Why Corporate Filing Is Necessary for Trucking Business

 The trucking industry is very competitive, but it is growing substantially over the years and trucking services are in high demand. Starting a trucking business comes with a decision whether to incorporate it or not. Although corporation filing is costly and time-consuming, its benefits outweigh all the disadvantages. One of the most important reasons for a Corporation Filing for trucking businesses is to protect the owner’s assets and establish credibility.

 There are different legal structures to consider when incorporating your business. Therefore, you need to do thorough research and choose the structure that best fits your company. Incorporating your business in your base state help to reduce confusion and saves more money. Continue reading as Global Multi Services explain why Corporation Filing is necessary for trucking business. 

Benefits of Corporation Filing 

Access to Capital 

Corporations sell ownership and raise capital by trading their stock publicly. This helps them have more access to capital. Also, one of the criteria for borrowing money in many banks is by being an incorporated business. This access to capital helps many businesses grow and saves them from going bankrupt in times of need.

Limited Liability 

Corporations provide personal liability protection to their shareholders. That means the owners are not personally responsible for the debts and liabilities of the business. This is one of the main reasons companies choose to incorporate. For example, when a corporation is sued, the shareholders are not personally responsible for corporate debts. Thus, creditors cannot pursue their assets. However, in a sole proprietorship corporation, the owner’s assets and business assets are considered the same. Therefore, can be used to pay business debts.

Business Management 

Incorporated businesses have distinct business management. The shareholders are responsible for making decisions. They speak with the board of directors, who delegates their authority to the company's officers. These improve accountability, efficiency, and business growth. Corporations also have resources that make them offer good salary packages which attract the best talent available in the industry. The lack of structure and shared decisions in an unincorporated business can affect the company.

Tax Advantages 

Corporations enjoy tax flexibility such as medical taxes, savings on self-employment taxes, worker’s compensation, and many more. Although some corporations, like C corporations, are charged with double taxation, others, like S corporations, are not. 

Business Security and Longevity

Corporation ownership depends on the percentage of the company shares held by the shareholder. This makes the transfer of corporation ownership flexible, and the business also perpetuates for a long time. Although the transfer of ownership depends on the governing agreement in the bylaws and articles of incorporation, ownership of the corporation is often easy to buy and sell.  For example, if a shareholder dies, their stock can be transfer to someone else. Similarly, they can sell off their stocks if they want to leave the company.

Business Credibility

Incorporating your business establishes credibility. It builds banks, customers, and investors' trust. It also makes them believe the company has a positive image. 

Is MC Authority Beneficial for Trucking Companies?

 Have you ever consider stepping out of your comfort zone and getting your MC Authority after years of working for a trucking company? It is not a bad idea, but you need to have all the necessary skills and be fully committed to it. Having your MC Authority gives you many opportunities. These include running the trucking business the way you like, making decisions based on your vision, growing it at your own pace, and many more. Running a successful trucking business is beyond driving, and it is not for everyone. You need additional skills. These include business management skills, problem-solving skills, analytical skills, financial management skills, team-building skills, and many more. 

 

Many great drivers are deficient in these skills, which can affect the success of their trucking business. So, how do you know having an MC Authority is the right move for you? The decision is not something you should jump into because many drivers have taken the leap and have either failed or burned out. Therefore, you need to weigh your advantages. Read on as Global Multi Services takes us through the benefits of Motor Carrier Authority for trucking companies. 

Make You A Boss 

Operating under your MC Authority allows you to make decisions that suit you. You get to decide on the kind of load to take on and where you want to operate. It also gives you a lot of control over how much money you make and how far you want to go in the trucking business. But achieving all these isn’t an easy task. Having your MC Authority means you are no longer under big organizations with freight ready to be hauled. You must build your business and streamline your operations to build customer’s trust. That means spending time to build relationships with your customers and negotiating contracts with brokers and shipped. These ensure you have freight to transport, and your trailers are always full. 

 

Help You Decide Your Income 

 

With your MC authority, you get to decide your charges. You can negotiate better rates and search for better loads. When you are an owner-operator leased under a company or a truck driver in a company, you will have a fixed rate per mile. But with your MC Authority, you are only limited to the types of loads you take on. Although, it might feel unachievable, and thighs might be going slow. But it will get better over time, and you will get more loads to haul. Once you establish your business, it allows you to turn down not so good per miles rates and get better ones. 

 

Keep Your Profits 

 

Having your Motor Carrier Authority helps you keep the profits you made from your trucking business after paying expenses. All the efforts you put into establishing your business and long hours on the road make you more money instead of adding to someone else’s bank account. However, figuring out how to make more profit isn’t an easy task. You need to maximize your top-end revenue and cut your expenses. These will help you boost your profit. 

