How to Start a Transport Commission Agency Business

“With very little investment I am earning a good sum from my newly established transport commission agency firm. There is a long road ahead but I think in the coming years the commission will start increasing” 

-Says Mr. Sanjay Jain owner of Jain Transportation Firm Ltd.

With the economy expanding and the population rising, opportunities and business possibilities have also increased in the transportation profession. If you are someone who is new to the transportation business or are planning to open your new firm then this article is a must read for you!

What is a Transport Agency?

When you buy heavy goods from a supermarket it becomes very difficult to carry it all the while to the cashier. Here a trolley or a cart provided by the supermarket helps you in the transit of the goods. Similarly, the transportation business provides transportation facilities to the client to carry the shipment from one place to another. In this process, the business earns a commission known as ‘transport commission’ for their services. Transport commission agents in the trucking business play an important role in the logistics industry as over 80% of truck companies need the assistance of commission agents to run their businesses.

Why are Transport Commission Agencies needed in India?

The Indian trucking industry is organized in a way that 95% trucks are owned by individual truck owners or small fleet owners. These trucks are usually unregistered and hence there arises a need to register them timely, that’s where a transport commission agency plays a critical role of providing that assurance to shippers. Transport agencies execute various other pivotal roles such as solving payment challenges for the shippers. They handle the payments for multiple trucks so that shippers don’t have to. Shippers just pay the commission agency, who then pays the truck owners.

5 Steps to Start a Transport Commission Agency

1. Get Registered

One of the first steps for any business is to get registered, for that you will have to choose a name and get registered under the same. A business with a physical address is more trustworthy for shippers. You will also have to select a business entity while keeping in mind the taxation law that applies to each business type and also the requirements and compliances for each business type. After the business registration, now comes the GST registration of your transport business which will require some basic documentation like identity proofs, address proof and bank account details. 

2. Conduct Research

When you are just starting your business it becomes very important to do research and know more about the industry you are about to step into. Meet business professionals, talk to them, understand the nuances of the line of work, educate yourself about the laws and regulations which need to be followed over the years. This will not only help in carrying forward the business but will also help you jump the hurdles which might come your way.

3. Work upon Social Skills

While working in the transportation business sector, one of the most important factors for your success in ‘communication skills’. As a mediator between 2 parties you have to be clear in your thought process about how to communicate with both of them. You should have a friendly yet professional rapport with the truck drivers and clients so that they can approach you time and again for business.

4. Use the Power of Social Media

Once you have established your business now it is the time for marketing it on different social media platforms. First and foremost would be making your website which will help your customers to quickly get you. Secondly, promote this website on popular platforms like LinkedIn, Instagram, Facebook etc. Grow your network with people of similar interests and mindsets. Keep posting about your journey, success, new initiatives and new business ideas. You can also invest in ads to increase organic followers and connections.

5. Be Optimistic

It is not always necessary that you will get shipments and business orders on the very first day, you have to stay patient and keep in touch with people. Build connections with truck drivers and potential clients so that people may know that you are in the business. Target manufacturing companies who usually don’t invest in fleet expenditure, so here will be your chance to provide services, give discounts and earn commission.

Why Would Shippers and Fleet Owners Choose Your Transport Agency?

With a number of business opportunities opening in the transport business sector there has also been an increase in the number of agencies that have been opened. What sets your transportation commission agency aside from others is very important in terms of business. To  gain clients’ faith and confidence in the longer run you have to display transparency, trust and commitment  through your work. Following are some points which can provide you the leading edge among others :

1. Payment Policy

Keep all the information up-to-date regarding advance payments, mode of payment along with receipts. Make sure that you go through the payment structure twice in order to be assured regarding the pricing.

2. Handling varied business’

Your transport commission agency should be well equipped to handle different business for eg. The transportation required for a hardware shipment will be different from a cold food shipment. Hence there should be varied facilities, equipment and labor for smooth transit.  

3. Experience & Proficiency

Your transportation commission agency should be proficient in handling goods and heavy freight. Be clear with the commission percentage, never over-quote or under-quote the pricing. More the fluidity of your business, the more it will come to notice among manufacturing giants. 

With the digitisation of almost each and everything, and the sudden growth of e-commerce, your transport commission business can grab this chance to increase customer acquisition. Dealing with e-commerce logistics companies will help you earn more profit and help you earn more Commission income. This can prove to be beneficial for your organization in the longer run and help to build permanent clientele. More tech-savvy businesses are said to attract more people. It will not only help them build a better reputation but also help them to do work efficiently with lesser manual labor.