With 21.7 billion parcels changing hands in the US in 2023 alone, there’s always a share of the pie for new transport and logistics companies. But if you want to grow your small business into a successful logistics company, you’ll need more than vigor and a truck or two.
Learn how to start a logistics business, from the industry benchmarks you’ll have to clear to the startup costs.
Why Modern Logistics Is More Than Just Shipping
On the surface, the logistics business is a simple affair: all you need to do is move goods from one place to another. Yet, there’s more to it than just transportation. Logistics companies also have to:
- Coordinate the supply chain to ensure on-time delivery
- Manage the inventory using real-time data
- Meet customer expectations (e.g., same-day shipping, eco-friendly delivery)
- Store the cargo
- Sort and package it effectively
- Optimize load planning
- Manage the fleet and drivers
Software enables some of these and other logistics activities while facilitating others. For example, the tech layer of your logistics business can help you:
- Track the location of every individual item stored in a warehouse
- Optimize delivery routes to cut costs
- Notify customers about the delivery progress
- Facilitate managing multiple warehouses
The good news is that logistics services are needed everywhere, from e-commerce and retail to the manufacturing supply chain. So, you can carve out a niche for your logistics business relatively easily.
Common types of companies in the modern logistics industry include:
- Third-party logistics (3PL) providers that manage supply chains end-to-end
- Freight brokerages that connect shippers with carriers
- Trucking businesses that transport goods by truck
How the Logistics Industry Has Already Changed
If we had to compare the logistics industry of today to that of ten years ago, four key changes would stand out the most.
Customer expectations have shifted
In e-commerce and beyond, customers expect same-day delivery. Thanks to the likes of Amazon and Uber, they also want full transparency into the delivery process with notifications at every step of the way.
Logistics-as-a-service (LaaS) has emerged
Businesses no longer have to develop warehousing, inventory, routing, and delivery capabilities in-house to power their operations. Thanks to LaaS platforms, they can now hire logistics services ad hoc from third-party providers, optimizing their operations and improving their responsiveness to changes in demand.
Automation and real-time visibility are the new normal
Achieving success in the logistics industry today goes hand in hand with leveraging automation and real-time visibility. They generate cost savings and efficiency gains by streamlining storage space management, inventory management, route planning, fleet management, and delivery.
Gig-based fleets are on the rise
On-demand delivery platforms allow companies to hire independent drivers on an ad hoc basis instead of recruiting them in-house. As a result, businesses can quickly ramp up their delivery capacity to handle peak times, all while avoiding costs associated with in-house recruitment and HR management.
6 Steps to Start a US Logistics Company in 2025
If you want to start a logistics business, preparation is key. Here’s your cheat sheet for starting a business in logistics and transportation:
- Define your business model early on. For example, you can focus on last-mile delivery, regional freight shipping, or niche B2B logistics for online shopping or manufacturing companies.
- Decide how you’ll build your fleet. You can lease vehicles, purchase them (opt for second-hand ones to cut costs at the start), or hire them ad hoc. You can also make do with personal transport early on in certain cases.
- Apply for a business license and get the USDOT/MC number. You’ll need to register your business as a legal entity first. Then, you’ll have to acquire a license to operate as a logistics business in the US from the FMCSA.
- Get your business insured. Protect your transport and logistics business against freight and fleet damage, loss, or theft with commercial insurance. If you don’t, you as the business owner will be on the hook for all the associated costs.
- Set up storage space. You can rent a shared warehouse or cross-docking space or buy it. If you opt for the purchase, consider pulling resources together with other businesses.
- Get your first clients. Build your network, leverage word of mouth, or secure your first contract on digital freight platforms.
What Software to Choose for Running a Logistics Business
At the very start, you’ll need basic tools for:
- Order tracking and delivery management
- Fleet and driver tracking and management
- Delivery route planning
- Invoicing and billing
You may also need:
- Mobile app for drivers for delivery tracking, status updates, and proof of delivery
- Dashboards for real-time fuel use, delivery timing, and driver performance monitoring
Consider integrating internal systems via APIs and connecting them with client systems to avoid manual data entry and streamline workflows.
As you grow your business, you’ll be better positioned to benefit from tech capabilities like:
- AI-powered route optimization
- ETA forecasting powered by predictive analytics
- Preventative maintenance for the fleet
- Warehouse automation
- Advanced customer portals with real-time updates
How Much Does It Cost to Start a Logistics Company in the US?
Before you can start a logistics company, you’ll need to prepare a solid business plan. Here are the seven types of upfront and running costs you’ll have to factor in.
Business registration and legal setup
The first step to starting a logistics business is creating a legal entity for it. Preparing all legal documents and filing for the business license will cost you between $300 and $800. Costs may vary depending on the type of business structure (limited liability company/sole proprietorship) and your state’s fees.
USDOT and MC Authority registration (FMCSA)
Besides setting up the legal entity for your logistics business, you’ll also need to register with the FMCSA; it’s the regulator that disburses logistics licenses in the US. The filing fees and compliance setup will cost you approximately $300–500.
Commercial insurance
Commercial insurance rates for a transportation business vary based on fleet size and type, region, and coverage. That said, you can expect to spend $5,000-15,000/year on commercial insurance.
Fleet purchase or lease
Next, you need to think about transportation. Leasing a van or truck will cost you around $800-1,500/month per vehicle, while buying used vehicles will cost you $20,000-50,000+ in one-time payment each. Consider starting with personal transport if your cargo permits it.
Basic logistics software and tools
As we covered above, you’ll need some software tools from the get-go. However, the costs can vary wildly depending on the range of tools you adopt. They also depend on whether you hire a transportation and logistics software development partner to build a custom system or use off-the-shelf tools.
Staffing and operations
Even at the very start, you may need one or two dispatchers or coordinators to operate your business. Hiring them will cost you around $4,000-8,000/month in salary, payroll taxes, and employee benefits. Factor in the recruitment costs, as well.
Warehouse or cross-docking space (optional)
Finally, you’ll need to store your cargo somewhere. If your personal closet isn’t spacious enough, you can rent a shared space. The running costs will vary based on the location, from $1,000/month to $5,000/month or even more in urban areas.
Conclusion
Starting a profitable logistics business isn’t an overnight endeavor. It requires careful consideration of the software you’ll use, your asset acquisition strategy, and the legal obligations of the business.
Need lean, scalable custom logistics software that will grow together with your business? Contact us to discuss how we can build a system that addresses your main challenges and remains flexible and scalable in the long run.