How profitable is it to start your own moving business?
Many people who already have a truck or a van can easily start their own moving business. However, a moving business is more than just transporting items on a truck from one location to another. Just like it is with every other business, starting a trucking company or your own moving business is a big decision and it carries with it a huge responsibility of becoming a business owner operator.
Taking your first steps and entering the market can be overwhelming. Take a deep breath and ask yourself if your own moving business will be profitable. This is not an easy question to answer. The trucking industry is growing and there are a lot of opportunities to make money. Moving businesses with trucks move around 75% of the country’s freight each year.However, there are a number of factors that you need to consider. First of all, it is important to talk about the costs and expenses of starting and running your company. Your profit will depend on such expenses.
Licenses and insurance
It is important to take care of paperwork before your moving business can hit the road. The necessary business permits and licenses include USDOT Number and Motor Carrier Operating Authority. You may have to have a number of other licenses if you are looking to offer interstate moving services. The licenses and permits will depend on the type of services you provide and where your company will operate.
It is equally important to get business insurance for your moving business. In order to obtain the license from the US Department of Transportation (USDOT), you will need to have insurance coverage for general liability and cargo insurance. Take the time to choose an insurance provider and take into account the needs of your moving business before you decide on an option.
Getting the right equipment, tools and a truck
You will have to invest in tools and equipment, such as packing boxes and a dolly, that will help make the process of moving, packing, loading and unloading easy for you. These are necessary for your business to complete moving jobs quickly, safely and efficiently.
Needless to say, you’ll need to get a truck for your moving business. You could buy or lease a truck. The kind of truck that you should get will depend on what your finances look like and on the kind of services that you will be providing. However, when you’re just starting you should not get a big commercial sized truck. A loading van or a truck will be good enough. You could get a bigger one when your business starts to expand at a later point in time.
If you do not have sufficient funds to buy a truck, leasing a truck is a good option to get a truck and to keep monthly costs down. Do not forget that you could also get a used truck. However, it is important to be careful in order to avoid spending a good amount on repairing and maintenance in the future.
Remember to track your business expenses, avoid cash flow issues and to comply with licenses and insurance. Being the business owner, you will need to stay up-to-date. Remember that the US DOT Authority requires a biennial update every 2 years. Make sure that you do not miss any deadlines in order to avoid penalties and fines.
Another aspect of having a profitable moving business is that it is important to track your expenses as your business becomes operational. Take into account the cost of gas, any lease payments, maintenance of the equipment and your moving truck. We would suggest that you save some money from your monthly income in order to deal with emergency situations, such as when the battery of your truck has died.
Is starting your own trucking company worth it?
A business owner of a moving company earns more than three times the average salary of a truck driver. It is important to remember, as mentioned above, all costs and expenses have to be deducted from this income in order to determine the profit. For those who are looking to be their own boss, starting your own moving business is definitely worth the venture.
In order to stay profitable, all you will have to do is charge your customers more per mile than your business’ cost per mile. However, it is important to take into account all the other costs and expenses, some of which we have discussed above. Base decisions knowing what effect it will have on your business. Moreover, being the owner of your own moving business will mean that you are in a unique position to grow your own business in order to increase your salary even higher. So starting to offer a wider range of services, adding additional trucks and drivers to do more jobs will multiply your income.