Business: light-duty cargo transportation. Where to begin?

Recently, many people have been striving to become owners of their own business. Of course, working for hire has its positive aspects: the employer has established business processes, its staff is familiar with its own responsibilities, it has permanent business partners and experience in market activities. However, “working for an uncle” greatly reduces the possibilities of one’s own realization. The employee is within strictly limited limits and must follow only the instructions of management. It is the lack of conditions for self-improvement in hired work that pushes many people to start their own business. In addition, having your own business implies not only responsibility for its management, but also a certain profit.

What kind of business guarantees monetary benefits? There are many types of own businesses: a person can open a store, a car wash, a travel company, a real estate office... Those who have driving experience and category B and C licenses can open a company that will engage in light-duty cargo transportation.

Cargo transportation: overview of the cargo transportation services market

The all-Russian cargo transportation market reached 773 billion rubles in 2020, which is 14.6% more than a year earlier. Real volumes, calculated not in rubles, but in ton-kilometers, more accurately characterize the state of this sector of the economy. But here the business has not such impressive dynamics - the increase was 6.4% - or 130.9 billion ton-km. If we compare with 2014, the situation looks in a completely different light. Then the cost volume was equal to 982 billion rubles, and the physical volume was 117.6 billion ton-km.

Experts say that the positive trend is likely to continue in 2020. But even under these conditions, running a small business and transporting heavy loads will feel like an icy shower. Of course, you will have to forget about foreign-made trucks and focus on competition with your “colleagues in the shop.”

“Don’t dream of big profits and a short payback period for cargo transportation,” says Igor Malyugin, an expert on business plans. - At the same time, there will be income. The owner can count on earnings in the range of 2-2.5 average salaries in the region. Of course, if it spins like a squirrel in a wheel.”

Marketing plan

Competition in the cargo transportation market is extremely high. Without an extensive advertising campaign, it will be extremely difficult to obtain orders. Therefore, it is planned to spend a significant part of the budget on promoting services, especially during the formation of the company. The following advertising methods will be used to attract customers:

• Advertising in the media, newspapers and radio.
• Internet advertising. Publishing information on bulletin boards (Avito), forums and social media. networks.
• Posting advertisements around the city.
• Outdoor advertising (banners on the highway).

It is also planned to cooperate with furniture stores, household appliance stores and construction markets. Such retail outlets often sell goods that can only be taken away by truck. Stores that do not have their own fleet of vehicles will be happy to cooperate with our company. A large number of orders can come from furniture factories, door and window production, and other industrial enterprises that need to unload goods to a retail outlet or wholesale warehouse in another city or region.

What does it take to open a cargo transportation business?

Before starting a business, you need to decide what transportation to carry out. If you are counting on small volumes, then for this you choose a form of entrepreneurial activity - individual entrepreneur. This is easy to do - go to your local tax office and follow a series of easy written procedures.

Until 01/01/17, the status of individual entrepreneur was confirmed by a certificate. Today, the main document for a businessman is an extract from the Unified State Register of Individual Entrepreneurs in form P6000. It will be issued 3 days after submitting the application. There, at the tax office, they will talk about preferential taxation and even give links to sites where you can find a sample of any contract for individual entrepreneurs for “domestic” cargo transportation.

Of course, you can register a Limited Liability Company, but the total amount of taxes will be prohibitive for a novice businessman. This form is necessary for working with large customers, as it takes into account VAT (individual entrepreneurs do not pay this tax). Large businesses simply will not enter into contracts with “individuals.”

Conducting a cargo transportation business “under the table”—that is, without registration—is simply dangerous. With today's level of control, leftist cargo carriers quickly come to the attention of law enforcement agencies.

Staff

The next step of the business plan is the selection of personnel for cargo transportation. You need to look for personnel for cargo transportation in parallel with vehicles.

“The technology is not only expensive, but also unsafe. Transportation is associated with property liability and the price of the cargo. So you should approach hiring drivers responsibly,” advises businessman Ilya Komolov.

