By Donna Ryun
OOIDA communication director
Thinking of buying a truck? With any luck, your years spent as a company driver have provided you with a great education, and you’ve used the bits of knowledge you’ve gained as steppingstones toward owning your own business. But are you really ready to make the leap?
As a company driver, your focus has been mainly on your driving ability. Once you’re sitting behind the wheel of your own truck, however, you’ll be not only a truck driver, but also a truck driver who runs a business.
It’s time to change your focus and start thinking like a person who calls the shots, i.e., the boss. Indeed, a ton of responsibility comes with that title.
I’ve seen a bumper sticker that says, “If you don’t know where you’re going, how will you know when you get there?” It’s a good question, and one that’s worth thinking about before you become an owner-operator. You’ll definitely need a business plan.
If the thought of writing a business plan gives you a headache, you’d better get out the aspirin. With a whopping 95 percent first-year failure rate for small-business ventures, according to the Small Business Administration, you’d better plan on honing your business management skills in order to avoid becoming part of that statistic.
Although it’s true that writing a business plan can be a pretty time-consuming project, it is definitely worth the effort.
While you’re planning and researching for your business plan, you’re also forcing yourself to take a critical look at your ideas. You are comparing previous assumptions you may have had about the business of trucking to the actual facts that you’ve found during your research. This is perhaps the most important reason to write a business plan.
The process of gathering information, thinking about your future business, and analyzing your findings so that you can complete a business plan is a valuable tool that could actually help you avoid costly mistakes. Don’t take this process lightly. Make the effort and take the time to write a good business plan, even if it does cost you a few headaches.
Your business plan is your road map. It should spell out where you want your business to go and how you expect to get there. What are your company’s strengths, and how will those strengths help you to succeed? What competition will you face, and how will your company use its strengths to gain an edge?
How will you promote your services? What government regulations will apply to your operation, and what are the expenses involved? How will you manage your accounts receivable and accounts payable? Do you have a list of professionals that will provide advisory support for your business, such as an insurance agent, attorney, accountant and banker?
What are your startup expenses? What are your profit and loss projections, and how did you arrive at these assumptions? How will you set your rates? How do you plan to develop and grow a reliable client base?
Developing and writing a good business plan will force you to research the answers to these questions and to take a good hard look at the factors that could either make or break your new venture.
Your business plan should serve as a reference point when you encounter new and different opportunities. It will help you decide whether these opportunities are a good fit for your business. The business plan should also be flexible enough to allow you to modify it if you see that you’re headed in the wrong direction and could be more successful following a different path.
Whether you lease on with a carrier or decide to be independent, do not forget that you are the owner of a trucking company with the responsibility and the right to make decisions that affect your business. Careful planning now can make the difference in whether you’ll achieve success or be added to the high percentage of new business venture failures.
You can’t do the job right if you don’t have the proper tools, so if you didn’t join OOIDA when you were a company driver, go to www.ooida.com to fill out a membership application or call a membership representative at 1-800-444-5791. More than 160,500 professional truck drivers have used this network to scope out opportunities for themselves with the support of knowledgeable OOIDA staff members.
The OOIDA Foundation periodically offers business seminars that provide practical information on operating a successful trucking business, including tips on writing a business plan. Classes fill up fast, so if you’re considering attending the April 8-10 seminar, visit www.ooida.com and click on “Business Seminar” on the right side of the page to enroll.
Ask questions, compare answers, learn from your mistakes, and be flexible enough to change course if you’re headed in the wrong direction. Write a business plan so you’ll know exactly where you’re going and recognize it when you get there. LL
If you have questions about doing business as an owner-operator and/or an independent trucker, please e-mail them to firstname.lastname@example.org or send them to PO Box 1000, Grain Valley, MO 64029. We can’t publish all of your questions in Land Line, but you will receive a response, even if your letter is not published.