The operation of any cargo company involves transportation of different types of consignments from one place of origin to international and local destinations. They deal in goods of various sizes and from raw materials to expensive item. These cargo operators utilize aircraft or ocean vessels to transport these goods to the desired destination. This also involves trucking, packaging and loading/unloading services.

There are several transport companies based in the United States. So given the sheer level of competition in this industry, starting a new one could be quite challenging. But in case one calculates ones strength and weakness before making a foray, it would be beneficial for his prospects. Here are few important pointers regarding setting up a transport business in the US:

This Is How You Can Start Your Own Cargo Shipping Business

1. Know and Grow: It would be very necessary for you to first study the freight-forwarding industry inside out. Being a complicated market full of several parameters and procedures, it becomes all the more important to comprehend these factors. One should have an in-depth knowledge of international law, trading practices, custom rules and the other financial aspects. Apart from these, it would also be important to acquaint yourself with shipping methods, foreign markets, relevant insurance policies and warehousing. At the same time, one should have knowledge of potential client base and the competitors in the market.

2. Sea License: Before entering into the market, one has to acquire the necessary licenses for cargo shipping services. These licenses could be obtained from Office of Transportation Intermediaries (OTI). They review the provided applications and the documents associated with them before granting the license.

In order to obtain a license as a first-time owner of a sea cargo, one has to fill out form FMC-18, or the Application for a License as an Ocean Transportation Intermediary. One can only get this license either as a business or a sole proprietor. There are also some conditions regarding credit ratings of applicants and some required experience.

3. Air Certification: Like the one for sea cargo, one is required to obtain licensing from the Federal Aviation Administration FAA in order to start operations as an air cargo business. For this, one should fill the Pre-application Statement of Intent form or PASI form and then submit it to the FAA. Apart from this, one has to write a formal application letter containing the name and address of your company. You may also be required to send along your pilot’s resume and certifications.

4. Insurance: One must obtain the business insurance coverage for the employees and the liability cover to guard oneself against damages and loss of shipments. Insurance for the sea cargo part of business could be availed by filling the form FMC-68. It basically safeguards you against damages, reparations, or penalties arising from transportation related activities.

Types of Sea Shipping Services: You will have an option of choosing from two kind of sea-shipping services. The first one is called the ocean freight forwarder. They basically own the fleet of ships that are used for transporting the cargo and they take the entire responsibility for your cargo from the initial point to the destination point. The other option is where one chooses not to own the vessels but provide the shipment services. For running both these types of sea cargo businesses, one will have to obtain the necessary licensing by filling the Form FMC-18.

Apart from these technicalities involved in setting up a shipping business in the country, one might need to be well aware of the market realities and should plan ones strategies accordingly.