How to Write a Business Plan For a Trucking Company?

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your trucking business, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in the business plan of your trucking business. Use this template to create a complete, clear and solid business plan that get you funded.

For more information on trucking businesses, make sure to read our guides below:
How To Start a Trucking Business in 10 Steps
How Much Does It Cost To Start a Trucking Business?
How To Build a Financial Model For a Trucking Business

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for a trucking business?

The purpose of a business plan is to secure funding through one of the following channels:

• Obtain bank financing or secure a loan from other lenders (such as a SBA loan)
• Obtain private investments from investment funds, angel investors, etc.
• Obtain a public or a private grant

How to write an executive summary for a trucking business?

Provide a precise and high-level summary of every section that you have included in the business plan of your trucking business. The information and the data you include in this segment should grab the attention of potential investors and lenders immediately.

Also make sure that the executive summary doesn’t exceed 2 pages in total: it’s supposed to be a summary for investors and lenders who don’t have time to scroll through 40-50 pages, so keep it short and brief.

The executive summary usually consists of 5 major sub-sections:

• Business overview: start by introducing your trucking business, where it is located, the services it offers, and the pricing strategy you want to implement. Mention what sets you apart from other businesses. For instance, if you carry a specific type of freight or if you specialize in long-distance moves, make sure that you also mention that
• Market analysis: summarise the market where you will operate and provide a brief about your target market and narrow down the data to your niche market such as flatbeds, refrigerated loads, tankers, etc. Also give certain data points about the trucking industry in the area where you want to operate (size and growth), as well as an overview of the main competitors, etc.
• People: introduce your trucking business’ management and employee structure. Provide a brief (no more than a couple of sentences each) of the knowledge and experience of the team. Also, mention how the company will be structured (management roles and reporting lines)
• Financial plan: how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? You can include here a chart with your key financials (revenue, gross profit, net profit)
• Funding ask: what loan/investment/grant are you seeking? How much do you need? How long will this last?

2. Trucking Business Overview

In this segment of the business plan, you will provide details about the trucking business.

You must answer here some important questions that potential investors and lenders often ask about your business and operations. Here are some examples of questions you must answer:

• What is the rationale behind your opening a trucking business today?
• What’s the trucking business’ location and why did you select that location?
• What will be your area of operation?
• Will you specialize in a specific type of logistics arm, cargo type, or a particular region?
• How many trucks do you intend to buy or lease?
• What will be your pricing strategy and why?
• What will be the legal structure of your company?

a) History of the Project

Any business overview must start with explaining the history of the project. There are 2 components here:

• Passion & experience of the business owner
• Rationale behind starting a trucking business today

Passion & experience

You may or may not have prior experience. If you have experience, speak about it and how it will help you to run your business. For instance, you may have been a dispatcher for a leading trucking business for 5 years, and you have the complete experience of taking orders, sending shipments, and monitoring routes. Now you want to start your own trucking business and use your knowledge to run it more efficiently.

Rationale

Is there a certain problem (or perhaps, a set of problems) that your trucking business will try to solve when it comes into existence? For example, there may not be any competitive trucking service offering refrigerated trucks or reefer trucks to move perishable goods and your business will fill that gap.

But that’s not all: the market must be suitable for a business to exist and thrive. For instance, if you are trying to open your reefer truck business in an area where shippers usually ship cargo that is neither susceptible to weather nor do they require temperature-controlled transport, you will most likely run into losses. 

Similarly, if the shippers in your area require LTL (less than truckload or partial truckload) shipping, but you specialize in FTL truckload, there may not be enough demand for your services.The rationale behind your project must be backed up by a thorough analysis of the industry in the area where you plan to open your trucking business. This is what we will cover under Market Overview further below.

b) Business Model

This section of the Business Overview should explain your business model. For example:

• Will you buy new trucks or lease trucks for your business?
• If you want to own your fleet instead of hiring subcontractors, where will be your warehouse located?
• Will the warehouse be located at an optimal distance from shippers?
• What type of cargo will you carry?
• Will you offer long distance or short distance move?

What are the different types of trucking companies and services?

There are various types of trucking services that you can select. Some of them include:

• LTL: LTL stands for Less Than Truckload (aka partial truckload). It is a type where a shipper’s cargo will not fill your entire truck. Usually, you will carry cargo from different shippers and each shipper will pay for the space they are using. In this form, shippers do not have enough control over the shipping time and route.

