A lot of essentials to take care of before fully getting out there and starting a new truck business venture. Insurance is something that every single person should have from day one. This protects the driver and those who are employing the driver.
A clear plan is essential for success as an entrepreneur. It will help you map out the details of your business and uncover some unknowns. Some important issues to consider are:
What are the costs involved in starting a trucking business?
The average cost to start a small trucking business is $ 200,000. A medium-sized transportation operation can cost up to $ 1 million and a large-scale operation can cost up to $ 5 million to start.
Aside from the basic corporate structure, your costs will vary depending on the type of transportation operation you own. In general, expect to pay approximately $ 2,500 for liability insurance, permits, and licenses. An office and land for the trucks will cost around $ 40,000.
What are the running costs of a trucking company?
Ongoing costs include fuel and wages. Fuel can vary from month to month but, on average, it costs about $ 180,000 per year (for long-haul trucks) or $ 1.38 per mile to operate a truck, according to the Annual Truckers Report.
Who is the target market?
Most shipping customers are business customers. Within the business-to-business space, customers tend to be manufacturers and industrialists.
Establishing a legal business entity such as an LLC prevents you from being personally liable if your trucking business is sued. There are many business structures to choose from, including: corporations, LLC, and DBA. In addition to establishing a business registration, you must register for taxes. You will need to register for a variety of state and federal taxes before you can open your business IRS, TDMV, EIN. Your business will likely also need to complete Heavy Use Tax Form (2290) and comply with tax regulations regarding heavy use of the nation’s public highways.
Failure to obtain the necessary permits and licenses can result in heavy fines, or even lead to the closure of your business.
Trucks transporting cargo across state lines must be registered with the Federal Motor Carrier Safety Administration. Depending on the type of business you run, you may need a federal DOT number and a motor carrier authority number, as well as other permits to transport certain types of materials.
In all states, a commercial driver’s license is required when operating trucks for commercial purposes. Other state permits and licenses may be required to operate a trucking business. Learn more about the licensing requirements in your state by visiting the SBA’s reference to state licenses and permits.
Check with your town, city or county clerk’s office. Get help from one of the local associations listed in the US Small Business Association Directory. From local business resources. Businesses must register vehicles that will cross state lines for business purposes.
Trucks are expensive. A seven-year-old used truck can cost between $ 30,000 and $ 40,000. A near-new truck can cost up to $ 100,000. If you start with a small fleet, it can cost you between $ 600,000 and $ 1,000,000. Partnering with multiple truck owners is an option for startup.
As with licenses and permits, your business needs insurance to operate safely and legally. Business insurance protects the financial well-being of your business in the event of a loss.
There are several types of insurance policies created for different types of businesses with different risks. If you are unsure of the types of risks your business may face, you can seek advice from WhiteRock which is a great place to insure your business.
Open a business bank account and credit card.
The use of business credit and bank accounts dedicated to the business (separate from your personal accounts) is essential for asset protection. In addition, set up business accounting to record your various expenses and sources of income (critical to understanding the financial performance of your business).
Keeping accurate and detailed accounts also greatly simplifies your annual tax return.
One of the hardest parts of being a trucking owner-operator or owning your own small fleet can be finding more loads. It can be a real struggle to find your next load and growing your business when you have to spend most of your time on the road. Fortunately, there are some things you can do to make finding loads easier – here are a few tips:
Create valuable partnerships
A key valuable partnership is to find a reputable and reliable load planning and dispatch service. When you partner with the right trucking dispatch service, they can help you find more loads that are going where you want to, when you want to, and they will negotiate the best rates possible for you. Additionally, they might complete and submit all paperwork for the load, manage all back office support and administrative tasks for each load and follow and track loads and miles.
Use your time wisely
There are many apps available to truck drivers that can help you save time. When you save time using these apps, you can spend more time looking for new loads.
Build lasting relationships
The old business saying is that it is easier and less expensive to keep clients than it is to find new ones. To do that you need to build lasting relationships with your brokers and shippers. Always be pleasant and friendly in your communications with them. If they enjoy working with you, they are more likely to keep sending loads your way.