How to Start a Trucking Company in 5 Steps

Starting a trucking company requires a great deal of planning and research. You will need to determine the type of services that you want to offer, as well as the areas that you want to service. You will also need to obtain the proper licenses and permits, and insurance. Once you have all of this in place, you will then need to find drivers and vehicles.

If you are looking to know how to start a small trucking company, Hiring people, selecting your company entity, and arranging to finance are just a few things to think about.

We have a breakdown of how to start a trucking company in 5 easy steps.

How to start a trucking company?

There are a few things you should think about if you’re interested in starting your own trucking company. First, you’ll need to decide what type of services you want to offer.

Do you want to specialize in a certain type of cargo? Or offer a variety of services? Once you’ve decided on the type of services you want to offer, you’ll need to obtain the proper licenses and permits. You’ll also need to find drivers and vehicles and arrange to finance them.

Now that you’ve seen the advantages, let’s look at how to start a trucking company by looking at the important activities you’ll need to complete before hitting the road and joining a great big convoy. Here are the 5 basic steps that you need to follow to start a trucking company.

Image via: Horizon Go

Step 1: Write a business plan

As a business owner, your first step in starting a trucking business is to write a business plan. It will help you to grow your business. This document will outline your company’s goals, how you plan on achieving them, and what you’ll need in terms of financing, equipment, personnel, and the international registration plan irp.

Step 2: Register your business

After you’ve written your business plan, the next step is to register your company with the state in which you’ll be operating. This typically involves filing articles of incorporation or a limited liability company (LLC) formation document.

Choose a business entity

When starting a trucking company, you’ll need to choose a business entity. This will determine how your business is taxed and how much personal liability you have in the event of a lawsuit. The most common business entities for trucking companies are sole proprietorships, partnerships, limited liability companies (LLCs), and S corporations.

Choose a business name

The next step is to choose a name for your trucking company. This name will be used on all of your company’s documents and should reflect the type of business you’re in.

All trucking companies must have a Department of Transportation (DOT) number. This number is used to track the company’s safety record and must be displayed on all of its vehicles.

You can apply for your DOT number online or by mail. After obtaining your DOT number, you’ll need to get a motor carrier (MC) number. This number is used to identify your company when shipping goods across state lines.

Step 3: Obtain necessary permits and licenses

Depending on the type of trucking services you plan on offering, you may need to obtain additional permits and licenses. For example, if you plan on transporting hazardous materials, you’ll need to obtain a Hazardous Materials Safety Permit.

You can apply for most permits, USDOT numbers, and licenses online or by mail.

Business licenses and permits

Trucking companies need to obtain several different licenses and permit before they can start operating. The exact licenses and permits required will vary depending on the type of business, the state in which it’s located, and the type of goods being transported.

Business Insurance

Trucking companies are required to carry commercial truck insurance. This type of insurance covers the vehicles, drivers, and cargo in the event of an accident.

Step 4: Choose the right truck

The next step is to choose the best commercial truck for your business after you have learned how to start a trucking company. When you are going to select the truck for your company, you need to consider some factors; like the type of business you’re in, the type of goods you’ll be transporting, and the size and weight of your cargo.

It would be best if you also considered the cost of the truck and its operating expenses, such as fuel, maintenance, and repairs.

Buy vs. lease

One of the first decisions you’ll need to make when choosing a truck is whether to buy or lease it. There are pros and cons to both options, and the best decision for your company will depend on your specific needs and budget.

If you decide to buy a truck, you’ll need to secure financing. The cost of the truck will be spread out over time, and you’ll have the option to sell the truck when you’re finished using it. When you have your one truck you will work as an owner-operator.

If you decide to lease a truck, you’ll have lower monthly payments. However, you won’t own the truck outright, and you’ll need to return it to the leasing company when your lease is up.

Step 5: Secure startup funding

After you’ve chosen your business entity and obtained the necessary licenses and permits, you’ll need to secure startup funding. This can come from various sources, such as personal savings, loans from family and friends, or small business loans.

If you’re applying for a loan, you’ll need to create a business plan. This document should outline your company’s purpose, products or services, target market, and financial projections.

