Are you perhaps a seasoned truck driver who wants to become their own boss? Well, since you know the industry well and are confident that you can succeed not only as a driver but also as a business owner, now may be the ideal time to start your own over-the-road trucking company.
The transport and logistics sector is extremely competitive and offers excellent opportunities for experienced truck drivers and savvy businessmen. So, if you feel like you’re ready to start a trucking company but don’t know where to start, this simple guide will point you in the right direction.
Make A Thorough Business Plan
You’ll want to set up your new trucking company with an organized approach, just as you would a new job with a fresh outlook and set of goals. A business plan is your success map, and it can be refined as your company grows. It assists you in getting organized, identifying goals, articulating your perceived value, and identifying potential roadblocks.
Writing a business plan may appear to be a lot of work. That’s why you can use a trucking business plan template to stay organized and ensure you write a solid and successful plan. However, when writing your business plan, keep in mind to be as thorough as possible and write down everything that seems relevant for your business to succeed from funding, inventory, and workforce to marketing and annual budgeting.
Establish Your Company
Running your trucking company as a highly constructed company separates your personal assets from your business liabilities. Combining offers several legal, tax, and business benefits in addition to securing your private possessions as a business owner. Besides selecting the type of legal business entity you want to start, when establishing your future company, you should also be mindful of the two following things:
- Select a registered agent. A registered agent enables the state to communicate with a business entity which is required by law in most states. As the secretary of state’s official point of contact, the registered agent must be present at a physical address (not a P.O. Box) during specific business hours to register for and begin receiving legal notices, state mandates, wage garnishments, and tax documents. Registered agents must be always reachable. A late delivery could jeopardize your company’s strong reputation with the state or allow a lawsuit against you to proceed without your knowledge.
- To open a bank account, you must first obtain your EIN. Your employer identification number, or EIN, functions similarly to a social security number for your company. This nine-digit number is needed to open a new bank account and should be visible on all tax records for the lifetime of the company.
Obtain All Required Business Licenses And Permits
Most state, county, and local governments require businesses to have the necessary licenses and permits before opening their doors. Based on your offering and also where you manage your trucking company, you may be required to obtain a variety of licenses and permits.
Every owner-operator should check with their local authorities if the following items are required:
- A commercial driver’s license (CDL) and required endorsements;
- A USDOT number;
- A Motor Carrier Operating Authority (MC number);
- A BOC-3 filing;
- An International Fuel Tax Agreement (IFTA) and credentials for the International Registration Plan (IRP)
Choose The Appropriate Insurance Coverage
As an owner-operator, you would also need to acquire commercial truck insurance from some of the best commercial insurance brokers in your area for your new company. Before deciding on a policy, you should look into the various types of insurance policies to find the best one for your business:
- Primary liability insurance;
- Cargo insurance;
- Physical damage insurance;
- Passenger accident insurance.
Understand And Keep Track Of Your Earnings And Expenses
Constructing a system for tracking income and expenses is a critical component of running a successful business. This is especially important for transportation companies in terms of logistics, because payments are frequently received weeks or months after shipment, and it can be hard to track expenditures while on the road.
To help avoid common startup obstacles, keep the following tips in mind:
- Hire an accountant
- Subscribe to bookkeeping software
- Determine when and how you will be compensated for deliveries
- Maintain thorough records of business expenses
- Keep your personal and business finances separate
Find New Customers And Expand Your Business
You’ll need to find freight to transport when you first start a trucking company. Using load boards to find customers is one option for new freight companies.
Another option is to begin establishing a relationship with clients through marketing and networking. Directly contact local shippers and meet potential buyers with which they do business. Industry groups or relevant small business trade shows, as well as the DAT Load Board for Truckers, are good places to start.
Truck drivers are in demand, and starting a trucking company is a great way to take advantage of this. If you think you have what it takes to be a business owner, then follow this step-by-step guide to start your own trucking operation. It’s never been easier to start your own business, so go for it!