September 17, 2021
If you love the open road and drive for a living, it’s only natural to want to open your own business. It’s also normal to wonder how you could grow your fleet, which would ultimately expand your business and profit. But there are risks associated with starting a business. All the pieces need to fall into place prior to expanding your fleet. Here’s a rundown of everything you need to consider prior to opening shop.
Your finances are the first stepping stone to opening a business. When it comes to funding your business, there are several ways to go about it. You can apply for a bank loan or lease new or used equipment. Both options can get your business off the ground, however, they also have their own set of pros and cons. Bank loans may cover all of your startup costs, but the interest rates might be too high. When it comes to leasing, you can write this off on your taxes, however, it might take too long to own everything outright.
In addition to the initial startup costs, you also need to think about cashflow. Depending on the client, it could be 90 days before your client pays their invoice. That means you need to have enough money to keep your business going in the interim. Unless you have substantial savings in the bank, you might want to consider selling your invoices to a factoring company who will pay you a percentage of the total freight until your client pays. A factoring company can also run credit checks on potential clients prior to entering into a contract with them. The downside is that you will have to pay all handling costs.
Owning your fleet also means taking care of your drivers. You will need to have the appropriate insurance in place, like personal injury and liability. You should also think about their safety when on the road. Having dash cams for your fleet provide you and your truck drivers an extra layer of security. Installing these types of cams can reduce the likelihood of collisions, improve overall visibility while driving and reduce your insurance rates. You should also make sure that all drivers have obtained and maintain the appropriate license required by law. They should also carry their own insurance coverage. The last thing you need is to hire a driver who isn’t insured or hold the appropriate license.
On the topic of drivers, you want to make sure that anyone you do hire is reliable. Many drivers hop between companies, so you need someone who is in it for the long haul. As a small business owner, you need to make working for you worthwhile. There are some recent tech tips that you should be aware of because these are directly related to how people are job hunting and where they’ll eventually decide to work. Even if you pay as much as your competition, you can still find ways to sweeten the pot. In addition to offering holiday pay, you can also guarantee weekends at home, which is a huge incentive for a lot of drivers.
