Trucking business is not the most cost-effective route to entrepreneurial success. There is a lot of demand for freight services. This gives you the chance to build a profitable business. It is possible to start your business as a solo entrepreneur and grow the company as you go.
7 Steps to Launch Your Trucking Business
These are the steps to follow to get your trucking business set up
Step 1 – Make a business plan
A business plan that is well-written will be the key to your success. A business plan can help you set goals, organize, avoid potential roadblocks, and define your unique value proposition.
Here are some details you should include in your business plan:
There are multiple reasons to start a business
You’ll only offer specific trucking services
It will help you plan your business and avoid potential pitfalls. However, a well-written plan is also necessary if you are looking for investors or funding.
Step 2 – Form a Business Entity
If you are starting a trucking company from scratch, I recommend incorporate.com. This service will assist you with all the steps necessary to launch your trucking business. This service will take away many of the hassles involved in filing paperwork and forming your company. You’ll then be free to concentrate on the exciting and hands-on aspects of starting your business.
Incorporate.com simplifies the process of creating a business entity. Select your state and choose the type of business entity that you want to create. Next, you will be offered three options for formation. These are The Starter, The Essentials and The Works.
You might require additional services when starting your business. The more expensive packages include these extras. The Essentials package includes an Employer Identification Number (EIN), annual report preparation, and filing, which is not available with the Starter plan. The Works plan also includes an operating agreement, business license research, and a contract, which aren’t included in the Essential or Starter plans.
Step 3: Obtain the necessary permits and licenses
Depending on the location you intend to operate, licensing and permits requirements may vary. Before you can start your trucking business, you will need all the required licenses and permits. To make sure that you do not miss any information, it is worth checking the transportation website of your state.
The process agent will receive legal documents on your behalf. A process agent is required in every state you do business. You can also choose a company with universal coverage.
Heavy Vehicle Use tax – An annual tax on trucks that weigh more than 55,000 lbs. This money is used to finance highway programs.
You might also need to adhere to state-specific regulations. Many states have safety rules and air quality regulations. They also have truck size and weight standards.
Step 4: Purchase trucks for your business
Trucking is a flexible business that allows you to have one truck and still be able to succeed. Many small businesses start with just one truck. Before you commit to buying, explore all options. To avoid costly errors down the line, take time to carefully consider this large investment.
Begin by determining the type of freight you want to transport. This will help you choose the right type of vehicle. You can then choose to lease or purchase your truck. This option is cheaper and more convenient for you to start your business. You can also lower your monthly expenses by leasing a truck.
However, buying a new truck can help you save money in the long-term.There’s always the option to buy a used truck. To avoid costly repairs or downtime, make sure it’s in excellent condition. Before buying a used truck, here are some things you should inspect:
Step 5 – Insure your Trucking Company
There are many types of insurance that you will need for your business. Although most insurance is required by law, it is important to have insurance for your company. Insurance will protect your business assets as well as your customers from loss, theft, and damage.
The following are the most important types of insurance that you will need for your trucking business:
Primary liability insurance
Insurance for physical damage
Passenger accident insurance
More information on trucking insurance can be found at the Owner Operator Independent Drivers Association website.
Step 6: Calculate your Income and Expenses
You’re almost ready to begin hauling freight. This will assist you in pricing your services. You will most likely get paid several weeks or even months after your services are delivered. If you aren’t careful, this delay could cause cash flow problems for startups.
A business bank account will be required. If you’re financing your business using your personal capital, this applies as well. You’ll also need to keep detailed records of your income and expenses. This is why bookkeeping software such as Xero or QuickBooks is so useful. This will allow you to monitor your finances while you’re on the move.
Next, determine how and when your services will be paid. Shipping contracts typically pay between 30 and 90 days. This duration will allow you to project cash flow for your company.
Step 7 – Locate Loads To Transport
Your vehicle is now ready to transport freight. You must ensure that you have all required permits and licensing. Also, make sure to display your Radio Frequency Identification tags at your windshield. Install decals with the company name on your vehicle. Don’t forget to include your International Registration Plates and license plates.
5`Start by looking at local load boards to find leads. To find potential customers, you can also reach out to your network, including friends and family.