• FTL: FTL stands for Full Truckload. This is the type where a shipper’s cargo will fill your entire truck. The shipper will pay for the entire truck trailer and your truck will follow a specific route and deliver within a specified time.

• Refrigerated Trucks: These are also known as reefer trucks and they are usually used for moving perishable goods such as meat, poultry, fish, etc. You may even move medical or chemical cargo that will require specific temperature and humidity during transport. Simply put, the trucks will have the technology to control temperature and humidity. There will be special monitoring and tracking features, too. Plus, you can operate in both LTL and FTL modes.

• Flatbed Trucking Service: Flatbed trucks are meant for easy loading and unloading of cargo. They are perfect for transporting cargo that is already packaged into vehicles, shipping containers, or material, keeping the cargo protected from the weather. Usually, building supplies and machinery are transported with this service.

• Expedited Trucking Service: You will deliver cargo from point A to point B anytime, anywhere in a hurry. This service is also known as Straight Truck Delivery, and it is best for transporting cargo that is too fragile or too large for air freight, but it still needs to reach its destination quickly.

• Intermodal Freight Shipping: It is a type of service where multiple transport modes are involved. However, a trucking service usually covers the last part. For instance, a shipping container can reach Nebraska from New York via rail, but a trucking service will be required to move it to Norfolk, Nebraska.

• White Glove Service: This is the type of service where you will be responsible for packaging cargo, shipping to a specified location, and unloading and unpacking the cargo. Essentially, you will provide a complete end-to-end solution.

c) Services

The business model you select will define your services. However, you still need to categorically mention all the services you want to offer. If you want to specialize in a specific type of cargo, make sure that you mention that. 

For example, you may specialize in transporting hazardous biochemical material in a temperature-controlled environment with a time-bound delivery schedule. Explain your expertise and experience.

d) Pricing Strategy

Strategy

This is where you will provide an overview of your pricing strategy. For instance, you may provide trucking services at a lower cost than your competitors because you hire subcontractors, thereby reducing the overhead cost of fleet maintenance.

You may also provide a lower pricing range because of route optimization leading to maximum profitability.

On the other hand, you may charge more than your competitors because of many reasons such as advanced security, guaranteed delivery, hi-tech trucks for cargo safety, and more.

Of course, the pricing strategy will heavily depend on various factors that include (but are not limited to):

• Quick & timely delivery
• Cargo type
• Delivery location (geography)
• Fuel cost
• Route
• LTL or FTL model, etc.

Pricing table

While it may not be possible to provide a proper pricing table for all cargo types that you may haul, it is still a great idea to provide a table that gives an overview of your pricing structure.

Here is a sample table that you can refer to and build on that:

Cargo type	Distance	Cargo weight	Price (per mile)
Perishable cargo (food)	< 100 miles	1,000 lbs.	$2.90
Perishable cargo (food)	> 100 miles < 200 miles	1,000 lbs.	$2.50
Perishable cargo (food)	> 200 miles	1,000 lbs.	$2.10
Pharmaceutical cargo (hazardous biochemicals)	< 100 miles	1,000 lbs.	$4.50
Pharmaceutical cargo (hazardous biochemicals)	> 100 miles < 200 miles	1,000 lbs.	$4.00
Pharmaceutical cargo (hazardous biochemicals)	> 200 miles	1,000 lbs.	$3.80

However, don’t go into extreme details because potential investors are not interested in the nitty-gritty of your pricing. They just need the big picture to assess the profitability, because they will tie your pricing strategy with financial projections later on.

e) Company Legal Structure

Finally, your business overview section should specify what type of business structure you want. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?

3. Trucking Business Market Overview

A complete understanding of the market where you want to operate is important for the success of your business. That’s also something you must showcase in your business plan.

For example, if the customer segment is PC manufacturers, semiconductor manufacturers, and wholesalers of non-perishable products, offering refrigerated or reefer trucks is probably not a good idea. You will be better off with a flatbed trucking service.

Therefore, you must cover here 3 important areas:

• Market trends: how big is the trucking industry in your area? What is its growth rate (or decline rate) and what are the factors contributing to its growth or decline?
• Competition overview: how many competitors are there? How do they compare vs. your business? How can you differentiate yourself from them?
• Customer analysis: who is your target audience? What type of cargo do they usually ship? Do they require quick and timely deliveries? Do they need long-haul deliveries? How frequently do they ship and is there a steady demand?

a) Trucking Industry Status Quo

How big is the trucking industry in the US?

