As per the data provided by the U.S. Customs and Border Protection, our country’s ports receive over 11 million containers yearly, indicating a significant market for owner-operators immersed in drayage trucking businesses.
If you’re curious about venturing into this profitable enterprise, it’s essential to take into account the subsequent six factors when undertaking your journey to establish a drayage company.
Gain some driving experience
A considerable number of owner-operators begin their career as Drayage company drivers before venturing into establishing their trucking businesses. This approach not only provides an invaluable opportunity to gain industry knowledge but also fulfills a common requirement among trucking companies, which often mandate prior company driver experience before allowing lease-on as an owner-operator.
Lease or buy a truck
Your truck holds immense significance as the most vital asset for your business. When it comes to acquiring a semi-truck as an owner-operator, there are various approaches available, and it will be crucial for you to assess and determine the most suitable route for your business’s needs.
For many owner-operators entering the drayage company industry, buying a used truck serves as a common starting point. Alternatively, some may opt to lease a new or pre-owned truck.
Select your business structure
When setting up your Drayage company, there are numerous alternatives open for structuring your firm. Among the most predominant options for owner-operators are exclusive proprietorships and limited liability companies (LLCs).
A sole proprietorship typically entails lower costs compared to an LLC but lacks certain liability protections that an LLC can offer. Conversely, forming an LLC generally involves additional steps and paperwork beyond those required for a sole proprietorship.
Determining the suitable structure for your drayage company should be founded on your precise events. It is extremely recommended to seek direction from a solicitor and accountant to ensure you make the most educated decision feasible. Their expertise will help you steer the complexities and exquisiteness of each option, allowing you to choose the structure that adequately aligns with your firm objectives.
Apply for a Transportation Worker Identification Credential (TWIC) card
A TWIC card is a special identification card issued by the Transportation Security Administration (TSA) and U.S. Coast Guard, serving as an essential credential for individuals working in drayage as owner-operators. It grants access to secure areas of port facilities without constant supervision.
As of 2021, obtaining a TWIC card involves a cost of $125.25 for a five-year registration period.
To begin the registration process, you can conveniently fill out an application online through the TSA website. Following that, you will need to organize an appointment at the most immediate TWIC application center. Throughout this appointment, you will be directed to:
- Furnish the required documentation as per the conditions
- Undergo fingerprinting
- Have a facial photo taken
- Present either a current U.S. passport or a driver’s license along with a birth certificate
Completing these steps ensures the proper application and issuance of your TWIC card, allowing you to operate within secure areas of port facilities as an owner-operator in the drayage company industry.
Secure all necessary documentation and insurance
Before commencing business as an owner-operator, there are additional documents you may need to acquire. It’s important to note that business requirements and associated costs can vary based on factors such as your state, carrier, or individual circumstances. As a port dray owner-operator, some examples of documentation you might require include:
Employer Identification Number (EIN) – You can register for an EIN online via the IRS’s website. This unique identifier is essential for tax purposes and for establishing your business identity.
Base plates, permits, and licenses – Many carriers often handle the registration of these items on your behalf. These include base plates for your truck, permits, and licenses required for operating within specific regions or jurisdictions.
Trucking insurance – It is advisable to inquire with the company you lease with regarding their specific semi-truck insurance requirements. Besides, conferring with your legal advisor can help choose other types of insurance range that may be suitable for your company, considering aspects such as drawbacks and risk management.
Recall to remain revamped on the precise conditions and laws pertinent to your business, and seek experienced guidance to ensure compliance and protect your interests as an owner-operator.
Lease-on with a drayage carrier
After acquiring the necessary experience, securing a truck, and completing the essential business paperwork, the next step is to actively pursue Drayage company business opportunities within your area.
One recommended approach is to consider leasing with a reputable carrier, as it can offer the stability and predictability vital for establishing your business. Many prominent carriers facilitate the application process for owner-operators seeking business opportunities through convenient online platforms.
By leveraging these online resources, you can efficiently apply for relevant Drayage business opportunities, enabling you to expand your clientele and forge valuable partnerships within the industry.