This question is about becoming a truck driver.
You need to take stock of your resources, determine a specialized form of trucking, and obtain a Transportation Workers Identification Credential (TWIC) in order to start a trucking business. Here are details on each of these steps and others you can take to start a trucking business:
Take stock of your resources. To start a trucking business, you must first determine what equipment you already possess and what equipment you might need to purchase or rent.
This also applies to your finances. Do you have enough capital to start the business, or do you need to get a small business loan? You can also ask for loans from friends and family or seek out investors for your business.
If you don't have the capital in place, make sure you draw up a detailed business plan that you can present to any of the parties just mentioned. The more prepared and tedious you are with your business plan, the more likely you are going to be able to secure the funding that is needed.
You need enough operating cash on hand to start a profitable trucking business. It is crucial to figure out what you will pay yourself and the minimum profit you need to make to succeed.
You also need to have systems and tools in place to track and record expenses, payments, shipments, and other important data and information.
Determine a specialized form of trucking for your business. You should choose your specialty in relation to the resources you have on hand or can gain before starting your business.
There are different kinds of trucks and trailers to handle different types of loads. Most trucking businesses have medium-sized trucks, typically larger than pickup trucks.
Trucks come in different classes:
Class 3 medium-duty trucks have a weight limit of 10,001-14,000 pounds. Mainly contractors and last-mile delivery drivers use this class, but you can also use them for lighter trucking loads.
Class 4 medium-duty trucks have a weight limit of 14,001-16,000 pounds. These are heavier trucks, but they're still classified as non-commercial.
Class 5 medium-duty trucks have a weight limit of 16,001-19,500 pounds. Many of the lightest commercial trucks are categorized as Class 5.
There are also some jobs that require the use of trailers. Bumper pull trailers are generally shorter and less expensive. They're easy to use, which is why they're popular with civilian drivers. But they can't haul as much, typically less than 10,000 pounds.
Gooseneck trailers have a tighter turn radius than bumper pull trailers. They can also usually carry larger, heavier loads. This can be an advantage when delivering to construction sites or other remote areas with little space to turn around. Tilt deck trailers tilt at an angle, so it's easier to load heavy cargo.
Lowboy trailers have a low center of gravity, ideal for the heaviest loads. Dovetail trailers work well if you're hauling cars or other equipment with wheels.
The great thing about starting a trucking business is that you can choose to only haul low-weight cargo if you want. You can also choose to specialize in refrigeration hauling; these are utilized in the food, medical, and other perishables industries.
The more specialized you can make your business, the more likely you will be to attract more clients and to have clients refer you to others seeking similar services. You should specialize in something that makes sense to your budget, but don't worry, you can always pivot after you have gained enough profit.
Another step in this area is coming up with a proper name for your company. You'll need a unique name you can register and open a business account with.
Try picking a name that lines up with the type of specialized trucking services you are going to provide. It should be short and sweet so it's easy to remember from a marketing standpoint. In addition, you should also set up an LLC during this step to protect yourself from liability claims.
Get a CDL license and EIN. Getting a CDL license is something you will need, and any drivers that you hire will need it. It is almost always a requirement to start a trucking business.
CDL licenses fall into three different categories:
Trailer gross weight rating restrictions separate Class A and Class B. Class A license allows you to drive tractor-trailers, while a Class B license clears you to drive straight trucks, box trucks, and large passenger buses.
A Class C license allows you to drive smaller vehicles, like passenger vans and certain delivery trucks. Most local truck driving positions require a CDL license.
The next step is to get federal and state tax IDs. Your employer identification number (EIN) is critical to starting and growing your business. It helps with matters like opening a business bank account and paying taxes. Essentially it is like a social security number but for your business. In certain states, you may also have to get a tax ID as well.
You now should apply for the proper licenses and permits for your trucking business. This guarantees that the business stays legally compliant. The licenses and permits you may need for your business varies, depending on what industry your business is in, what state, the specific location of your business, and other factors as well.
Secure a motor vehicle record (MVR). This step is fairly simple in most states, but you should still do the proper planning in the event of delays.
In most states, there is a fee you must pay to get a motor vehicle record. In certain states, you can also accomplish this online and get a digital version. In other states, drivers may need to pick up a physical copy or have it mailed to their home address, or to your business address.
Obtain a Transportation Workers Identification Credential (TWIC). These credentials are critical if you want to have variety in the types of loads you can legally haul with your business.
