Do you want to start a trucking business with one truck? If YES, here is a 15-step guide on how to start a trucking company with no money and no experience.
The trucking industry plays a very pivotal role in the economy of the United States of America, as well as the economy of the world. This is typically from manufacturing plants to retail distribution centers and from warehouses to construction sites, amongst others.
It is for this reason that heavy duty trucks are indispensable in the construction industry. The trucking industry is responsible for the majority of freight movement over land, and they are a major stakeholder in the manufacturing, transportation, and warehousing industries in the united states of America and in other parts of the world.
In the United States of America, those who are into the trucking business – that is large trucks and bus; drivers require a commercial driver’s license (CDL) before they can be permitted to operate.
How Regulated is the Trucking Industry?
The activities in the trucking industry is regulated by the United States Department of Transportation (USDOT), the Federal Motor Carrier Safety Administration (FMCSA) and the Federal Highway Administration (FHWA).
They ensure that drivers and trucking companies adhere to safety rules and regulations and also that potential truck drivers undergo special training on how to handle large vehicle before applying and obtaining their commercial driver’s license (CDL).
The trucking industry is not restricted to only trailers or large trucks that haul goods from one, destination to another via interstate highways; it also involves smaller trucks that help transport smaller quantity of goods from one destination within a city to another destination within the same city.
This means to a large extent that trucking business is not only about transporting goods over a long distance. As a matter of fact, in the U.S. about 66 percent of truck tonnages move distances of 100 miles or less; local and regional hauls account for almost half of all truck revenues and are they are the preferred choice for private carriers.
Is a Food Truck Business Part of the Trucking Industry?
Although, food truck business is considered to fall into the restaurant business, but in all ramifications people still list it as part of the trucking industry especially in North America. Excluding for few requirements especially when it comes to handling food and health requirements, all other requirements are same with the trucking industry.
No doubt starting and operating a trucking business can be challenging, but the truth is that it can be rewarding at the same time. One good thing about the industry is that it is open to both big time investors who have the capacity to start the business with fleet of trucks and aspiring entrepreneurs who may one to start with just one truck.
15 Steps to Starting a Trucking Company with No Money
1. Understand the Industry
Statistics has it that the trucking industry alongside warehouses and the private sector that patronize the services of trucking companies in the United States employs about 8.9 million people in trucking-related jobs; an estimated 3.5 million people employed in the industry are truck drivers. It is important to note that United Parcel Services (UPS) employs 60,000 workers and 9 percent are owner operators.
LTL shippers account for about 13.6 percent of America’s trucking industry. An estimate of 15.5 million trucks operate in the United States of America, and of this figure 2 million are tractor trailers. There are well over 3.5 million truck drivers in the United States of which 1 in 9 are independent truck drivers (operators); they own their trucks. Canada has well over of 250,000 truck drivers.
Interesting Figures About the Industry
The United States economy depends on the trucking industry to deliver about 70 percent of all freight transported annually in the country. These activities accounts for about 671 billion dollars’ worth of manufactured and retail goods transported by the trucking industry in the United States alone.
Aside from transporting goods and equipment within the United States, most trucking companies in the United States are also involved in transporting goods and equipment to and from Canada and Mexico.
The Trucking industry is a key industry when it comes to trade facilitator between Canada and the United States. It is on record that more than two-thirds of United States – Canada trade is moved by truck, this include more than 80 percent of all the goods exported from the United States of America to Canada.
The United States trucking industry generates well over 295 billion dollars annually in truck trade with Canada and well over 195.6 billion dollars annually in truck trade with Mexico.
Statistics has it that food and food products, lumber or wood products, as well as petroleum or coal account for 34.8 percent of truck traffic in the United States and by volume, clay, glass, concrete and stone, farm products, as well as petroleum and coal account for 35.6 percent of truck traffic.
The advancement in technology in areas such as computers, satellite communication, and the internet, has contributed immensely to the growth of the industry. The advancement in technology is responsible for increase of productivity of trucking companies operations, it helps them effectively monitor their trucks and their drivers and it helps driver save time and effort.
Is the Trucking Industry Growing or Declining?
No doubt trucking companies that are located along busy routes are expected to stay busy and experience increase in revenue because the trucking industry will continue to blossom and grow. This diverse industries are made up of a few large companies and thousands of small and medium-sized businesses around the US and Canada.
