The transportation sector is an essential economic subset because it facilitates the flow of both people and goods. Airlines, railroads, shipping companies, trucking companies, logistics providers, and other transportation-related businesses fall into this category.
Every nation’s economy relies heavily on the efficient transport of goods. Analysis of the transportation sector estimates that trucks added more than $150 billion to the US economy in 2019. In the same period, FedEx alone, as the market leader in freight transportation, made over $60 million. It is the online retail industry that logistics firms are primarily concerned with serving. The founder of FedEx, Fred Smith, predicted that by 2020, the value of this market would have nearly doubled, to $2.4 trillion, from what it was in 2018.
Success in the transportation industry hinges on providing customers with the most convenient, economical options possible. For this reason, logistics firms need to look at the latest transportation trends and adopt those strategies that will help them compete successfully in the delivery market.
Read on to learn more about the scope of the transportation industry and where to look for transportation companies up for sale.
Where to find transportation businesses for sale?
Any new business, including the transportation industry, will face challenging market conditions and competition. But you shouldn’t let that stop you from starting your trucking business.
Yet, you should be aware that many startups fail. They fail early on because they are launched without sufficient preparation. Having no idea where to go or what to sell, to lack of market and customer research data, is a classic example of how a lack of direction can cripple a business. At some point, you can expect to be forced out of your market segment by your rivals.
Nearly $671 billion in retail and manufactured goods are transported annually by trucking companies. An estimated 15.5 million trucks ply American roads, making up roughly 70% of the country’s freight fleet. On the contrary, the trucking industry is dominated by small businesses. It is the perfect time to buy a transportation business. Click here to view some routes for sale listings.
How big is the transportation business?
At a CAGR (compound annual growth rate) of 9.9%, the global transportation services market is forecasted to increase from $6,559.71 billion in 2021 to $7,210.41 billion in 2022. At a CAGR of 9.6% from 2019 to 2026, the market is projected to reach $10,394.13 billion.
Market participants in the transportation services industry include companies, sole proprietorships, and partnerships that transport goods and people for a price or fee. Businesses that help transport passengers, freight, and other materials by air, rail, road, water, or pipeline are considered part of the transportation services sector. Companies that run facilities to store merchandise, perishable goods, and other materials are also included in the market because they sell the services associated with those facilities to customers.
Innovation in the transportation business
Businesses are making concerted efforts to switch to electric bus power in an effort to lower their carbon footprint and save money. Solar buses are electric buses that use batteries to power their operations and are sometimes equipped with solar panels to replenish those batteries while they’re out in the sun. This reduces the vehicle’s carbon footprint and prolongs the useful life of lithium-ion batteries. Furthermore, the technology’s low-maintenance components help businesses save money. Kiira Motors, BYD Company, Heilongjiang Qiqiar Longhua New Energy Automobile Co., Ltd., Bauer’s Intelligent Transportation, Yutong, and Volvo Buses are just some of the top names in the electric bus industry.
Recent trends in the transportation business
Forecasts of stable economic growth in many developed and developing countries bodes well for the expansion of the transportation services market. In 2020, global GDP growth is expected to be 3.3%, and in 2021, it is expected to be 3.4%, according to projections by the International Monetary Fund (IMF). It is anticipated that rising commodity prices will also contribute to the expansion of the market. There will be consistent growth in developed economies as well. Also, during the predicted time period, emerging markets are anticipated to continue growing slightly faster than developed markets. The market will be propelled by an increase in investments in end-user markets as a result of sustained economic growth.
Use of cloud technology in the transportation business
Cloud-based system adoption is a major movement in the transportation sector because cloud-based platforms mandate a software-as-a-service (SaaS) model, allowing for infinite scalability and creative application of digital resources. It enables businesses to achieve greater profitability and outperform the typical returns of on-premises systems. Whether it’s sales and marketing, accounting, legal, or another department, using SaaS will improve efficiency and reduce costs.
Use of GPS technology
Companies in the e-commerce, retail, and logistics sectors are increasingly concerned with transparency in all aspects of their operations. As a result, the transportation sector is seeing a rise in the adoption and adaptation of tracking technologies in order to improve traceability. By using anti-theft GPS, for instance, you can track individual packages and entire fleets in near real-time. Losses of any kind should be reduced thanks to increased security measures.
Regulatory compliance
Rather than being a passing fad, compliance with transportation regulations should be seen as an absolute necessity. Companies providing public and commercial transportation services should be aware of and compliant with any and all new requirements and regulations imposed by local, state, or federal governments. Timely monitoring regulations will continue to be popular, whether they concern electronic logbooks, overtime pay, or safety guidelines.
Find your niche
As a result of the wide variety of services available and the wide variety of vehicles involved, the transportation market is massive. Do you want to be a courier service like FedEx or a pack-and-move company like Call2shift?
You should explore various niche markets to determine which one is best suited to your resources and other factors at the present time. You might have previous experience transporting items from one location to another. You’ll be able to put your knowledge to use in the transportation industry by specializing in a specific area. Thus, determining your USP is crucial.
Conclusion
The transportation sector is a perfect example of an ever-expanding industry. It’s currently dealing with the challenge of keeping up with the ever-accelerating pace of technological development and shifting consumer expectations. This is the right time to put money into the transportation business or any route business for sale it makes a great small business for teens, adults, and entrepreneurs.