According to Statista, the trucking industry in the US is responsible for moving most of the overland freight in the country. In 2020, the industry was worth $732.3 billion..!

The industry has declined significantly from its peak in 2018 at $797 billion, due to the pandemic. Yet, it already shows signs of recovery in 2021 and 2022.

There are around 3.5 million truck drivers in the United States, of which 1 in 9 are independent and most are owner-operators. 

Considering that trucking dominates the freight industry in the US and there is a shortage of drivers overall, the trucking industry remains a profitable industry nowadays.

How big is the trucking industry in your area?

After getting a clear picture of the trucking industry in the US as a whole, narrow down to your location. It’s very likely that you won’t find the number anywhere (at least not for free).

In that case, you can use our guide to estimate the TAM, SAM, and SOM for your business. Here is an example of how to do it:

We know there are around 1.2 million trucking companies in the US in 2021. Together we know they generate a total annual turnover of $732 billion, so the average annual turnover generated per company is around $610,000.

Therefore, if the area where you want to open your trucking business has 1,000 trucking companies (for example, a large city), you can safely assume that the trucking industry in your area is worth approximately $610 million.

b) Trucking Industry Competition Overview

Studying your competitors’ business models is vital. You need to understand what makes them successful or why they fail. A clear understanding of their business model, the services they provide, their marketing strategies, etc., will allow you to provide a better service.

If your competitors are offering nearly the same services, then what is their market share and how do they market their products & services to attract new customers?

It is always a good idea to do some research (if necessary, you may consider physically visit your competitors without revealing your business intentions) and create a comparative table summarizing their service offerings, marketing strategies, target audience, etc.

Here is a sample table that you can use:

	Competitor #1	Competitor #2	Competitor #3
Location	xx	xx	xx
Type of trucks	Expedited Trucking	Flatbed Trucking	Refrigerated Trucks
Services	Fragile cargo hauling	Big machinery hauling	Perishable cargo hauling
Pricing range (per mile)	$3.80 – $4.50	$2.50 – $3.50	$3.20 – $4.10
Fleet size	14	18	10
Subcontractors	1	4	3

Trucking Business SWOT Analysis

SWOT stands for Strength, Weakness, Opportunities, and Threats. This analysis will help lenders and investors better understand how you compare vs. competitors as well as the overall risk and reward profile of your business.

Here is a sample that you can use as a reference:

• Strengths: 12 years of truck driving experience, 5 years of dispatcher experience with expertise in route optimization for increased profitability, personal connection with reliable brokers, experience in handling hazardous biochemical transport
• Weaknesses: Startup cost, no initial brand reputation
• Opportunities: Research facilities of various pharmaceutical companies in a 50-mile radius, a booming food industry because of the steadily increasing residential population
• Threats: Established players like Schneider National Carriers, J.B. Hunt Transport, etc., are entering the market with a big fleet, and new smaller players (both private and for-hire carriers) are emerging

c) Customer Analysis

This is the sub-section where you will provide a detailed analysis of your target audience.

Some important points that you must include in your customer analysis include:

• What types of companies and businesses are looking for trucking services?
• What type of trucking services are in demand?
• How do they hire trucking businesses (referrals, cold calls, in-person presentations)?
• What do they want to be improved in the current trucking business scenario so that their needs are met in a better way?

You can add as many data points as required to validate your business decision. The idea here is to display your deep understanding of the target audience and their needs, preferences, and expectations. This knowledge can help you to tailor your products & services to attract new customers.

4. Sales & Marketing Strategy

This is the section where you outline your customer acquisition strategy. Try to answer the following questions:

• What is your Unique Selling Proposition (USP)?
• What are the different marketing strategies you will use?
• How do you intend to track the success of your marketing strategy?
• What is your CAC or customer acquisition cost?
• What is your marketing budget?

What marketing channels do trucking businesses use?

A few marketing channels that trucking businesses typically use are:

• Brokers
• Direct visits by sales representatives
• Cold calls & emails
• Billboards & signages
• PPC ads

Trucking businesses still rely heavily on direct sales (Sales reps who sign contracts with shippers) and intermediaries: the brokers.

