Freight forwarding sales growth

With almost 50% of UK forwarders failing to achieve any sales growth in the last 12 months, we look at how sector star performers achieved average sales growth of 88%

Historically the forwarding sector has grown sales significantly faster than the UK average, but its rate of sales growth has begun to slow and actually contracted -1% in the last 12 months.

Growth across the forwarding sector is very mixed, with the smallest struggling in consecutive years, which suggests that this end of the spectrum may suffer disproportionally if the economy slips into recession.

8 year forwarding growth analysis

Size – Latest growth
£1m:                  -11%
£1m to 3m:         0%
£3m to £5m:       0%
£5m to £10m:     5%
£10m to £30m:   1%
£30m to £50m:  0%
Over £50m:        -2%

Overall 707 firms, which represents nearly half the sector, did not increase sales at all. Is this the result of a forwarding market that is more challenging than other business sectors, or is it a systemic failure of management to deal with the basics for business growth, like the 10 listed below:

1. Focus on target markets/niches
2. Effective sales/marketing planning
3. Customer retention strategy
4. Understand and focus on customer needs
5. Increase customer lifetime value
6. Use database marketing, CRM and analytics
7. Align sales and marketing
8. Identify and communicate differentiation
9. Focus on customer service and delivering benefits
10.Use free marketing channels to amplify voice

Among the sector’s stars are these top performers, who averaged 80% sales growth over the last 12 months.

  • DFDS Logistics
  • Redcliffe International
  • Tigers Global
  • Greenshields Cowie
  • GBA Logistics

So what are these five doing to generate their enviable growth?

While we may not be certain which of the 10 basics they are following, we can see that they each have clearly defined target markets and/or operate in distinct market niches, which means that their activity and efforts are precisely focused and communicated.

  • DFDS target nine clearly defined verticals.
  • Redcliffe have clearly defined expertise in the military sector with a focus on challenging locations.
  • Tigers have six target markets and a differentiated eCommerce product.
  • Greenshields Cowie specialise in humanitarian logistics, working alongside government agencies and charities.
  • GBA Logistics specialise in the time critical niche.

A lot of forwarders, particularly the smaller ones, take a shotgun approach to growth by trying to do everything for everyone, but never a lot of one thing, to specialise.

In many ways it is harder to focus on a single market, niche or service than it is to do everything, which is why they continue scratching the surface rather than digging a layer deeper to find what really works.

Successful companies get the majority of their scale from a single channel, which is why these five can afford to be a little haphazard with their attention to the other nine growth basics.

Also see our blog post – Target marketing: The Top 20 way

Target marketing

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