UCR Permit: The Cons of Being an Independent Owner-operator In Trucking Business

 Running a trucking company as an independent owner-operator comes with a lot of benefits. From choosing the type of company you want to work with, load to haul, to the amount, you charge per mile. You also get to earn more profit since the business is yours. The benefits are endless, but it also comes with a lot of work which can sometimes be overwhelming and tiring. These are why many truck drivers do not venture into the business despite the benefits it entails. Being an independent owner-operator is more than just driving the truck. It means you handle all the affairs of your trucking business. You are the CEO, Dispatcher, Safety and Compliance Officer, Maintenance Manager, and many more. You also need to obtain your UCR Permits, IRP Plate, IFTA, and other licenses. These give you a lot of work that could have you working for longer hours, especially when developing systems to make your business run smoothly. Keep reading as Global Multi Services explains the cons of being an independent owner-operator in the trucking business.

Finding Consistent Load

New independent owner-operators often struggle to find consistent load at a better rate. These happen because they are just developing their business, and brokers are still hesitant to work with them. Also, they have not built customer’s trust, and most brokers prefer to work with companies with good track records. Furthermore, there is a lot of competition in the trucking industry. As an operator, you will be competing with big companies who will take pennies to stay on top and other owner-operators who charge less. Growing your business comes with the responsibilities of persistently looking for new loads and negotiate your rates.

 

Building Customer’s Base 

 

Having few customers might seems reasonable at the beginning as an owner-operator. But it cannot sustain your business in the long term. As an owner-operator, you need to build your customer base, and can sometimes be difficult because many brokers have built trust with other trucking companies. Building a good customer base takes time and conscious effort to provide the best services for your customers. Ensure your clients are constantly supplying you loads, and you are meeting all their needs. Also, stay in compliance by processing your Unified Carrier Registration to obtain your UCR Permit.

 

Keeping Up with UCR Permit

 

Becoming an owner-operator means you must handle all your permits, invoices, and compliance documents yourself. These include UCR Registration, IRP Plates, UCR Permits, and many more. Big trucking companies often dedicate an entire department that takes care of their paperwork but, you must do it all on your own. Managing your business while also driving can sometimes be hectic. But using trucking management software can help you scan, track, and keep records of all your essential documents and paperwork. It also relieves you of the stress of staying up late and scarifying your downtime to sort out stacks of paperwork. 

USDOT Number: Safety Compliance For Trucking Companies

 One of the essential things for trucking companies is adhering to the rules and regulations laid down by the Federal Motor Carrier Safety Administration. These include obtaining a USDOT Number. Driver’s License, and many more. These guidelines are put in place to ensure truck drivers and other drivers on the road are safe. The FMCSA focuses on verifying operating trucks to ensure they are fully maintained. They also protect roadways by making sure trucks do not haul overweight loads that can damage the road. For trucking companies, remaining compliant with the DOT Number is more than legalities. It is a way to ensure your drivers are safe and your fleet is well maintained and in top shape. Read on as Global Multi Services take us through how trucking companies can stay in compliance.

 What is USDOT Number?

 

The USDOT Number is a unique number assigned by the Federal Motor Carrier Safety Administration to identify and track motor carrier safety information. This information comes from different sources such as audits, compliance reviews, investigations of accidents, and inspections. Every trucking company operating across state lines and transport people, or goods is required to have one. Trucking companies need to register with the Federal Motor Carrier Safety Administration to obtain their DOT number.

How To Stay in Compliance 

 

Test All Truck Driver for Alcohol and Drugs

 

The Federal Motor Carrier Safety Administration and the Department of Transportation require commercial vehicles drivers to adhere to specific drug and alcohol regulations. Drivers with CDL must be tested for alcohol and drugs regularly. These include part-time, intermittent, backup, international drivers, and other full-time workers in the company. Drug and alcohol tests should be administered in the following scenario: 

·         After an accident occur

·         Randomly throughout the year

·         Before employing a truck driver and it must be negative 

·         Drivers returning to duty after a failed drug and alcohol test 

·         When a driver is suspected to be under the influence of drugs or alcohol

 

Maintain A Clean Record 

 

Maintaining a clean record boosts your company’s safety ratings hence, increasing your revenue. The following documents are essential for maintaining a clean record. 

·         Driver’s logbook 

·         Insurance documents

·         Drivers record such as proof of CDL. 

·         USDOT Number and proof of inspection 

 

Focus On Truck Maintenance 

 

Trucking companies complain about the hefty paperwork and regulations. But most of these guidelines are put in place by the Federal Motor Carrier Safety Administration for the safety of the truck drivers and other people on the road. The following regulations can be put in place to ensure proper truck maintenance. 

 

Tire Inspection: Drivers should inspect their tires before and after every trip. They should check for damages such as cuts, foreign objects, cracking, uneven tire wear, and other damages. 

Avoid Overweight: Drivers must not overweight their trucks. Overloading the trailer can cause tire failure while driving, which can lead to severe accidents.

Avoid Overspeeding: Drivers must adhere to the speed rating. Exceeding the recommended limit can lead to tire failure, which can cause accidents.