Starting a trucking business can be overwhelming at first. There’s a lot of work to do before you can start your operations. The startup phase will also give you a hard time budgeting your working capital. That’s because commercial trucks are often expensive.
Luckily, there are commercial truck financing companies for startup businesses. They can help you establish your trucking company. However, you can’t just depend on the commercial truck financing companies for startup businesses. They may put in money if you’re approved, and they may even give you some advice. But you’re still the person who has to do most of the work. You should take the right steps to ensure your success. That’s why today, we’ll talk about starting a trucking company with commercial truck financing companies for startup businesses.
Begin Operations with Commercial Truck Financing Companies for Startup Businesses
Every startup trucking company requires commercial truck financing at some point. In your trucking business, you’ll likely need it when acquiring your trucks. Using a big portion of your working capital to acquire trucks is a risky move. This can drain your cash reserves and cause financial instability.
That’s why getting funds from commercial truck financing companies for startup businesses can benefit you. Owner-operators usually earn more than company drivers. So the hardships during the startup phase will pay off in the long run. Having said that, let’s move on to how you should start your trucking business.
Register Your Trucking Company
Before you get funds from commercial truck financing companies for startup businesses, you need to register your trucking company first. Starting a trucking company will require a lot of forms and licensing.
To give you an idea, a new trucking company must apply for the following:
- FMCSA Number & Registration. Before anything else, make sure that you are registered with the Federal Motor Carrier Safety Administration and the Department of Transportation.
- IRS Form 2290. Also known as the “Heavy Use Tax Form”. All trucking company owners need to fill this out, according to IRS policies.
- IRP Tag and IFTA Decal. The policy for obtaining International Registration Plan Tags and International Fuel Tax Agreement Decals depends on your state. Check laws in your state regarding this matter.
- CDL License. You and your drivers are required to get a Commercial Driver’s License from whichever state you are based in.
- LLC Status. Before you start your operations, you need to register your trucking company as a Limited Liability Company.
- BOC-3 Form. This is needed if you’re planning to do interstate business. This form proves that you have a legal conduit within each state that you operate.
Keep in mind that the process for insurance depends on your state or location. You can consult the FMCSA to help you decide which insurance plan is best for your company. After that, you can look for commercial truck financing companies for startup businesses. However, make sure that you have all the requirements, such as your business plan.
Create a Business Plan
It’s important to have a business plan if you want to get funds from commercial truck financing companies for startup businesses. Commercial truck financing companies often check a business plan to see if their client can repay the borrowed money. Apart from that, having a business plan can help in assuring your success when you start operating. The business plan can prevent you from making choices that may hinder the growth of your trucking company.
But to make that happen, your business plan must address different aspects of your business. It should cover everything from your target market to projected earnings for six to twelve months at least. That’s why a good business plan can help you manage your capital. You can easily allocate your budget if you know details about different aspects of your company, especially it's expenses for the first six to twelve months.
In addition to that, the business plan will help you create the best operation and services. Just be sure to address the following aspects of your trucking company in your business plan.
Your Target Market or Niche
Determine your target market. Do this before you get funds from commercial truck financing companies for startup businesses. Knowing your target market helps you plan everything about your business. That’s because it tells you what sort of clients you’ll have, what needs you should see to, etc.
This helps you decide different things about your business. For example, it can help you determine the trucks and trailers you need to buy and the rates you charge. Also, your target market gives you an idea which freight lanes you can service.
The Cost of Your Services
You need to plan how much you will charge your customers. Address this in your business plan. This can help prevent you from charging too much. Charging too much can drive potential customers away. But if you charge less than the average, you could lose out on potential profits. That’s obviously not an outcome you want either!
Set your rates before you start promoting your trucking company. You can check other trucking companies in your area to see the right rate for your services. Earning the right amount of money will also help you repay the funds from commercial truck financing companies for startup businesses.
Outline the Cost of Your Operations
You need to outline the cost of your operations. This will give you an idea of how you’re going to spend your capital. You must allot the right amount of money to each aspect of your business. Outlining the cost of your operations helps with that. It can reveal discrepancies or inefficiencies in operating expenses.
That will help you wisely use the funds you get from commercial truck financing companies for startup businesses.
Acquire Trucks for Your Operation
Plan how you’re going to obtain commercial trucks for your operations. Do this before you look for commercial truck financing companies for startup businesses.
You need to decide how you’re going to buy trucks for your operations. The cost of buying a truck ranges from $15,000 to $300,000. Note that you’re going to have a hard time accommodating clients if you only have 1 truck. So it’s best to acquire two or more trucks for your operations.
Of course, buying brand new commercial trucks involves a lot of money.
With that said, you should consider buying used trucks. This option is cheaper, even if you might spend a fair amount of money on maintenance. To avoid operating with insufficient capital, consider getting additional funds from financing companies for equipment acquisition.
There are a lot of lenders out there but only few of them are willing to give funds to a startup trucking business. Be sure to get funds from commercial truck financing companies for startup businesses. That way, you’ll get the funds right when you need them.
Look for the Best Commercial Truck Financing Companies for Startup Businesses
You can search the Internet to find commercial truck financing companies for startup businesses. Each of these commercial truck financing companies for startup businesses has different truck financing programs.
Be sure to choose the one that fits the needs of your business. Trust Capital is one of the best commercial truck financing companies for startup businesses. Many trucking business owners choose them for a lot of reasons.
One of those reasons is that they have an easy application process. Trust Capital uses a simplified online application process.
Their single-page application allows you to have $150,000. They have no down payment requirements. That means you can get the funds as soon as possible. You can even get the funds in a couple days after your financing application approval. Not all commercial truck financing companies for startup businesses offer that.
That’s one of the reasons why they’re one of the best commercial truck financing companies for startup businesses.
Final Thoughts on Commercial Truck Financing Companies for Startup Businesses
In this blog post, we talked about commercial truck financing companies for startup businesses.
Starting a trucking business requires a lot of work. Before you can start your operations, you need to register your business first. After that, you need to create a business plan. Your business plan should address different aspects of your business. You also need to determine how you’re going to acquire commercial trucks and trailers for your operations. Since most trucks and trailers are costly, you should consider getting additional funds from truck financing companies.
There are a lot of lenders out there. However, not all of them are willing to lend to a startup trucking business. With that said, it’s best to look for commercial truck financing companies for startup businesses like Trust Capital.
You can Call Trust Capital at (866) 458-4777 to know more about commercial truck financing.