Ilya’s cargo transportation business plan assumes that a couple of drivers will be enough to start with. It is necessary to conclude an agreement on material property with each of them. Loaders will probably be needed. It is not necessary to hire them on staff - it is enough to have contact numbers of people who are ready to come to work on the first call. It is also better for the owner of the company to take over the functions of the dispatcher. Or outsource.

Here are the monthly salaries for personnel according to the business plan:

The monthly wage fund for a company with a staff of 2 drivers will be 115 thousand rubles per month. Here we will add a tax of 6% of turnover and contributions to the Pension Fund of the Russian Federation and the Federal Compulsory Medical Insurance Fund in the amount of 22,261.38 rubles + 1% of turnover. With a total income of, for example, 500 thousand rubles in the first month, personnel costs will be:

115,000 (salary) + 22,261 (stable rate) + 5,000 (1% of 500,000) = 142,261 rubles.

Marketing

As we have already noted, the freight transportation market is characterized by high and fierce competition. Figuratively speaking, you need to not whisper about yourself, hoping for word of mouth, but declare it as loudly as possible so that potential customers can hear.

“It’s best to advertise in local media,” says Komolov. “It’s worth going around as many houses and yards as possible, sticking information about yourself - like, we’ll deliver the cargo quickly, cheaply and reliably.”

You can also be on duty at building materials supermarkets. It’s easiest to find clients there, although you can run into aggressive “colleagues”. Examples of those whose business “got on its feet” show that advertising needs to be done constantly.

The cost of marketing and advertising for a cargo transportation business plan at the initial stage will be at least 50 thousand rubles.

Equipment

Due to the expensive currency, you will have to rely on Russian cars. Experienced entrepreneurs advise buying for cargo transportation vehicles with an extended body (the so-called Europlatform) GAZ-3302 Gazelle with a Cummins diesel engine.

How much money do you need to open transportation?

So, we decided to open a small company with a fleet of 2 GAZ-3302 trucks, as most people do. In this case, the costs, according to the business plan, will be as follows:

• 2 GAZ-3302 Gazelle cars with a Cummins diesel engine - 2,108,000 rubles;
• laptop, alarm system, video recorders, anti-theft mechanisms and insurance - 60,000 rubles;
• fuel and fuels and lubricants - 100,000 rubles;
• rental of parking spaces - 12,000 rubles
• unforeseen expenses for repairs and other needs - 160,000 rubles;
• advertising - 50,000 rubles
• salary fund - 142,261 rubles.

In total, according to the cargo transportation business plan, you will have to pay 2,632,261 rubles.

Please note that our business plan for cargo transportation takes into account minimal costs. For example, if the hired driver has a parking space in the yard of the house, and fuel is purchased from advance payments.

Asset acquisition

You need to find and buy the right equipment to start a transportation business. If you decide to operate a private fleet with your own drivers, you will need to purchase commercial vehicles. Depending on your starting capital, you need to determine a reasonable and efficient number of vehicles. Although many businesses start small, you can always add to your fleet as your profits grow. When choosing which commercial vehicles are suitable, consider the type of cargo you plan to transport. Different types of cargo require different equipment. For example, if you will be transporting food, you may need a refrigerated truck.

Choose quality

If you have enough funds and decide to purchase your own assets, it is always better to focus on quality rather than price, especially when it comes to vehicles. The equipment you purchase must be in excellent condition. A higher price for a new truck means fewer repairs, maintenance and downtime, which can reduce your fleet's profitability. Here's a short list of things you should check before you buy a used truck:

• Any visible signs of damage to the housing
• Rust
• Tire tread
• Car mileage
• Vehicle maintenance and oil change history

The administrative components of the business have little overhead. However, obtaining trucks to transport goods can be expensive. A new 18-wheeler with a trailer can cost more than 10 million rubles. While financing options are available from dealers, if you plan to own more than one truck or trailer, you may want to consider a small business loan.

Choosing the right trailer equipment

Choosing the right trucking equipment can have a huge impact on how trucking companies make money. Although freight rates fluctuate from week to week, generally, flatbed trucks pay the highest rate on average. This does not mean that the load on a refrigerator, van or deck will never be more beneficial. Rather, it is simply a general average that you should consider before choosing the type of equipment for your truck. Keep in mind that location also plays an important role in determining freight rates.

