Top Tips for Starting a Successful Vehicle Transport Business

By Isabella Thomas

Transportation businesses vary greatly. One company may offer personal dispatch services while another moves large-scale freight. Entrepreneurs wishing to enter the transport industry will find they have numerous options. Why should a person start a vehicle transport business, and how can they make this venture successful? 

What Does a Vehicle Transport Business Do?

A vehicle transport business moves vehicles between locations. As of January 2023, there were 21.2 million vehicles in Australia, and owners often need them moved. They turn to a vehicle transport business to do so, and these companies use trucks such as the 18 tow and tilt trucks found at a local dealership. How can an entrepreneur start this type of business with the help of one of these trucks? 

Create a Business Plan 

Lenders require a business plan, but someone funding their venture without outside help may choose to skip this step. Doing so is a mistake. The business plan outlines the company's goals, potential challenges, and competitors. It also shares information about how the business will be financed and how long it will take before the venture becomes profitable. 

Choose a Business Model

An entrepreneur must choose a business model. The sole trader option is for individuals or married couples who don't want to incorporate, but selecting this option leaves them open to personal losses. A partnership allows individuals to join forces to create a business. A company completely separates the owner's personal and business information, so the owner's assets won't be at risk. Other options, such as a trust, should also be considered. 

Establish a Budget

Entrepreneurs must determine the cost of starting their ventures. A single-truck operation costs significantly less than a multi-truck venture. Once the number of trucks needed has been determined, the entrepreneur must find financing. Many entrepreneurs finance their debt through a bank or another lender. However, equity financing is an option that should not be overlooked. The entrepreneur brings in a partner to help finance the business. Each option has benefits and drawbacks. 

Hire Employees

Establish standard hiring practices before hiring the first employee. These will evolve as the business grows, but they should be in place from the day the doors open. Doing so ensures the company will comply with all employment laws. 

Legal Requirements

Business owners must comply with all legal requirements regarding vehicle transport and ensure that the trucks used to transport vehicles are legal for road operation. Drivers must have the appropriate license, and the company must have its licensing and permits. Furthermore, insurance is essential for businesses in this industry. 

Mistakes to Avoid

New business owners often make mistakes, and one mistake could be the downfall of the venture. Avoid this by learning the road rules for all locations between the origination point and the destination. One state may have a rule that doesn't apply in other states, and it's best to know these differences before moving the first vehicle. 

Purchase the appropriate insurance, including liability insurance and umbrella insurance. Furthermore, contracts should be incorporated to ensure payment is received for services rendered. Entrepreneurs can never be too careful. 

Every entrepreneur can realize their dream with time, effort, and money. The tips outlined above will get the business off on the right foot. Once the company gets established, the focus can turn to grow.