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America’s trucking industry has been called the “lifeblood of our economy” and it serves as the backbone for thousands of supply chains. It’s also an industry that invites innovation, one that has seen fundamental changes over the last several years.
Thinking about entering the trucking industry? Here’s our guide to entering this exciting field.
Understand the Industry and Your Capabilities
The trucking industry encompasses several different types of companies. Depending on your experience, interests, and resources, you may decide to establish any of the following:
- Motor Carrier: An organization that transports cargo for a fee. These include both full truckload (FTL) carriers that ship deliveries of up to 50,000 pounds and less-than-truckload (LTL) carriers that ship deliveries smaller than 10,000 pounds.
- Broker: An organization that coordinates transportation by a motor carrier. They do not take place in the actual transportation of goods.
- Freight Forwarder: An organization that offers a range of storage and shipping services on behalf of other organizations.
It’s crucial to conduct a thorough, objective self-assessment before deciding what type of organization you’ll establish. What are your strengths and weaknesses? Do you have the resources necessary to build a long-lasting organization? Be honest to ensure you make a smart, strategic decision, and start a business that’s built to last.
Develop a Business Plan and Establish Your Trucking Company
Next, you need to start defining your business. What do you hope to achieve? What will set your trucking company apart from the competition? A business plan will serve as a guide throughout your company’s early days. Take this process seriously and carefully outline your organization’s goals and differentiators as well as the obstacles you expect to face.
More formally, you’ll also need to legally establish your trucking company. You might choose to set-up your business as a corporation, a sole proprietorship, or a Limited Liability Company (LLC). This step ensures you’re paying the appropriate amount in taxes and, in some cases, entitles you to legal protections.
Then, you should set up an employer identification number (EIN) for your trucking company. This step is necessary to set up a bank account and file your taxes on behalf of your organization. It’s like a PIN or Social Security number — a nine-digit number that’s unique to your trucking company.
Finally, you’ll need to purchase or lease the appropriate trucking equipment. It’s important to select vehicles that will meet your needs and make the right decision between leasing and buying.
Get Licensed and Insured
Trucking is among the more highly-regulated industries out there, which means your organization will require a number of different licenses and certifications before it can open its doors.
You’ll need to obtain licenses and certifications including:
- Commercial Driver’s License (CDL): Driving for a trucking company isn’t like driving any old car. All of your drivers will require a special license. Each state’s licensing agency has different requirements for certification so be sure to do your research.
- United States Department of Transportation (USDOT) Certification Number: Most states require trucking companies to register with the Department of Transportation. This unique number is used for certain inspections and audits.
- Motor Carrier (MC) Number: The majority of trucking companies need to apply for MC numbers. These enable them to operate as for-hire trucking carriers.
Build Your Fleet and Team
What’s a trucking company without trucks or truck drivers? Make the purchasing and hiring decisions to suit the business goals you’ve already outlined. If trucking is the “lifeblood” of the American economy then your trucks and truck drivers will certainly become the lifeblood of your organization.
Keep Up with Trucking Trends
Few industries are evolving more quickly than trucking. New technologies like self-driving trucks and electronic logging devices promise to rapidly transform the industry. Keep yourself informed to ensure your company is at the cutting edge of any new developments.
Image Credit: Milos Muller / Shutterstock