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Running a trucking business is a risky but very rewarding venture. There’s probably no single business without its risks. How well you manage them determines your level of success or failure as a business person.
To get your trucking business up and running, you must come up with a well-thought-out strategy. Failure to do the right planning means you could easily run into losses. Here are a few tips you should consider when starting a trucking business.
1. Insure Your Truck
We all know how risky it is to operate any vehicle today. There’s the possibility of losing your truck due to road accidents, and if you are able to salvage anything, the repair costs might be too high to afford. The other possibility is losing goods in transit due to accident or theft. All these are serious risks that need to be countered.
The best way to secure your truck and the goods in transit is insurance. You need to get comprehensive insurance from a company like Coverage Specialties to be on the safe side. This will ensure your truck and goods are compensated in the event of an accident.
2. Talk to Someone Who Has Been in this Business
Every business decision has to be backed with real information. You should not get into any venture as a way of trying out. Remember these are important resources you are risking. Failure to seek advice from someone who has been in the trucking business can be very detrimental to your finances. Ensure you have gathered enough information before purchasing your first truck.
3. Specialize in One Area
Do not buy a truck before knowing what kind of goods it will be ferrying. The last thing you want is to see your expensive asset idling in a parking lot due to lack of work. Whether you are planning to offer your truck for hire or use it to transport specific goods, always have a workable plan.
Make sure you are supporting the right market niche. This will help you to decide the type of truck to buy, the capacity, and additional equipment to buy. For instance, hauling specialized goods can make you great profits. On the other hand, acquiring a dry van will give you a hard time making revenue out of this competitive sector. Specialize in what is more profitable to be assured of decent revenues.
4. Analyze Operating Costs
No matter how much you are making, operating costs are a major concern. You need to strike a balance between the operational costs and the amount you are making. Failure to compare costs with income can kill your investment easily. Some of the costs you must consider include:
- Fuel costs
- Truck payments
- Maintenance/servicing costs
Ensure you identify your fixed and variable costs to come up with a rough idea of how your business is performing. If the costs don’t add up, consider making the appropriate changes.
5. Get the Right Partners
Anything that involves transportation and logistics requires great business partnerships. Since this venture is interdependent, you must have the right links with shippers. For instance, having the right relationship with brokers and load boards will ensure your truck never stays empty. Although it might cost you to work with brokers, the fee they charge is fair in comparison to the benefit they bring.
You should, however, only use brokers as a last resort. Try to build a customer list of direct shippers. With a number of reliable shippers, it will be hard to run out of work.
Do the right planning before committing your resources to the trucking business. You can never go wrong with the right planning and prior research.