Investing in the trucking business is a potentially lucrative endeavor that could generate you a considerable residual income when done correctly. Luckily, there are many areas to invest in, for example, a trucking school, acquiring a truck and leasing it out, investing in a FedEx delivery route, or even buying a bread route.
However, the trucking business is no easy task. It is a colossal undertaking that could eat through your budget if you take it lightly. Therefore, whatever business idea you try, ensure that you have done sufficient market research. To remain in business and thrive, you want to earn a good ROI, steady income, and reasonable profits.
Things to Consider Before Investing in a Trucking Business
Below are a few things to consider before investing in a trucking business:
- Consider available options when looking for a loan: You will need a loan if you cannot foot the upfront costs of buying and starting a trucking business. Thus, ensure you consider all your options to secure a favorable deal.
- Choose your trucking segment carefully: From refrigerated vehicles to food trucking, it’s essential to consider which niche to choose.
- Do enough market research: It allows you to settle on a trucking segment that generates enough passive income to meet your desired returns.
- Get Feedback: Feedback from stakeholders, including your customers, will give insight into your business and how to improve it.
- Generate Market Awareness: Marketing is critical for your success, whether running your website, utilizing social media marketing, or using local media and billboards. Generating widespread awareness and exposure helps you reach your target audience, get better deals, and secure your market niche.
Acquiring a Truck
Below are some things to consider when acquiring a truck:
- New or Used?
Do you go for a new truck or buy a used one? A new truck has a longer shelf life with fewer repairs at the outset, but you need to pay for it upfront. New semi-trucks cost anywhere between $130,000 and $200,000.
On the other hand, used trucks are considerably cheaper, but you need to ensure it’s in good condition and the mileage is not too excessive. If need be, hire a qualified mechanic to inspect the vehicle before buying it.
- Type of Truck
What type of truck you buy or lease depends on the business you wish to start. Additionally, it should align with your budget. For example, do you want a day cab or a sleeper, and what brand should you get?
When it comes to the truck brand, get one that has easily accessible repair parts and affordable maintenance. Certain brands may cost more or could be harder to find. For example, Freightliner has easy access to parts, making its maintenance more affordable than brands like Volvo or Peterbilt.
Trucking Ideas to Try
There are several trucking ideas to try that will earn you passive income. These include:
- Leasing Your Truck onto a Carrier
Once you acquire your truck, you could lease it to a carrier, making your investment passive. The carrier will handle most of the associated administrative and operational hassles of the trucking business. These include:
- Handling fuel tax
- Handling the paperwork
- Arranging insurance
- Providing maintenance at their shop
- Finding freight for you
- Providing dispatching services
- Providing drivers
Additionally, you don’t need an operating authority if you lease your truck. However, the carrier will give you a more significant cut if you have your authority and insurance.
- Buying and Leasing a Trailer
Acquiring a trailer and leasing it is a super passive source of income in the trucking business. You don’t have to deal with the hassle of maintaining trucks, handling breakdowns, acquiring and managing drivers, and other issues associated with the trucking industry.
Trailers are cheaper to buy and cost anywhere between $10,000 and $20,000 based on mylittlesalesman.com listings. Additionally, you can rent them for around $900 per month on sites like Rentalyard.com.
- Start a Mobile Billboard Business
If you already have a truck, you could make additional passive income by renting out mobile billboards to organizations and companies who wish to advertise their business on your route.
- Investing in a Box Truck
If you wish to operate a trucking business without a semi-trailer, you could choose a box truck. These trucks are smaller and more affordable than semis and can easily maneuver through urban centers while hauling decent freight.
- Investing in Dump Trucks
Operating a dump truck business is an easier option because it’s a local operation that does not require long hauls.
- Investing in a FedEx Delivery Route
Buying a FedEx route is a lucrative passive income idea. Your route will cover a given region where you make deliveries to different locations. Your managers and drivers will handle the daily delivery obligations, and you get paid per delivery. You don’t need to buy a truck in most cases because the routes for sale come with one. Additionally, FedEx has a steady flow of deliveries.
- Buying a Bread Route
You could also buy a bread route, which uses a similar concept to FedEx. Your deliveries will cover a designated territory, with many distributors offering exclusive arrangements.
- Trucking School
You could start a trucking school and earn a good profit. For example, if you offer a six-week class with ten students, you expect 80 students per year. Using the standard tuition fee of around $4,000 per student, you can expect to generate about $320,000 in revenue.
In Conclusion
There are many passive income opportunities in the trucking industry worth exploring. Hopefully, this article sets you off on the right path to investing in the industry.
