How to Start a Supply Chain Consulting Business
For those with a background in logistics and an entrepreneurial spirit, you might see opportunities to start a supply chain consulting business. The industry, currently valued at over $1.3 trillion, is continuing to expand rapidly. There is no time like the present to begin your career in logistics consulting, but you might have some questions.
Our guide to starting your own supply chain consulting business covers all of the essential information you need to decide if supply chain consulting is right for you.
What is a Supply Chain Consulting Business?
Supply chain consulting is an interdisciplinary field that involves the logistics of moving and storing goods. Everything in a supply chain, including the journey from raw materials through production into finished products and distribution of these finished products to consumers, is included. A supply chain consultant works closely with businesses to help them build, market, and implement effective strategies to make their client’s supply chain more efficient. In fact, 90 percent of Fortune 500 companies use some sort of third-party logistics consulting.
The right consultant implements industry best-practices to ensure a business’s supply chain runs smoothly. This way, business owners can focus on running other aspects of their company. As a supply chain expert, you become a trusted resource that business owners look to as a subject matter expert for all things supply chain management.
Who is the Ideal Candidate to Start a Supply Chain Consulting Business?
There is a necessary skill set required for anyone looking to start a supply chain consulting business. The opportunity is ideal for supply chain professionals who have worked with logistics in the past or military veterans with logistics experience who can apply their knowledge to operate a compelling, home-based supply chain consulting and management business.
In short, a logistics consulting business is right for high-energy individuals who have solid sales and rapport-building skills, and who can demonstrate they are committed to providing great, consultative customer service. Proper skills include:
- Project management
- Technical know-how as it relates to information technology
- Effective cost-to-serve understanding to ensure profitability for clients
- Good communication
- A desire to always learn more and adapt to the ever-changing environment
What are the Costs Associated with Starting a Supply Chain Consulting Business?
As with any new business venture, it’s important to make sure you have enough financial capital and liquidity, so you don’t endanger yourself financially. Initial costs for a Nexterus franchise typically run from about $87,800 to upwards of $124,300. These costs begin with an initial franchise fee ranging from $45,000 to $60,000.
Much of your initial franchise fee is dependent on your area of primary responsibility (APR) and assigned territory. There are initial fee discounts available to military veterans who qualify.
After you have completed your initial franchise fee, an additional $2,000 to $4,000 is required to cover training expenses for your supply chain consulting business. This comprehensive corporate-based and in-territory training is designed to provide franchisees with the support they need to succeed in their logistics consulting business.
Franchisees are also asked to pay an initial marketing launch fee of $7,500 following their training. This fee is paid during the first three months of operation of the logistics consulting business. These funds are used to develop marketing strategies to promote the Nexterus brand. They will also fund the creative costs of developing local marketing materials and campaigns to establish the franchisee’s brand identity within their territory.
Another expense to consider is a new computer system. This will often cost franchisees in the range of $3,000 to $5,000. The computer system will enable smooth access to Nexterus’ proprietary Fusion Center™ software platform, as well as our best-in-class supply chain optimization and modeling tools.
Further expenses included in your supply chain franchise startup costs include initial insurance premiums in addition to legal and accounting fees. Click here for a chart detailing start-up costs for a logistics consulting business.
What are the Benefits of Starting a Supply Chain Consulting Business?
Compared to other opportunities, supply chain consulting has several main “pros” to starting a business in the industry. First, there is a relatively easy start-up method that is guided entirely by the franchise; planned out and streamlined for your business in your protected territory. There are also minimal overhead costs, staffing needs, and equipment needs. You can even start your business from home!
A logistics consulting business also allows you to have a wide base of target clients and multiple revenue streams, meaning your potential for revenue is essentially endless. There are multiple links in the supply chain for multiple industries. By becoming an expert in multiple facets of supply chain management, the array of clients you can provide value-added supply chain consulting services to is nearly limitless.
Are you ready to start your journey as a supply chain consultant? Click here to request a brochure to get started!