So this really goes back to your long term plan. Small trucking companies want the office to run smoothly and efficiently while at the same time it must remain cost effective. Unless you are an owner-operator (OOPs), you will need support staff. Maintain a proper business owner type of mentality and your staff will grow with you.
Find The Best Cash Flow Solutions For Small Trucking Companies
If purchasing trucks and equipment are considered the most expensive aspects of small trucking companies, than the most stressful is maintaining a positive cash flow. Unfortunately even the largest trucking companies can face cash flow problems, but they have the resources and departments to help absorb of it.
This can be much harder for small trucking companies. One of the biggest headaches is the turnaround time for invoice payments. In the trucking industry it isn’t a simple payment when services are rendered. Usually invoices are paid on 45 or 60 day cycles. What this means is that you might have to wait almost two months to get paid!
Can small trucking companies afford to wait that long? If they have other contracts and the invoices are offset so that not everyone is due at the same time, they can absorb the long payment cycles. The problem is the other bills; they don’t wait! Staff needs to get paid, truck drivers’ salaries, trucks need fuel, and even maintenance issues can pop up. If at all possible, managers should try to maintain a cushion to keep the small trucking companies afloat during these lean times.
Resources For Small Trucking Companies
There are numerous resources available to all small trucking companies. Often finding them can be hard, or at least it once was. But now the internet holds the key to finding the resources sought after by small trucking companies.
Here are a couple of resources small trucking companies need to refer to:
- The National Association of Small Trucking Companies (NASTC)
- Small Business Administration (SBA)
- Department of Transportation (DOT)
- Department of Labor (DOL)
The National Association of Trucking Companies (NASTC) was founded in 1989 and serves as an advocate for, consultant to, and even a source buying as a collective power, for their members. The NASTC maintains a strong lobbying effort for small trucking companies. They are committed to safety, compliance, technological and other advancements to benefit the industry.
The U.S. Small Business Administration (SBA) was formed in 1953 to assist and protect small businesses and their needs. Basically the SBA aids small businesses (to include small trucking companies) in the start-up, build-up and growth of their businesses.
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The Department of Transportation (DOT) was formed in 1966. Their primary purpose is to oversee the nation’s highway systems. They also regulate the transportation of both private and commercial freight. All small trucking companies must ensure they are in compliance with the DOT.
The Department of Labor (DOL) can trace its roots back to 1884 but was officially established in 1903. The DOL is primarily responsible for all things employee/worker related. This includes: wages and hours standards, economics statistics, and occupational safety.
Small trucking companies have so many aspects to consider when starting up. It often can be overwhelming, at first. But once you have gone through all the legal issues, and studied the regulatory requirements you’ll see there is a ton of potential.
One of the things that kill the profit in most small trucking companies is the lack of proper preparations and planning. So before you decide to pursue this make sure you have conducted the proper research and are well aware of what is expected.
It is highly recommended that you have enough capital (money) available to hold you over for at least 6 months to a year. Hopefully your business will take off and you’ll starting making a profit sooner, but this is the cushion that most experts will recommend.
Small trucking companies are the backbone of the trucking industry. Sure it is the large ones that everyone thinks about, but they only represent a portion of the commercial freight carriers running across the American highways on a daily basis.
Do you know any small trucking companies? Have you built one up yourself? Do you have any advice or questions? Share them with us.