Have you thought of starting a trucking company? The demand for freight shipping capacity has increased throughout Europe, making this a prime time. In the trucking business, you can get going rather quickly, and careful preparation can help you find cargo.
We discuss all facets of beginning a trucking company in this extensive manual, including costs, profitability, and starting with one truck. We outline an eight-step process for starting a successful company, look at several, profitable trucking kinds, and handle the driver issue. As well as talking about load boards and freight forwarders, we highlight sennder, a platform that can help you launch a trucking business.
What is the starting price for a trucking firm in Europe?
Starting a trucking company in Europe depends on a number of variables, including the nation, business model, and types of freight. Costs for equipment, warehouse space, insurance, and permits should all be included in your plan. Don’t forget to account for all expenses in your budget.
Make sure you have enough cash on hand to cover all of your expenses plus some extra for unforeseen needs. Effective money management is crucial. Maintain a cash reserve for expenses and paying personnel. To assist with startup expenditures of haulage companies Birmingham, look into loans and grants. You can start running your trucking company right away with careful planning and budgeting.
Can I establish a trucking company on the cheap?
Without any initial financial flow, a trucking company can begin operations. This can be accomplished by looking at financial alternatives, such as loans for commercial vehicles or other types of funding. When you lack the funds to invest in your business, these finance options might fill the gap. It’s crucial to keep in mind that beginning a trucking business necessitates a sizable initial investment and continuing operating expenses.
Is the trucking industry successful?
Trucks carry more than half of all shipping in Europe, and over 75% of all inland freight. By 2025, the market for road freight in Europe might be worth about 420 billion euros annually, according to Statista.
The number of truck drivers is drastically decreasing despite the rising demand for truck freight shipping. The IRU estimates that by 2026, there may be 60% more open truck driver employment than there already are. Poland, Germany, and the UK have been severely afflicted by the truck driver shortage, which affects all major European nations.
If you’re starting a trucking business, this may be bad news for Europe’s supply chain but wonderful news for everyone else. The demand for dependable road freight capacity is rising throughout Europe. For trucking companies, this is a great chance. Anyone with the ability to purchase a truck, register it, and put it on the road will undoubtedly discover that business is flourishing.
Can I establish a trucking company with just one vehicle?
Small players dominate European road freight in terms of volume. According to a thorough research by the IRU, 51% of trucking companies in Europe have between two and ten vehicles, while around one-third of all European trucking companies own and operate just one vehicle.
So, if you’re starting off with a small amount of money, consider starting with just one or two trucks. Later, you may always expand your fleet, and in the meanwhile, you’ll start picking up useful experience.
Many of the trucking companies that we work with here at Sennder began with just one vehicle. For instance, UAB Rolavita, a self-owned trucking firm and business owner in Lithuania with whom we continue to collaborate, was established by two persons who acquired a single truck in 2013. 11 trucks have been added to UAB Rolavita’s fleet in less than ten years.
Eight stages to launching a successful trucking company
What therefore is required to begin? Here are the essential five steps for starting a trucking business from scratch.
First, draft a business plan.
Every successful business begins with a solid plan. Make sure to give it some serious thought because investing the time to create a solid plan can really pay off in the long run.
You should probably start with the fundamentals, such as coming up with a company name, writing a trucking company business plan, figuring out who your target customers are, and developing a pricing strategy.
Also take into account the following queries:
- What number of trucks do you wish to have at first?
- Which types of clients are you looking for?
- Do you intend to ship domestically or abroad?
- Do you have any special truck preferences or items you like to work with?
- What will distinguish your business from the competition?
Step Two: Select the Appropriate Business Structure
The type of business structure you choose will have an impact on how your company operates, how taxes are paid, and how much money you must set aside for personal property and other debts. Select a deal whose advantages and legal protection are equal. See Comparing Company kinds for further details on a company structure.
Pick a target market in step three.
To lessen competition and boost sales, it’s critical to identify your target market and to specialize in a certain niche.
Choosing a certain market or industry to concentrate on is one efficient approach to accomplish this. For instance, you might specialize in moving products for a specific sector of the economy, like agricultural or construction. With this strategy, you can gain knowledge and experience particular to your business, enabling you to provide specialized services that are suited to the individual requirements of your clients.
