You may be a professional truck driver who is looking to become an owner-operator. You may have planned to switch from being a small commercial vehicle owner to a large fleet manager. Or, you may be a newbie who is looking forward to entering the trucking industry. If that is the case, this post is a step-by-step guide to start a trucking fleet business today.
Why is the Trucking Industry Important for a Country’s Economy?
The trucking fleet businesses serve as the commercial mainstay of the U.S. economy. The trucking industry contributes to employing innumerous drivers and generates a great deal of revenue for the U.S. economy. Here are a few statistics by American Trucking Associations :
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The trucking industry has assisted in transporting 72.5% of freight in the United States.
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Trucks trailed around 11.8 billion tons of freight in the year 2019.
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In the same year, the motor carriers generated 80.4% of the total revenue of the nation.
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80% of the nation’s workflow depends on trucks.
Therefore, it’s an industry that will provide ample opportunities for the owners and the drivers to maintain the current demands of the U.S. economy.
Steps to start a trucking fleet business in 2021
1. Make an Out-and-Out Business Plan
Starting a trucking fleet business needs a well-planned road map that includes all the necessary steps and backup plans. You should know your budget and have enough financial sources to keep your business going with all ups and downs. Set your goals, team, budget, roles, and know your hurdles before stepping into this business. Through the stats of the current market, competitors, investments, you will have to set your budget. Your budget includes the fixed capital and the working capital. According to all these factors, finalize the par figure for your budget. Owning the trucking fleet business will require you to plan it smartly and work on these points:
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Capital Management
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Buying Long-Lasting and Cost-Efficient Assets
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Hiring Well-Trained Staff
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Documentation
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Marketing Team
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Finance Team
Just like any other business, you will have to bear a no-profit phase in the initial stage. Be prepared for that.
2. Funding
You should know the right amount of money for the investment from the very first day of planning to start your trucking fleet business. You have to arrange enough funds to handle all kinds of emergencies in this business. The initial expenses include vehicle downpayment, insurance, permits, and some state-specific expenses. There are a lot of options to finance your trucking business. Whether it’s a bank loan or using your savings, you should have enough money for all the necessary expenses in the beginning.
3. Incorporation of Your Company
To operate a trucking fleet company, you should register it to get various benefits. Incorporation will set a boundary between your personal property and business liabilities. Legal incorporation allows you to operate the company without risking your personal assets like your savings, properties, etc. Additionally, you are entitled to several business advantages and tax exemptions.
4. Get All the Necessary Licences and Permits
After getting your business registered, you must obtain all the necessary licenses and permits, so that you can freely haul beyond state lines. Depending on your location, service, and where you operate the fleet, you must maintain all the licenses and permits that may apply to your business. You need to find out if the following items are required to run your trucking fleet business with no objection.
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USDOT Number (United States Department of Transportation Number)
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CDL (Commercial Driver’s License)
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MC Number
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BOC-3 Filing
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IRP & IFTA decal
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Motor Carrier Number
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International Fuel Tax Agreement stickers
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International Registration Plan
5. Buy Your Own Trucks
You need to buy your truck to run your trucking business on your own terms. Although expensive, owning the trucks or vehicles in your fleet means freedom. You don’t have to depend on contractors. Having your own vehicle will let you freely upgrade them. You can change or modify them whenever required. Moreover, you can sell them or rent them out in case of emergencies. Getting the trucks on lease will bind you in certain ways. If they are not in a good condition, you have to pay for the repairs without getting any future benefits.
6. Hiring The Drivers
Your trucking fleet business success depends on the drivers and their discipline. You should have a special recruiting process for hiring the drivers of your fleet. They should be judged based on their driving skills, knowledge of traffic rules and regulations, license, and should know how to stay compliant with FMCSA rules. Remember, hiring irresponsible drivers could cost your reputation and you may lose your clients.
7. Stay in Compliance With FMCSA Standards
If you own a trucking business, you need to stay updated with all the safety regulations. You would be required to keep all the necessary equipment and documents to keep your drivers and trucks safe. All the fleet owners are required to have any of these fleet tracking devices and install an ELD (Electronic Logging Device) on their vehicles so that the drivers can record their HoS (Hours of Service), duty status, and other necessary information. It helps in staying compliant with the FMCSA (Federal Motor Carrier Safety Administration) rules and keeps the roads safe. They are also advised to have a proper fleet management systems as well.
8. Find Loads to Haul
Operating a trucking fleet business requires you to set a lot of marketing strategies to get the freight contracts. You can use hoardings and banners, a personalized website, phone calls, emails, and social media platforms for better marketing of your business. You can also meet your clients and build a good relationship with them through a face-to-face conversation. Outsourcing your business is also one of the ways to get new clients.
9. Insurance
Last but not least! Insuring your trucking business is a vital step. Like any other business, you should be prepared for the worst-case scenarios in the fleet management business too. Fleets or trucking business could mean accidents, theft of trucks, or the load they are carrying. Getting your vehicle insurance can cover the cost of wear and tear that are likely to happen regularly. You may consider getting primary liability insurance, physical damage insurance, cargo insurance, or passenger accident insurance. You can choose the option that matches your business. You can read more about it from here.
Final Words
Starting your own trucking fleet business is not a piece of the cake. You need to understand the nature and process of the business with time. You may also need to adapt according to the conditions, rules, and regulations of the area where you want to establish your business. Doing proper research and maintaining your business according to the demands of the market can let you lead a very successful trucking fleet business. You can find more trucking and fleet tracking resources on yourbestfleet.com
The post 9 Steps to Start Your Trucking Fleet Business in 2021 appeared first on Tweak Your Biz.
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