After brainstorming different box truck business ideas, the next step is learning how to start a box truck business.
Starting a box truck business is as straightforward as following the below steps.
Don't miss out on step number three, which is very important.
See below what you'll need.
Step 1. Create a box truck business plan
The company has higher chances of success when it follows a predetermined strategy.
A business plan sets the company’s financial goals. At the same time, it mentions what needs to be done to achieve those goals.
In other words, a box trucking business plan is a roadmap showing how to start your box truck business and how to grow it.
Writing a business plan for the first time doesn’t come out perfectly. But, at this stage, perfection isn’t the goal because a business plan is a tool for your internal use only.
The time you need to improve it is when showing it to banks or investors trying to lend money.
If you don't know how to create a plan for your box truck business, use this business planning tool from The Small Business Administration.
Step 2. Establish your box truck business
Give your business a memorable name
A box truck business needs a company name.
The company name helps the customer differentiate your business from your competitors.
To come up with a good name for a box truck business, follow the below rules:
Keep your business name simple. For such as George Box Trucking, Purple Box Trucking, or Fly Trucking.
The “Fly Trucking” business name version is a good option because it leaves room for further expansion to other types of trucking services.
If you have trouble figuring out any company name ideas, try this business name generator.
Once on the website, go to Trademarks→Searching Trademarks→Search our trademark database (TESS).
Also, check the availability of related domain names using this domain name search tool.
Check if the exact name of your business is available as a web domain.
Also, create your social media profiles using the exact name of your box truck business.
That level of business name consistency across the web improves credibility for your business.
Create a memorable logo
The next step in establishing your box truck business is creating a unique logo.
To create a logo for your business, you have two options.
There are two ways to create a logo - a free one and a paid one - a free one and a paid one.
The free option:
Go to canva.com and check out some of their logo templates. Choose a logo template and reoptimize it to your liking.
The paid option:
If you prefer a more ready-made solution, go on Fiverr and hire someone to create your logo.
Step 3. Register your box truck business
Find your state’s registration office using the SBA tool.
File for EIN
What is an EIN?
An EIN is the business's tax ID.
In other words, an EIN is something like a social security number for business entities.
Apply for your EIN through the IRS website.
Set up a business structure for your box truck company
When starting a box truck company, you are required to choose a business structure for it.
The business structure determines the business’s taxes, personal liability, and registration requirements. So, choose wisely.
Here’s a short description of the four business structure types:
- Sole Proprietorship - is a common choice for small businesses. In this case, the business entity makes no legal distinction between the company and the business owner. So, the entire income of the company goes directly to the owner. At the same time, the business owner is also responsible for any debts, losses, or liabilities.
- Partnership - this business structure has the same characteristics of a sole proprietorship except for having multiple partners or business owners. As the owners, they keep the pre-tax income and are responsible for any losses.
- Corporation - shields owners from personal liability for their debts, and profits are distributed to shareholders rather than received directly.
- Limited Liability Company (LLC) - combines the characteristics of corporations with those of sole proprietorships or partnerships. Besides that, the owner of an LLC is not personally liable for debts.
Most business owners choose an LLC for box truck business to enjoy liability protection.
Note 1: This can be a complicated area. You don’t want to make mistakes. So, you may want to consult someone more experienced in this field.
Note 2: Keep in mind that by choosing sole proprietorship, you can simply use your social security number as your EIN.
Register for taxes
Once you have your EIN, you need to choose your tax year.
This determines your business's tax cycle. While the chosen business structure determines the taxes needed to be paid.
Note: To ensure the correct taxes completion consult an accountant or other professional.
Step 4. Open a business checking account
After registering the box truck business create a business checking account. It helps to separate your personal finances from business finances.
Why do you need to do that?
Some benefits of opening a business checking account are:
- Keeping a separate account keeps things tidy from a recordkeeping and accounting perspective.
- It makes things easier when tax time comes.
- It makes it easier to track the company’s income.
- When writing a check from your business account, it signals credibility and professionalism.
To open the business checking account, bring in your EIN, articles of incorporation, and other legal documents.
Step 5. Get a box truck
The next thing that your business requires is a box truck or many box trucks.
Box trucks are the fuel of your business. So, make sure to get a good quality box.
If you have the money, you can buy a new or a used-box truck upright. Find out what to look for when buying a used box truck.
Buying a box truck is expensive. In the short term, it puts financial stress on the buyer. While, in the long term, it takes the hassle off your shoulders.
Many owner-operators who don’t have the money to buy a box truck start a box business with a rental truck.
Commercial truck rentals services like Penske, Ryder, and Enterprise rent out box trucks without as much upfront capital as leasing or buying.
Step 6. Get funding
Sometimes, starting a box truck business may need a bigger investment than you may have at the moment.
In such cases, you may need some financial help.
As a just-starting box truck business, you might not have enough financial history to apply for big funding options.
Most likely, the only funding option available for box truck business starters may be loaned to small businesses.
If you don’t have enough money in your savings, check out these financing ways to start a trucking company with no money.
Step 7. Get box trucking authority, licenses, and permits
To use a box truck for business requires you to get the below licenses and permits.
- Depending on the category weight of your box truck, you may need or may not need a CDL.
- If you want your trucking authority, apply to the Federal Motor Carrier Safety Administration (FMCSA) for a Motor Carrier (MC) Number and also get a Department Transportation number (USDOT number).
- If your company transports cargo across state lines, you will also need a Unified Carrier Registration (UCR).
- Finally, you will also need appropriate insurance for your box truck business.
The license requirements and how to obtain them vary from case to case. So, check the websites of your state, city, and county governments or contact the appropriate person to learn more.
Step 8. Get insurance
Insurance protects businesses from devastating consequences resulting from unexpected events.
Without insurance, a starting out box truck business is vulnerable because it doesn’t have enough financial capital to fix all the issues allowing it to stay in the business.
By buying insurance, you protect your box truck business from consequences that could bury all your hopes of building a successful company.
Here are the types of insurance your box truck business should have coverage for:
- General Liability: It covers a wide range of issues, making it the most comprehensive type of insurance. This is the only sort of insurance I recommend you should get. It even covers property damage and bodily injury.
- Business Property: Delivers coverage for your equipment and supplies.
- Equipment Breakdown Insurance: Mechanical equipment failure is covered by equipment breakdown insurance, covering the cost of replacing or repairing the equipment.
- Workers Compensation Insurance: Provides compensation to employees injured on the job.
- Property Insurance: Covers your physical space, whether a cart, storefront, or office.
- Professional Liability Insurance: It covers your business against claims of professional negligence.
- Business Interruption Insurance: Protects lost income and expenses if your business is forced to shut down due to a covered event.
There are a lot of companies that offer this type of insurance. Do your research to find a suitable insurance company for your business.
Step 9. Learn to get business
The next step is to learn how to get business in this red ocean of starving sharks.
The box truck business industry is very competitive. And if you want to be successful, you need to hustle starting a box trucking business with Amazon or finding other ways to make money with a box truck.
Once you find good customers to do business with and focus on building healthy long-term relationships with them. These relationships will provide the company with consistent profitability.
The problem is when you don't know how to get box truck contracts. You register a business and stop.
If you want to be successful in this box trucking industry, avoid this unconscious behavior.
The above checklist will guide you on how to start a box truck business.
Begin by choosing a name for your business, register your business with state entities, and get more business.
Even with one box truck, you can provide many services to multiple businesses.