Running a trucking company can be a good way to find financial freedom. Sure, in the earlydays, you will be the one putting in the miles behind the wheel, but over time you can build up your fleet and this will help you to take care of your family and the people who work for you.
But one question remains. If running a trucking company is a great way to make money, why aren’t more people doing it? Like everything in life, it is the ‘doing’ which takes a great deal of work. With that in mind, here is a guide on how to run a successful trucking company. So, if you want to become a trucking mogul, then read on.
- You Need the Right Tool for the Job
If all you have is a hammer, then everything will look like a nail. However, all of that pounding away might not be what your customers want. As such, you the first step to running a successful trucking company is to get the right tool for the job.
While this might sound simple, you do need to stop and think for a moment. Are you contemplating cross-country deliveries, or will your company focus on being a local service? Also, will you provide cold-chain services or just dry deliveries? You get the point, knowing what type of service you will provide will help to determine which truck to get.
But your work is not done, as you will need to secure financing for your new – or new to your vehicle. While this can be slightly confusing in the beginning as there are several alternatives out there. The best advice is to take it slow and walk through the details and how each option will impact your business.
For example, in some situations leasing might make sense and then there is the question of new or used equipment. Each choice has its pros and cons and the only way to figure out what is best is to sit down and walk through the options.
- Bring on the Right Advisors
You might think that running a trucking company is straightforward – you load up the truck, you drive, you unload the truck. While this is correct on the surface, the reality is that you will also rely on the advice of experienced lawyers, accountants, and insurance agents to run your business.
For example, there are tax implications tied to how you have paid for the equipment you use. Beyond, there are also questions of depreciation – especially if you are using your equipment frequently. And then there is the entire exercise of valuing your equipment when it comes time to trade or sell it. As such, you will need the help of an accountant who understands trucking business.
In addition, you might never think about the need to have a good lawyer on your side, but the reality is that there are severalbusiness-related risks that you might need to deal with. These include negotiating contracts, car accidents, or even lost time due to injury. In this case, you will want to bring on a lawyer who understands your business and can help you in your time of need. For example, if you run into problems in Southern California, then you might need the assistance of a Los Angeles auto accident lawyer.
- Find the Right Customers
You might be thinking that any paying customer is the ‘right’ customer, but this would only be half true. Sure, it’s better to have paying customers than non-paying customers but when it comes to running a successful trucking business, the devil is in the details.
For example, you aren’t the only one competing for a particular customer’s business. As such, you might be forced to give low prices – in some cases even below cost. However, this is not a good strategy as gas prices can fluctuate significantly and penalties for late delivery might make what is a barely profitable contract a loser.
As such, you want to start with customers who have realistic expectations and who pay on time. Start small at first as it is better to have one or two good customers than have to keep for every trip with a low-price customer who pays late.
- Cash is King
This extends to several parts of your business. First, know how to bid. This means understanding your costs and what the customer is willing to pay. In some cases, it might make sense to put in a bid marginal bid while in other cases you might be better served not wasting your time.
In addition to knowing how to bid, you also need to be able to keep your records in order. If you are one man/woman band, then this can be tough but maybe someone in your family can help you with the record keeping. Not only will this help you to keep your costs in check but it will make sure you get paid on time. So remember, that cash is king when it comes to running a successful trucking company.
