Guide
Logistics business plan for a Jeddah operator
Logistics is a utilisation business. A plan that projects revenue without showing vehicles, routes and hours is a plan that has not been thought through.
A logistics plan is built from capacity: vehicles × hours × utilisation × revenue per delivery, against driver, fuel, maintenance, insurance and platform costs. If those numbers do not produce a margin, growth makes the loss larger.
Jeddah-specific context, in general terms
Jeddah is a port city and a distribution gateway for the western region. That creates demand across import handling, warehousing, regional trucking and last-mile delivery. It also means competition from established operators and from informal capacity.
The plan should state which layer of that chain the business serves, because the economics differ sharply between them.
| Layer | Revenue driver | Main cost |
|---|---|---|
| Port and customs-adjacent services | Shipments, documentation, storage | Labour, compliance, space |
| Regional trucking | Tonnes and routes | Fuel, drivers, maintenance |
| Warehousing | Pallet positions and handling | Rent, labour, systems |
| Last-mile delivery | Deliveries per day | Drivers, vehicles, fuel, platform fees |
Unit economics for last-mile
| Input | Value |
|---|---|
| Deliveries per driver per day | |
| Days worked per month | |
| Revenue per delivery | |
| Driver cost per day | |
| Fuel and vehicle cost per delivery | |
| Platform or dispatcher cost | |
| Contribution per delivery |
Then test at 70% utilisation. A model that works only at full utilisation is fragile, because utilisation is the first thing to fall when a contract ends.
Fleet decisions
| Option | Capital | Flexibility | Risk |
|---|---|---|---|
| Buy | High upfront | Low | Residual value, maintenance |
| Lease | Low upfront, higher monthly | Medium | Fixed obligation |
| Owner-drivers | None | High | Quality control, retention |
Most early-stage operators mix: a small owned core fleet plus contracted capacity for peaks. The plan should show how peak demand is covered without carrying that cost all year.
Contracts and concentration
A single client representing most revenue is a risk that lenders will price. The plan should show:
- contract terms and duration;
- revenue concentration by client;
- renewal risk;
- service levels and penalties;
- the pipeline of new contracts.
Cash profile
Logistics consumes cash in specific ways:
- fuel and driver costs are paid weekly or monthly;
- clients often pay 30–60 days after invoice;
- vehicle deposits and insurance are paid up front;
- maintenance is lumpy.
The cash flow forecast must reflect those timings. A profitable operator can still miss payroll in month three.
Transport licensing, vehicle registration, customs and labour requirements are regulated and change. Verify current requirements with the relevant Saudi authority before including them in a plan or budget.
What the plan should contain
- Service definition and customer segments.
- Route or coverage map in general terms.
- Fleet plan with capacity and utilisation.
- Unit economics per delivery or per kilometre.
- Contract pipeline and concentration analysis.
- Operating cost base, including maintenance and insurance.
- Staffing and driver model.
- Monthly cash flow and funding requirement.
- Downside case at lower utilisation.
- Risks: contract loss, fuel prices, vehicle downtime.
See financial modelling for the model, or business plan writing for the document.
The three numbers that decide a delivery business
| Number | Why it matters |
|---|---|
| Deliveries per driver per day | The revenue capacity of the operation |
| Contribution per delivery | Whether volume produces profit |
| Contract concentration | Whether one decision can halve revenue |
Growth in deliveries with negative contribution is not progress. The plan should show contribution at the expected utilisation, and again at 70% of it.
What to prepare before commissioning a plan
- vehicle costs: purchase, lease, insurance, maintenance, fuel;
- driver cost per day, including allowances;
- expected deliveries per route or shift;
- client contract terms and payment periods;
- platform or dispatch costs;
- a realistic peak-to-average ratio.
A logistics plan built without those inputs becomes a revenue forecast with a fuel line. Lenders see that immediately.