Featured image by Zetong Li via Unsplash
Are you interested in starting a trucking company? Owning one can be quite profitable if you do it right. But you do face a lot of competition, and there are some critical first steps you don’t want to miss. This can make the entire process seem overwhelming, but it’s worthwhile if you stick to it.
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Tips for Starting a Trucking Company
Here are a few things you’ll want to keep in mind if you plan to start a trucking company this year.
One of the first things you’ll want to do is write up a business plan for your trucking company. While you can change it up later on, it’s important to carefully think about the basics of your company and what you truly want to accomplish with it.
There are numerous aspects you’ll need to include in the plan. The first is your executive summary. This is an overall description of your company and its mission and values. This is perhaps one of the most important pieces to focus on as it will guide you with the remaining parts of your plan.
Other crucial things to include in your business plan are:
- Marketing strategies and goals
- Your main competitors and how you plan to compete against them
- Financial goals
- Operational costs
- Services you want to offer
- The management structure
Another crucial thing to look at is your finances. Starting a business can be financially draining, especially a trucking company. You need to ensure you have enough permits, licenses, equipment, and salaries.
As you design a budget, be sure to look into the future as well. You’ll want to have some money set aside for potential issues, such as mechanical problems. Doing this will keep your business financially steady.
If you need financial assistance, look into applying for loans. This could be through your banks or something like the Small Business Administration. Of course, you’ll want to understand the pros and cons of certain loans carefully, but in most cases, they’ll be quite beneficial at helping to boost your new company.
Most states will require that you have some form of insurance before you can legally operate. This can give you peace of mind knowing that you’ll have financial coverage should something go wrong. It also helps your customers feel better because they will receive compensation should there be a problem.
For this industry, you’ll usually need to have general liability insurance. This type covers basic things such as equipment damage and employee injuries on the job. However, if you want more in-depth coverage, professional liability is ideal. This will cover more intricate details, such as if you missed a deadline or there was confusion with an order.
The law often requires workers’ compensation if you plan to hire employees. You might also look into auto or cargo insurance which explicitly covers potential issues with your vehicles and supplies.
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Once you determine the right business plan and have your finances in order, you’ll need to register your company. If you’re unsure where to start, check out local government requirements if you plan to cater only to a certain region.
Regardless of where you’ll serve, though, you’ll need to register with the Federal Motor Carrier Safety Administration (FMCSA) to receive a USDOT number. In addition, you’ll often need to complete a safety course before officially registering. Plus, you will need to show that you have the necessary permits (such as a CDL license).
You’ll also need to determine the best business structure for your trucking company. Some you can choose from include:
- Limited liability company (LLC)
- Sole proprietorship
While each has its pros and cons, an LLC is one of the most frequently used options for trucking companies. This tends to have more tax breaks and legally separates the company from its owners. Therefore, if something goes wrong, you won’t have to use your personal assets to fix it. There’s also a lot more management flexibility, so you don’t always need to legally have a formal structure (such as board members).
Apart from high-quality vehicles, you’ll need to equip your trucking company with other tools to help get jobs done faster and safely. One is a forklift trailer hitch which you can easily snap in place to your trucks so you can connect another vehicle or piece of equipment to it. This tool is also useful because it keeps things stable as you drive.
You’ll also want to make sure to have things like reflectors, jumper cables, air gauges, and extra motor oil on hand.
Prepare for Success with Your New Trucking Company
Starting a trucking company in 2023 has plenty of benefits, but there’s a lot to remember if you want to succeed. With these tips, though, you’ll be better prepared for what’s ahead.
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