How to start a trucking company from home

You can initially start a trucking company from home if you don’t have an office. This would help you to keep costs down, and you can hire accounting and other services virtually over the internet. This is how you overcome the high costs of operations that are inherent in the trucking sector by starting a trucking company from home. Finding ways to keep the you successful is vital because the annual running costs of a rig might approach $100,000, and the price of a full tank of diesel fuel can range anywhere from $700 to $1000 (which will only last you a 2-3 days per truck if you are doing Over The Road OTR driving. Even if a trucking company is run from home and does not have the overhead costs associated with an office, you are still need to comply with all of the state’s registration and licensing standards. So, in this article, we talk about the mechanics of how to start a trucking company from home.

Register your Business

It is required that you register your company with the secretary of state before you begin operations. This may be simply done using the web portal of the secretary of state, where you will enter information about the owners of the business, establish a unique business name, and pay the necessary costs. You can use your home address for filling your LLC or INC. The costs differ from one state to the next. For instance, the filing fees in Texas are $300, but the expenses in Georgia are only $100. Most reputable truck Dealerships wont even sell you a truck if you don’t have a registered company. After you have registered your company, you can visit the website of the Internal Revenue Service (IRS) to complete the online application for a free tax identification number (EIN). You will need these documents to open up your company bank account as well.

Get a Semi Truck

Operations costs don’t include start up purchase costs. A brand-new semi-truck, including the tractor and trailer, might set you back $190,000 to $270,000. My advice is to buy a quality used semi truck for $60-90K. You don’t have to get the trailer right away, or you can rent one for $1,000 -$1,700  per month depending on the type of trailer (refer, dry van, low boy, car hauler, etc). Having a trailer helps you to get the better paying loads, but it is not essential….you can do “Drop” and “Hook” and still make your money. I recommend you start out with basic dry van hauling, because car hauling and other specialized hauling (flat bed, large machinery and oversized loads) requires more experience because of the technical aspects. Your insurance is higher too because of the increased risk and liability. Knowing how to start a truck company from home is the easy part (the paperwork), the challenging part is managing your start up budget and beginning cashflow.

Most new entrants start with just the semi tractor and hook trailer loads and drop them off.  There is a wide range of financing options, from no money down to a significant investment. Learn about your choices and pick the one that works best for you. You can expect to put down $20,000-30,000 down on  quality semi truck, but it will run for 1,000,000 miles and more if properly maintained. If you can afford a warranty then get that too. A warranty is something most reputable Dealerships will offer you for a truck in good condition. I recommend you get one that gives you a loaner truck if your truck is sidelined for more than 24-48 hours for a repair. It should cover drive train repair or replacement as well (engine/transmission).

Insurance and Bonding

If you plan to lease on to another carrier, then you will only need to buy Bobtail (physical asset) insurance which covers your tractor but not the cargo being hauled. If you plan to open your own truck authority, you will need the full insurance coverage of Bobtail and Cargo Liability.

You are required to have both insurance and a bond in order to receive a license from the United States Department of Transportation. The Department of Transportation requires a general liability and cargo insurance policy with a minimum of $750,000 and up to $5,000,000 in coverage. In addition to that, you need to secure a surety bond in the amount of $75,000. Get in touch with an insurance professional that specializes in commercial lines so that you may receive the appropriate policies to safeguard your company, your rig, and your cargo. Again this level of insurance is only necessary if you are starting up a truck authority.

US DOT Registration

The Department of Transportation has a division called the Federal Motor Carrier Safety Administration (FMSCA) that is in charge of monitoring whether or not transportation companies are in compliance with applicable regulations. Visit the website of the FMCSA in order to receive your U.S. DOT number initially. This number serves as an identifier, but it is not the license. If you transport federally regulated cargo, you are obliged to have an Operating Authority Number, also known as an MC Number (motor carrier); therefore, you should review the requirements for obtaining this number. If you require one, submit your application through the appropriate online portal located on the FMCSA website.

Start the application procedure with the FMCSA and supply the needed information about drivers, as well as insurance and bonds. Transportation businesses are required to conduct drug testing and review drivers’ driving history. You are required to participate in the New Entrant Safety Assurance Program, which is a probationary term of 18 months, and adhere to random inspections and audits throughout this period. Additionally, if you are driving, you must maintain a clean driving record and pass all mandated drug screens. If you are hiring other drivers to, just remember that their actions and movements on the road, will factor into your company’s overall safety score. You will be issued a permanent license if you have successfully completed the New Entrant Safety Assurance Program.

Build up your client base and your relationships

How to start a trucking company from home is not terribly difficult, if you have basic business skills and a good head on your shoulders. If you are personable, you can even create a network of contacts (Direct Shippers and Brokers) within the trucking industry to identify loads and projects that other carriers are unable to complete due to schedule constraints or other logistical challenges. In the beginning you may depend on Brokers to bring you most of your loads, but the most money is made obviously if you have your own contacts (Direct Shippers). If you are leased onto another Carrier, you would probably have to just accept the loads that are already brokered for you. Include huge wholesalers and shipyards on your list of potential customers for your services. Besides hiring safe drivers, your next biggest issue is on time pick-up and delivery. Most Brokers and Direct shippers will penalize you for late drop offs. So, pay attention to delivering the goods on time and making sure it is in good condition. This is the most important factor in creating a customer base that is loyal to your business. This is what its like to start a trucking company from home. If you want a professional team to do the set up and ongoing management of your trucking company, consider hiring my company.