The industry might not be green, but of course it is a growing one , and it will continue to grow because of the vital role the trucking industry plays in commerce and industry within the United States of America and also in cross – border trade between Canada and Mexico.
Over and above, the trucking industry is still open for entrepreneurs to come in. Also, loads of people are motivated to start their trucking business simply because they can become their own boss with less stress save for the challenge of driving long distance and maintaining heavy duty trucks.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic composition of those who are in need or those who patronize the trucking industry cannot be categorically stated. Of course, merchants, industrialist, farmers, contractors and a host of other people who have need to move goods and services from one location to another location are considered to fall within the demography of those to be considered when mapping out marketing and sales strategies.
3. Decide What Niche to Concentrate On
- Private carriers
- Courier firms
- For-hire carriers
- Owner-operators
- Refrigerators
- Food trucks
The Level of Competition in the Industry
Just like other businesses that play important roles in commerce and industry, the trucking industry can be said to be a competitive industry. This is so because trucking companies compete for available business deals.
There is hardly any city in the United States of America where you will not find the presence of big corporations who are into trucking business. They are well positioned to compete for any haulage job that is available within the locations where they operate.
Categorically, it is safe to say that the trucking industry is highly competitive, but there are enough business deals to keep trucking companies going especially if they know how to source and market clients. If you know that you don’t have the capacity to compete with well – established trucking companies, it is safer to start as owner – operator or for – hire carriers.
4. Know the Major Competitors in the Industry
There are diverse names that just might ring a bell when it comes to the trucking trade. Most of these well-known brands have been available for decades and some even centuries. Here is a list of some well-known brands in the trucking industry;
- United Parcel Service
- FedEx Ground
- Schneider National
- Roadway Express, Inc.
- Yellow Transportation Inc.
- FedEx Freight
- B. Hunt Transport, Inc.
- Swift Transportation Co.
- FFE Transportation Services
- Overnite Transportation
- Ryder Integrated Logistics
- Werner Enterprises, Inc.
- ABF Freight System, Inc.
- United Van Lines, Inc.
- USF Holland, Holland, Mich
- Penske Logistics, Inc.
- Watkins Motor Lines, Inc.
- Allied Systems, Ltd.
- Estes Express Lines
- S. Xpress Ent.
Economic Analysis
In most countries of the world, the economic strength relies heavily on an efficient, safe, secure and sustainable freight transportation system; it is a vital sector in commerce and industry. The trucking industry is responsible for flexible, reliable and economic movement of goods within and outside the United States.
The trucking industry adds to the national economy of the United States and the industry is responsible for providing jobs for millions of people.
It is important to consider many factors before venturing into the trucking industry. The fact that the industry is profitable does not mean that you won’t lose your investment within a short period of time if you fail to conduct your homework and most importantly economic analysis.
It is safer to start your trucking business as owner – operator if you know that you are not ready to go into partnership with big – time investors.
5. Decide Whether to Buy a Franchise or Start from Scratch
If you are like most budding trucking entrepreneurs who may be confused about whether to buy a franchise or not, you may want to take this column seriously. You might not have the opportunity to buy a franchise from a well – established trucking company, but you can position your trucking business to work with larger trucking corporations. Bigger trucking companies work with owner – truck operators to carry out some of their services.
So, if you are considering starting your own trucking business, it is better to start from the scratch and then build the business to become as big as you want it to be. One good thing about trucking business is that you can start with just one truck and within a period of time, if you are dedicated and hardworking you can grow the business into fleets of trucks.
6. Know the Possible Threats and Challenges You Will Face
Some of the threats and challenges you are likely going to face in the trucking industry are mature markets, bad economy (economy downturn), stiff competition, volatile costs, and rising fuel prices. Also lack of finance, high debt burden, cost structure, lack of scale compared to your peers who have already gained ground in the industry could be a major threat and challenge to the survival of your trucking business.
7. Write a Business Plan
If you want to compete favorably in the trucking industry, then you must ensure that you have a detailed business plan. No doubt writing a business plan may not be as easy as it sounds, but thanks to software (templates) that now make it easier for people to write their business plans without consulting the services of business experts. Here is a sample trucking business plan template to help you get started.
