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8 Proven Ways to Grow Your Logistics Business in 2022

As the logistics market gets increasingly competitive, logistics companies are finding themselves at the crossroads of survival and sustainability. It is no longer enough to survive when the norm is to go beyond the ordinary to sustain long-term growth.

What are the key drivers of global transformation in logistics operations?  Changing logistics scenarios, supply chain challenges, truck driver shortage, and tech disruptions, to name a few.

Whether you’re a logistics start-up or an established logistics company, here are eight proven ways to grow your logistics business in 2022:

1. Know Your Market and Competitors

The logistics landscape has witnessed rapid shifts in recent times. Changes in the logistics industry have had a significant impact on the movement of goods by air, road, rail, and sea.

It’s no longer surprising to use drones and self-driving vehicles to optimize last-mile deliveries and enjoy same-day delivery as a standard delivery option.

Getting your logistics network in place and refining your logistics capabilities are necessary to boost your profitability in your target logistics market. A better awareness of cross-border logistics trends will give you a much-needed competitive advantage.  

The logistics ecosystem is not limited to seasoned players but makes room for ambitious ones as well. Increased transportation costs, high customer expectations, and volatile market conditions are transforming the logistics processes.

As a logistics business owner, it is essential to track competitor activities to stay a step ahead in the logistics space. You can do this independently or outsource the work to a trusted market research company.  

Performing competitor analyses and understanding their social media interactions can guide you in improvising your business strategy. Don’t want to get left behind? Study competitor behavior routinely for deeper insights into market positioning, customer communication, and engagement.

2. Optimize Your Digital Presence

Traditionally, logistics businesses have relied on business cards, cold calling, word-of-mouth promotion, print and so on to gain clients. A solid online presence is an advantage you can’t ignore in the digital economy. It is what brings you closer to your customers.

A well-crafted digital marketing strategy isn’t an option anymore.  

No matter the business size or nature of operations, i.e., local/international, your website is the first immersive touch point for your target customers. Imagine turning a potential customer away in a single click. Not good, right?  

Look online for logistics website ideas and choose the one that works for you. Widen your reach with a user- and SEO-friendly website. Even if your customers are on the go, a mobile-responsive website with interactive content can connect them with you, instantly.

Attracting active consumers is the first step to converting opportunities into sales.  

Customized email marketing and pay-per-click (PPC) advertising can earn you well-paying clients. You can use various advertising options such as Google Ads to set up ads and bid on relevant keywords to promote your offerings.  

3. Drive Customer Loyalty

Logistics is not only the storage and delivery of cargo, merchandise, and supplies but also the gateway to customer happiness. Loyal customers build the foundation of stable growth. While gaining new customers is crucial to a logistics provider, retaining existing customers is equally important.  

A research study shows that “20% of your existing customers will likely drive 80% of our future profits.” DHL, a leading mail and logistics company, is known for providing exceptional customer experiences across the world.

Do you want to make customers come back to you? Take a look at the after-sales opportunity.

Find your target customers and help them trust you. Be it long or short, your customer journey holds a lot of promise for your logistics business. Do your best as a customer-centric company, and your business will flourish because company success is directly proportional to customer satisfaction.  

Make yours a forward-looking logistics company. Innovate when you need to and inculcate values where you have to. Your customers will appreciate your professional logistics service as much as the personal touch that comes with it. A happy customer means a healthy business.  

4. Leverage a Broader Network

At the heart of the logistics sector is a collective endeavor. We love to collaborate with and learn from others. Conventional networking events such as trade shows continue to provide viable opportunities to grow your logistics business.

Social media platforms and online meet-ups also offer better flexibility in leveraging in-demand talent and collaborative partnerships.  

Online social networking events can establish your credibility as a unique brand and connect you with industry partners, logistics experts, potential clients, and future employees, too!  

For example, LinkedIn is highly popular with supply chain and logistics executive professionals who get a host of opportunities to demonstrate their expertise and network with peers, thought leaders, and other skilled individuals.  

LinkedIn communities can help you go further with strategic tips and real-time conversations on everything you need to shine in the logistics industry.  

5. Build a Resilient Value Chain

Research studies show that organizations that ride out economic downturns demonstrate fast decision-making and financial flexibility. Such resilient organizations don’t shy away from investing more in logistics innovations, value-chain expansion, and workforce management.  