Whether you opt for these standard channels, you must have a fair and nearly accurate estimate of your sales & marketing budget.

For example, whilst direct sales will come up as salaries and commission to your own sales representatives, using brokers will cost you a fee (usually 15%) for each contract. For more information on how much it costs to run a trucking business, read our article here.

What is your Unique Selling Proposition (USP)?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors.

A few examples of USPs are:

• Service quality: we offer GPS-based automated route optimization for the fastest delivery for time-sensitive and perishable products in a highly controlled environment optimized for different cargo types
• White Glove: we offer white glove full-service hauling for fragile and hazardous cargo with hi-tech trucks
• Location: we deliver cargo in hard-to-reach locations, thanks to our highly experienced drivers with stellar safety records who can drive through perilous routes

Your USP will depend on your business model, competitor analysis, and target audience. Whatever your USP be, it should be clear and appeal to your target audience.

5. Management & People

You must address two things here:

• The management team and their experience
• The organizational structure: different team members and who reports to whom?

Management

Small businesses often fail because of managerial weaknesses. Thus, having a strong management team is vital. Highlight the experience and education of senior managers that you intend to hire to oversee your trucking business.

Describe their duties, responsibilities, and roles. Also, highlight their previous experience and explain how they succeeded in their previous roles.

It is also important that you explain how their experiences and qualifications help you in implementing the trucking business you are proposing. If they have specialized training and experience (such as years of experience in customer database management, customer service, dispatch & route optimization, etc.), add that information.

Organization Structure

Even if you haven’t already hired a general manager, safety manager, in-house technician, accountant, sales representative, client management representative, dispatcher, and other relevant staff members, you must provide a flowchart of the organizational structure defining hierarchy and reporting lines.

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan for a freight or trucking company.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your trucking business is an attractive investment.

There should be 2 sections to your financial plan section:

• The startup costs of your project (if you plan to start a new trucking business, purchase new trucks, etc.)
• The 5-year financial projections of your trucking company

a) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a trucking business, startup costs are all the expenses you incur before you start transporting goods for your customers. These expenses typically are:

• The acquisition of the fleet (the trucks)
• The office & warehouse lease deposit (if you rent) or real estate price (if you buy)
• Office equipment
• Business insurance, etc.

Of course, the startup costs depend on a number of factors, like the number of trucks you operate, whether you own the trucks (if you operate as an owner-operator) or simply subcontract with the drivers who own their trucks, etc.

For example, it costs on average $208,000 to $343,000 to start a small trucking company with 9 trucks (assuming you take on additional debt to buy the trucks).

Note that these costs are for illustrative purposes and may not be fully relevant for your business. For more information on how much it costs to open and run a trucking business, read our article here.

Startup cost	Amount
Fleet acquisition *	$135,000 – $270,000
Office & warehouse lease deposit (optional)	$10,000 – $20,000
Licenses & certifications	$18,000
Business insurance	$45,000
Total	$208,000 – $343,000

b) Financial Projections

In addition to startup costs, you will also need to build a solid 5-year financial model in the business plan of your trucking company.

Note that your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

• How much revenue do you expect to generate over the next 5 years?
• When do you expect to break even?
• How much cash will you burn until you get there?
• What’s the impact of a change in pricing (say 15%) on your margins?
• What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

• The number of miles ;
• The deadhead rate ;
• Your expected revenue ;
• Operating costs to run the business ;
• The cost to acquire the trucks.

When projecting your financials, make sure to sensitize sales volume (miles), pricing, deadhead rate as well as the expenses (fuel, tolls, salaries, etc.). Indeed, a small change in these assumptions may have a significant impact on your revenues, and most importantly, profits.

7. Use of Funds

This is the last section of the business plan of your freight and trucking company. Now that we have explained what your business model is, what type of freight you transport, how you get customers, etc., this section must now answer the following questions:

• How much funding do you need?
• What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
• How long will this funding last?
• Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

• What percentage of the total funding the loan represents?
• What is the corresponding Debt Service Coverage Ratio?

If you raise equity

• What percentage ownership are you selling as part of this funding round?
• What is the corresponding valuation of your business?

Use of Funds

Any business plan for a trucking business should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying your employees’ salaries and the COGS (fuel, tolls, maintenance)? Or will it cover mostly the cost for leasing or purchasing the trucks?

For the use of funds, we also recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.