How Owner Operators Can Reduce the Headache of Bookkeeping

While you might enjoy being the owner and operator of your very own trucking business, you may feel you can do without the accounting and bookkeeping aspect of the job. Luckily, you don’t have to become a master of record-keeping to handle your company’s finances. Here are few tips to get you up and running.

Make It a Daily Practice

Do yourself a favor and get into the habit of carving out time every day to handle owner operator expenses. It’s easy to leave the task for tomorrow or the weekend, but doing so just makes the work pile up more and more. Not only does daily bookkeeping make your life easier, you’ll also have a more accurate picture of how your business is doing so you can plan and adjust accordingly. After all, you don’t want to make business or financial decisions for tomorrow when you don’t have a clear picture of what happened yesterday.

Use the Right Software

There are more bookkeeping and accounting software options available than ever before. Explore your options to decide the best fit for you and your business. Specifically, you might be better off with a cash-based system that allows you to count your income as you receive payments and your expenses as you take care of them. Don’t be afraid to try out different types of software (especially if there are free trial offers) until you find one that’s a solid fit for you.

Consider Going Digital

Because paperwork can take up a great deal of space and become cumbersome to organize adding even more time to your day-to-day workload, go digital when it comes to keeping up with financial documents. This is an especially great idea if there’s already an abundance of paperwork you have to deal with on a daily basis. Keep all those invoices and bank statements on a cloud where you can easily and quickly access them from a computer, tablet or smartphone.

Learn How to Properly Manage Your Cash Flow

One of the first things you should learn when it comes to bookkeeping is the ins and outs of cash flow. Knowing how much money you have available right now can mean the difference between paying your suppliers and employees on time and getting hit with late fees or having team members quit on you. Money or payments you have coming later in the month won’t do you much good right now, especially because those future payments might be delayed.

Prepare for Audits Before They Happen

As a business owner, the last thing you want to deal with is the IRS sniffing around. Bookkeeping for truck drivers involves a great deal of preparation, including audits. Head trouble off at the pass by keeping your personal expenses and accounts separate from your business expenses and accounts. Get and save the receipts for every purchase you make on behalf of your business, no matter how insubstantial that purchase might be. You never know when you’ll need them either for yourself, or for an audit.

Get a Business Credit Card

Business credit cards are a solid idea as you work on keeping your business finances separate from your personal finances, mainly because you’ll have fewer monthly statements and paperwork to keep up with, even if you are going digital. While you can always keep track of your receipts, using a credit card cuts down on time and can make your life that much easier.

Don’t Forget About Tax Deductibles

Speaking of the IRS, don’t forget to look into tax deductibles and write-offs when you’re buying office equipment. For instance, some computers, printers, company vehicles and business software might qualify for tax deductibles. When it’s time to buy equipment for your business, it’s a good idea to have a list of qualifying brands and models that qualify for deductibles before you start shopping.

Bring In the Pros

As stated earlier, there are plenty of accounting and bookkeeping software options for business owners to take advantage of, but nothing beats the advice and insight of a professional accountant who’s familiar with how the trucking industry works. Should you ever feel you’re in over your head when it comes to keeping up with your trucking company’s financial health, or if you have a question you can’t find the answer to, turn to a professional.

Even if you do have an easy time keeping up with your business accounting, it’s still a good idea to check in with a professional accountant a few times throughout the year for financial advice, and to make sure you’re doing everything right. You don’t want to find out the hard way that your business isn’t doing nearly as good as you might have thought.

Bookkeeping is made easier when you have the right tips, software and expert help. Fulfil your business potential by taking care of your company’s financial health. Best of luck!

Tools Every Truck Driver Needs On the Road

In their quest to make their deliveries and keep clients happy, truck drivers have to make sure they bring everything they need to keep their operation, truck and health going strong while out on the open road. There’s a lot that can go into a truck driver’s toolkit, but knowing the most important items goes a long way in saving room, time and potentially even money along with the trucking company’s reputation.

High-Quality Sunglasses

New truck drivers might not realize how being exposed to abundant sunlight for long period of time can have a negative effect on their driving abilities. Sunglasses are essential tools for truck drivers, mainly because they keep them from getting headaches, becoming tired and straining their eyes, which can lead to more problems later on. Because shades are likely to break or become lost, it’s a good idea to buy more than one pair at a time for quick and easy access in case the current pair becomes damaged while out on the road.

Flashlight

The exact opposite of sunlight, darkness can also prove problematic for drivers. A good flashlight helps drivers see better at night, inspect their trucks while stopped after the sun goes down and feel safe. Drivers will have several different flashlights to choose from, including shake flashlights. In any case, it’s best to have plenty of batteries available.