Insurance

The nature of the trucking industry as a business places stringent requirements on business insurance. Since you own and oversee the operation of commercial vehicles, your insurance claims will cost more than many other businesses. To fully understand your insurance responsibilities, discuss them with an expert in your area. In addition to your insurance responsibilities, your responsibilities as an employer require you to comply with health and safety standards and regulations. The Department of Labor's Occupational Safety and Health Administration is providing compliance assistance to the auto industry to meet these expectations.

Insurance should cover risks such as damage to your vehicle and injuries caused by road accidents. You can consult trucking forums and social media for recommendations on which insurance product to purchase based on your needs.

Payback period

If the investment is made from personal money, then the normal payback period does not exceed 10-12 months - based on this, an individual entrepreneur’s business plan is drawn up. If a bank loan was taken out, the company will pass the break-even point in 3 years at best. In any case, the registration and taxes of the company determine the organization of work and the speed of return on initial investments.

Rent a car or use your own?

If there is no money to start or banks refuse, cars are rented. But the rates are high, plus you will have to pay additional insurance.

“I tried renting. It feels like I’ve turned into a slave on a galley,” writes forum member #hfaur. And most users agree with him.

Search for clients

To form their own client base, budding entrepreneurs need to conduct a large-scale advertising campaign. To do this, you will have to incur significant expenses, but you cannot do without informing the potential consumer audience. All costs incurred must include a freight dispatch business plan in the appropriate section.

An advertising campaign for cargo transportation may include the following:

• An entrepreneur must create his own website, which can be actively promoted through contextual advertising.
• Print flyers, calendars, booklets, brochures that can be distributed to the offices of different companies, or dropped into mailboxes.
• The director of a company providing transport services must have original and informative business cards that can be distributed in places with high traffic volumes.
• You can advertise in the media, place ads on specialized Internet sites.
• It is also worth starting “word of mouth”, which in practice constantly proves its effectiveness.

Pros and cons of the cargo delivery business

The disadvantages include the high risk of the driver's profession, accidents on the roads, and the high cost of new equipment. In addition, unscrupulous clients can also go bankrupt if they place orders incorrectly. Unfortunately, there are many such cases.

The start may also be difficult. Real calculations by many experts show that a business is successful when new light-duty trucks have a price tag no more than 600-700 thousand rubles. Alas, for that kind of money you can only buy 3- and even 5-year-old Gazelles, but restoring them will require not only nerves, but also money.

The advantages include large earnings - of course, if you are lucky with international orders. At the same time, a survey of businessmen shows that after 3 years of work in this market, the majority manage to find regular customers.

Financial plan

The estimated volume of work for intercity transportation will be 36,000 km per month. The costs in this case will be:

• Fuel and lubricants (0.13 l/km, price per liter of diesel fuel is 45 rubles) – 210,600 rubles.
• Payment for drivers (3 rubles/km + 300 rubles/day) – 120,000 rubles.
• Depreciation (0.7 rub./km) – 35,600 rub.
• Other expenses (insurance, fines, etc. – 0.5 rubles/km) – 18,000 rubles.
• Cellular communication – 3500 rub.
• Parking rental – 11,000 rubles.
• Taxes (UTII) – 16,600 rubles.
• Total – 344,460 rubles.

Company employees and overhead costs

In addition to the general tasks associated with the formation of a production base, you need to think through all the nuances associated with hiring personnel. For optimal and cost-effective operation, a continuous schedule must be maintained. So, for each car you will have to hire two drivers and offer them payment in the amount of 19,500 rubles. In addition, you should take care of hiring three logistics dispatchers and a mechanic. They need to set the salary at 22,000 rubles. That is, the wage fund will be approximately 205,000 rubles.

Keep in mind that for the most efficient work you will need to hire at least two drivers for each car

A fairly large share of current costs will be the cost of purchasing fuel, depreciation and repair of the vehicle fleet. As a rule, they can exceed 70,000 rubles. for every month of work. Although, by operating a new vehicle and carrying out regular technical inspections, you can reduce this figure by about half.