When you decide to start your own trucking business, it can be as exhilarating as it is overwhelming. If your goal is to own and operate a fleet of several vehicles, then you have to be on the ball and know exactly who you’re looking to hire, what jobs you want to run and the industries you’re best fit to serve. On top of the big picture planning, you also have to be capable of managing a small business and running the day-to-day operations. Few startup ventures can be as expensive as trucking, so you have to plan wisely and make sure every cent goes into the right investment. Different industries require different strategies to be successful, it is not enough to say that you are an entrepreneur. For example, starting a travel agency is not the same as starting an in-home daycare. Be respectful of the need to be specific. Before you start your business, here are five things you absolutely need to succeed.
The Right Insurance
Owner-operators need specific trucking insurance coverage to be on the road. Not only is it a matter of legality, but you also want to make sure your policies have you fully protected in the event of collision, weather damage, vandalism, theft or any other crazy thing that might happen on a job. If you plan to be overseeing a fleet, then you’ll want to have the right coverage for your business and drivers. The vehicles belong to you, so while drivers need their own protection for liability and injury, you have to make sure the vehicles are properly covered for commercial use. All freight carriers must have at least $750,000 in liability coverage. If you plan to be a shipper or freight broker, you’ll need at least $1 million. On top of that, you need to explore different types of cargo insurance, roadside coverage, bobtail insurance and more.
A Good Perspective
Do you plan to be the sole owner and employee of your truck, or do you want to expand and start recruiting other drivers right away? Over the road truckers (OTR) spend weeks or even months away from home at a stretch. If you have a family or want to start one in the near future, this could have a serious impact on your relationships. Being an owner-operator is more than just a full-time job. This is a part of your life, and it comes with a certain lifestyle that doesn’t suit everyone’s needs. Make sure you have a good perspective on your current life as well as your future goals. How does your business factor into both the present and future you?
For someone who is driving their own rig, you can’t operate without a commercial driver’s license (CDL). You may think this is obvious, but there’s a surprising number of people who don’t realize all the legal requirements behind trucking. You’ll have to determine what class you need first. Most are Class A. After passing a physical examination, you’ll need to study and prepare for a test. Once the written test is over, you have to pass a driving test. For someone who is an absolute beginner, studying independently could be overwhelming. Signing up for a trucking school might be the better route.
The Right Technology
In addition to choosing the right type of truck, you also need to consider equipment and add-ons. Dash cams, rear cams and GPS tracking should all be installed. GPS tracking helps truck owner-operators and fleets help operate more efficiently by offering real-time data and feedback. You can read a full guide on everything you need to know about truck GPS tracking here.
A Registered Business Name
You can’t operate without a USDOT, issued through the Federal Motor Carrier Safety Administration (FMCSA). But before you can get that, you have to already establish your business as a legitimate professional entity. In most cases, this means registering your business as an LLC. If you do not already understand the difference, being an LLC is often preferred over a sole proprietor because you have some degree of separation between you and your business. A sole proprietor is the business, meaning there’s no legal distinction between them. This can quickly lead to financial hardship in the event of a lawsuit or liability issue. The FMCSA will ask you questions about your business model before they issue you a USDOT. You need to have all the right paperwork in place beforehand to avoid any delays or potential rejections.