The transportation sector is competitive and on the move. Technological advances have improved efficiency, driver safety, profits, and reporting accuracy of firms of all sizes that rely on moving goods from Point A to Point B as their main source of income. How do startups survive in such a fast-paced, crowded marketplace? New entrants to the transport segment can leverage the power of specializing and thinking small, especially during their first few years of operations. That’s why so many transport startups focus on niche markets in their local regions.
Likewise, nearly all the newcomers discover the indispensable advantages of fleet management programs that make drivers safe and help managers meet stringent legal requirements. Other approaches for day-to-day survival include smart outsourcing of key services, paying extra close attention to customer service, leasing vehicles instead of buying them, and operating at a financial break-even point for at least the initial year of business. Here are more details about the many ways new companies in the ever-changing transportation market deal with competition, legal requirements, and customers.
Niche Markets
Owners often use the term going niche to describe the tactic of focusing on a narrow demographic within a well-defined geographic region. For new entrants in transportation markets, the strategy is a way to start slowly, build up a loyal client base, and earn a modest profit for the first few years of their existence. Some tiny trucking companies only haul one or two kinds of cargo in a single city.
To further hone in on their chosen niche, they might decide to work for manufacturing or recycling businesses exclusively. Aiming for a specific niche can help you succeed in a competitive industry and also lets owners zero in on offering excellent, cost-effective service to just a few clients.
Fleet Management Programs
Managing fleets via programs, software packages, and various stand-alone apps can be a game changer for startups looking to succeed. The best products in the line can create efficient routes in real-time, track every shipment via GPS, keep tabs on vehicle maintenance schedules, and use ELDs (electronic logging devices) to meet legal mandates regarding hours of service (HOS) and record of duty (ROD) status for every driver and all shifts. In fact, there is a detailed law in place in all jurisdictions about ELD for trucks, which means that every truck must have a device in place or risk a large fine. Smaller, newer companies can be hardest hit by such fines and work hard to avoid them. That’s just one of the many reasons startups need this important technology to compete.
Focus on Customer Service
When you’re the new kid on the block, it pays to be nice to others. That basic childhood truism applies to the everyday reality of running a delivery company. Startups that focus on customer service before, during, and after sales can build up their client list rather quickly. That means doing things like hiring humans, not robots, to answer phones and respond to inquiries. It also entails fixing things that go wrong with orders, like late arrivals, shipping the wrong items, delivering damaged goods, etc. Devoting extra attention and effort to your first few customers is a strategy that usually works.
Smart Outsourcing
Knowing which tasks to outsource, and being willing to let go of the responsibility, is the key to any successful operation. Many organizations that use vehicle fleets in their everyday operations prefer to outsource totally unrelated chores like tax planning, payroll, legal services, and IT security. Most retain the human resources functions of scouting for new talent, interviewing candidates, and training new hires. But, it’s imperative for smaller enterprises to diligently consider which of the many day-to-day work categories they will do themselves and which ones they’ll outsource.
