>Making money off a logistics network is an economy of scale game.
And yet there are so many small niche providers.... you'd think that would have gone away long ago...
Such a weird world.
And yet there are so many small niche providers.... you'd think that would have gone away long ago...
Such a weird world.
There's also a big difference between asset-owning and non-asset-owning carriers.
You can start a logistics company with very little capital--just licensing, bonding, and insurance. In that case, you're basically a travel agent for freight. Some of these agents have grown into very large companies, however, because they help big customers allocate freight across many asset-owning carriers and mitigate their risks, and they handle dealing with international customs and compliance regimes. They're like an outsourced supply chain operations department.
In air and ocean, the niche asset-owning carriers generally have some statutory protection. A good example is Jones Act carriers--there's a law called the Jones Act that requires that only American flagged carriers can transport freight between any two American ocean ports. That means there are only a couple of ocean shipping companies that are allowed to go to places like Hawaii, Alaska, Guam and Puerto Rico.
Consolidation is also hard on the trucker side, where there's a ton of fragmentation in the kind of work they perform and access to it