Steps to Start a Sea & Air Cargo Company

Freight business involves transporting cargo from location to destination. The shipment could move within state lines or abroad.

 Freight forwarding is a lucrative business however it involves serious logistics, handling, planning and execution. The cargo company may consolidate small cargo or haul large shipments.

To operate a cargo company you don’t necessary need to own the mode of shipment except vehicular transportation. The goods are generally delivered through road, air and sea.

Some operators specialize in only one method of transportation while others offer a broad based service. Operators haul a diverse spectrum of goods such as equipment's, vehicles, food and raw materials.

It is the duty of the cargo company to thoroughly check inventory for prohibited goods before shipment. Business success is not guaranteed however proper networking, handling and efficiency are essential elements.

Here is a step by step guide on how to launch your cargo business.

Write a Cargo Company Business Plan

The job has many complexities so writing a business plan is important. The plan should cover mode of transportation, target customers and demography.

Other important aspects are acquiring appropriate licenses and certification. You need to carefully choose your operational base, management team and network partners.

Others are growth, expansion, future goals, profit/ loss. Another major challenge is sourcing funds for your business.

Steps to Start a Sea & Air Cargo Company

Understand the Cargo Business

To understand the business you need to study the freight forward industry. The business is moderately complicated and involves various permits, licensing, ethics and procedures.

You need adequate funding, networking and extensive knowledge of every aspect of the job. A deep knowledge of foreign markets, regulations, and proper inspection and documentations is very important.

Every country has different custom regulations however there are general procedures along foreign boarders.

What the Cargo Market Entails

The job involves lots of documentation, inspection and cargo movement. You need a receiving outlet or partner in foreign lands.

Other aspects are shipping methodology, warehousing and abiding by strict custom regulations. The company prices should be reasonable and competitive and cargo delivered intact.

Define your Target Market

It’s all good handling different kinds of cargo however you need to define your market. Narrowing the field would allow better proficiency and organization.

 You need to decide the type of freight and geographical location you wish to operate. By doing this you understand the target countries custom requirements and acceptable cargos.

Narrowing your niche, leads to specialization, efficiency and better delivery system. It also affords the company better time management and capacity building.Box Truck Business

Identify you Customer Base

Once you have chosen your preferred destinations and understudy the custom regulations you need to identify your customers. Conduct a survey of specific customers, location and demography.

Use various marketing strategies to target the preferred customer and market. Determine your preferred load volume and purchase appropriate equipment.

Transportation Equipment

There are some transportation equipment’s you need to ease the handling of goods. Common equipment’s are hydraulic pallets, power pallets, tractors and dolly.

You need weighing equipment such as weighing scales and Weight Bridge for heavy goods.  Material handling equipment are x-ray machines, gloves, cargo offloading ramp, four wheel trolleys, fork lifts and low bed.

Cargo Equipment

• Hydraulic pallets
• Power pallets
• Wooden pallets
• Tractors
• Vans, trucks
• Dolly
• Weight bridge
• Weight scales
• X-ray machine
• Gloves
• Visual inspection aids
• Offloading ramp
• 4 wheel trolley
• Fork lift

Mode of Transportation

International destination cargo shipment is carried out in four ways. We have ship ownership, third party shipment services, owner cargo plane operations and commercial air freighting.

Ship Ownership

The first and most capital intensive method involves owning your own ship. Ship ownership is no small potatoes and requires serious cash. The ship owner is responsible for the safety of the cargo from port to delivery at the docks.

Provide Shipment Services

The second sea shipment method requires significantly less funding. The funding requirement is targeted at paying the ship to deliver the goods.

Once the ship accepts the goods and delivers the cargo. The company either uses their representative at the destination to clear the good or hands the document to the customer.

Owning an Air Cargo Plane

The same major expense applies to owning a cargo plane. Apart from purchase of the plane you need operational licensing and certification.

There are a host of aviation rules and best practices. The capacity and size of the plane depends on the cargo you want to freight.

Lease an Aircraft

There are two ways to lease an aircraft. You could lease a small aircraft exclusively to carry your cargo or freight the cargo in a commercial cargo plane. The first option requires more capital that using a commercial airline.

Cargo Aircrafts

• Airbus A400M
• Lockheed Martin "Hercules" C130J
• Antonov An-32
• EADS CASA C-295
• Alenia C-27J "Spartan"
• de Havilland Canada DHC-4 "Caribou"
• Fokker F27-400/700
• DC-3
• DC-6

Licensing and Registration

Cargo business is all about proper documentation and certification. Before you get into the nitty-gritty of freight forwarding register your company.

Incorporate the business as a limited liability company and obtain license to ship by sea or air. The Maritime Commission handles sea transportation while Federal Aviation Administration air transportation.

Find out all the requirements and acquire the necessary certification. You will need to submit formal application, fill form, provide evidence, certificates and pass serious scrutiny before getting the operational papers.

The business also has some elements of risk such as lost cargo, damaged goods or impounded goods. You need serious liability insurance cover to protect your business.

Cargo companies face penalties, reparations, damage charges and accidents. Therefore there is no compromise on the type of insurance cover you acquire.

 Marketing

Effective marketing should target only your preferred customers. Use different parameters, surveys and techniques to attract patronage.

A stratified customer most likely would be a repeat customer. Work on efficiency, transparency, due diligence and safety.

 Ship/Air Cargo Business Terms

• Forwarding out
• Forwarding in
• Consignment
• Cargo 2000
• E-freight
• Air transportation
• Air cargo laws, claims, complaints, insurance
• Finding partners
• Customs Act 1962
• Demurrage charges
• Bulk cargo
• FIATA, FFFAI, MOC, EXIM, ECGC. FIEO