Another tactic is to decide on a specific area of the world to operate in. By concentrating on a certain area, you may build solid connections with neighborhood companies and establish yourself as a dependable and reputable transportation company.
In the end, choosing a target market and carving out a specific niche can help you stand out in the fiercely competitive transportation sector and improve your chances of success. By offering specialized services and establishing trusting relationships with your clients, you may build a successful and long-lasting business.
Step 4: Obtain a business license.
You must now take the required actions to formally register your trucking company and to obtain crucial papers like tax IDs, business bank accounts, and insurance policies.
It’s crucial to understand local criteria because the process can vary between European nations. In general, you’ll need the following to launch your trucking company in Europe:
Certificate of incorporation: Register your firm in accordance with local legislation so that you can get a certificate of incorporation attesting to the fact that your company is a legitimate legal entity.
Obtain bank reference letters as part of the procedure for opening a business bank account. These letters may be necessary for specific financial transactions and business operations.
Passport copies: As part of the business registration procedure, provide passport copies for all company directors, shareholders, and other important personnel.
Send in the resumes and headshots of the company’s directors and other important employees to prove their expertise in the trucking sector.
Give a thorough description of your trucking company’s operations, services, target markets, and any specialty areas (such as the transportation of hazardous products) in this section.
Obtain the essential business licenses and permits for your trucking company, including transport operator licenses, commercial driver’s licenses for your drivers, and any other licences needed for particular types of goods.
By taking these actions, you can make sure that your trucking company conforms with the law and is set up to succeed in the European market.
Secure trucks and essential equipment in step five.
Now that your paperwork is in order, you can start constructing your fleet. In general, adding additional trucks can increase revenue, but big cars are expensive. It might be a good idea to start modest if you’re new to the industry.
Put some time and research into the best manner for you to obtain your initial fleet because reliable equipment can mean the difference between success and failure in the trucking industry.
Consider your budget as a starting point and research your possibilities for purchasing as opposed to leasing trucks. Additionally, think about the kind of truck you want. There are many various truck and trailer types available, ranging from modest options like vans and 7.5-ton trucks to larger ones like mega-trailers and road trains.
Make sure you select a truck that is appropriate for the cargo you plan to transport. For instance, refrigerated trucks are important for perishable items but are not necessary at all if you are not shipping groceries.
A tautliner is a practical choice for transporting substantial amounts of dry goods. A vehicle with a curtain-sided trailer is referred to as a tautliner in general. You can achieve quicker loading and unloading times by opening the curtains so that forklifts can easily load and unload material from the sides. Then, the curtains are drawn and pulled tightly with winches to prepare the cargo for transportation.
Run a cost-benefit analysis on a few various trucks you are considering if you’re not sure which one to buy. Do your study and make an effort to account for gasoline and maintenance costs. Older, used trucks are less expensive initially, but repair expenses mount quickly, and every downtime a truck has in a garage results in lost revenue. More loads can be delivered by newer trucks before they require major maintenance.
Finally, you might want to think about the fuel type you wish to utilize. Biodiesel or HVO fuel can be used in normal diesel engines as well. Utilizing alternative fuels to cut carbon emissions could make your company stand out. Big shippers are looking to switch to greener supply chains more and more, so delivering trucks with fewer emissions might just help you land a few more contracts.
Step 6: Form a group
If you plan to start with just one or two trucks and you want to handle all of the labor associated with owning, running, and driving your vehicle(s), you can skip this step for the time being. But when your company expands, you’ll probably want to hire at least a small crew in order to manage your operations more effectively.
Owner operators who intend to drive their own trucks must obtain a commercial driver’s license that is appropriate for the class of vehicles they own. Make sure that any drivers you intend to recruit have the necessary driving license before you hire them.
Additionally, you could want to develop an onboarding procedure that lets you to validate the employment eligibility and experience of divers. Additionally, you want to think about conducting background checks on potential hires. Some trucking companies also employ teams to handle their administrative and financial needs in addition to drivers. Sales and marketing teams may be present in lager companies.
Establish a fleet management procedure in step seven.
To improve vehicle performance and save operating costs, a thorough fleet management procedure must be established. All parts of purchasing, maintaining, tracking, and disposing of vehicles should be carefully planned, coordinated, and carried out during this process. Fleet managers may monitor vehicle use, fuel use, and scheduled maintenance while guaranteeing regulatory compliance by putting in place a centralized system. Furthermore, using telematics and cutting-edge software solutions provides real-time data analysis and better decision-making, leading to increased productivity, cost savings, and a more sustainable fleet.