A well-prepared organization sustains operational effectiveness to reduce balance-sheet debt. Unwavering focus on value and cost supports an organization’s core goals of maintaining profit margins while cultivating customer relationships.  

A value chain analysis assesses inter-related primary and secondary value chain activities for a logistics company, including inbound logistics, outbound logistics, firm infrastructure, procurement, and technology to create strong connections with customers.

Successful outperformers adopt a through-cycle approach to growth that encompasses critical components such as asset intensity, cost-cutting, long-term thinking, and stressful scenarios.

Responding quickly to growing demand and shifting customer expectations makes a difference in long-term survival. Unlock profitability with a resilient value chain.  

6. Move Ahead with Geographic Expansion

How well a logistics company takes advantage of geographic expansion goes a long way in achieving scale in a highly competitive industry.

The logistics sector essentially deals with an inherently unpredictable business cycle, continuously evolving customer expectations, and ever-increasing competition between start-ups and legacy players.  

Why should you pursue new markets? Unexplored markets represent unused opportunities. However, stepping into an unfamiliar territory demands a detailed market analysis, a winning market entry strategy, and a lot of fresh thinking.

If you want to retain a competitive edge, boost your existing competencies, increase cost savings, and expand your operational networks.

Exploring a distant market requires a thorough understanding of significant criteria such as customer profiles, local demands, and logistics policies. In addition, flexible and connected logistics processes can save you time, money, and resources.  

Do you want to conquer an emerging market? Use the window of opportunity to discover the market, make performance improvements to differentiate yourself from the competition, and introduce innovative service offerings to reinforce your expertise.  

7. Tap into a Systematic M&A Program

When a logistics company revisits its business model, it opens up new growth opportunities in the face of external uncertainty. Any slowdown arising from economic, political, or epidemiological uncertainties can stall the progress of your logistics firm.  

Logistics industry experts are seeing a surge in global mergers and acquisitions (M&A) activity among logistics players. Strategic partnerships are becoming popular for a variety of reasons.

There are many benefits of a robust M&A strategy—from competitive rates and extensive services to cost savings and wider geographic coverage.

Small and large deals are encouraging companies to enhance existing capabilities and expand local/international presence. For example, a programmatic approach to M&A with several deals per year leads to increased market capitalization.

As a niche player in the highly dynamic transportation and logistics (T&L) industry, your company can benefit from a well-coordinated M&A program. Proactive deal sourcing and careful deal evaluation are crucial for a collaboration that maximizes synergy value and minimizes operational discrepancies.

8. Adopt a Holistic Strategy for Supply Chain Success  

A sound logistics strategy can help a logistics business increase operational efficiency and maintain a reliable cash flow. Providing timely customer service and attaining fulfillment targets require a logistics business to be more agile and consistent in logistics planning—from customer demand to order fulfillment.

Some of the major logistics challenges include inbound logistics management, warehousing development, and sales process automation. Globally, freight management is a considerable challenge for freight companies, including ocean freight companies and rail freight companies.  

How can logistics and transportation companies become future-ready? A business that embraces technology excels in a fast-changing world.

For example, while a custom warehouse management system boosts productivity and optimizes inventory management, freight forwarding software can efficiently manage operations for a freight forwarder.    

Logistics and transportation businesses are interdependent for successful supply chain management. The collaboration between a logistics partner and a transportation partner is an asset that drives value in the supply chain ecosystem.

When supply chain partners work together, they leverage combined expertise and succeed in building sustainable supply chains.

As you explore these business growth strategies, it’s always good to have the most comprehensive lead generation platform along the way.

If you’re a logistics company looking to stay ahead of the curve, contact us for detailed competitor analysis, potential leads, custom research and much more. You can rely on us for actionable and data-driven intelligence to power your business.  

Many logistics companies have had to rethink their business strategies to survive and thrive in the rapidly evolving logistics market. If you want to scale your business, it’s time to adapt and innovate more than ever to keep up the momentum.

In the words of Dave Waters, “Without logistics, the world stops.” Are you ready to grow your logistics business footprint in 2022?

