How do I start a trucking company?
The forecast for overall economic growth is 2.6% and the U.S. truck transportation volume growth rate is projected to be about 2.3% per year from 2019 through 2024. There will always be a demand for truckers, and therefore trucking companies. In fact, there is a shortage of drivers. Your new company could draw in new, much-needed drivers. If you drive for someone else and want to start your own company, here’s how you can get started.
Step 1: Plan, Plan, Plan
Many people start off as owner-operators, meaning you drive a truck and run the business daily. You should decide if you want to be the sole driver with one truck or hire multiple drivers for multiple trucks. There are multiple types of company you can set up, too: sole proprietorship, partnership, limited liability corporation (LLC), and corporation (C-corp, S-corp, etc.).
You should also set business goals: how many loads do you want to carry? How do you want to grow in the next 6 months? Where will you get the money to do those things? What’s your salary going to be?
Step 2: Get Authority
Once you have a specific business plan, apply for trucking authority. Having authority means that the FMCSA has approved you to transport freight as a carrier. This requires you to register for a DOT # through the Unified Registration System (URS). Once you’ve got authority, find a process agent for every state you’ll be carrying in so they can complete the BOC-3 for you.
Step 3: Purchase Insurance
Every business needs insurance, especially trucking businesses. This insurance covers your trucks in case of damages and injuries to you our your drivers while driving. You can read about specific requirements here.
Step 4: Buy or Lease a Truck
Based on your business plan and goals, you could lease, lease-to-own, or purchase a truck or multiple trucks. Based on how much start-up money you have, you could go all in and purchase your own truck. If you purchase multiple trucks, some dealerships may even give you a special deal or discount. Not enough capital? No worries. You can rent a truck for a monthly payment. This takes off the pressure of owning a truck and you can terminate your lease according to contract terms. You can read more about the three truck ownership options and their pros and cons here.
Step 5: Start Picking up and Factoring Loads
There are multiple ways to build a clientele and find loads, from going to small business trade shows and advertising locally, there is no wrong way to start! There are also many apps you can download that let you know where loads are available for pick-up.
Once you’ve started picking up loads, you may realize that shippers take 30 days to pay back your invoice. Since you’ve started a new business and need working capital, this 30-day wait is probably not going to work for you. To get paid the same day, you can use InstaPay’s factoring service.
We have no contract lock-up, no sign-up fees, and no termination fees. That means you can factor one load with us for free just to try it out. Don’t like it? Don’t have to use us again! It’s really that simple.
You can sign up with us and log into the online portal to submit invoices and track payments there. When you’re new to the game, you may not know which brokers to factor with. Our credit check in the portal feature lets you know if we will factor that broker before you pick up their load! Got more questions? Our customer support is there for you when you need us.
So what are you waiting for? The outlook for trucking and transportation is bright and InstaPay is here as your growth capital partner.
Sign up today and start getting paid the same day!