An article by Alan Coughlan, founder and CEO of global supply chain solutions company Lansil Global

The past few years have been a whirlwind for the logistics industry, marked by a global pandemic followed by an explosive growth phase. Fluctuations in interest rates worldwide added further complexity to what was a rather turbulent sector.

Despite these challenges, momentum continues to build. I think the industry is far from reaching its peak; there remains ample room for innovation, making it a great time for entrepreneurs who are ready to set up their own business. There are many lessons to be learnt in growing a global company in today’s economy. Here I will share some of my observations so far.

Establishing a startup from the ground up

While the logistics industry, currently valued at around $9.41 trillion, seems overwhelming, it has a low barrier to entry. A new startup doesn’t need to cover every aspect of logistics; believe it or not!  you can start with one truck and expand as demand grows. This means that getting started without investment is possible if you have some cash savings.

There is always room for growth within the logistics sector. If you start a warehousing business, you can later expand to fulfilment, freight forwarding, and even product sourcing. When I established Lansil Global in 2015, I didn’t start with logistics. I used what little savings I had and began sourcing products from China to serve online retailers. Fast forward to today and I have expanded the company into international logistics, warehousing, and fulfilment, as these businesses are an integral part of the e-commerce supply chain.

My experience in China had a strong influence on my decision to establish the company. I witnessed firsthand the rapid advancement of China’s factories and the growing demand for online shopping through e-commerce platforms. I have learnt that the logistics landscape is unpredictable at times; it’s rapidly evolving, and I think that anyone considering building a startup in that area should focus on finding a suitable market opportunity, identifying niche areas with high demand, and creating a strong network of partners.

The ups and downs of building your own business

From experience, starting a new company brings its fair share of opportunities and challenges. As a business owner, you have the autonomy to shape your vision and build your company according to your goals. Unlike large corporations, startups have the edge in that they can be more flexible in their decision-making, allowing them to pivot quickly in response to any unexpected market changes. 

On the other hand, the future of startups is also uncertain. This year saw startup failures grow by 60% in the US due to the lack of funding and high interest rates. I believe the emphasis on lightning-fast growth is damaging the startup ecosystem as small businesses seek to acquire more market share before creating a sustainable, profitable business model.

Competition from industry giants is often seen as a significant hurdle for newcomers. However, I believe the effect is somewhat overstated. Large companies can sometimes struggle to meet specific customer needs, creating opportunities for more nimble businesses to step in and fill the gap.

A prime example of this is FedEx in the early days, when it was shipping only a few packages daily. When UPS, the undisputed market leader at the time, encountered challenges related to unionised workers, FedEx experienced a substantial increase in shipments. This surge was instrumental in FedEx’s development into the leading logistics company it is today.

Sustaining operations during turbulent times 

The outbreak of COVID-19 proved a difficult test for businesses worldwide, and the logistics industry was hit hard. At Lansil Global, we faced unprecedented challenges due to China’s zero-covid policy, which disrupted our Shenzhen operations. 

At that time, rather than seeing lockdowns as a negative situation, we learnt to seek opportunity and opened our first local fulfilment centre in Nevada, the US, with the aim of further expanding operations. During 2020, our US business grew substantially, offsetting the operational disruptions in China and allowing us to continue serving our clients effectively.

Beyond the ups and downs, I firmly believe that COVID-19 taught us many valuable lessons. Not only did we have to apply rigorous cost-cutting measures and adapt to working remotely, but I had to stay outside China throughout 2020. 

Going global with your business

One of the greatest takeaways from my journey is that achieving global growth is feasible (even if you don’t think it) for new startups. Depending on the type of industry in which you operate, growing your business elsewhere may not require sizable capital at the start. In the early days, our operations have always been global, as we have served clients in other countries. 

I feel our most significant step towards real worldwide expansion was setting up fulfilment centres in the US during COVID-19 lockdowns. As countries started opening up, we were among the first to benefit from the continued e-commerce boom as our Nevada fulfilment centre, which we built during lockdowns, was ready to go. We learnt that taking risks sometimes pays off.

Dubai and the expansion to the Middle East

The Middle East is experiencing rapid economic development, driven by diversification efforts and increased investment in various sectors. The growing appetite for online shopping, especially in the GCC region, is fuelling growth in e-commerce and logistics.

Dubai, in particular, is a fertile ground for setting up a business and capitalising on the region’s booming market. The Emirate has the Middle East’s busiest port, a network of cargo airports, a dedicated logistics city in the making, and a thriving startup ecosystem. In conclusion, for anyone planning on tapping into the Middle East’s burgeoning market, setting up a logistics business in Dubai provides a strategic advantage through that solid network alone.