Backup Smartphone

While everyone has a smartphone, it’s especially important that truck drivers have backup smartphones with them as part of their must-have truck tools. It’s also worth considering having a phone devoted specifically for trucking. Trucking phones should have high-definition cameras to take images of or scan important documents, and apps designed to improve productivity as well as find great prices on fuel. Some truckers might prefer to keep their personal lives separate from their professional lives, and having two different phones can go a long way in achieving this goal.

Utility Knife

Utility and pocket knives are great for a number of uses both on and off the road. Twine can be cut from a haul, and drivers can also use the blade of a knife to take tire tread depth measurements.

GPS Navigation

This one might seem obvious, but it’s important to point out here that any GPS navigation devices truckers buy to add to their truck driver tools should be made specifically for OTR truck drivers rather than passenger automobiles. It’s also best to opt for devices with high-quality maps that are upgraded on a constant basis to account for things like construction, traffic jams, road closures and the like.

Work Gloves

There’s more to truck driving than just sitting behind the wheel; it can also be quite physically demanding work. For that reason, drivers should have a good pair of work gloves with them at all times. Cowboy gloves are a good option for protecting the hands and making work easier.

Mallet & Hammer

Along with a utility knife, a mallet and hammer can also make a truck driver’s job that much easier and more efficient. Not only can the combination be used alone, it can be used with other tools as well. And speaking of tools…

Spare Parts

Even a well-tended truck can have its share of problems while on the open road. Having such spare parts as air/fuel lines, liquid wrench, antifreeze, bulbs, fuses and brake fluid can take care of emergency fixes and help with on-the-road maintenance.

Spanners

Besides adjustable spanners, oil filter spanners are also good to have in a trucker’s arsenal. That being said, long-haul drivers might find they’re better off with metric and complete US spanner sets. It never hurts to complete the collection by adding socket spanners as well.

Cash

While truck drivers might know where the physical road takes them, there’s no guarantee where the road of life will take them. That’s why it’s a good idea to have physical cash on hand; you never know when a card reader will go down or the nearest ATM is several miles away. Having a couple hundred dollars in physical cash is sure to come in handy sooner or later.

Water

Don’t find out the hard way how much the price of bottled water can fluctuate between different states. Besides the price difference, it’s also a good idea to have water on hand to stay properly hydrated.

Slow Cooker

It doesn’t hurt to have a slow cooker while on the road. Healthy meals aren’t always within easy reach while traveling, but that doesn’t mean drivers have to do without or settle for poor-quality food. Having a slow cooker makes it easy to not only eat healthily, but eat when you want to rather than having to wait to pass a place you like.

Truck driving can be that much more satisfying with the right equipment and tools. Before you set out on the road again, make sure you have these packed and ready to go.

You Can Run A Successful Trucking Company: Here’s How

If you’re a truck driver thinking of starting your own business, or if you just have an entrepreneurial spirit and want to start your own trucking company, you’ll want to proceed the right way. While there’s certainly much to be gained by having your own business, you’ll want to have the right info for starting a successful trucking company rather than a company that’s destined to be an expensive failure.

Make Sure You Have Quality Equipment

No matter how great of a business plan, name or location you have, you’ll need to have it all backed up with the right equipment as you learn how to run a trucking company. Once you’ve compiled a list of all the equipment your company will need, you’ve got to decide whether you’ll be better off renting it all or buying it outright. While buying equipment guarantees you’ll be the owner, you might prefer to lease equipment that’s bound to become obsolete in the next few years. There’s also the fact that you might not be in a financial position to buy what you need, especially if you hope to grow your trucking company as much and as soon as possible.

Identify Your Customer Base

After you’ve decided how to take care of your equipment needs, it’s time to turn your attention to finding customers to deliver to and work with. Load boards are most certainly a great place to start while getting your feet wet, but one of the main problems with these boards is that you’ll probably have to be the lowest bidder. There’s also the fact that you’ll find load boards are quite competitive, making it hard for a new business like yours to get a good foothold.

You’ll be better off splitting your time and focus between load boards and making sales calls to find customers on your own and start forging relationships and business connections that way. Once you’ve managed to prove yourself to customers through sales calls and solid customer service, you could find you no longer need to even think about looking at load boards.

Learn How to Bid and Handle Common Expenses

When it comes to biding, you’ve got to learn how to find the balance between offering customers a good deal and actually making money. This is likely to take some getting used to, so give yourself plenty of time when you’re first getting started.

To help strike an equilibrium, get to know your expenses. For instance, how much do common truck repairs cost? If there are any trucks that will soon need maintenance, how much do you think that will cost? What do fuel prices look like right now, and how might they change in the future? You might also have to charge more depending on where you deliver and how difficult it is to get to your final destination. Always have enough for unexpected emergencies, because there are bound to be more than a few when you least expect or want them.