Blackridge Research & Consulting is a premier market research and consulting organization covering the Energy and Construction Industry. We provide an objective, independent and holistic view of the markets and present critical insights that are essential not only to help you make better business decisions but also to develop transformational business growth strategies.

For more details contact us here

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How to Avoid 15 Common Construction Bidding Mistakes

The construction bidding process is an integral part of the construction industry. From residential construction projects to commercial construction projects, the winning opportunity goes to the most responsive bidder with the highest value provided to the project owner.

What is a bid in construction? A construction bid is a proposal submitted by a bidder to a project owner to complete a project under specific terms and timelines. The project bid includes a cost estimate with the contractor’s margin.

Bidding right takes time to master in an industry that sees hundreds of bids made every day across the world.

Often, a general contractor needs targeted guidance on how to make bids without compromising on profitability and sustainability.

How does construction bidding work?

As the bidding process becomes increasingly complex, understanding the construction bidding process is necessary to know how to bid on a construction job. While the bidding process is less formal for a private project, it is highly regulated for government projects.

Typically, the bidding process consists of sequential activities, including bid solicitation, bid submission, bid selection, contract formation, and project delivery. A solid bidding strategy can land you coveted construction project deals.

How can you avoid common construction bidding mistakes?

If you’re new to bidding on construction projects or think that your construction bids are not working, it’s time to take a pause. Bidding errors can make or break a deal in the construction business.

When you submit a bid to the project owner and realize a bidding error too late into the construction bid process, it may become difficult to withdraw or modify the bid.

From misplaced decimals and transposed numbers to incorrect estimates and bad value-adds, bidding mistakes are sloppy but stoppable.

As a construction contractor, you would want to present the best bid against prospective bidders to gain the construction contract.

Here’s how to avoid 15 common construction bidding mistakes and get closer to the winning bid:

Choose the right projects

Know the competition

Respond quickly to the bid invitation

Review the bid terms

Use construction bidding software

Watch for inaccurate takeoffs

Always qualify subcontractors

Conduct a site visit

Check your equipment

Build trust with the project owner

Don’t ignore proposal risks

Don’t make uninformed guesses

Don’t rush your bids

Submit bid forms in full

Adhere to the bid deadline

1. Choose the right projects

Generally, a qualified contractor would be considered a more competent fit for a construction project that demands previous experience and specialized skills. Avoid bidding on a construction project that is outside your niche. Pick your projects wisely based on your experience and expertise.

As you know your strengths and competencies better than anyone else, it’s not worth risking your business reputation for a project that isn’t a good fit for your business capabilities and project track record.

It is better to win a job you’re well equipped to do than bid on a job that may compromise your business reputation.

Why spend time, money, and resources on competing for non-viable construction jobs?

Select a project that you’re comfortable and confident in bidding on because your business success depends on your ability to make money while meeting project delivery expectations effectively.    

2. Know the competition

Construction bidding is a time- and energy-intensive process. A competitive bidder gets a head start in the bidding process. Knowing your competitors in the construction industry will help you create a well-thought-out bid package and position yourself well for success.

The right information at the right time makes a difference between winning and losing the bid on a construction project.

Commercial construction contractors have to face stiff competition from other well-established contractors or new entrants ready to explore the ever-growing construction sector.

Sometimes, a contractor may intentionally set a low bid to undercut other bidders and win a construction contract by offering attractive low up-front costs to a project owner. It’s better to pass on such an opportunity that focuses on simple capital cost rather than the quality of the bid.

Instead of offering the ��lowest bid price’ against your competitors, stay focused on providing overall lifetime value with a cost-effective bid that matches your credibility and construction expertise.

3. Respond quickly to the bid invitation

In a competitive bidding process, authorities governing public contracting projects usually carry advertisements to solicit sealed bids and award contracts to the most responsive and lowest bidders. In some places, publicly bidding contracts, especially construction contracts, is pursuant to a public contract code.

When you receive an invitation for bid (IFB), a request for proposal (RFP), or a request to tender (RTT), respond promptly to bid solicitation because non-responsiveness severely impacts your business profile.

If you wait too long to bid on a project, the client may have already decided on another contractor or construction management company. Don’t be disappointed if the construction bid results aren’t in your favor.

Be it a big commercial construction job or a small residential construction project, it’s important to be responsive and reach out to a wider network in the construction sector to grow your business.