Step 8: Locate your target market
You have everything you need to launch a profitable trucking business in the form of a business plan, legal paperwork, vehicles, and employees. Finding consumers is the last step in turning a profit.
Customers of trucking companies are “shippers” who need to move freight. Many of these shippers advertise work online on load boards or marketplaces. Following that, trucking companies put up bids for cargoes that they can handle.
Shippers choose doing business with trucking firms they can trust. Consider each first load as an opportunity to establish your credibility. Make every effort to finish your pick-ups and deliveries on schedule, and you’ll have a lot better chance of earning repeat business from your clients. For instance, obtaining long-term contracts will help to ensure consistent and ongoing business throughout time. However, hauling sporadic spot cargoes could result in higher load profit margins.
What different transportation enterprises are there?
There are many different kinds of trucking companies, depending on the services they offer, the goods they transport, and the regions in which they operate. Here are a few typical trucking business types:
- Local trucking: These companies move goods over relatively short distances within a particular area or city.
- great-haul trucking, also referred to as over-the-road (OTR) trucking, is the practice of moving freight great distances, frequently over states or international borders.
- Less-than-truckload (LTL): LTL carriers move smaller goods coming from various clients that don’t need a full truck. Smaller cargoes are combined by these carriers into a single truckload.
- Full truckload (FTL) carriers deal with larger goods that take up the whole truck. These shipments are often made by a single customer and are sent right away.
- Transporting particular sorts of cargo, such as hazardous items, refrigerated commodities, or enormous loads, is the emphasis of specialized trucking.
- Construction equipment and other huge, bulky objects that cannot fit in a typical enclosed trailer are transported by flatbed trucks.
- Transporting containers to and from ports, train yards, and distribution hubs is the company’s primary focus.
- These companies specialize in moving automobiles, including cars, trucks, and motorcycles, and they frequently use specialized car carriers.
Using different forms of transportation, such as trucks, trains, and ships, to transfer cargo is known as intermodal trucking. To manage the shipping process, intermodal trucking companies frequently collaborate with other logistics service providers.
Owner-operator: Self-employed truck drivers who own and run their own vehicles are referred to as owner-operators. They could work alone or contract out their services to bigger transportation firms.
Every type of trucking company faces a different set of difficulties, rules, and specifications. It’s crucial to do your study and pick the type of trucking business that best fits your experience, interests, and resources if you’re thinking about beginning one.
What transportation companies are the most successful?
Depending on the geography, demand, and prevailing economic conditions, different trucking operations may be the most profitable. However, there are a few parts of the trucking sector that routinely earn well:
- cooled transportation (reefer)
- Transport by tanker (of hazardous goods)
- Flatbed delivery
- specific heavy lifting
- LTL shipment, or less-than-truckload shipping
- Shipping a full truckload (FTL)
- Services for expedited shipping
Keep in mind that profitability can vary; personal success depends on effectiveness, reducing empty mileage, and skillfully controlling operational costs.
There is a severe lack of drivers.
A significant problem in the commercial transportation sector is the lack of drivers in Europe. Trucking businesses are looking for drivers who can fill the gap because of a number of causes, including an aging workforce, tougher rules, and a lack of enthusiasm among younger generations in a career as a truck driver. You might gain an advantage because you’ll be assisting in the hiring of more drivers.
Do I need to work with a freight forwarder or load boards?
Shippers can post cargoes they require covered on load boards or freight boards, which are online markets where trucking companies can cover them. Operators of trucking companies may occasionally need to bid on loads in order to “win” them. In other circumstances, you might just be able to “accept” loads for a set fee. Especially for trucking companies that are just getting started, load boards may present chances to find both new clients and new business. Load boards, however, are notoriously difficult to manage. Finding the greatest loads for your company can be difficult to search for or filter sometimes. The loads you see might not always be accessible since certain load boards do not update in real time.
Some trucking companies collaborate with freight forwarders to eliminate the administrative work of browsing through load boards and placing bids on shipments. In essence, freight forwarders plan transportation services for suppliers. Large shipping businesses frequently enter into agreements with freight forwarders, who then engage with a variety of smaller trucking firms to meet their demands for road transport.