Don’t Forget About the Back Office

What happens in the background of your business operation is just as vital as what’s going on in the foreground. If your trucking company has more than one employee, you might need office space to keep things running smoothly. If so, decide the size of office you’ll need to accommodate the size of your business, the office equipment you’ll require and what needs to take place in the office.

Should your business grow large enough, you may have to bring on additional employees, like a secretary. Be sure to account for this in your business plan as well as your expenses. In addition to paying a salary, you also have to think about taxes, benefits and the like. Even if you’re just getting started as a single owner-operator trucking company, it won’t hurt to do some research to see what you’ll be expected to handle should you decide to expand.

Anticipate Cash Flow Problems

Even when business is booming, there’s always a chance your business will bust in the future. Rather than wait for that to happen, go ahead and start planning for it now. Something else to consider is the fact that just because you deliver something today doesn’t mean you’ll get paid for it anytime soon; you might have to wait as many as 90 days to receive payment, which can throw your cash flow off track.

Look into freight factoring as a way to keep cash flowing in while still allowing your customers to pay in 40, 60 or more days. This gives everyone the best of both worlds without ruffling any feathers.

There’s a lot to being the owner of any kind of business, but there are special considerations to make when it comes to owning a truck company. Be sure to keep the above info in mind as you get started.

Owner Operator Semi-Truck Financing

Getting a loan on a commercial vehicle can be a complex process. Lenders tend to be more lenient with semi truck loans, because the vehicle possesses high collateral value and is typically only used for business purposes. However, getting semi truck financing isn’t going to be a walk in the park either. You will need to show the commercial lender that you can make loan payments. Here are six things you can do to improve your chances of getting commercial truck financing:

1. Have a registered business.

Most states require an LLC or corporation to register through the Secretary of State. If  you are a sole proprietor, you should be able to show business income through your taxes. As a new sole proprietor, you may want to get an employer identification number (EIN) or have a doing business as (DBA) name. Your lender may also want you to have a CDL, a Motor Carrier (MC) number and USDOT number. Some lenders want to see some experience, at least two years, in the industry.

2. Work on your personal credit.

For new owner operator financing, you may need to have a personal credit score of 600 or more to qualify for financing. If you’ve been in business for a couple of years, you may have a little more leeway. As a sole proprietor, you are probably relying more on your personal credit than your business credit. The higher your score, the better chances you have to qualify for a loan and for a lower down payment.

If you have a lower credit score, you may want to find a co-signer or work on your credit score before applying for a loan. If you are behind on child support, have had a recent bankruptcy or repossession or have a tax lien, the lender may refuse financing. Take care of your finances before applying for a commercial loan.

3. Find a good truck to buy.

The lender may have specific requirements about the truck, for example, it may need to be less than 10 years old, or have less than 700k miles on it. This is to protect their investment as well as your business. Older trucks break down more frequently. The collateral value isn’t as high. However, provided the truck is in good condition, it’s easier today to purchase the truck through a private party or even an auction. Generally, you will need this information

  • Make, model, year and mileage
  • Serial number
  • Pictures of the truck
  • Condition report
  • Specifications of the sale, the seller, new or used truck, etc.
  • Check with the lender for everything you need to finalize the purchase

4. You will need money for a down payment and cash reserves.

Most of the time, you won’t qualify for 100 percent financing. Having a down payment of 10 to 30 percent will reduce your loan payment quite a bit and make the lender feel more confident in your ability to repay the loan. Your lender may also want to see a cash reserve of one to three months to cover repairs, insurance and expenses in case you have a slow month. It makes good business sense to have a little extra in the bank. You never know when you may have to wait for payment or have to take time off because you have the flu. Unexpected things can often upset your finances more than you realize.

5. Have insurance lined up.

Generally, you will need insurance to cover the truck before lender releases the money to pay for the truck. The type of insurance your business requires will depend on many factors, as does the cost of insurance. Make sure you have a policy lined up while you’re working with lenders.

6. Work with your lender.

Traditionally, owner operator loans were only available through financial institutions, such as banks or credit unions, but there are many more lenders in the marketplace today. Many online lenders have almost instant credit decisions, allowing you to have more options for commercial truck loans.

You may want to consider each company carefully before applying. First, lenders may have different qualification requirements. They may also specialize in different types of loans or only work with certain leases. Every lease application can affect your personal credit. Do your research first. Don’t just take the first approval you get. Read all the terms and conditions of the loan application before signing.

Enjoy Financial Freedom

Owning any type of business doesn’t mean that you will be free from responsibilities. You may not have a boss looking over your shoulder any longer, but your stakeholders will be expecting you to make payments on time. However, when you purchase your own new or used semi truck, you are on track to having financial independence. It will take hard work, but you can do it. Just make sure you take the time to understand the requirements of owning your own truck.