Freight Brokerage Business Plan

Silicon Freight Brokers will be going after the silicon chip market. This is a reasonable target, due to SFB’s industry knowledge. SFB will be bringing customers aboard through the use of a website, advertisements in industry journals, and networking from a combined 17 years of industry experience. SFB will turn these leads into customers through our specialized knowledge which translates to superior service offerings.

5.1 Competitive Edge

SFB’s sustainable competitive advantage is our thorough knowledge of the silicon chip industry and freight brokerage business. Steve has spent the last 10 years in the freight brokerage business and has significant insight for creating business in this industry. Steve’s wife, Wendy, has spent the last seven years consulting for Intel and Texas Instruments regarding the usage of silicon chips for processors. She intimately understands the logistics of the processor manufacturer’s needs of silicon chips and their supply chain for this product. Having inside knowledge about freight brokerage and the niche of supply chain logistics for the silicon chips is rare. Generally, a specialty freight brokerage will concentrate on a niche for whatever reason, but rarely because they have inside knowledge regarding the niche industry product, usually the specialized knowledge is just in the freight brokerage business.

This specialized knowledge, coupled with an unsatiated need to exceed customer’s expectations will give SFB the competitive advantage to succeed in this industry. SFB has made it their mission to provide the finest customer service possible. This makes good business sense, particularly in this industry where so much of the business is repeat business.

5.2 Sales Strategy

The sales strategy will be a two-prong approach, the first prong deals with establishing strategic relationships with the carriers to have a basic portfolio of carriers who excel at moving silicon chips. The second prong deals with closing deals with chip buyers and sellers to utilize our brokerage service.

SFB will be developing strategic relationships with carriers by first assembling a comprehensive report of all the carriers that are silicon chip carriers. SFB will then attempt to enter into mutually beneficial relationships with them. SFB will also have a large portfolio of possible customers that have been developed through marketing and networking activities. The carriers will have a desire to work with SFB if they see that SFB is indeed a company of integrity, as well as a good source of future business.

Once these relationships are established, SFB will be able to offer our future customers a wide range of options. SFB will continue with its marketing efforts to qualify these leads. SFB will also be using our network of friends in the industry to drum up additional business. Customers are looking for a headache-free solution, and this is what SFB will appear like to them. Additionally, SFB industry expertise (freight brokerage and silicon chips) is rare and refreshing and will certainly make the customer feel at ease.

5.2.1 Sales Forecast

The first month and a half will be spent setting up the new office. It is highly unlikely that there will be much sales activity. In addition to dealing with the legal and accounting issues, SFB will be working with a Web developer to get the website up and running. During this period of time SFB will be setting up relationships with carriers.

As a service provider business we have labor costs and expenses, but no direct costs of sales. Labor costs are included in the Personnel table and expenses are listed in the Profit and Loss table.

During month two SFB will be interviewing and hiring for a receptionist/secretary.

During month three SFB will begin to get a few phone calls regarding inquiries for our service. From month three on, business activity will be steadily increasing. By month four SFB will be bringing on one additional person in the capacity of customer service/account representative.

By month five sales will be getting still stronger yet. This assumption is based on the fact that it takes a bit of time for the advertisements in the journals to start becoming effective. When they do they should be bringing in a decent amount of business. Another reason for the business starting to really ramp up by month five is that the networking, that SFB has been continuously working on, will finally begin taking hold and the new customers will be spreading the word about SFB.

5.3 Milestones

Silicon Freight Brokers will have several milestones early on:

1. Business plan completion. This will be done the first month.
2. Office Set-up. This will be done the first month.
3. Have the website up and running by month two.
4. Hire a third employee by month four.