The whole idea of writing a business plan is not just for the sake of having a business document in place; but a detailed guide on how to effectively run your business. Your business plan should outline and cover strategies on how you intend to manage your trucking business.
The rule of thumb in writing a trucking business plan is to try as much as possible to be realistic and never to over project when putting figures on income and profits et al. As a matter of fact, it is safer to underestimate when writing a business plan so that you won’t be so disappointed when reality sets in. These are the key areas that should be covered in your trucking business plan;
- Executive summary and Company’s descriptions; here, you are expected to write about the concept of your business, descriptions of your company, your company’s vision statement, mission statement and where your company will be located and the areas you want to cover.
- Other key components that should not be missing in your trucking business plan are business structure, employment policy, SWOT analysis, competitive analysis, marketing and sales analysis / strategies, pricing, costing and financial projection, publicity and advertising strategy, budget and start – up capital generation et al.
8. Choose a Suitable Location for your Business
When it comes to choosing a location for your trucking business, one of the factors that should influence your choice is closeness to the industry you intend servicing. For example; if you want to services the agriculture sector, it will be wise for you to locate your business close to a farm or farm market et al.
Other factors that you should consider before choosing a location for your trucking business are closeness to the highway, closeness to industrial and commercial hub and any location that will give you enough space for parking and servicing your trucks.
9. Buy the Trucks
Starting a trucking business means that you would need a suitable truck; it could be a brand new or fairly used. If you have the opportunity of spreading payments for over a period of time, then you should consider purchasing brand new trucks.
But if you don’t have social financial facility, then your best bet is to acquire fairly used trucks. There is nothing bad with starting your trucking business with fairly used trucks, it will serve same purpose. The only challenge is that, you will spend more on maintaining a fairly used truck as against a brand new one.
If you are starting a medium scale trucking business, you can consider contracting the maintenance of your trucks; it is cost effective to do so. But if you are starting a large – scale trucking company, then having an in – house maintenance team is your best options.
10. Hire Employees to Cover your Manpower Needs
Most trucking companies ensures that they install car (truck) tracker on their trucks; it enables them effectively monitor their trucks and it indirectly increases efficiency et al. With car (truck) tracker a truck owner can categorically tell where his or her truck is per – time and in essence they will be able to plan effectively.
These are some of the key roles that you should make available if you intend starting medium scale or a large scale trucking company;
- Chief Operating Officer (Owner)
- Admin and HR Manager
- Transport and Logistics Manager
- Business Developer (Marketers)
- Accountant
- Commercial Truck Drivers
- Front Desk Officer
On the average, you will need a minimum of 10 employees, to kick start your trucking business, but if you are starting a small scale trucking business you may not need to hire anybody if you have just one truck and you choose to drive the truck yourself.
The Service Delivery Process of the Business
Basically, when it comes to trucking business, you are expected to go out there to source for deals. This also means that you have to have great marketing strategies sin place, so as to attract the best of deals.
Once you are able to secure a business, you are expected to assess the nature of what you are supposed to transport, the numbers of hours it will take you to transport the goods from where you are expected to pick it from to where you are expected to deliver it.
As a matter of fact, these are the factors that will influence your fees. Once you are able to get all this facts, then you can go on to carry out your job. It is economical to ensure you always source for deals from the destinations you are expected to deliver goods so that you will not run empty back to your base / station.
11. Write a Marketing Plan Packed With ideas & Strategies
It is very important that you have great marketing plans in place if you want to go far in the trucking trade. Those who have had only success stories to tell in the industry know that making your business known by all and sundry is one of the practical parts of being a business Person. There are several approaches that you can take in order to market your trucking business but you must first have a trucking service marketing plan at hand.
The nature of your services offerings (what you transport) will define where you should go to market your services. For example; if you are involved in the transportation of agriculture produce, there is no point coming out with a market strategy that can only attract people in the corporate world; you must come up with plans that will take you directly to farms, plantations and farm markets.
No matter the marketing and sales strategy you choose, ensure that the responsibility of marketing the services your offer does not rest on the shoulders of your marketing and sales executives alone; every of your employees should be involved in the marketing of your business.
