Are you aware that over 20% of new businesses fail within the first year? If you’re hoping to avoid that with your new trucking business, you need a game plan. When you get organized with your operations and finances, you can make a dent in the trucking industry. Stick around to learn how to effectively start a trucking business!
Begin with a Business Plan
Before seeking out business, trucking companies need a business plan. Detail a few measurable goals and indicate the personnel involved in getting your business off the ground. Describe your company and its mission.
Account for expenses in that first year, as well as revenue targets. And don’t be afraid to detail potential challenges and concerns. That way, you’ll be able to work with other key stakeholders to create contingency plans.
Get Permits and Licenses
When starting a business of any kind, look into state and national licensing requirements. For instance, you’ll need a business license within your state. And, of course, you’ll need a Commercial Driver’s License (CDL) to drive a big rig.
Plan on getting an International Fuel Tax Agreement (IFTA) sticker and doing a BOC-3 filing. The BOC-3 is a Blanket of Coverage policy that designates process agents in the states where you’ll do business.
You’ll need a trucking authority, too. This is your formal permission to work as a carrier hauling freight around the country. The Department of Transportation will give you a number, which you’ll need before you can start taking jobs.
Find Financing When Starting a Business
Creating a business comes with inevitable start-up costs. And in the trucking industry, you can count on needing investors or loans to finance your vehicles and location. Big rig lending, for instance, uses a truck as collateral to cover the loan.
Remember that you’ll need to plan for more than just a potential truck purchase, too. You’ll have maintenance costs, licenses, and software to manage your fleet. Plus you may need financing to help cover marketing and office space.
Choose the Right Equipment
Not all trucking companies need the same types of trucks. For example, if you aim to transport items that require refrigeration, it follows that you’ll want a refrigerated truck. You may need a truck capable of hauling certain weights, as well.
Or maybe you prefer one cab style over another. Whatever the case may be, look into new and used trucks and consider whether you want to buy or lease. Leasing may restrict what you can do, but you won’t have to pay as much upfront.
And while you’re at it, get insurance to protect your business. You’ll want primary liability and cargo insurance, at the very least.
Learn the Right Way to Start a Trucking Business
When you start a trucking business, you’ll want a clear business plan with revenue projections and goals. You’ll also need to make sure that you’ve obtained all necessary permits, licenses, and insurance on the front end. Finally, make sure you have financing in place to get the right equipment for the job.
To find more business ideas, check back soon for new articles.