How Do I Start My Own Trucking Company?
Updated: Mar 16
Starting your own trucking company is a big step. There is great opportunity to grow in the trucking industry and run a successful trucking company as demand for truck drivers increases. It is important to remember that the trucking industry is extremely competitive, but also very profitable. It's common for many people who get into this industry to fail in the first year as they aren't prepared. But, if you prepare yourself properly and know what you're doing, there is a lot of room for success. We are have compiled some important information to point you int he right direction on how to start your own trucking company.
Develop a business plan
Your business plan will set out everything for your trucking company. It will include what you want to achieve, how your company will operate, and set up your company's guidelines.
Form a business entity
There are two main business entity's to choose from: Sole Proprietorship and Limited Liability Company (LLC). With a sole proprietorship, you own the business yourself and are liable for everything. All profits and losses are recorded on your personal tax return. With an limited liability company (LLC), you are not held liable for everything, but you still treat profits and losses on individuals members tax return.
Get a truck
Obviously. You need to decide if you're going to buy a new or used one, or if you want to lease it. The main decision factor comes down to what you want to spend. For long-term, buying a truck is the way to go. But if you don't have the cash flow to cover the high down payment, leasing a truck is the next best option.
Get your CDL
You must have a CDL to drive your truck. Depending on what type of truck you plan to drive, there are different classifications and several steps to follow. Make sure you apply for the right one to avoid any delays.
Get your trucking authority
You must have an active trucking authority to participate in interstate commerce. You won't be able to haul any loads to run your business without it. It is extremely important to get this done correctly, as it takes about 21 days for your authority to go active. You don't want to mess it up and be delayed even more. We can file your authority for you for free to help you avoid any mistakes!
Before you can completely move forward, you also need to be in compliant. This means filing for your BOC-3, setting up your IRP and getting your apportioned plates, creating an IFTA account, and completing a UCR.
Get an insurance policy
Insurance is one of the largest expenses a trucking company will face. You must have an insurance policy filed with the FMCSA before you can start hauling loads and running your trucking company. Factors that are considered when looking for insurance are: age of equipment, commodities, hauls, radius, vehicle locations, loss history, and years in business.
Deciding how you are going to finance your company can be make or break for your business. Especially for new carriers, getting consistent funding is critical in your success. Signing up with a factoring company will help you succeed and keep you cash flowing. Make sure you research who you're going to factor with before signing up.
The last thing that you need to prepare for when starting your trucking company is where you're going to get your loads from. In order to start making money as soon as possible, it best to have this in place before you get started. You'll need to decide if you want to work with a dispatcher, load boards, or directly with brokers or shippers.
If you've already done some research and gotten a head start, you might already have some of these things in place. But until you have everything in order, you won't be able to start your trucking company. It is always better to be patient and get it done right, than rushing and missing a vital step.
For more help on getting your authority filed and starting your own trucking company, give us a call today! (855) 552-4689.