Most transportation companies think growth means more trucks. In reality, it’s often poor storage and logistics infrastructure that slows them down first. Historically, it has involved hiring more drivers, securing more contracts, and then off you go to the races.
If you wanted to grow, the logic used to be that you simply needed more things that moved and could get something from A to B. While there is inevitably still truth to these assertions, there is so much more involved when scaling this kind of business, and many companies would do very well to first take a look at what sorts of bottlenecks are slowing them down and causing them to stagnate. We tend to view storage as something passive.
However, when it comes to transportation operations, the right sort of storage solutions can make the difference between securely storing the products and spare parts that keep your fleet running efficiently and slowing down to a crawl and ultimately leaving money on the table. In this post, we’re exploring why, for nascent logistics businesses looking to grow, it’s not just about how much you can store but how effectively you can get it out to your paying customers.
Assessing Your Current And Future Storage Needs
Before you’re able to come up with a solution, you first need to understand the problem. It might appear obvious at first glance, i.e., you don’t have enough space, and you need more. But this is far too simplistic an approach and will never get you the results a growing business needs without using more resources than necessary.
The first step is to conduct an all-encompassing audit to figure out where you’re lacking. Could it be that you don’t have enough large truck storage to keep up with the upcoming demand? Perhaps it’s that you don’t have any repair and maintenance facilities on-site with the requisite spare parts to keep your fleet operational, meaning that you’re failing to sweat your very expensive assets.
Whatever the reason, a complete audit will allow you to not just discover what you need right now but also help you to design and choose facilities that can keep up with further growth into the future. There are multiple ways to approach an audit, but you will get the most out of one by splitting it into two phases and taking the following actions:
Phase 1
- Physical footprint mapping: If you’ve been in a facility for some time, things have likely moved around and been altered in some manner. Therefore, it’s best not to rely purely on floor plans alone. Take a walk around and mark down any areas that are active, stagnant, or dead. This data will give you an overview of what’s working and what isn’t, and help you to form a plan of what to improve first.
- Ascertain asset velocity: This metric can relate to either the actual products you transport or spare parts and other things. It will help you to see which items are most used and, therefore, need to be most easily accessible and which are less used (or possibly even redundant) and can be moved elsewhere to take up less valuable real estate.
Phase 2
After getting to know your current needs, the next step is to assess where you’ll be in the next 24–48 months and what you need to achieve your KPIs. Here, you can examine your projected fleet increase over that time and review how much space for the vehicles, along with their spare parts and staff rooms, you may require.
Parts And Inventory Management Systems
When relatively new companies start to outgrow their existing situation, it can cause a rapidly deteriorating set of protocols. What might have worked perfectly when you opened up shop may now cause all manner of issues, from bottlenecks in getting products to the right vehicles to missing spare parts. To address these concerns, you can utilize technology and set up a parts and inventory management system to enable you and your management team to see where everything is located and what gets checked out and by whom. When it comes to the tech available, most businesses fall into one of four tiers when choosing inventory systems.
| Type | Best for (number of vehicles) | Key features |
| Basic barcoding system | 5-20 | Simple check-in/check-out spreadsheet that integrates with your inventory management software. |
| Cloud inventory platform | 20-50 | The cloud enables real-time tracking and updates for maintenance work via remote access. |
| Integrated ERP system | 50+ | Full business integration interacts with other components of the business, such as predictive ordering based on the data it receives. |
| Highly specialized custom solutions | Specialized operations (cold storage, hazardous materials, medical, etc.) | Automated tracking and verification tools that enable larger and more complex transportation companies to shift more specialized products more safely and quickly. |
Each of these various options increases in price and complexity as you scale up, so you need to choose carefully based on your current needs and the assessments you made during your audit, as discussed in the first part of the article.
Administrative And Documentation Storage
When addressing topics such as storage, it’s easy to fall into just covering the physical aspect of the business. But as a business develops, it must contend with a range of other, equally complex recordkeeping requirements. Historically, this meant reams of paperwork, whereas nowadays it will almost all be digital. But the change also brings up the issue of security, data protection, and other regulations concerning sensitive data. You will have to deal with more issues, such as the following (but not limited to):
- Vehicle maintenance logs
- DOT compliance records
- Financial and tax documents
- Driver details
For most growing enterprises, a cloud solution will be the best option, as they usually include tiered levels enabling you to only pay for what you need and invest more as necessary. It is also vital to ensure you can save audit logs, which are often required for legal reasons, and make life much easier when data is requested.
Growing a transportation business is much more involved than merely investing in a larger facility. By treating your space and administrative needs with the same sort of precision that you would treat the logistical side of things, you can reduce roadblocks and future-proof your scaling.
