Starting a shipping company requires a lot of hard work and hard money of course. To start a shipping company you will need a lot of hard cash, to be precise more than $200 million of course.
Why start a shipping company?
We live in a universal society where goods and products are the most important factors of an economy. This economy can’t just work without shipping services and shipping companies. In other words, shipping is the backbone of an economy. Shipping allows us to have the necessary goods from other countries and regions. Every day thousands of ship travel from one corner to another corner of the world to transport goods, machinery equipment, foods, etc. Without ships and the shipping industry, this would simply not be possible.
Shipping is the most reliable and ancient mode of transportation of goods in bulk amounts. A shipping company generally deals with wholesalers or resellers of different parts of the world to transport bulk or a huge amount of goods.
The shipping industry is growing and changing so fast because of online shopping industries and the economic development of every country in the world. So this is the most appropriate time to get into the shipping industry.
Types of Shipping Company
There are many types in the shipping company, like other businesses. But it is not that important to target an individual type in the shipping industry as they all work in the same way. But choosing a type of shipping business and working on it will give you some advantages while you are in the primary stages of your shipping business.
- Cargo Shipping
- Container Shipping
Competition in Shipping Business
The shipping business is one of the ancient business platforms on this earth. There are a lot of big whales in this business, which gained a name for them. Also, this industry maintains secrecy, which made it more difficult for newcomers to tap into this industry.
But this industry has a big room to accommodate the big ones, and small ones, therefore, it won’t be a big problem for you to start the shipping company. It will not be a big challenge for you to get contracts from small companies and fulfill them before expanding.
Starting a shipping company is indeed difficult and tiring, it is a pressing business that is not meant for the dull-minded. The crucial financial analysis must be carried to assure that the prospects and other warnings compared with starting a business from scratch or investing in a business idea are moderated.
If you are thinking of starting a shipping business in Pakistan, your major concern should not be limited to just acquiring an office facility and equipping the facility or hiring the best hands in the industry, but it will be of more concern to you on procedures you can evolve to ensure that your shipping company is patronized with mouth-watering contracts.
How to buy Ship
The most important step in Shipping is buying a ship. It requires at least US$ 100 million minimum and requires some professional knowledge. There are three steps in buying a ship. Those are:
Negotiation and Contract Stage
This is the first step in buying a ship. Normally these steps are carried by a broker appointed by you. Initially, the broker will establish telecommunication with the seller with the invitation of buying a ship. The main interests of both parties at this step are the pricing, the specifications of the ship and the lay-days of the business.
After all the features are agreed through various communications, a formal agreement for the sale of the ship – Memorandum of Agreement (MOA) – will be drawn up. There are some official form agreements for the MOA like the Norwegian Sale Form (NSF). After outlining the sales form, 10 percent of the deposit will be paid by the buyer and the buyer can appoint his surveyor to inspect the ship.
After finalizing the agreements, it will enter the inspection stage. This stage requires two kinds of inspection. One is document inspection and the other one is physical ship inspection. In the documents section, you will if all the documents of the ship are okay. The document should reveal all the details of the ship’s maintenance and requirements of the class. You should also check the ship’s mortgage records and other legal issues.
For the physical inspection, inspections are usually made to the surface of the ship and its logbook.
In this stage, you will transfer the whole amount agreed to the seller, and they will deliver the ship with all the documents transferred in your name.
Also Read: Major Imports and Exports of Pakistan
Documents required to Start a Shipping Company in Pakistan.
- The registration of Pakistani ships shall be performed by the Registrar of Ships, Mercantile Marine Department Karachi.
- The ship’s name should be registered by the Directorate of Signals, Naval Headquarters, and Islamabad.
- The call sign of the ship must be issued by the registrar of ships at the time of issuance of the Certificate of Registry.
- The following conditions shall be fulfilled as to ownership of a Pakistani ship or vessel.
- In case of individual proof of proprietorship, partnership or association of individuals, NIC, TIN and place of business shall be provided;
- In case of an organization, a certified copy of memorandum and articles of association certificate of incorporation, certificate of commencement of business, list of directors with their nationality and address, and place of business in Pakistan shall be provided
- Evidence of the ownership of the ship shall be provided.
There is more process needed to complete which you should find at mercantile marine.
Starting a shipping company can be a profitable business if you can run it with integrity and professionalism.