content allows management to keep up with the market and industry changes. Keeping up with news content can help forwarders starting a business to analyze and understand the market. This will allow companies to keep up with logistics trends, competitors, and new strategies to gain more leads. As market value and costs continue to change every day, staying up-to-date on such news and events can allow freight forwarders to make the proper changes to operations. Keeping up with the latest freight news can provide vital learning and knowledge on the industry so informed decision-making becomes easier. If the company seeks to grow globally, keeping up with international news and markets allows the company to provide more solutions for different areas.
Connect With the Right Peers
Connections and networking around the globe with suppliers, buyers, and customers is vital for growing a business. For many curious about how to grow a freight forwarding business, communication and using a logistics network are key to making growth happen. There are a variety of different platforms that provide interaction for forwarders on a global level. Freight forwarders must develop a clear business strategy that promotes global business exchange and allows your transportation business to expand efficiently. Starting a freight forwarding business with the guidance of networking and load boards can make it easier to generate new leads without spending extra money. Additionally, having access to a marketplace or other form of the network allows forwarders to gain more customers even from a global standpoint. Sign up for Cargologik to get started today.