Here are some specific business ideas in the transport sector that might suit your capital, skill set and pursuits. Once you’ve figured out what type of business you would like to start the next step is figuring out how to get going.
Our comprehensive guide to starting a transport and logistics business provides you with everything you need to know.
1. Transport and logistics opportunities
The aim of this type of business is to deliver other business’ products, affordably and quickly. In this category you can specialise in the import and export of goods from inside and outside South Africa along with deliveries to and from other African or international countries.
If you want to successfully run a transport and logistic business you’ll eventually need a link to freight transport. This will make your business start-up an expensive investment, but a transport and logistics business can be lucrative if you have organisational and management, skills along with the right expertise.
Start out small and be reliable, there is a low barrier of entry for this business so you will have to set yourself apart from your competition. You also don’t want to invest large amounts and find that the market was wrong or you need to pivot your idea. If you’re going to start big, be sure to plan and research your business idea before you start buying expensive vehicles.
2. A courier business
You can effectively start-up a courier business overnight. All you need is reliable transportation and enough time to make it worth your while. You can pick up and deliver small packages every day, until you’re able to grow your fleet of vehicles. You can start out with any vehicle you like, your personal car, a van or even an SUV.
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You’ll have to grow your customer base; to achieve this you’ll need to perform consistently and offer a reliable service. Remember there are a lot of entrepreneurs in this industry; good service can really help you stand out.
When starting out you’ll have to go above and beyond for your customers. Clients value the extra effort and will continue to use your company as long as they feel appreciated. Try to offer added convenient services along with your courier business. Keep your eyes open for opportunities to convenience your customers and make more money.
If you’re a little wary of starting out on your own and want to gain first-hand experience then consider a courier franchising opportunity.
3. Specialised transportation
If you’re looking to corner a niche market then perhaps specialised transportation is what you’re looking for. This can include abnormal load trucks, in other words trucks that carry or transport abnormal or larger loads.
It can also include medical vehicles such as ambulances, helicopters and air ambulance. This is an expensive but worthwhile endeavour. Read more about a specialised transport business here.
4. Owning public transport
The public transport sector has had many disruptors over the past few years. There are many in this country whose sole means of transportation is public transport. You can offer an alternative and service their daily even hourly needs. Along with more competition there are many alternatives that have started to gain popularity recently.
Uber offers entrepreneurs the opportunity to start a public transport business with the benefit of accessing already established systems and processes. You can purchase a vehicle and hire a qualified driver to handle the run around. The advantage of Uber is that it allows you to piggyback off a reputable name to start your business and the marketing is done for you.
The only drawback to this type of business would be that you’ll have to share a portion of the profits with Uber. They expect 20% from each driver for the use of their app, for the convenience of having the customers come to you, and being able to use their respected and reliable name.
Minibus Taxis have been the main source of transportation for the majority of South Africans for many years. Millions of South Africans use the Minibus Taxis every day, several times a day. Owning just one will eventually give you return on investment and allow you to start making profit.
The only drawback to this type of business is you only earn while you work, until you can grow your fleet of buses and drivers. Your vehicle will also need to be continually maintained and go for regular road safety checks.
Public transport is how many people travel in South Africa. Investing in a bus or a fleet of busses can help you to create a long term, profitable business. There will always be demand for reliable quality public transport, as many South Africans can’t afford private vehicles.
A bus business will cost more to start, but will have a faster return on investment. You’ll most likely have to seek funding or an investment partner to get your business started, but since a bus can hold a larger amount of people, your income will be substantial.
The driver of your bus, whether it’s you or someone else, needs to have a bus driving licence to legally operate a bus. Be sure you’re compliant with all the law regarding public transportation and your bus is constantly maintained and check for roadworthiness.
What is the next step?
1. Write a business plan
Use a business plan to help you organise your ideas before you launch your company. It can be used as a guide to help you remain focused on your vision and goals. Business plans can be flexible, to help you to course correct or help you to pivot if you want to change your businesses direction or offering.
Here’s an example of a transportation business plan. It will help you to plan, organise and prioritise your own transportation business plan.
2. Adopt the lean method
The lean method involves experimentation, customer feedback and interactive design. Its focus is on receiving constant feedback from your target market instead of trying to stay under your competitors’ radar. This approach allows you to design and develop a business on the foundation of what your customers are looking for.
3. Insure your transport business
Fuel price fluctuations can cause you to end up paying for severe costs you weren’t prepared for. As an insurance measure you should be sure to link your fuel costs to inflation or on escalation when signing a contract.
This will help you control your costs even after time has passed. The end user or your client will end up cover the cost of the increase in fuel should it increase during your contract. If you don’t have an escalation clause in your contract you’ll need to ensure your business can carry the costs and risks associated with an increase in fuel price.
It’s important for your drivers to be sufficiently trained along with receiving constant and up-to-date driver education and awareness training.