The trucking industry is considered to be the backbone of America’s economy as it employs around 8.7 million people according to the American Trucking Association. This speaks volumes to its importance, not only for the country’s economic growth but also for the lives of people as there are 3.5 million truck drivers.
As there are driver shortages, it is more than likely that the demand for trucking services will increase significantly and this has stirred up interest with many people who are looking at the idea of opening their own trucking company. If done right, running a trucking company could be a successful venture. Becoming an owner-operator of a trucking company isn’t a breeze and you have to follow certain steps and make the right moves to get your trucking operation in high gear.
In this article, we offer a step-by-step plan to assist you in launching your trucking business.
Just like any other business, the best way to start a trucking company is to develop a well-designed trucking business plan. Making a business plan is a type of operational strategy aimed at guiding you at the beginning of getting your business going.
Start by writing an executive summary, and continue by offering an industry overview, describing the trucking industry, and offering relevant statistics. You’ll need to conduct a thorough analysis of the market and your competition and come up with a marketing and sales plan where you describe your services in detail, the pricing, and distribution.
Furthermore, one of the most important parts of the business plan is the operating plan where physical requirements like offices, warehouse, and staffing are detailed, and the financial plan where you demonstrate how your business will grow and become profitable.
Since your business plan must address critical questions and give a clear image of how the company will function, you must do thorough research as it will make the process smoother and keep you focused on building your trucking company.
Register Your Trucking Business
Once you complete your business plan, the next step is to register your trucking business with any local or state governments that require it. You’ll need to create a business entity so that you obtain liability protection for your assets. You will be required to form either a corporation or a limited liability company to get protection and prevent someone from pursuing your assets to satisfy a claim against your business.
In case you establish your company with a business partner, consider different kinds of LLCs designed for partnerships and corporations. This is a relatively straightforward process although there is some paperwork to do.
In addition to registering your business, you’ll need to pick a business name as it will be the first thing your clients will hear so make sure it’s unique. Once you’ve boiled down your option, go to the U.S. Patent and Trademark search to check whether the name is available for use.
Obtain Business Licenses, Permits, and Insurance
One thing you need to make sure of is that your trucking business has obtained all necessary licenses, permits, and insurance so that it operates legally.
This business is known to face unique challenges and liabilities so having all licenses and insurance policies required by your state authorities is crucial if you want to succeed. Make sure you obtain them before your first shipment hits the road.
There’s also a license called an International Registration Plan which is required if your truck is 26,000 pounds and crosses state lines. It will give you permission to operate in all states, including some Canadian provinces.
Always consult with your state’s guidelines to be on the safe side of local regulations and get peace of mind.
Calculating the expenses and what your money will be spent on is a must. Technological upgrades, supplies, taxes, fuel, trucks, licenses, and registration are costs that your company must pay for. They’re only the startup costs and as your company starts operation, more costs will begin adding up and you must be prepared ahead of time and save as much money as you can.
You can kick start your trucking business with SBA loans which have become quite popular for their high loan totals, low-interest rates, and generous repayment terms. If you have a good credit score and credit history, there are great chances that you’ll make the cut.
Although starting a trucking company may sound complicated and feel overwhelming, when you follow these steps, you’ll be able to get the wheels rolling on your business in no time. With the right business plan, good research, licenses, and finances in place, you’ll provide a firm foundation for your new trucking business.