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The good side with choosing this option is that will give you most return in profit. At least that’s what the trucking company owners with company truck drivers are saying!
Moreover, it will give you total control over your business and the employees.
But, like and with everything else in life, there is downside to it. The only con that I can think of right now for the trucking company owners is the fact that this option requires a lot more start-up capital and other operating costs.
The owner operators are the drivers who drive their own trucks usually. Even thought they privately own and run their businesses, they should still take in consideration all the additional cost and expenses that come with this option.
If trucking company owners consider this second option as a way to run their business, they should know that this type of operation gives the drivers more choice and freedom in how they want their businesses to operate.
With this option the trucking company owners can run their business using sub-contractors as drivers.
It’s something like with the owner operators. So, you as the business owner will run the business and receive the contracts, but your drivers are not actually employed by your company. With other words you are employing outside drivers, to work on contracts for specific transport jobs.
Some trucking company owners prefer exactly this option for running the business end, and get people to drive their trucks. That is because they can start with less capital and fewer business requirements. This way they cut down on start-up costs, insurance costs, and the required equipment.
The bad side is that this option will give you less control over your trucks and drivers, and drivers can sometimes cut deeply into your profits too!
Be Proactive in Finding Clients
As I said, the trucking business is highly competitive and demanding. It operates by constantly bidding on and fulfilling transportation accounts and contracts.
But, receiving contracts is difficult, especially if you are a start-up business, you most likely will not have the experience and the reputation required to receive large accounts.
If you are one of the new trucking company owners, the best way for you to build up a client base, will be to start small by utilizing local contracts and small business trade shows.
Later on, you will get to the “big fish” and grow your business with lending larger accounts and contracts.
But until then, work on eliminating or at least minimizing your competition!
How to do that?
Well, simple. Just work on becoming the best transportation company out there! The route to success might be painful, but you will get there! It’s totally worth it!
In order to keep up with, and be one step ahead of your competitors, you have to build strong customer database and be proactive in finding clients.
Many trucking businesses start small, utilizing local contracts and small business trade shows, to build up a client base. As you successfully complete these jobs, you’ll be able to grow your business and contract larger jobs.
That is why for, trucking company owners are in a constant search for clients.
The three most common ways for trucking company owners to get new clients are:
- By going through online bidding sites to check for available contracts and accounts;
- Going through classified ads and other portals to find clients and contracts;
- By being recommended from their existing clients to other trucking company.
This practice is especially important for new trucking company owners who tend to not only have more limited means, but also don’t generally register a profit from a new customer until later on.
Determine What Equipment You Can Afford
The type of equipment you choose, the type of operation you have, and the way you operate will be a determining factor in your profitability. So, determining what equipment you will need and even more important what equipment you can afford, it’s of a big importance for your success.
I know you probably like the sleek looks and the classic styling of a long-nosed Peterbilt, but the question is: Can you afford it?
Trucking company owners should choose the right equipment in order to start and run successfully their business.
Most importantly, they should identify how much start-up capitals they will have, and base on that, determine what equipment is reasonable and they can afford.
The money you have to start a trucking business, will determine also the number of trucks and equipment purchased.
When choosing what commercial vehicles are appropriate, consider the type of freight you plan to haul.
Different types of cargo require different equipment. Some goods also need particular equipment to maintain their freshness and condition.
Like example, you cannot start a food transport business without having reefers, right? Or you might need some dump trucks or flatbed trailers rentals , that you prefer to rent on the beginning and then later purchase?
Those are all questions that you will need to answer in your head, before you even consider further involvement in the industry and spending your hard earned dollars.
One thing is sure thought. If you choose to operate a private fleet with your own drivers, you will definitely need to purchase some commercial vehicles.
One other thing that trucking company owners should consider is whether or not they should consider equipment leasing.
There are many pros and cons with both of them so I guess weighing the good and bed sites will provide insight into choosing to purchase or lease equipment for your business.