If you’re the owner of a small trucking business, you know it’s tough to compete with larger fleets. The obvious advantage of more trucks often means that they can offer more aggressive pricing, hire drivers more quickly, get better discounts from their suppliers, and generally leverage their size to deliver faster.
So what can you do in the trucking & transportation industry today to grow your trucking company to compete with the big guys?
Here are eight things you can do right now to put you on the path to smart growth:
1. Anticipate regulations
We will continue to see rising operating costs this year, including regulations such as increased training for truck drivers, environmental regulations, hours of service and electronic logging devices. There’s a lot to do, so start taking steps now to make sure you’re ready.
The ELD mandate
One of the most prominent mandates of 2017 was the e-log mandate that requires drivers to use electronic logs to track their hours of service.
Drivers must now be in compliance with the ELD mandate.
The Federal Motor Carrier Association (FMCSA) estimates the mandate will impact over 3 million trucks and 3.5 million drivers. This mandate has the potential to force smaller trucking companies out of business if they aren’t prepared to handle the changes. That’s why it’s important to stay on top of these laws on websites like the FMCSA to stay ahead of the game.
2. Keep up with technology
As an owner-operator of a truck transportation business, you’re responsible for a lot on a day-to-day basis. Sometimes, it can be tough running your small business from the road. The good news is that technology can help you get organized, manage finances, reduce stress, navigate the road and so much more. For example, use GPS to determine the best routes and find ways to combine loads for cost efficiency. You really need to tap into apps to save time and increase efficiency.
For instant impact, check out these trucking apps you can use right now:
KeepTruckin – Trucker logbook is the #1 electronic logbook and elog for truckers! Track your daily HOS driver logs on your smartphone or tablet for free. KeepTruckin is a fully editable logbook and is FMCSA compliant. Get violation alerts, recap hours worked, send logs via email and many more features.
Trucker Tools – This app gives you real-time traffic info, turn-by-turn directions, weigh-scale status, accurate truck stops along your route, weather conditions, nearest diesel prices, and more.
Gasbuddy– Using information provided by over 60 million users to save money on fuel prices at fuel stations across the United States, find gas stations by distance or price. You report gas prices and help other drivers like yourself.
3. Master your finances
As a trucker, you know where you’ve been, where you are and where you’re going. Yet, as a trucking business owner, you need to know all those things in relation to your money. Think of it like this:
Where you’ve been – spending
Where you are – current balances
Where you’re going – income, expenses and financial goals
How you’ll get there – your plan
4. Commit to providing the best service available and then use it to your advantage
Sounds simple, but the truth is this may be the one area that the big guys can’t compete with you on. Because you’re smaller, you’re more nimble, you’re hungrier, and you’ve got fewer clients. So treat each one like they are the most important client you have and your phone will keep ringing.
People today will still pay a little more to get the bells and whistles that come with being a big fish in a smaller pond. Grow your trucking business by creating relationships… not clients.
5. Pace your plans for growth
This article at FleetOwner does a great job laying out a growth calculation formula that helps fleet owners determine their break-even point along with the Capitalization Fund Objective, or what you’ll need to reach growth plateaus. It’s not a new article, but it nicely shows you how to calculate how much capital you’ll need to reach your growth objectives, along with how much time it will take to expand your transportation business and get there.
It will help you understand the realities of growing a small fleet so you can put a transportation business plan in place.
6. How to find clients for trucking business with load boards and freight brokers
Truck load boards – or freight boards – is a great way for trucking companies to find loads. Truckers and fleet owners can use the boards to search for criteria to match them to the types of loads they may be looking to move. It’s a great way for truck drivers to build relationships with shippers.
7. Work smarter not harder
As an owner operator, you need to get out of the company driver mindset. You need to start working smarter so you can earn even more.
To do that you need to stay away from loads that require you to drive more miles. As an independent trucking business owner, you need to find loads that allow you to drive less, yet pay the same amount of money. The benefit is fewer miles are driven so less money is spent on fuel, less stress on your truck, less time working, and more profit in your pocket.
8. Stabilize your cash flow and accelerate your access to capital
Freight bills are often not paid until well after delivery, and there can be a good deal of expense in getting them delivered. That’s okay if you’re a large transportation company, but if you’re a small to midsize fleet, immediate cash is often needed to fuel your trucks and pay your drivers.
With freight invoicing factoring for small fleets and owner-operators, a third-party factor like eCapital purchases your invoices for a small fee. We assume the collections or accounts receivable duties and you get your cash quickly – rather than wait until the job is completed. There are a number of other money-saving benefits, from the best fuel cards for your trucking company, lower insurance rates, truck leasing assistance, and more.
Freeing up your cash flow and getting faster access to your working capital with freight factoring gives you options to grow your business faster.
There are many ways that you can grow your fleet and trucking company. The eight above are only a handful of options but they are important considerations when charting growth. Put them to good use today and stay safe on the road!