You should always have a growth-oriented mindset as an entrepreneur. The trucking industry continues to enjoy considerable demand from the market even during the pandemic. With things already going back to normal, the industry will grow even further!
There will be plenty of opportunities for your trucking business soon. However, you can only achieve growth if you start taking steps as early as now. You should prepare your business for that upcoming rise in demand. It is a must to dig the foundation of your business expansion way before the opportunities arise. That will make the transition smoother and more proactive.
Here are five steps that you can take as early as now to position your business for future expansion. Consider these tips before you apply for loans for truck drivers to finance your upscaling.
Leverage Existing Technology
Existing technology will help make your business more streamlined. Implementing such technology in your fleet can raise the efficiency of your drivers. You, as an entrepreneur, can focus more on managing the business and finding sources of revenue that can support your existence.
For instance, you should make sure that each of the trucks in your fleet is equipped with radio communications as well as a global positioning satellite (GPS) system. These pieces of technology help your dispatch team keep track of your deliveries in real-time. They’re also very useful in determining whether your drivers are dallying on purpose, or are having an actual emergency.
Technology has totally transformed industries. For truckers, there are now apps that let you track fuel prices at various locations throughout the United States. These apps can help your business reduce costs for keeping your trucks fueled during their deliveries. Some apps also automate several management processes, like invoice creation, record-keeping, and maintaining compliance with regulations.
Leveraging technology can help you reduce expenses in labor and logistics as a trucking business. Most apps created to help truckers are free of charge, so why not give them a try? All you and your staff need are Android or iOS phones.
Keep Your Cash Flow and Working Capital Stable
Having a stable cash flow and working capital is vital not only for success but also for survival. An enterprise with shaky finances is setting itself up for catastrophe if a crisis suddenly strikes. For example, businesses that already suffered from unstable cash flow found themselves severely crippled when COVID-19 struck.
You need to start learning how you can stabilize your cash flow and working capital while your business is still small. There are only a few items to look at when the company is still in a fledgling state. By the time your trucking business has expanded, dealing with these two concerns will be a breeze for you and your financial team.
At this point, you also need to learn how you can plug cash flow gaps as soon as they come. There are various forms of financing available. One is invoice financing, which allows you to advance a portion of your accounts receivables. This way, you can get the cash that those receivables represent even before they mature and can be collected.
Consider Cost Cutting
It’s difficult for any business, in general, to realize growth if they are already burdened with expenses. Costs could single-handedly bring down any enterprise’s cash flow. As an entrepreneur, it’s your job to look at your finances and decide if your business is in good shape or not.
The only way you can measure your finances is to sit down with your financial team. This is a great time to look at the numbers on your financial statements. They tell a story on their own, and it’s actually easy to follow. You don’t have to complicate the process; you can simply look at the income and expense summaries.
These two sections of your financial statements list down your sources of revenue and your expenses. They give you a snapshot of where your money comes from and where it goes. You can see from these data each specific expense account. From this information, you can decide which expenses need to be cut back on or eliminated entirely.
Network with Potential Clients
Like every business in general, a trucking company will need a sizable pool of clientele to continue earning revenues. The moment you run out of clients is also the moment you’ll need to start thinking about fixing your cash flow. Troubleshooting is something you wouldn’t want to do at all; it’s your job as the entrepreneur to find sources of income for your business.
Most companies nowadays rely on digital marketing techniques to get their business across to their potential customers. Unfortunately, these are passive strategies for gaining traffic to your website, Facebook page, or physical headquarters. You’d need to get out there and talk to the people that matter – your target market.
Community boards are great venues to get up close and personal with potential clients. You can engage in conversations with members of your target audience. It’s not just advertising your business to potential clientele, but also a way to demonstrate your authority and expertise in your chosen niche. People also tend to post their trucking needs to these communities, and this is an opportunity you should be taking advantage of.
Attending trade conventions is also a great way to meet potential customers as well as your fellow truckers. As unlikely as it sounds to you, networking with your competitors could also lead to referrals.
Invest In Your Fleet
Last but not least, you will want to invest in improvements to your fleet of trucks. Upgrading your trucks improves your capabilities immensely. For instance, larger trucks enable you to take on heavier loads or larger orders. This alone will increase your revenues dramatically, but there are reasons to upgrade as well.
Having upgraded trucks helps to reduce costs on maintenance and repair. Brand new vehicles are less likely to break down because of defective parts. Any downtime in your fleet means revenue loss and additional expenses, after all. These are cash flow problems, albeit minor, that you will want to avoid if you want to keep your business in good shape.
In other words, keeping your truck fleet updated and in good working condition ensures optimal revenues. Every truck that breaks down means that you’re missing out on deliveries that the vehicle could’ve taken on. Yet, you have to spend money to get it back to working condition. If you don’t have a robust cash flow, these repair costs could tilt your finances towards the negative.
The trucking business continues to enjoy a high growth potential even while the pandemic is ongoing. People and other businesses will always need to move orders around, after all. With the COVID-19 crisis almost ending, trucking businesses can look forward to seeing further growth in their potential revenues as restrictions are relaxed.
However, as an entrepreneur, you can’t just expand your business without first laying the groundwork or foundation. You’d need to first take care of a few things that will make your business growth more manageable and less stressful on your cash flow or your working capital. Fortunately, following those five tips above will keep your business in good shape until the opportunity for growth arises.