4. Review the bid terms

While a project owner can waive minor irregularities, bidders have to stay away from material irregularities as these can cause bid rejection. Some bid terms solicit financial statements, additional information, or bid alternates.

For example, a public agency may solicit bids for a portion of the project rather than the entire project to stay within budget. A bidder can provide a base bid for the core portion of the project and alternate pricing for additional portions to comply with the agency’s project bid requirements.

If a contractor doesn’t comply with the advertised terms and conditions, there is an increased risk of bid rejection. Submitting a bid goes beyond providing a price.

A contractor has to be flexible enough to adapt to the complicated bidding process and fulfill essential criteria, including minimum qualifications and license requirements.

5. Use construction bidding software

A building construction contractor requires a trustworthy construction bid source to identify new project opportunities. However, a contractor’s bid may suffer if something goes wrong with the arithmetic. Construction estimating mistakes cost you money and business goodwill.

An erroneous bid amount leads to a greater possibility of withdrawing the bid or forfeiting the bid bond. There’s a solution. Construction bidding software eliminates costly errors and streamlines workflow.

Previously, a general contractor had to deal with cumbersome communication (email/fax solicitations) to qualify subcontractors or depend on manual work processes.

Currently, advancements in construction data management make it easier for a construction company to use cloud software to manage subcontractor databases, optimize the pre-construction processes and do much more in less time.

Choose from a variety of online construction bidding software options that offer value for your money.

6. Watch for inaccurate takeoffs

Inaccurate takeoffs are detrimental to your bid. Furthermore, imprecise construction costs cause financial distress. Takeoff software meticulously calculates construction takeoff components, including quantity and material requirements for a project.

If you’re planning to work on a commercial construction project, you can greatly benefit from construction takeoff software to boost business success.

It’s really easy to bid on projects with takeoff software’s excellent features such as auto-count, linear measurement, area measurement, volume measurement, predefined assemblies, and plan overlays.

Data-driven takeoff software gets your detailed cost and schedule summary ready in minutes. You would be able to bid confidently with a comprehensive understanding of material and labor costs.

7. Always qualify subcontractors

Whether you’re hiring subcontractors for the first time or have been employing them for years, it’s always a good idea to review subcontractor pricing and proposals.

Prequalifying subcontractors helps in evaluating their past projects for quality and performance and removing any incompatible profiles.

Before requesting from subcontractors, you should clearly define the scope of services to prevent duplication of work.

Furthermore, get a minimum of three competitive subcontractor bids for the work you would like to be completed to hire the best contractor to meet your work expectations efficiently.

8. Conduct a site visit

A site visit shows you existing site conditions to factor in equipment, labor, and transportation costs. Imagine seeing the site for the first time after getting the contract award for a construction project.

Would you be prepared to deal with unknown site conditions such as limited road accessibility or high location access costs?

Skipping a site visit at the start of the construction phase does more harm than good. If you’re subcontracting the work, you can recommend a site visit to the subcontractors as well.

In fact, many bidding opportunities allow prospective bidders to visit the construction site after attending a pre-bid meeting. It is useful to determine the topography, take measurements and soil bore samples during your site visit.

A site visit is not only necessary to understand environmental concerns and project scope but also protects you from incurring additional costs in the course of project management.

9. Check your equipment

Ensure your equipment is in top operating condition prior to submitting your bid. Overestimating your equipment capabilities can impede your progress in completing the project awarded to you.

You don’t want to incur random costs on repairing or renting equipment when you should focus on getting the work done without any delay.

10. Build trust with the project owner

Make the most of the construction bidding process in building trust with the project owner. The project owner could be a general contractor, a government entity, or another organization.

The construction industry thrives on mutual collaborations and strategic connections.

Investing extra time and energy in nurturing friendly connections goes a long way in creating a strong impression of your construction management company.

Do you want to deliver value without missing out on connections that matter?

Get to know the project managers and the estimators during the bidding process for optimal results. These construction experts may well open the doors to mission-critical insights and pave the way for future partnerships.

If you’re new to the construction industry or haven’t had a chance to connect with the project owner, a well-timed follow-up with the client does wonders to demonstrate your readiness and reliability.

