Our current living world is a very connective one. With the rise of internet and advancements in technology, we are able to communicate with people all over the world. This increased communication has given rise to globalization. With the spread of globalization, businesses have become much more expansive than ever before. Businesses which were limited to one area or group of closely located areas have now expanded past the international borders. With businesses expanding from one city or other cities and more, there is demand for products beyond the local area of an operating business. The products or goods being offered by any business company need to be moved from their manufacturing or storage facilities to purchasing clients. And with moving a large quantity of goods or goods of larger size, comes the need of huge vehicles like trucks. Box trucks have become a huge part of transporting goods from one place to another. Box trucks are used for moving a wide variety of materials. These items include but are not limited to packages or goods of large size, getting rid of extra junk, helping people move from one place to another and making deliveries for companies like Amazon.
A box truck (also called a box van) is a cab truck that has an enclosed rectangular area for the purpose of carrying cargo. They can be up to 26 feet in length and can be as heavy as 33,000 lb. at their back is a roll up door that allows to access the interior of the cargo storing area. The box truck business basically involves carrying goods for your paying customers which are to be delivered at a certain address. The products carried could include food items, deliveries for companies like Amazon, furniture etc. In the USA, about 70% of all freight is carried by trucks. This means that the trucking industry is worth almost three quarters of a trillion dollars. In other words, the box truck business is a pretty lucrative one and having a good set up with one or few vehicles can make for an excellent business. This article will take a look as to how you can open your own box truck business.
How much does it cost to start a box truck business?
Just like most businesses, you will needing a good amount of money in your bank before you can even start moving forward with an idea of launching a business. Some businesses won’t cost you that much but starting a box truck business is going to make a dent in your pocket. The biggest expense you would have to deal with is getting a truck. Trucks, of course, don’t come cheap. If you want to buy a new truck, then that is going to cost you up to 45,000 dollars even for a light duty class truck. The heavier you go, the more expensive your box truck is going to be. The best medium duty class truck can cost you up to an insane 90,000 dollars. Of course, if you don’t want to spend that much there are always other options like purchasing a used box truck. You can find a good used truck in the 5,000-14,000 dollars range which is far cheaper than a new brand one.
If you really low on cash, then you could also try renting one. This will give you a few advantages like saving money and not having to pay for maintenance. Do your research before renting a truck as rental prices can increase over time. You can also go the installment route by paying about 10% down payment in the beginning. In addition to the truck, you will also be paying for equipment, insurance, marketing, permits, licenses, load board fees etc.
How much does a box truck business owner make?
Before breaking into any business, it is important that you evaluate how much profit you could actually make from the product or service you are offering. Your delivery charges usually vary depending upon the size, weight and value of the cargo you are carrying. If you decide to work solo, you can get a 70% profit on basis of 200 dollars as your average load price. On an average, box truck owners have been known to make 100,000-110,000 dollars on an annual basis. This means you can expect to make an average of 50 dollars per hour. Of course, income has also been found to be anywhere between 23,000 dollars to 290,000 dollars. This is because your income can fluctuate depending upon a number of factors. These could include:
- Your area of operation. Some places tend to have higher prices for box truck services than the other. Most metropolitan areas will have higher annual income than those working in non-metropolitan areas.
- The number of loads you deliver can also affect your income. Bigger trucking companies will be making more revenue because they can afford to take a large number of orders and deliver them in time. A smaller company or a one man business will obviously make less due to lower number of loads delivered.
- Your experience can also affect your income. People tend to trust established and experienced box truck owners for the safe transfer of their goods or services. If you are a newbie, then it will be a while before you can make the big bucks.
- Your income will also be affected by some other expenses like salary of your hired employees, money spent on maintenance and repair of trucks and the market prices of fuel.
How to set up your box trucking business?
So imagine you have decided to open a box truck business. You have managed to secure the funding for the expenses of setting up your business. You have also successfully created a business plan and you are now ready to act upon it. The following are the things you now need to do to successfully set up your box trucking business:
Establish your business entity and obtain licenses
First we need to deal with the legal aspects of the business. Start by establishing your business with your state as sole proprietorship or LLC depending upon your preference. The best thing about setting yourself up as an LLC that can come in handy during some legal troubles. Even if someone makes a claim against your business, your business’ status as an LLC will guard your personal assets. You can use the help of a lawyer for this purpose if you want or use an online service like Incorporate. Once you are done with this, move your focus towards obtaining licensing and permits necessary to operate your business. These licenses and permits may vary from state to state, so contact the respective authorities for the required information. Also file for insurance in case of any situations that may arise during your business venture. Lastly, if you want to obtain your own trucking authority, apply to the Federal Motor Carrier Safety Administration for a Motor Carrier number.
Create a website and list your business
This is necessary regardless of the nature of your business. In the current age of digital technology, your customer should be able to reach you by multiple methods. Creating a website will give you more exposure in the eyes of the general public. Your website should be designed to be professional to ensure that you mean business. Also make sure that is user friendly and easy to navigate. Don’t make things too much complex as it can be turn off. Be active in your response to customer requests through phone or emails. You can hire a professional to create your website for you or you can do it on your own by picking templates form sites such as Theme Forest. Also make sure to list your business on Google My Business. This will let people now that your box trucking service is present in their local area.
Selecting a business location
The next thing you need to sort is the location of your business. Don’t take this step lightly as a good business location can have a positive impact on your business by a 40% margin. The first step is recognizing your audience and pinpointing the place where there is demand for the services you are going to provide. If you are someone who is new to your line of work, then avoid locations where there are already competitors with a loyal customer base. Selecting the right area is important. Also make sure that your office is easily accessible to your customers. Avoid any hard to reach places. If you are renting a place for your office, then check the rent list as prices vary from region to region. An office in a metropolitan city is going to cost you more than a non-metropolitan city. Also make sure that your office is large enough to handle all your operations.
Depending upon the scale of your business, you may have to hire workers to handle various operations. So put an advertisement out there and let people know that you are hiring. Remember, a good business is built upon its workmanship and that eventually depends upon the employees. Put specifications in the advertisement to make it clear what you want form your employees. Make sure that you hire skilled and experienced people that are already familiar with ins and outs of your business. You can hire newbies if you want but a group of experienced professionals is a must. Built a qualified team you can rely on as they are going to be integral to the success of your business. You can hire drivers, administrators, maintenance crew etc.
Marketing your truck box business
We have already talked about creating your own website and listing your box truck business with Google My Business but marketing forms an essential part of your business. Though marketing will require for you to expand your budget but it is necessary evil especially if you are launching a new business. Marketing helps you bring more eyes to your product and as a result increasing product awareness. You can put ads on TV, distribute fliers or use social media. Social media marketing is a must in today’s age as it allows you to expand your business beyond your local area. Millions of people spend a huge portion of their time on social media sites daily and every businessman should take advantage of this fact. Also providing quality service to your customers acts as free marketing as they will likely suggest your services to your friends and family.
By following these simple steps, you will be on your way to start your own box truck business. It is important to do your research and formulate a good business plan before you start putting your plans into action. It is also possible that you may experience a slow start or face some losses in the early stage of the game as purchasing a truck and other equipment is going to set you back a little. Always remember that making good business decisions, acting with patience, having the right amount of funding and being disciplined will help you to launch your business successfully and also make sure that it stays relevant in the long run.