I never thought that I would ever venture into this industry, with my limited knowledge and exposure. However i had been always intrigued by the magnitude of companies like FedEx, DHL, UPS and many more. Since young i had a dream, which became a lot clearer as of recent days which is to give employment to 500 employees. I enjoy the feeling of giving salaries, benefits and being responsible for that many lives. When the opportunity came in 2011, i chanced upon it to grow that company to a mighty 70 man company by 2014.
Let me share my learning journey so those of you whom are interested to start a transportation business can be a little more aware of what to expect. Transportation has many sectors; Courier, Delivery, Catering, Personal Transportation, Forwarding and I tell you the list keeps going.
Now its vitally important for you to have some domain knowledge of the sector that you choose to build your business on. As for Expedite Transportation and Logistic Services Pte Ltd, www.expeditelogistic.com we chose the delivery, and in particular Food Delivery; Yummy.
My partner, Ridzwan had a couple of friends, i think it was around 10 of them, with whom we began supporting delivery operations for Al Azar Food Restaurant in Bukit Timah. We did really well at that outlet, with the hang of things, we starting emailing out to all other businesses that had to do with Food Delivery. With some effort, luck and gods grace we grew slowly but surely, eventually supporting companies like Spizza, Yoshinoya, Sakae Sushi, 7 Eleven, PastaMania, Ananda Bhavan, Wendy’s and many many more.
The road was definitely not rosy, it had lots of pitfalls, commonly overspending on resources. Normally as a food delivery vendor, you will need to always have spare riders to do covering duties and that would also mean additional cost incurred. To be sure we decided to hire full time individuals to assist us with covering duties which dont exactly generate revenue.
The other major pitfall was to put your foot in a domain that you have little knowledge: Van !!! We got a project at 7 eleven to deliver food items however our usual bread n butter bikes were too small for the size of the delivery area and items. We decided to get a van, with little or no knowledge on how to maintain a van. My mind voice asked; “How different can this machine be?” Hell no its a totally different animal. The van is prone to many problems as they age and you need to know how to handle it and what to look out for.
Other common business challenges were money management, its really crucial in this business as most of your clients may ask you for a payment term, often 30 days to 60 days. Unfortunately you cant do the same with your employees, lots of money has to be on float when you need it or you need to borrow, hence finding good places to leverage credit is really important.
Does it take a lot of money to run this business ? It totally depends on the sector, with regards to food delivery yes and no. It all depends on the size that you wish to grow to. We at almost every beginning of the month had to keep at least $60,000 on standby for salary and other misc payments.
Do i have to do the delivery first before hiring ? Its always best for you to taste the soup before you serve. It most definately motivates your employees and also helps you obtain the know hows.
Isnt it too competitive? Well i think there are room for more as the delivery business doesnt seem to have saturation point as of yet with so many businesses popping up, all require some form of assistance in fulfilling their delivery requirements.
Thats all folks, do leave me a comment or question and will respond to you in due time ☺