A TWIC also lets you access secure areas, such as ports and other maritime hauling-related facilities.
Apply for a DOT number. A DOT number or Department of Transportation number is a trucking requirement that can be a little more challenging than other steps.
You have a few different options to complete this step:
You could also lease on another company's authority so they put their numbers on your truck. Essentially they "lease" your vehicle from you. Most companies charge for this service, but it is an easier way to go.
No matter what, though, you need a DOT number to operate your trucking business, so you must obtain one.
Get a DOT physical and medical card for all of your drivers. You may also be required to get your drivers to undergo DOT physicals and get medical cards.
These health examinations performed by the Department of Transportation are meant to evaluate truck driver's physical, mental, and emotional abilities to make sure they are fit to be hauling loads.
The Federal Motor Carrier Safety Administration (FMCSA) requires truckers to complete and pass these tests in order to maintain commercial truck driving licenses. This applies heavily to your hot shots business if you are planning on using vehicles for interstate commerce in certain weight categories or want the legal ability to haul hazardous materials.
Get all the proper insurance. A trucking business means you need a variety of insurance.
Business insurance is necessary to protect your LLC from liabilities and other possible claims. You also obviously need auto insurance for all of your vehicles.
It is highly recommended that you seek the counsel of an experienced insurance agent to determine all the necessary insurance policies you should get for your business.
Purchase or rent your vehicles, equipment, and office space. Depending on how much start-up capital you have, you may be able to purchase all of the necessary vehicles and equipment.
Depending on what kind of trucking you choose for your business to specialize in, this will dictate what types of trucks you should purchase or rent and how many you need to add to your fleet to get your business going and be profitable.
You must also consider renting office space. If you can run your business from home somehow, that's a great way to save on costs; however, you need parking areas for your fleet when they are not engaged in service.
Many trucking business owners start off by leasing many of these things, and as their business becomes more successful, they start to switch to purchasing.
Average costs of starting a trucking business. Now we'll take a look at how much capital you will need in general to start your business.
On average, starting a trucking business in the United States costs between $100,000 to $200,000. This can vary depending on the size and scope of your business. You also might only need $10,000 to $20,000 of your own capital to start it because the rest might be able to be obtained through a small business loan.
Here's a breakdown of the average cost of the requirements of starting a trucking business:
Registering your trucking business is a one-time cost that can be up to around $1600. To legally transport loads within the country, a company has to register all the necessary permits. The registration is first done on a state level.
Getting the Tax ID number for your business is a one-time cost of $79.
Obtaining your MC and DOT number is a one-time cost of $300.
Purchasing trucks for your company is one of the most expensive facets. The price of a new truck starts at an average of $113,000. A new sleeper truck costs around $125,000, and a trailer costs around $50,000.
Specialty trucks are priced even higher. Many choose to start out their trucking business by leasing trucks and then purchasing them once their business has grown and is successful.
You might also want to consider purchasing used trucks. Used trucks are priced much lower than brand-new ones. Especially when the business requires specialty trucks like long combinations or loggers, new trucks can cost a small fortune. The average price of a used class 8 truck in the United States is $43,808.
The one downside of purchasing used trucks is that they will have many years of operation already on them, and this might mean a lot of repair and maintenance costs. A repair done on the road costs two to three times more than repairs done in your business's home location.
Heavy vehicle tax is a cost you have to prepare to deal with annually. This can be anywhere from $100 to $500 per year.
Another annual cost to keep in mind is IRP plate registration and IFTA. This can cost you between $1500 to $2000 per year. IRP license plates are meant for trucks traveling specifically on the interstate. IFTA typically comes with the IRP sticker and is renewed every year as you pay fuel taxes.
One of the most expensive annual costs you are going to have, aside from paying your drivers, is insurance. Insurance services for your trucks and business itself can cost you anywhere from $9,000 to $12,000 per year.
ELD, trailer trackers, and dash cams are good tech to have for a trucking business. All three items together cost around $1000 per year.
Out of these three items, the only requirement is an ELD. An ELD is a piece of tech that captures a driver's driving status to ensure they comply with local, state, and federal regulations. It assists in the automatic tracking of a driver's hours of service and alerts them to any violations. The average cost of ELD is $350 per year.
Hiring drivers is a high cost. The average truck driver in the United States earns a salary of $59,925 per year. What you pay your truckers will also depend on many factors, such as their experience level, the distances they drive, the frequency of trips, what they are hauling, etc.