Ask anyone who has achieved success in the trucking industry what their journey has been like and they will no doubt look at you with the kind of wry smile that says they’ve made a mint. They wouldn’t be lying either. Get it right and owning your own trucking company be mega-profitable. But don’t be lulled into a false sense of security because it ain’t easy. Most truckers trying to make it as entrepreneurs end up failing.
Sure, they were great truckers and they knew how to get from A to B on time, choosing the best route and with an admirable mile per gallon usage, but that won’t cut the metaphorical mustard here. Being good at business is the secret. To help you on this front, point you in the right direction, and make that transition between a truck driver and business owner, we have pulled together a few sage words of advice.
1. Look past the obvious
Anyone can drive a truck. It’s rough and perfecting it takes time, but anyone can do it. The same can’t be said for running a truck company and that’s because it involves much more than just picking up and delivering; it is marketing and tracking, managing inventories, training drivers, motivating and organisation. It is multitasking of the highest order. Yes, your humble origins as a paper delivery person with a paper route will stand you in good stead, but it will only get you so far. Understanding this is the first step. Doing something about it is the second. Whether that means reading books, attending seminars, signing up to podcasts, doing an online course or going to school – make sure you learn this side of the game.
2. Equipment is not born equal
What equipment you invest in will always be one of the first decisions you have to make, and the most expensive. Trucks, vans, pickups, water tankers, loading bays, pressure washers, cranes and whatever else. It all comes into play. But it isn’t how much money you have that makes you rich, it is how you spend it, which is why you want to carefully consider your option. With that in mind, you should consider looking at https://truckdealersaustralia.com.au/ because truck auctions are becoming increasingly popular. Why? Because you can pick up real bargains here. Of course, buying used, leasing or investing in shiny new equipment are all good options too. It just depends on how much cash you have to play with and how much capital you are willing to have tied up in your equipment.
3. The secret to success
You may think there is no secret, but there is: make your business completely service-driven. Make sure your customers are on your mind when you make each and every decision. Think of them every minute of every hour of every day. Think about your business from their perspective and what would make their lives easier or their businesses even more successful. Think about what you can do for them. And make sure you think about who is serving them – your drivers. The more you can look after your drivers, reward them and encourage them, the more that will rub off on your customers. See, everything comes back to them.
4. Finding your first customers
The trusty load board is where most new truck operators go to get business, and the best of the lot can be found at http://www.rtsfinancial.com/. These are great to snap up work quickly, but it is not a strategy you should be using long-term if success is your desired endgame. The reason for this is the competition. It is intense and that means offering rock bottom prices is the only way to win customers. Sure, the bigger companies may be able to balance the books on this front but you will start to feel the pinch pretty quickly. So, by all means, start out by prowling the load boards, but make sure you have someone making sales calls too, this way you can start building your own client base. Sure, this requires hard work, effort and a large pinch of persistence, but it is the smart way to go if you want to make the bigger bucks. Those who use load boards can expect to make around $11,000 a month per truck. Compare that with secured contracts of your own and you are looking at $20,000 a month per truck. It’s quite a difference.
5. Benefit from a back office
How well you manage your back office is going to have a direct effect on how well you succeed on the front end; how well you succeed as a business. Obviously, how much of your resource you dedicate to this part of your business depends on how big or small you. A small fleet will require more resource in the back than a single truck-operator. One thing is for sure, though, your back office should grow with your business. What you want is people that can manage your orders, your processes, your software and tools, your planning and procedures, training and whatever else you can think of. An efficient back office is what powers an efficient business. Think of them as the Micro to your Punisher (that’s a little Marvel reference right there).
6. Stay in the black at all costs
Recessions, teething problems, unforeseen expenses, taxes, shippers not offering quick-payment terms – there is a whole host of reasons why most trucking companies experience cash flow problems at some stage (usually at the worst possible moment). Getting used to net-60 day payments terms while battling with the more immediate fuel, repair and maintenance costs is something that requires a lot of attention. Don’t plan it properly and your cash flow problems can see your shipments get paused. It could be you keep an emergency fund, a budget tracker or a financing option like freight factoring. Whatever it is, don’t let your business falter because of cash flow issues. Plan for the tough times and you’ll ride them out with much more ease.
** This is a collaborative post