11. Don’t ignore proposal risks

A contractor bid proposal may overlook the risks that come with every construction project. Determine potential risks early and evaluate them fully to develop a risk mitigation plan. A low-probability risk is easier to manage than a high-probability risk.

Integrated project delivery requires effective risk management and mitigation. Plan a step ahead with contingency measures in place.

A lot of planning goes behind making a successful bid proposal. Don’t forget to take into account material prices and delays before submitting a proposal.

For example, a project owner needs a higher-priced product but doesn’t finalize finishes or materials before the bid submission. In such a scenario, a contractor should verify whether submitting a proposal with midrange-priced products would be acceptable.

Similarly, limited material availability or delay forces a project owner to accept costly material alternatives or pay more to receive the preferred products.

When you are well prepared to handle any contingency situation, it’s easier to reduce bidding mistakes. Consequently, there will be few overpriced, non-competitive, or underpriced bids from your end.

12. Don’t make uninformed guesses

Do you know that uninformed guesses eat up your profits sooner than you think? Before submitting your bid, it is crucial to have accurate and up-to-date information on every project.

When you consider job costs related to equipment, labor, construction materials and supplies, it’s also beneficial to consider overhead costs and soft costs such as engineering fees, legal fees, inspections, permits, taxes, and insurance.

Ignoring or neglecting such costs may wear or wipe away your profit. As a well-informed building construction contractor, you will save money on subcontracting work or renting extra equipment. The bidding process is a great way to optimize your costs while focusing on profitability.

Your bid price has to factor in costs for everything needed to do the construction job. Whatever project you want to bid on, stay informed to steer clear of expenses that drain your financial resources.

13. Don’t rush your bids

No one can win all the bids! The rush to bid early can cause you to miss out on key details, set your price too low, or include inaccurate/incomplete information. Take your time to get as much bid information as possible.

Study plans and specifications of a residential or commercial construction project thoroughly prior to preparing the bid package. After all, due diligence pays off in the long run.

If you’re submitting a bid on your own or have a construction bidding team working for you, it’s crucial to analyze the construction documents and bid scope in detail.

Sometimes, a project owner receives a change order request from a contractor for extra charge claims related to potential delays, new material costs, or project scope modifications. This risky strategy causes mistrust. It is recommended to refrain from making such questionable amendments.

Bid submission rewards patience and precision. Compared to a last-minute bid, a well-crafted bid boosts your bid value and lets your bid shine in the bidding process. Professional bids crafted with care are sure to improve your bid-hit ratio.

14. Submit bid forms in full

Read the construction contract bid documents carefully because an incomplete bid form is subject to rejection. It becomes quite challenging to move forward when things don’t add up.

Follow the guidelines if the construction project mandates prequalification or pre-bid conference participation.

Do you know that “a stitch in time saves nine?” Seek clarification sooner than later if you have any questions on the bid terms and conditions or scope of work.

If necessary, you may consider a pre-award bid protest to address defects in the solicitation specifications or terms.

Double-check your bidding documents for typographical and bidding errors, incomplete or inaccurate information. A tender bid with spelling or other errors may not disqualify you but doesn’t create a favorable impression either.

If you want to make your construction bid stand out from the crowd, highlight your competencies and present your bid in the most professional way to the project owner.

15. Adhere to the bid deadline

Last but not least, adhere to the bid submission guidelines. If your bid is not submitted by the stated deadline, it may be rejected by the project owner. Time management and proper planning help you stay close to the target of submitting your bid on time.

A tender advertisement includes general information on bid submission. If it requires you to submit your bid at a particular location and at a specific time, please follow recommended instructions to prevent bid disqualification or rejection.

Conclusion

When it comes to a construction bidding environment, bidding mistakes can make you lose a dream construction deal. From the bid opening to bid submission, establish your credibility as a reliable and responsive player.

Always aim for an honest and a realistic bid.

A trusted residential or commercial construction contractor stands a better chance of succeeding at the bidding process compared to other bidders and gaining the winning bid.

Whether you’re bidding on a private project or a government project, study relevant documents carefully before drawing up a strategic bid plan.

Your bid strategy should be clear enough to address the contract terms and conditions and also secure your bottom line.

When your bid is ready, submit it confidently for review. It’s never too late to avoid common construction bidding mistakes. Start now for your next win.

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Energy Research | Blackridge Research & Consulting

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