The trucking business serves by transporting large quantities of materials be it raw material, work in progress, as well as finished products, to and from the processing plants to the distribution outlets. It mainly involves the use of large trucks for which drivers are required to have a CDL (commercial driver’s license) to operate. Their operations are not only limited to one country, sometimes they cross borders to serve neighboring countries and states. This industry plays a great role in boosting the economy of a country.
Do It the Right Way
The trucking career requires a lot of attention for it to succeed. It offers huge profits if operated efficiently. Below is a list of a few key points that may help you grow a successful trucking career.
1. Focus on the Right Market
Truck owners should take a look into the market needs before venturing in the trucking career. They should identify potential gaps in the market which need to be filled or existing services which need improvements. The market channel you choose will determine the type of truck you buy, the lanes that you will service as well as the freight charges. As an investor and a risk taker, try focusing on the market other investors are avoiding due to high risk levels.
2. Charge the Right Freight Rates
To survive in a competitive industry like this you have to charge rates that are competitive compared to what other truck owners or companies are offering. However, you should always have it in your mind that it is an investment that needs returns and therefore the charges should be enough to offer you better profits. Before you officially begin making sales as looking for shipper ensure that you are comfortable with the charges per mile that you are about to charge.
3. Know Your Operating Costs
Just like any other investment, you need to calculate your operating costs which helps you know whether you have made any profits after a sale. You should identify your fixed costs as well as variable costs which gives you the operating costs incurred per service.
4. Fuel Buying Strategy
Given that it is a transport business, fuel is a major expense here. Truck owners and operators incur huge losses all attributed to fuel. Taxes charged on fuel used increase the expense incurred during transportation. Ensure that you buy fuel from trusted sources and those with the least base price despite the pump price they charge.
5. Avoid the Use of Brokers
Brokers usually get a portion of the price of the load usually 10% or 20%. This many negatively affect your returns. Therefore, try as much as possible to maintain a list of direct clients and offer them competitive prices compared to what the brokers offer. Working directly with the clients guarantee you good returns.
6. Maintain Proper Business Records
You may do this on your own or employ an expert to help with the accounting processes. Maintaining good accounting records helps you track the growth and success of your investment. Try avoiding delayed payments from the clients especially in the first stages of the business. Credit operations as well as delayed payments may leave you with no money to run your operations. Focus on quicker payments to help restock your business as well as sustain your employees.
The trucking career, being a transport centered investment and just like any other investment, is expected to offer returns to the owners. Keeping proper business records, avoiding the use of brokers, getting the correct fuel purchasing strategy, and having the right market are among the few key steps that will help you grow a successful trucking career.
We really hope these steps help you become successful. I’m sure there are some we missed so please drop us a line and tell us about it.