The trucking industry is one of the industries that people mention when they think about booming industries in the United States. The industry has enormous potential for professional truck drivers that want to start their trucking business. But it is highly competitive and sometimes frustrating.
Building a successful trucking company involves having the right equipment, using the proper safety indicators, and getting the required permits. These truck permits allow you to operate interstate and internationally without violating the regulations. Are you considering transitioning from a professional truck driver or owner-operator to running a trucking company? These blogs from Global Multi Services give details on what to do when starting your trucking business.
PERMIT NEEDED TO START A TRUCKING COMPANY
Navigating your way through permits in the trucking industry can sometimes be confusing and overwhelming. The Department of Transportation regulates the trucking industry and ensures trucking companies adhere to state and federal regulations. They also ensure motor carriers follow the state requirements for interstate and intrastate transportation. Here are some mandatory permits for trucking companies
INTERNATIONAL FUEL TAX AGREEMENT
The International Fuel Tax agreement simplifies the reporting of fuel used by trucks operating across the conterminous United States and Canadian provinces. Registered trucking companies have a single fuel license. But they also need to file quarterly fuel use tax returns with their base state.
UNIFIED CARRIER REGISTRATION
The Unified Carrier Registration is mandatory by the federal government for trucking companies that travel interstate and internationally. Trucking companies must also register their business to receive UCR Permit and pay an annual fee based on fleet size.
INTERNATIONAL REGISTRATION PLAN
The International Registration Plan permits operation under a single registration plate. IRP is issued to trucking companies in their base jurisdiction and requires an annual renewal fee. The state allows them to operate across the United States and Canadian provinces.
MOTOR CARRIER AUTHORITY
A motor carrier authority is an operating authority that gives trucking companies the right to transport goods on public roads. Receiving your MC Authority allow you to operate legally across the United States
MISTAKES TO AVOID WHEN REGISTERING YOUR TRUCKING COMPANY
Taking a leap of faith by starting your trucking business always comes with mistakes. There are many trials and errors as you learn the valuable lessons of your new business. But these mistakes made can be costly and time-consuming to correct. Here are the most common mistakes trucking companies make when starting their business.
Every detail must match 100% when registering your trucking company. From entity name, owner’s name, address, and Employee Identification Number to the Federal Motor Carrier Safety Administration registration. Spelling mistakes can cause rejection of your registration. It can cost you money to correct.
The Federal Motor Carrier Safety Administration uses the United States Postal Service to notify and communicate with trucking company owners. That means they do not accept PO BOX as a physical address and registering a wrong physical address can create problems.
Many trucking companies now use virtual addresses. They pay other companies to create a virtual for them. This address is accepted through the USPS system, and the company accepts mail on behalf of the trucking company. These also allow trucking companies to create an entity in any state. But this is not possible in states that require proof of residency to approve your International Registration Plan.
NO BUSINESS KNOWLEDGE
Focusing on what you know about trucking and driving is not enough to run a successful trucking business. You must research and understand how the industry works. Running a trucking business can be less exhausting and tiring when you know how to navigate it. Therefore, you need to be mentally ready for the stress that comes with profit. Study on your own or with your startup representative.
Common filing errors include
- Not having your business identifier listed on the EIN filing.
- Filing under the wrong entity type.
Obtaining your EIN before registering your business entity with the state can cause rejection of your company name due to similarity to another one in your state.
RUSHING YOUR BUSINESS REGISTRATION
Rushing your business registration can lead to many errors that can take time and money to correct. Therefore, take your time when registering and ensure everything is correct.
Do you want to be a brokerage, dispatcher, and carrier all at once? You will need a lot of capital and time. These might be too much to handle simultaneously. Register for one first and grow into your other plan. Building your business with a clear vision gives you a higher chance of success.
Every state has a different permit and handles everything differently. Failing to adhere to every state regulation can get you penalized, fined, or your license revoked. Therefore, know the rules of the states you want to operate across. You can also consult a trucking permit company like Global Multi Services for help.
HOW TO AVOID THESE MISTAKES
CREATE A BUSINESS PLAN
Creating a business plan helps you focus on the core parts of your business. It lays out permits, licenses, capital required, financial projections, and other strategy details. It also keeps you focused on building your company according to a blueprint.
Be prepared physically and mentally. Ask yourself these questions what will I do if my truck breaks down on my first load? How will I run my business if it takes weeks to get paid on my first load? How can I pay my drivers and find loads?
Gathering information for the entire process helps you understand what you are getting into and how to navigate your way. It also avoids confusion or falling into the hands of scammers. Check out online information about starting a trucking company and ask around other people in the industry.
TO SUM IT UP
Understanding how to start a trucking company can sound complex and tiring. Realizing the industry is a bit more competitive should not affect your desire to start. With the right business plan, permits, and finance, you can get the wheels rolling in your trucking business.
Do not be afraid to hire a trucking permit service provider like Global Multi Services to help you. Our truck permit services are the best in the United States. We will ensure you have everything completed and filed correctly.