The trucking industry is proving to be one of the most profitable ones in recent times, and estimates suggest that the industry will employ 1.1 million drivers by 2029 to support its extensive growth and reach. Notably, a number of new companies have emerged in the trucking scene, and many more will continue to do so to capitalize and capture the high potential market share. If you run, own or manage a trucking company, listed below are seven things you need to do to ensure its success:
- You need to complete all documentation
Safety certificates, boc 3 filing, and background checks are some of the regulations that trucking companies have to comply with. The trucking industry is home to a lot of regulations and government speculations on a regular basis and hence you need to make sure that your company stays up-to-date and completes all such required regulations in time.
- You need to expand your customer base
Many trucking companies work blood and sweat to acquire a chosen few big clients, and then run their operations off of them. While this may seem like a very profitable way of doing things, in the long run, it is actually potentially dangerous as even if one of your clients stops doing business with you, you would face a very big gap in your sales. Instead, trucking companies should focus on everyday customers and shipping clients that are likely to give them business in small but repeat members. Doing this is important to ensuring cash flow and growth.
- You need to thoroughly calculate your costs
In order to remain profitable in the trucking industry – or any industry for that matter! – you should be aware of all your costs up till the nearest decimal point. You need to calculate your insurance costs, rent costs, variable costs, bad debts, etc. and forecast your sales and expenses for the coming quarter to help you prepare for it.
- You need to make smart fuel purchases
Fuel costs often take up the biggest proportion of all costs for trucking companies and hence you need to make sure you purchase fuel in a cost efficient manner. Rather than purchasing fuel like a normal driver, trucking companies need to go down an alternative route. Since trucking companies are taxed on their fuel from the International Tax Fund, they should purchase fuel on the basis of the cheapest base price of fuel.
- You need to create load boards and schedules that are flexible
In your budding years as a trucking company you need to be flexible in how you design your work and truck schedules in order to garner more and more clients. You need to make sure you build relationships with your clients and in order to do that you may need to cater to unusually timed requests and comply accordingly. Hence, you will need to design load boards and schedules in accordance with what is in demand and what is allowed.
- You need to have adequate back office support
In order to make sure that your drivers perform well on the road, you need to give them the support they need from your back office and administrative processes. Your administrative and office procedures need to be run by one or multiple certified professionals that have prior experience in this field. You need to have appropriate software to run all systems and allow effective communication within and outside the field. You also need to have other supporting items such as a telephone, computer, printer and regular stationery.
- You need to avoid cash flow problems
Trucking businesses are highly cash flow intensive – you need to pay your fuel bills, insurance costs, make truck payments and what not. Businesses in the trucking industry usually have a payment process of 15-30 days with their clients and this process can also be prolonged for up to 45 days at a time. This creates a cash flow problem for your business. You need to ensure that in your trucking operations, you create a system in which you either get paid sooner or are able to delay payments until you get paid. However, this process needs to be established amicably otherwise you could risk letting down clients.