Trucking Companies in the USA

There are many trucking companies in the United States that provide a variety of services. Some trucking companies specialize in one type of service, while others may offer a variety of services. The following is a list of some of the more popular trucking companies in the United States:

• HorizonGO
• ABF Freight
• J.B. Hunt

These are just a few of the trucking companies that are available in the United States.

How much does it cost to start a trucking company?

The average cost of starting a trucking llc is between $10,000 and $50,000. This amount will cover the cost of obtaining the necessary licenses and permits, purchasing trucks, and securing startup funding.

SBA loans

If you’re looking for a small business loan, the U.S. Small Business Administration (SBA) offers a variety of programs that can help. An SBA business plan for a trucking company is the roadmap to secure financing and succeed in the transportation industry.

The SBA’s 7(a) Loan Guaranty Program is the most popular option for trucking companies. This program provides up to $5 million in loans to small businesses with strong credit histories.

To qualify for an SBA loan, you’ll need a good credit score, a well-developed business plan, and collateral to secure the loan.

Commercial truck financing

Another option for financing your trucking company is to apply for commercial truck financing. This type of loan is specifically for the purchase of trucks and other commercial vehicles.

To qualify for commercial truck financing, you’ll need to have a good credit score and a down payment of 20% to 30% of the purchase price.

You can find commercial truck financing through banks, credit unions, and online lenders.

Small business term loans

If you’re looking for a more traditional type of small business loan, you can apply for a small business term loan. This type of loan is typically used for short-term needs, such as financing the purchase of equipment or vehicles.

Small business term loans are available from banks, credit unions, and online lenders. The average interest rate on a small business term loan is 8% to 10%.

Equipment Financing

If you need to finance the purchase of commercial trucks or other equipment, you can apply for equipment financing. This type of loan allows you to spread the cost of the equipment over time.

To qualify for equipment financing, you’ll need to have a down payment of 20% to 30% of the purchase price.

You can find equipment financing through banks, credit unions, and online lenders.

How much does it cost to start a hotshot trucking company?

There’s no one-size-fits-all answer to this question, as the cost of starting a hotshot trucking company will vary depending on a number of factors, including the size and scope of the business, the location(s) where it will operate, the type of trucks and equipment that will be used, and more.

However, as a general rule of thumb, you can expect to spend anywhere from a few thousand dollars to several hundred thousand dollars in order to get your hotshot trucking company up and running. Of course, the more money you have to invest in the business, the faster it will be able to grow and expand.

But even if you’re working with a limited budget, it’s still possible to launch a successful hotshots trucking company.

The key is to carefully consider all of your options and make smart choices about where to allocate your resources. With a little bit of planning and foresight, you can get your business off the ground without spending a fortune.

4 Reasons to Start a Trucking Company

There are many reasons why you might want to start a trucking company. Here are four of the most popular:

Shortage of truck drivers

The trucking industry is facing a shortage of drivers. This shortage is expected to continue for the foreseeable future, which means there’s a good opportunity for trucking companies to fill the gap.

Need for innovation in the industry

The trucking industry is ripe for innovation. New technology, such as self-driving trucks, has the potential to change the way trucking companies operate.

It’s recession-proof

The trucking industry is relatively recession-proof. Even during economic downturns, there’s always a need for goods to be transported from one place to another.

It’s easy to start small (and scale)

Trucking companies can be started with just a few trucks while you start a trucking company initially. As your business grows, you can add more trucks to your fleet.

Hot shot truck financing

Hot shot truck financing plays a pivotal role in launching a trucking business by providing the necessary funding to acquire specialized vehicles and equipment tailored to the unique demands of hot shot trucking. This financial support ensures you have the essential resources to efficiently transport time-sensitive and smaller loads, contributing to the success of your business from day one.

Frequently Asked Question

The Bottom line

Learning about how to start a trucking company is quite a complicated process. Starting a trucking company can be a great way to enter the industry. There is a shortage of drivers, and the industry is ripe for innovation.

Plus, it’s relatively easy to start small and scale up as your business grows. However, it’s important to have a well-developed business plan and access to startup funding before getting started.