Starting your own shipping business in the UK can be a profitable investment. Shipping may develop into a booming business in the right hands.
However, the right person requires careful research, planning and compliance with state law.
According to the Office for National Statistics, the shipping sector only contributed £6 billion to the economy as of 2020 accounting for 19% of the UK transport industry.
This article will help you with all the insights about how to start your own shipping business in the UK.
Steps To Start Your Own Shipping Business in the UK
Here are the key steps to help you get started if you want to start your own shipping business in the UK. The steps are similar even if you are wondering how to start a barrel shipping company.
1. Research The Market Niche
You need to research and determine a specific niche of the shipping industry you’re interested in. For instance:
- Opening a shipping store
- Starting a shipping business from your home
- Launching a cargo shipping company
- Starting a freight forwarding company
- Starting an international shipping business.
Once you identify the niche, research the demand for potential customers, the type of shipping services in your location and competitors.
2. Creating A Solid Business Plan
Designing a business plan is important to launch a shipping business.
It must include a business model (B2B or B2C), an executive summary, a description of your company, market research and analysis,
The company and management structure, types of marketing and sales services offered and financial projections of the company.
3. Fulfill The Legal and Regulatory Requirements
To start your shipping business you have to register your business entity (LLC, Corporation or as a sole trader).
Depending on the type of shipping business you want to start, you may need to apply for necessary permits and licenses like an operator’s license (for road haulage), freight forwarding license, and customs and excise (if dealing with international shipping).
Consider applying for specific certifications relevant to the shipping industry in the UK. Having insurance for vehicles, liability, goods in transit or specialized cargo is also required.
4. Secure Funds For Your Business
Launching a shipping business in the United Kingdom may require investing a huge capital.
Some of the options that you can resort to secure funding are business loans, personal savings, Investors and crowdfunding.
5. Set Up Your Business Operations
The next step requires you to set up the operation aspect of your company like the following:
- Warehousing & Storage: Purchase or lease of space or warehouse facilities for storing goods before delivery.
- Technology: Install logistic software to help with tracking, building, routing and customer management.
- A fleet of Vehicles: Invest in the necessary vehicles (like ships trucks or vans) depending on your business type and equipment (like loading or unloading tools, GPS etc.)
- Networking: Create a strong relationship with partners and carriers like wholesalers, e-commerce stores and manufacturers.
6. Set Up Payment & Accounting System
Set up a shipping business bank account to separate your finances and business.
Determine the pricing structure after evaluating factors like vehicle maintenance, fuel costs, equipment size and labour.
Make sure you have an accounting processing system in hand that includes options for bank transfer, credit or debit card or online payments.
7. Marketing and Customer Acquisition
Create a brand identity for your shipping business such as a website, logo and necessary business materials.
Develop a marketing strategy by promoting your shipping business through various ways such as Social media marketing, direct reaching out to potential clients,
online advertising through social media, Google Ads and conventional methods like local print ads or flyers to promote your business.
Leverage social media platforms like Facebook, Instagram, Twitter, LinkedIn etc. to create a strong online presence and attract your customers.
The aforementioned key steps are similar for those who are wondering ‘how to start your own shipping business in the UK online’.
For this go through the above steps and choose an e-commerce platform. Make sure to comply with the relevant laws and regulations and obtain a license as well.
How To Start A Shipping Business from Home?
Starting a shipping business from home is an excellent way to reduce the overhead costs while entering the logistics industry.
The first step is to identify the niche and register your business with HMRC.
Make sure to set up a home office by designating a particular area for performing business operations.
You need to leverage technology by implementing online platforms and shipping software to manage the operations from home.
It is also important to form partnerships with suppliers and develop a strong online presence by leveraging social media platforms and creating your professional website.
How to Open A Shipping Store?
Do you want to open a shipping store? To start with you need to select a high-traffic location with good visibility.
Entrepreneurs must invest in the right equipment, like scales, packing materials, point-of-sale systems, etc.
An important step is to partner with major shipping carriers and establish a relationship with them. Also Consider offering additional services like printing, mailbox rentals, and notary services, to name a few.
How to Start A Cargo Ship Business?
Business entrepreneurs who are interested in handling larger-scale shipping operations can easily start their own cargo shipping company.
The first step is to learn the international shipping rules and regulations.
Securing infrastructure like transportation, assets and warehouse space will help you to get started.
Make sure to invest in technology tools like tracking systems and develop relationships with international agents and partners to build a strong network.
Cost to Consider When Starting a Shipping Business
Do you know how much it costs to start a shipping company? You can get started with a shipping business with just £200 to £300 to pay for your essentials like branding and a basic website.
It is important to understand the cost and other financial aspects when learning how to start a shipping business in the UK.
- Cost of Operation: Comprises rent, fuel, salaries, insurance, and maintenance.
- Technology Investment: Investment in tracking systems, shipping software, and cybersecurity measures
- License and Certification Fees: These may vary depending on your residence and shipping services. Freight Forwarder License cost in the UK is zero.
- Marketing Costs: Include promotional materials, advertising, website design costs etc.
Challenges in Starting Your Shipping Business
Understanding the common challenges in the shipping business is important before starting your own company. You need to be prepared to face these common hurdles.
- Cash Flow Management: Balancing payments to shipping carriers with client invoicing.
- Highly Competitive: The shipping industry in the UK is known for intense competition.
- Risk Management: Taking liability for any damaged/lost shipments.
- Regulatory Compliance: Handling complex customs and shipping regulation requirements.
- Technology Adoption: Keeping pace with the rapidly evolving infrastructure and logistic technology.
Conclusion
Here are the steps that you need to remember when wondering how to start a shipping business. The United Kingdom provides excellent opportunities in this sector.
However, choosing the correct business model is the key to getting success.
Shipping in the United Kingdom is considered to be a booming business. Moreover, the UK rules and legal laws are easy and straightforward.
The key to success lies in understanding how the shipping process works and understanding your role in the field.
You need to consider the business model, opportunities, regulations, and people involved. There is no one stopping you from starting small and slowly scaling your business as you learn the industry.
