Entrepreneurs who are looking to start a warehousing business need to do their homework. The industry benefited from a large demand over the past few years. However, being successful in warehousing means understanding all the associated laws, regulations, requirements and responsibilities. When you’re just getting started, there is a lot to consider, but we have narrowed down the three most important points to think about first.
Three Points to Consider Before Starting a Warehouse Business
1: Your Competition
As a booming industry, warehousing has become a very competitive space. When you start, look at the competition in your area to figure out who you are up against. Look at their services and capabilities, as well as the logistics staff they have on board. Consider how you can improve upon their model(s) or differentiate your own business. You’ll want to offer unique capabilities that your local competitors can’t match. Thinking outside the box is key! For a jumpstart, do a little more research on warehousing business outside your location. Contact the ones that seem to go above and beyond and see what you can learn from them.
2: Your Building
The next aspect of your warehousing business to consider revolves around the building itself and how you will utilize the space. First, you should consider whether you will be leasing or buying the building. While leasing a warehouse might be an option, owning the building will certainly give you more options for customizing the space and accomodating the exact products you hope to warehouse. In short, you will have more freedom to grow your business as you please. Next, consider what kind of product you would like to store or service you will offer. For example, will you simply offer warehouse space for storage or do you intend to become a distribution center offering shipping services as well?
We also recommend that you choose your niche. Think about what kind of businesses you would like to have as clients and what type of space will best serve them. This means considering the square footage and requisite costs.
3: Start-up Costs
Speaking of costs, there are several to consider when you are just starting a warehousing business. Some costs include:
- Licensing and equipment
- Hiring employees
- Developing a website
Licensing and equipment will likely require the most money to get organized. Register for a DBA and get the required forms through your local county or city administration office. Typically, the application fee costs between $25 and $50. Specific equipment, including forklifts, shelving, storage units such as freezers or refrigerators, crates; and computer and inventory software, will require the most investment. You may also need a truck if you get into the distribution side of the business, delivering products for clients.
The Most Important Part of Your New Business
Without question, the most important step after the abovementioned list is complete? Building your client base. The warehousing industry is all about the connections you have. In the beginning, forging new connections and meeting the right players will be crucial. First, make sure you have invested in a website. Think of the website as your virtual business card. Without it, how will potential partners and prospective clients understand your capabilities and background?
After the website is up and running, look to meet relevant industry players. Attending conferences and trade shows is a great way to start. Signing up with various associations can also be very useful. Look into the International Warehouse Logistics Association. Your business will be listed on their website as a local warehouse, which can generate new leads.
Top off all these efforts by developing a solid social media presence that articulates your business’s brand and capabilities. Advertise and get your name out there by any means possible.
Specialized Storage Solutions Can Help
After you establish your new company and build your client base, the right warehousing partners can help your business grow. As you consider how to start a warehousing business, consider beneficial partnerships. Specialized Storage Solutions can help you turn your warehouse or distribution center into an optimized and efficient space. To learn more about how we can maximize the efficiency of your business, contact us today!