Starting a trucking business is not like opening a store or restaurant. Before your trucking business can take off, you must meet specific requirements set by the government. It’s not just about figuring out how to attract customers and retain employees. So here is everything you need to accomplish before opening your trucking business.
Acquire the appropriate license
Driving a large vehicle is not like driving a pickup truck. Due to their size, you need to be able to maneuver it properly. As with any vehicle, you will need to acquire the appropriate license before you can legally drive your trucks. You and other drivers employed by your company must hold a commercial driver’s license. To acquire this type of license, you must be at least 18 years old. However, to drive the trucks yourself, you must be at least 21 years old.
Obtaining this specific type of license is different from a regular driver’s license. The issuer will conduct a thorough background check. You must also complete CDL training, pass the written exam and then pass your driver’s license. Standards for how the test is performed vary by state, so be sure to check your state’s guidelines for details.
Propose a business structure
Trucking companies can have various business structures. Generally, you have four business structures to choose from: limited liability company, general partnership, sole proprietorship, and joint stock company. You’ll need to think about the best structure so you can officially register your business with the state.
A sole proprietorship is when you are in complete control of the business and responsible for everything that happens. If you choose this structure, be prepared to do everything you can to mitigate liability and reduce the cost of taxes. Since we’re talking about a trucking company, one way to reduce liability is to integrate ELDs into every truck.
An ELD, or electronic logging device, is a device installed directly into the vehicle’s OBD. You will be able to see everything that’s happening inside and outside the vehicle. So, if an accident ever occurs or if your employee does not do their job correctly, the DCE will give you all the necessary information. Be sure to check out a detailed guide to DCEs to better understand how they work.
If you choose to make your business a corporation, you will need to choose from one of its subcategories: S-corp, C-corp, B-corp, non-profit corporation, and closely held corporation. A partnership is when you and someone else co-own the business. A limited liability company is often considered the ideal choice for beginning business owners because it combines the best of a corporation and a partnership. You won’t have to worry about liability in terms of liability, and your taxes might be lower as well. As with any business venture, it is also a good idea to seek legal counsel and speak to someone who is familiar with owning and operating a trucking business.