AUTO TRANSPORT BUSINESS STARTUP - Part 1 of 2How To Start An Auto Transport Business by Jay W. of Auto Transport Intel
NOTE: Due to the size of this blog, this post is ONLY STEPS 1-10. CLICK HERE for STEPS 11-20.
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How To Start A New Car Hauling CompanyYES, you've finally made the decision to start a new Auto Transport Business but you can’t find all the information you need in one place, right? You’re ready to become a Car Hauler and Owner-Operator but nobody’s given you a road map or full answer. Well, I wrote this for you.
20 Steps To Become A New Car HaulerFirst, I ask that you read all twenty steps before you finish step one - so you are not blind-sided later. Always be thinking about what's coming next, so you can get to step twenty before you run out of time, energy, and most of all, money. Remember: this advice is based on research, experience and feedback. Every new business is a gamble. Verify everything. Assume nothing. ***Before you proceed, click here and download this 162 page PDF called "A Motor Carrier's Guide To Improving Highway Safety" because the FMCSA and DOT will expect you to know it backwards and forwards: https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/ETA-Final-508c-s_508CLN.pdf
1) CREATE A LONG-TERM STRATEGIC BUSINESS PLAN
- What Are You Hauling? We all know that an Auto Transport Business moves vehicles, cars, trucks, vans, etc. How many will you carry at a time? This will determine your Trailer Capacity - and size of truck.
- Where Are You Hauling? If you plan to haul Intrastate (only within one state), some steps will differ from Interstate. Either way, you will need to become very familiar with Local State Transportation Laws and Business Operating Regulations. Click here to find your state and research local laws: https://www.usa.gov/states-and-territories
- How Are You Going To Get Your Loads? You must find out what the average load pays on routes you will travel. How will you obtain new orders and get paid to move those units? Are you going to rely primarily on Load Boards - or can you get direct access to Brokers, Dealers and individual Customers?
- What Experience Do You Have? If you have no Truck Driving or mechanical experience, think about how you are going to get the experience to make car hauling work for you.
- What Equipment Do You Already Have? Most new car haulers at least start with a used Truck and Trailer. If you are starting from scratch, make sure you have plenty of money in your budget.
- Define Job Roles. If you are the owner, driver, dispatcher, and accountant, write it down and own it.
2) GET YOUR MEDICAL CARDIf you can't get a Medical Card, you need to go back to step one. If you can't physically drive, you will need to find a good, reliable driver to make money as an Auto Transport Business. Visit https://www.fmcsa.dot.gov/medical/driver-medical-requirements/dot-medical-exam-and-commercial-motor-vehicle-certification to learn how to obtain your new medical card.
3) DEFINE YOUR BUDGET & SET UP YOUR COMPANYEvery business needs working capital and a brand new Auto Transport Business can easily require a $100,000 initial investment. Whether you’re halfway there, you have an investor, you have a partnership, or you’re just starting out, consult with your Tax Professional to set up a new company, apply for an Employer Identification Number (EIN), register with the Internal Revenue Service (IRS), and set up a Business Checking Account. Click here to get started: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online This is also a good time to look into using QuickBooks Accounting Software https://quickbooks.intuit.com/
4) PURCHASE EQUIPMENT, INSURANCE & A LOT MORENow that you have a company and a business plan, it's time to shop for equipment. NOTE! You should have your insurance lined up BEFORE you buy equipment. Do not buy equipment you cannot insure! Since you are just starting out, we're going to focus on Pickup Trucks vs. Semis as well as 3-4 Car Hauling Trailers instead of a 10-car stinger. Here's a Shopping List (with an average range of cost):
- Truck: 3500 dually, price $40,000-$50,000
- Trailer: 3-4 car capacity, price $5,000-$10,000
- Insurance: $1M automobile liability + per vehicle cargo, $15,000-$30,000 annually
- Fuel: $1,000/week
- Maintenance: $5,000-$15,000 annually
- Business Expenses: $1,000 set up
- Central Dispatch Load Board: $1,000 annually