Trucking industry great promise for small operators: Back in the 1970s, there was an inescapable popular saying you could find plastered all over t-shirts, posters, bumper stickers, and even as part of a Billboard chart-topping song. “Keep on Truckin’!” The saying certainly reflected the times. Truckers were greatly admired. They were seen as a hard-working, independent breed ready for endless adventure on the wide-open highways of America. What little boy didn’t want to be like Burt Reynolds or Jerry Reed in one of the greatest all-time trucker movies, “Smoky and the Bandit”?
Fast-forward 40 years, and little has changed. Trucking remains as popular as ever in the public lore. For those who like the solitude and the call of the road, there’s no better time to drive a big rig. If you’re one of those people who has always dreamed of “putting the hammer down,” this may be a suitable time for you to fulfill that desire with your own small trucking firm. Or then again, it may not be, depending on which side of the wheel you sit.
The good? According to the American Trucking Associations (ATA), trucking is high-balling it towards the greatest era in its storied history. ATA president and CEO Bill Graves says he “see(s) no scenario, no outcome on the horizon that is anything but great for this industry.” The ATA is robustly predicting overall industry revenue will jump 72 percent by 2022 and tonnage moved will climb nearly 24 percent in that same timeframe. Truckload volume, meanwhile, will grow 3.5% a year through 2019.
The ATA reported an all-time high in trucking tonnage hauled in February 2016. Other market research studies have indicated that higher demand and ever-rising shipments could create a capacity crunch down the road. This crunch could pave the way for those wanting to enter the industry. Indeed, one report trumpeted that small independent trucking firms are among the nation’s fastest-growing small businesses.
Sounds great, right? Throttle down and take your foot off the accelerator for a second. Before you shift into high gear, lasso up some friends and start your own convoy down the Interstate in search of trucking riches, a few other important things need to be considered.
The Advantages of Small Trucking Companies
Small trucking companies and owner-operators are carving out their own path to success, armed with a deep understanding of the pros and cons of operating on a smaller scale. Despite facing challenges such as navigating supply chain issues and balancing start-up costs, these entities enjoy distinct advantages over their larger counterparts. The freedom to choose types of freight, coupled with the personal touch they can offer in the supply chain, sets them apart in a crowded market. For those dreaming of a career in the trucking industry, becoming an owner-operator within a smaller trucking company not only provides a more intimate driving experience but also opens doors to a variety of trucking jobs that might not be available in larger firms.
With an emphasis on quality over quantity, small trucking firms are adept at offering customized solutions to shippers, ensuring that even the most specialized freight requirements are met with precision and care. This flexibility extends to their operation model as well, where drivers and owner-operators often enjoy more leeway in choosing their routes, thereby improving job satisfaction and work-life balance. Additionally, smaller companies may offer more attractive packages for drivers, including competitive wages, vacation time, and even life insurance options, addressing one of the industry’s biggest hurdles: driver recruitment and retention.
However, the journey for small trucking companies is not without its bumps. The initial start-up costs, license fees, and the need for a safety team are significant considerations. Yet, for many, the advantages of running a smaller operation—such as closer relationships with clients and a greater sense of ownership and independence—outweigh these challenges. In an era where the impersonal nature of large corporations can be a turnoff for both employees and clients, the personalized service offered by smaller carriers becomes a compelling selling point.
As the trucking industry continues to evolve, the role of small trucking companies and owner-operators will be pivotal. Their ability to adapt quickly to changing market conditions, coupled with their commitment to providing personalized service, positions them well to navigate the highways of opportunity. For entrepreneurs and career seekers alike, the small trucking sector is great ground for growth, innovation, and success, proving that in the world of trucking, size does not always dictate capability.
Trucking Industry, a Few Other Important Things Need to Be Considered.
First off, the trucking industry is undergoing a number of regulatory changes. The new regulations may put a brake on trucking’s headlong rush towards a new golden age. These include stricter limits on the number of hours a driver may be behind the wheel per day and per week. A number of governmental entities are also considering more and stricter health exams for commercial drivers, who have to sit for long periods, making them more susceptible to health problems.
So not only can drivers be behind the wheel for a shorter time, reducing productivity and profits (both for the company and the driver), but there are fewer drivers than ever. A massive driver shortage has stymied practically all haulers, big and small, with rapid turnover rates common as drivers continually jump for more lucrative offers from the competition. Not enough new drivers are entering the industry and today’s drivers are rapidly aging, creating even more significant shortages. Industry watchers speculate that the trucking industry will have to hire 89,000 new drivers every year just to keep pace.
That means wages are rising to entice people into the cab. That’s great news for drivers but not so welcome for company owners trying to fulfill more and more orders.
Finally, new technology is having a big impact on trucking. Companies slow to embrace new technologies are finding they are increasingly less efficient and are becoming roadkill for faster, more nimble haulers who swallow them in a convoy of mergers and acquisitions.
So as you can see, the road ahead for the trucking industry has some great opportunities in terms of increasing demand for service, Still, there are also several potholes to dodge in terms of finding and keeping drivers. One effective solution for small trucking companies is freight bill factoring. By working with a freight bill factoring company, trucking businesses can convert their unpaid invoices into immediate cash, ensuring steady cash flow and the ability to meet operational needs without waiting for customer payments. If you’re a small business entrepreneur looking for a new challenge, trucking could be a lucrative path to prosperity, provided you have a firm grip on the wheel, gear your expectations accordingly and carefully map out your route.
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