Just ensure that you create a system that gives bonus and commissions to your employees who bring in business deals to the company. With that, every member of your team will be motivated to market your services. You should also encourage freelancers to work with you; pay them commissions whenever they refer clients to you. Here are some strategies you can adopt when marketing your trucking business;
- Introduce your business by sending introductory letters alongside your brochure to stake holders in the construction industry, manufacturing industry, oil and gas industry, timber merchant et al.
- Promptness in bidding for contracts
- Advertise your business in haulage magazines, newspapers, TV stations, and radio stations et al
- List your business on yellow pages
- Attend expos, seminars, and business fairs et al
- Create different packages for different category of clients in order to work with their budgets and still deliver quality services
- Leverage on the internet to promote your business
- Apply direct marketing approach (go to places like construction sites, wharf, farms, et al to market your business)
- Encourage word of mouth marketing (referral marketing)
12. Develop Iron-clad Competitive Strategies to Help You Win
Some of the key competitive strategies that will give you advantage in the market place when you operate a trucking business are trust, honesty, good network and excellent relationship management, strong fleet operations, direct access to all Atlantic and Gulf Coast ports, the size of your company (the numbers of trucks under your fleet), cost advantages, supply chain, and strong reputation amongst domestic industry players.
In as much as it is good to specialize in a particular area of business, it is still to your advantage to structure the trucking business so as to work with a wide range of clients. Lastly, if your employees especially truck drivers are well taken care of, they will be committed to the growth of your business; they will work hard to help you achieve your business goals and objectives.
13. Brainstorm Possible Ways to Retain Clients & Customers
It has been proven over and over again that excellent customer services and excellent service delivery/products are one of the surest ways to increase customer retention for your business. In essence, in order to retain customers and to attract new customers as well, you must go out of your way to meet and surpass the expectations of your clients. Ensure that you under promise and over deliver.
14. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
If you have plans to build a business that will have a wider reach, then you should create a good budget for publicity and advertisement. By all means if you have the money, it will pay you to hire business consultants to help you create strategies that will help you boost your brand awareness and also to help you create a corporate identity. Below are some of the platforms you can leverage on to boost your brand awareness and advertise your trucking business;
- Place adverts on both print and electronic media platforms
- Sponsor relevant TV shows
- Maximize your company’s website to promote your business
- Leverage on the internet and social media platforms like; Instagram, Facebook ,Twitter, LinkedIn, Badoo, Google+ and other platforms to promote your business
- Install your Bill Boards on strategic locations
- Distribute your fliers and handbills in targeted areas from time to time
- Attend chambers of commerce meetings with the aim of networking and introducing your trucking to business to stakeholders in the industry.
15. Tips for Running a Landscaping Business Successfully
If you have ever closely monitored other successful businesses, you would find that one of the reasons why they are able to go far is their management style. As a result, your management style and strategies has a major influence on the success of your business. If you want to run a successful trucking business, then you must ensure that you put structures and processes in place that will aid you in achieving your business goals.
Part of what you need to do to run a successful trucking business is to create time to meet with your employees on a regular basis. Meeting with your employees will give you the opportunity to listen to the challenges and difficulty that they are subjected to, while carrying out their jobs. You will also have the opportunity to sell and re – sell your vision and business goals to them.
Training is another key factor that contributes to the success of any organization. Ensure that you make provision for training and re – training of your staff. This is very vital so that you can expose your team to learn new stuff. This will no doubt help in broadening their horizon.
Furthermore, the tools and equipment they work with must be in top shape at all time. This is so that optimum satisfaction can be guaranteed. Before any truck leaves your yard for a trip, make sure that the truck is in tip top shape for the journey. One of the ways to guarantee that your trucks have a long lifespan is when they are in tip top shape always.
It is very important that you run your business in such a way that they are free to suggest things to you. This is because the ideas they bring to the table might be of great essence. You may consider having a monthly, bimonthly or quarterly meeting where the input of your team can be harnessed.
Overall, running a trucking business might not come too easy. Why is this so? This is especially so, because just like any other business, there is the teething stage. As such, your trucking business might also go through the same challenges that all baby businesses go through.
However, the idea is not to give up, but to be optimistic and hardworking at all times. You will also do well to have only kindred people in your team. That is those who buy into your idea and believe that it would be a huge success in no distant time.