For anyone thinking of investing in a transportation company, or perhaps considering starting one from the ground up, there are several things to consider before into the transportation industry.
Using our experience in the trucking industry, and having the luxury of being able to chat with dozens of trucking companies a month, we will going over what we have discovered are important things that you should keep in mind when investing or starting a trucking company.
The Market Demographics.
The most important thing for your trucking business venture (quite frankly every business venture) is proper demographic research. Prior to taking any major steps, you need to first understand the market demographics of the area you intend to operate in.
By undertaking demographic research, you will be able get a rough calculation of the number of people most likely to need and buy your service and what it will take to reach them. Seeing the possibility of business and growth definitely makes the big step of investment a lot easier for the first-time business owner.
Review Permits and Registrations
Before you close the deal, carefully study and review the operating authorities, and safety certificates as well as other licenses, registrations, or permits which are necessary for operation. This type of due diligence will help prevent hefty fines, investigation of your company, and other unpleasant situations.
Check Driver classification
Learn about the relationships between the targeted company and the drivers and other independent contractors. This will involve carefully reviewing the practical relationships and owner-operator agreements to ensure that the drivers are not misclassified as dependent employees.
Review Carrier safety (If you’re purchasing a company)
Review the target company’s driver training records, safety program, and safety ratings. This will help you identify any operational and safety concerns from the start so that you don’t waste your time and resources trying to remedy poor safety records after buying the company.
The legal works
Another important box you need to check, is reviewing the legal historic background of the target company. It is important to employ lawyers who are skilled in this while procuring a company. You should try to learn as much as possible about the targeted company and its history and identify any “red flags”.
These are some extremely important points that you should keep in mind when buying a transportation company.
If you have invested in a trucking company and you are experiencing growth and ready to have new, qualified drivers knocking at your door, reach out the Get Truck Drivers team!